ITO, Ward-5(2)(5), Ahmedabad V. Shri Pritesh D. Shah(HUF), Ahmedabad

ITA 1940/AHD/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5807 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 7 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-03-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2012-2013
• Appeal Filed On: 26-07-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAURABH SINGH
• Assessee Lawyers: BHADRESH C GANDHAKWALA
• Section: 143(3); 194C

Judgement Text

ITA NO. 1940/AHD/2016 ITO VS. PRITESH D SHAH HUF ASSESSMENT YEAR: 2012-13 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD A BENCH, AHMEDABAD [CORAM: PRAMOD KUMAR AM AND RAJPAL YADAV JM] ITA NO. 1940/AHD/2016 ASSESSMENT YEAR: 2012-13 INCOME TAX OFFICER ..................APPELL ANT WARD-5(2)(5), AHMEDABAD VS. PRITESH D SHAH (HUF) ...........................RESPONDENT PROP. OF KASHYAP SHIPPING AGENCY, 11 KALINDI COMPLEX, OPP. OLD HIGH COURT, NAVRANGPURA, AHMEDABAD-380009 [PAN : AANHS 6430 F] APPEARANCES BY: SAURABH SINGH FOR THE APPELLANT BHADRESH C GANDHAKWALA FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : 14.03.2018 DATE OF PRONOUNCING THE ORDER : 22.03.2018 O R D E R PER PRAMOD KUMAR, AM: 1. BY WAY OF THIS APPEAL, THE ASSESSING OFFICER HAS CHALLENGED CORRECTNESS OF THE ORDER DATED 31 ST MAY, 2016 PASSED BY THE LD. CIT(A), AHMEDABAD-5 IN THE MATTER OF ASSESSMENT UNDER SECTION 143(3) OF THE INCOME TA X ACT, 1961 (THE ACT HEREINAFTER) FOR THE ASSESSMENT YEAR 2012-13, ON TH E FOLLOWING GROUNDS :- (1) THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW I N DELETING THE ADDITION OF RS.1,67,41,254/- U/S. 40(A)(IA) OF THE ACT. (2) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, TH E LD. CIT(A) OUGHT TO HAVE UPHELD THE ADDITION MADE BY THE AO. (3) IT IS THEREFORE PRAYED THAT THE ORDER OF THE L D. CIT(A) MAY BE SET ASIDE AND THE ORDER OF THE ASSESSING OFFICER BE RESTORED. 2. LEARNED REPRESENTATIVES FAIRLY AGREE THAT THE IS SUE IN APPEAL IS NOW COVERED, IN FAVOUR OF THE ASSESSEE, BY A CO-ORDINATE BENCHS DECISION IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2009-10. VIDE THIS DECISIO N DATED 04.10.2013, THE TRIBUNAL HAS, INTER ALIA, OBSERVED AS FOLLOWS :- ITA NO. 1940/AHD/2016 ITO VS. PRITESH D SHAH HUF ASSESSMENT YEAR: 2012-13 PAGE 2 OF 3 5. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND P ERUSED THE ORDER OF THE A.O. AND CIT(A) AND COPIES OF VARIOUS DOCUME NTS AND DETAILS FILED IN THE COMPILATION BEFORE US. WE FIND THAT THE ASSE SSEE IS ONLY A CLEARING & FORWARDING AGENT AND HAS CHARGED ITS SER VICE CHARGES KNOWN AS AGENCY CHARGES FROM ITS CLIENTS WHOSE GOOD S ARE EXPORTED THROUGH VARIOUS PORTS MAINLY IN GUJARAT & MAHARASHT RA. THE ASSESSEE HAS RECEIVED THE RAILWAY FREIGHT, SHIPPING FREIGHT, ICD CHARGES ETC. FROM ITS CLIENTS BY WAY OF REIMBURSEMENT OF EXPENSES. AC CORDINGLY, THE ASSESSEE IS MERELY A FACILITATOR IN THE EXPORT BUSI NESS OF ITS CLIENTS AND HAS RECEIVED THE REIMBURSEMENT OF EXPENSES INCURRED AND SERVICE CHARGES IN THE NAME OF AGENCY CHARGES FROM ITS CLIE NTS. THESE FACTS COULD NOT BE CONTROVERTED ON BEHALF OF THE REVENUE BEFORE US. WE FIND THAT THE RECEIPTS WERE ISSUED BY THE VARIOUS PARTIE S IN THE NAME OF CLIENTS OF THE ASSESSEE AND NOT IN THE NAME OF THE ASSESSEE. ON THE PERUSAL OF THE COPY OF THE AUDITED ACCOUNTS, IT SHO WS THAT THE ASSESSEE HAS RECEIVED AND CREDITED TO ITS P&L ACCOUNT AGENCY CHARGES APART FROM THE REIMBURSEMENT OF EXPENSES INCURRED ON BEHALF OF ITS CLIENTS. WE FIND THAT THE ASSESSEE FACILITATES TO AND FRO MOVEMENT O F CLIENTS GOODS BOTH IN LAND AND OVERSEAS, USING ROAD, RAIL, AIR AND SEA ROUTES INCLUDING TEMPORARY STORAGE OF THE GOODS IN CUSTOM BOUNDING W AREHOUSES FOR LEGAL AND PROCEDURAL PURPOSES ETC. FOR THE APPLICAB ILITY OF PROVISION OF SECTION 194C & 194I, THE RELATIONSHIP OF CONTRACTOR AND PAYEE PURSUANT TO CONTRACT BETWEEN THE PARTIES IS ESSENTIAL. IN TH E CASE BEFORE US, NO SUCH RELATIONSHIP HAS BEEN FOUND. THE CIT(A) HAS GI VEN THE FINDING THAT THE CLIENTS OF THE ASSESSEE ARE REIMBURSING AMOUNT OF MONIES PAID BY THE ASSESSEE TO SUCH AGENCIES ALONG WITH THE ASSESS EES COMMISSION OR HANDLING CHARGES. THE CIT(A) HAS REFERRED TO NUMBER OF DECISIONS WHEREIN THE HONBLE COURTS HELD THAT TDS PROVISIONS ARE NOT ATTRACTED IN CASES INVOLVING REIMBURSEMENT OF EXPENSES. IN THESE FACTS OF THE CASE, WE FIND THAT THERE IS NO MISTAKE IN THE ORDER OF TH E CIT(A) IN HOLDING THAT THE ADDITION ON ACCOUNT OF PAYMENTS, MADE TO VARIOU S PARTIES ON BEHALF OF ITS CLIENTS BY THE ASSESSEE COULD NOT BE SUSTAIN ED AND DESERVES TO BE DELETED. ACCORDINGLY, THE ORDER OF THE CIT(A) IS CO NFIRMED AND GROUND OF THE REVENUES APPEAL IS DISMISSED. 3. WE SEE NO REASONS TO TAKE ANY OTHER VIEW OF THE MATTER THAN THE VIEW SO TAKEN BY THE CO-ORDINATE BENCH. 4. RESPECTFULLY FOLLOWING THE TRIBUNALS DECISION D ATED 04.10.2013, IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2009-10, WE CONFIRM TH E ORDER OF THE LD. CIT(A) AND DISMISS THE GROUNDS RAISED BY THE REVENUE. 5. IN THE RESULT, THE APPEAL IS DISMISSED. PRONOU NCED IN THE OPEN COURT TODAY ON THE 22 ND MARCH, 2018 SD/- SD/- RAJPAL YADAV PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) AHMEDABAD, THE 22 ND DAY OF MARCH, 2018 **BT ITA NO. 1940/AHD/2016 ITO VS. PRITESH D SHAH HUF ASSESSMENT YEAR: 2012-13 PAGE 3 OF 3 COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD 1. DATE OF DICTATION: ..... 22.03.2018....COVERED MATTER...... 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE T HE DICTATING MEMBER: ..... 22.03.2018....... 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR . P.S./P.S.: .22.03.2018...... . 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE TH E DICTATING MEMBER FOR PRONOUNCEMENT: ... 22.03.2018... 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK : ... 22.03.2018 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK : . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER : 8. DATE OF DESPATCH OF THE ORDER: ......