The DCIT, Circle-2, Surat V. M/s. Ganga Automobiles, Surat

ITA 205/AHD/2011

• Counselvise Citation: 20520514 RSA 2011
• Duration Of Justice: 8 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-10-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2007-2008
• Appeal Filed On: 27-01-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K PATEL
• Assessee Lawyers: HARDIK VORA A R
• Keywords: Corroborative evidences
• Section: 143(3)

Judgement Text

, , , , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD , .'.#$%, '& ' ' BEFORE SHRI MUKUL KR.SHRAWAT, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ./ I.T.A. NO.205/AHD/2011 ( ) * ) * ) * ) * / / / / ASSESSMENT YEAR : 2007-08) DY.CIT CIRCLE-2 SURAT ) ) ) ) / VS. M/S.GANGA AUTOMOBILES 21 ST CENTURY BUISNESS CENTRE HOUSE A, NR. UDHNA DARWAJA RING ROAD, SURAT + '& ./,- ./ PAN/GIR NO. : AADFG 2811 L ( +. / // / APPELLANT ) .. ( /0+. / RESPONDENT ) +. 1 ' / APPELLANT BY : SHRI A.K. PATEL, D.R. /0+. 2 1 ' / RESPONDENT BY : SHRI HARDIK VORA, A.R. )3 2 & / / / / DATE OF HEARING : 30/09/2011 4$* 2 & / DATE OF PRONOUNCEMENT : 14.10.11 '5 / O R D E R PER SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER : THIS IS AN APPEAL AT THE BEHEST OF THE REVENUE WHI CH HAS EMANATED FROM THE ORDER OF LEARNED CIT(APPEALS)-II, SURAT DA TED 01/11/2010 PASSED FOR A.Y. 2007-08 AND THE GROUNDS RAISED ARE DECIDED AS FOLLOWS:- 2. GROUND NO.1 READS AS UNDER:- ITA NO. 205/AHD /2011 DY.CIT VS. M/S.GANGA AUTOMOBILES ASST.YEAR - 2007-08 - 2 - [1] ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION MADE ON ACCOUNT OF KEYMAN INSURANCE PREMIUM EVEN THOUGH THE ASSESSEE WASNT ABLE TO PROVE ANY EMPLOYER-EMPLOYE E RELATIONSHIP BETWEEN THE PARTNERSHIP FIRM AND PARTN ERS. 2.1. FACTS IN BRIEF AS EMERGED FROM THE ASSESSMENT ORDER PASSED U/S. 143(3) OF THE I.T.ACT DATED 28/10/2009 WERE THAT THE ASSESSEE-FIRM IS AN AUTOMOBILE DEALER OF TWO WHEELERS MANUFACTURED BY H ONDA MOTOR CYCLE AND SCOOTERS INDIA LTD. A SUM OF RS.12,08,935/- WAS DEBITED UNDER THE HEAD KEYMAN INSURANCE PREMIUM . IN RESPONSE TO THE SHOW-CAUSE NOTICE, DETAILS FURNISHED WERE AS UNDER:- SR.NO. NAME AGE DUTIES AND RESPONSIBILITY AMOUNT OF PREMIUM (RS.) SUM INSURED (IN LACS) 1. NARESH J. INTWALA 45 DAY TO DAY SALES, PURCHASE, INVENTORY, FUND MANAGEMENT, COMPANY DEALINGS 4,84,489 45.82 2. PRAKASH J. INTWALA 54 HEAD OF WORKSHOP AT RING ROAD, CUSTOMER CARE 3,01,670 27.55 3. HARSHAD T.DALWADI 46 DAY TO DAY CASH BANK FINANCE, EXPENSES, CREDIT CONTROL ETC. 1,80,667 17.11 4. DILIPSINH M.SOLANKI 57 WORKSHOP AT VARACHHA & CITYLIGHT 2,42,109 10.44 TOTAL 12,08,935 ITA NO. 205/AHD /2011 DY.CIT VS. M/S.GANGA AUTOMOBILES ASST.YEAR - 2007-08 - 3 - 3. A DECISION OF ITAT DELHI BENCH IN THE CASE OF P. G. ELECTRONICS VS. ITO 98 TTJ 896 WAS CITED BEFORE AO ALONG WITH THE CBDT CIRCULAR NO.762 DATED 18/02/1998. HOWEVER, THE AO WAS NOT CONVINCED AND HELD THAT THE INSURANCE PREMIUM WAS NOT DEDUCTIBLE U/S.37(1) OF THE I.T. ACT. THE SAID ADDITION WAS CHALLENGED. 4. AFTER A DETAILED DISCUSSION AND CONSIDERING THE NATURE OF THE PAYMENT, THE LD.CIT(A) HAS FOLLOWED CBDT CIRCULAR( SUPRA), P.G. ELECTRONICS VS. ITO(SUPRA), CIT VS. B.N. EXPORTS 37 DTR 381(BOM), SUNITA FINLEASE LTD. VS. DCIT 118 TTJ 263 (ITAT)[BI LASPUR] AND ITO VS. MODI MOTORS 27 SOT 476 [ITAT](BOM) AND ALLOWED THE CLAIM. 5. HAVING HEARD THE SUBMISSIONS OF BOTH THE SIDES, WE HAVE FOUND THAT IN ASSESSEES OWN CASE FOR A.Y. 2005-06 ITAT D BENCH AHMEDABAD IN ITA NO.3921/AHD/2008 (FOR A.Y. 2005-06 ) ORDER DATED 15/03/2011 TITLED AS M/S.GANGA AUTOMOBILES VS. ACI T HAS ALLOWED THE CLAIM. SINCE A VIEW HAS ALREADY BEEN TAKEN IN THE PAST IN ASSESSEES OWN CASE BY THE RESPECTED CO-ORDINATE BENCH, THEREFORE ON IDENTICAL FACTS WE FIND NO FORCE ON THIS GROUND OF THE REVENUE, HENCE DISMISSED. 6. GROUND NO.2 READS AS UNDER: [2] ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION MADE ON ACCOUNT OF 20% OF PETROL AND VEHICLE EXPENSES INSPI TE THE AUTHENTICITY OF THE CLAIM WAS UNVERIFIABLE BY THE A .O. ITA NO. 205/AHD /2011 DY.CIT VS. M/S.GANGA AUTOMOBILES ASST.YEAR - 2007-08 - 4 - 6.1. THE AO HAD DISALLOWED THE 20% OF THE TOTAL CLA IM ON THE GROUND THAT THE COMPLETE SUPPORTING EVIDENCES WERE NOT FUR NISHED BY THE ASSESSEE. WHEN THE MATTER WAS CARRIED BEFORE THE F IRST APPELLATE AUTHORITY, THE LD.CIT(A) HAS UPHELD THE ACTION OF T HE AO PRIMARILY ON THE GROUND THAT THE APPELLANT HAD NOT CONTROVERTED THE FINDING OF THE AO. AFTER CITING CERTAIN DECISIONS OF THE ITAT AHMEDABA D, THE ACTION OF THE AO WAS CONFIRMED. 7. HAVING HEARD THE SUBMISSIONS OF BOTH THE SIDES, IT IS APPARENT THAT ONCE THE LD.CIT(A) HAS ALREADY AFFIRMED THE ACTION OF THE AO AND THE ADDITION WAS SUSTAINED, THEN THERE WAS NO OCCASION ON THE PART OF THE REVENUE TO AGITATE THE SAID FINDING OF LD.CIT(A). IT HAS ALSO BEEN INFORMED BY LD.AR THAT THE ASSESSEE HAS NOT PREFERR ED ANY APPEAL AGAINST THE SAID AFFIRMATION OF THE ADDITION. IN VIEW OF T HIS, THE GROUND OF THE REVENUE IS INFRUCTUOUS, HENCE DISMISSED. 8. IN THE RESULT, REVENUES APPEAL STANDS DISMISSED . ORDER SIGNED, DATED AND PRONOUNCED IN THE COURT ON 14.10. 2011. SD/- SD/- ( A.K. GARODIA ) ( MUKUL KR. SHRAWAT ) ACCOUNTANT MEMBER JUDICIAL MEM BER AHMEDABAD; DATED 14 / 10 /2011 6..), .)../ T.C. NAIR, SR. PS ITA NO. 205/AHD /2011 DY.CIT VS. M/S.GANGA AUTOMOBILES ASST.YEAR - 2007-08 - 5 - '5 2 /7 8'7* '5 2 /7 8'7* '5 2 /7 8'7* '5 2 /7 8'7*/ COPY OF THE ORDER FORWARDED TO : 1. +. / THE APPELLANT 2. /0+. / THE RESPONDENT. 3. 9 / CONCERNED CIT 4. 9() / THE CIT(A)-II, SURAT 5. 7<# /) , , / DR, ITAT, AHMEDABAD 6. # =3 / GUARD FILE. '5) '5) '5) '5) / BY ORDER, 07 / //TRUE COPY// > >> >/ // / , , , , ( DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD 1. DATE OF DICTATION..10.10.2011 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 11.10.2011 OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S 14.10.11 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 14.10.11 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 9. DATE OF DESPATCH OF THE ORDER