ACIT, UDAIPUR V. M/s. Chetak Enterprises Pvt. Ltd., UDAIPUR

ITA 205/JODH/2013

• Counselvise Citation: 20523314 RSA 2013
• Duration Of Justice: 7 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-11-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 18-11-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 04-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N A JOSHI
• Assessee Lawyers: G K GARGIEYA
• Section: 194C

Judgement Text

IN THE INCOME TAX APPELALTE TRIBUNAL : JODHPUR BENC H : JODHPUR BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER. ITA NO.205/JODH/2013 (A.Y. 2008-09) ACIT, CIRCLE-1, VS. M/S. CHETAK ENTERPRISES PVT. LTD., UDAIPUR. 396/11, HIRAN MAGRI, UDAIPUR. PAN NO. AACCC 1498 H (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI G.K. GARGIEYA & SHRI SARVESH BALDI. DEPARTMENT BY : SHRI N.A. JOSHI- D.R. DATE OF HEARING : 18/11/2013. DATE OF PRONOUNCEMENT : 22/11/2013. O R D E R PER N.K.SAINI, A.M THIS IS AN APPEAL BY THE DEPARTMENT AGAINST THE OR DER DATED 22/01/2013 OF LD. CIT (A), UDAIPUR. THE FOLLOWING GROUNDS HAVE BEEN RAISED IN THIS APPEAL: ON THE FACTS AND IN THE PRESENT CIRCUMSTANCES OF T HE CASE, THE LD. CIT(A) HAS ERRED IN 2 1. (A) DELETING THE DISALLOWANCE OF RS. 26,74,200/- MADE U/S 40(A)(IA) OF THE I.T. ACT ON ACCOUNT OF NON-DEDUCTION OF TDS ON CONSULTANCY CHARGES IGNORING THE FACT THAT PAYMENT IS PURELY FO R CONSULTANCY & NOT REIMBURSEMENT OF THE COST. 1. (B) IGNORING THE FACT THAT ALTERNATIVELY EVEN FR OM ASSESSEES CONTENTION IT IS THE PAYMENT AGAINST CONTRACT/AGREE MENT & THUS STILL LIABLE FOR TDS. 2. DELETING THE DISALLOWANCE OF RS. 38,19,669/- MAD E U/S 40(A)(IA) OF THE I.T. ACT ON ACCOUNT OF NON-DEDUCTION OF TDS ON HIRE CHARGES IGNORING THE FACT THAT ASSESSEE HIMSELF HAS DEBITED THIS EXP ENDITURE UNDER THE HEAD HIRE CHARGES & ACTUALLY ALSO THESE ARE HIRE CHARGES, THUS ATTRACTING THE PROVISIONS OF SECTION 194 I OF THE I .T. ACT. 2. GROUNDS NO. 1(A) & 1(B) OF THIS APPEAL RELATES TO THE DELETION OF DISALLOWANCE MADE BY THE ASSESSING OFFICER ON ACCOU NT OF NON-DEDUCTION OF TDS ON CONSULTANCY CHARGES. 3. AS REGARDS TO THIS ISSUE, LEARNED COUNSEL FOR THE ASSESSEE AT THE VERY OUTSET SUBMITTED THAT IT IS COVERED IN ASSESSE ES OWN CASE IN I.T.A. NOS. 206 & 207/JODH/2012 FOR THE A.Y. 2006-07 & 200 7-08 RESPECTIVELY VIDE ORDER DATED 22/03/2013. THE AFORESAID CONTENT ION OF THE LEARNED COUNSEL FOR THE ASSESSEE WAS NOT CONTROVERTED BY TH E LEARNED D.R. 4. AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE PAR TIES AND THE MATERIAL ON RECORD, IT IS NOTICED THAT AN IDENTICAL ISSUE WAS SUBJECT MATTER OF THE DEPARTMENTAL APPEAL FOR THE A.Y. 2007 -08, WHEREIN THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE AN D THE RELEVANT FINDING HAS BEEN GIVEN IN PARA 8.2 , WHICH READS AS UNDER:- 3 8.2 BEFORE US BOTH PARTIES HAVE REITERATED THEIR E ARLIER STAND TAKEN BY THEM ON THIS ISSUE. AFTER GOING THROUGH THE ENTI RE RECORD AND THE RELEVANT DOCUMENTS, WE HAVE NOTICED THAT THE AMOUNT OF RS. 1,31,125/- WAS PAID TO M/S. PYRAMID CONSULTANTS SER VICES, FOR FINANCIAL SYNDICATION IN THE F.Y. 2004-05 AND TDS W AS DEDUCTED THEREON. IN THIS REGARD PROOF IS ENCLOSED AT PAGE 6 4 OF PAPER BOOK. THE ASSESSEE HAS ONLY REIMBURSED THE AMOUNT OF RS. 12,15,000/- AS PER THE AGREEMENT AND PAGE 60 OF THE WRITTEN SUBMIS SION IS RELEVANT IN THIS REGARD. AS PER THE AGREEMENT ENTERED INTO B Y THIS ASSESSEE WITH THE CONCERNED AUTHORITY IT IS A COMPULSORY PAY MENT TO BE MADE AS A REIMBURSEMENT. ON THIS AMOUNT, OBVIOUSLY SECTI ON 194J IS NOT APPLICABLE. WE DONT FIND ANY INFIRMITY IN THIS FIN DING OF LD. CIT(A) AS WELL. IN A.Y. 2007-08, WE HAVE TO TAKE THE SIMILAR VIEW BECAUSE FACTS ARE THE SAME AND CONNECTED. THEREFORE, WE DISMISS G ROUND NO. 3 OF THE REVENUES APPEAL IN BOTH THE YEARS UNDER CONSID ERATION. SO, RESPECTFULLY FOLLOWING THE AFORESAID REFERRED TO ORDER DATED 22/03/2013, WE DO NOT SEE ANY MERIT IN THIS GROUND OF THE DEPARTMENTAL APPEAL. 5. THE ANOTHER ISSUE VIDE GROUND NO.2 IN THIS APPEAL RELATES TO THE DELETION OF ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT OF TDS ON HIRE CHARGES. 6 . REGARDING THIS ISSUE, LEARNED COUNSEL FOR THE ASS ESSEE SUBMITTED THAT THIS ISSUE IS ALSO COVERED IN FAVOUR OF THE AS SESSEE IN ASSESSEES OWN CASE IN I.T.A.NO. 215/JODH/2012 FOR THE A.Y. 2007-0 8 VIDE ORDER DATED 22/03/2013. THE AFORESAID CONTENTION OF THE LEARNE D COUNSEL FOR THE ASSESSEE WAS NOT CONTROVERTED BY THE LEARNED D.R. 4 7. AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE PARTI ES AND MATERIAL ON RECORD, IT IS NOTICED THAT A SIMILAR ISSUE HAS A LREADY BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY THIS BENCH OF THE TRIBUNA L VIDE AFORESAID ORDER DATED 22/03/2013, WHEREIN RELEVANT FINDING HAS BEEN GIVEN IN PARA 18, WHICH READS AS UNDER:- IN ASSESSEES APPEAL GROUND NO. (1) IS IN RELATION TO ADDITIONS OF TWO AMOUNTS, I.E. RS. 1,98,000/- AND RS. 3,31,564/- U/S SEC. 40(A)(IA) R.W.S 194C OF THE ACT. THE ASSESSEE MADE ENTIRE PAYMENT BEFORE 31/03/2007 TOWARDS HIRING OF TRUCKS FOR THE SHIFTIN G OF PLANT FROM ONE PLACE TO ANOTHER PLACE. THE ABOVE FACTS ARE NOT IN DISPUTE. IN SUCH CIRCUMSTANCES PROVISIONS OF SECTION 194C ARE NOT AP PLICABLE IN VIEW OF THE SPECIAL BENCHS DECISION IN THE CASE OF MERILYN SHIPPING & TRANSPORTS VS. ACIT REPORTED IN 136 ITD 23 (VISAKHA PATNAM) WHEREIN IT HAS BEEN HELD THAT PROVISIONS OF SECTION 40(A)(I A) OF THE ACT ARE APPLICABLE ONLY TO AMOUNTS OF EXPENDITURE WHICH ARE PAYABLE AS ON 31 ST MARCH OF EVERY YEAR AND IT CANNOT BE INVOKED TO DI SALLOW EXPENSES WHICH HAVE BEEN ACTUALLY PAID DURING THE P REVIOUS YEAR WITHOUT DEDUCTION OF TDS. ACCORDINGLY, GROUND NO.( 1) OF ASSESSEES APPEAL IS ALLOWED. 8. IN THE PRESENT CASE ALSO, LEARNED CIT(A) MADE THE A DDITION BY FOLLOWING THE DECISION OF THE ITAT, SPECIAL BENCH I N THE CASE OF MERILYN SHIPPING & TRANSPORT VS. ACIT REPORTED IN 136 ITD 23. THEREFORE, THE VIEW TAKEN BY THE LEARNED CIT(A) IS IN CONSONANCE W ITH THE VIEW TAKEN BY THIS BENCH OF THE TRIBUNAL IN ASSESSEES OWN CASE I N THE PRECEDING YEAR VIDE ORDER DATED 22/03/2013 IN I.T.A.NO. 215/JODH/2 012. SO, BY 5 RESPECTFULLY FOLLOWING THE AFORESAID REFERRED TO OR DER, WE DO NOT SEE ANY MERIT IN THIS APPEAL OF THE DEPARTMENT. 9. IN THE RESULT, APPEAL OF THE DEPARTMENT IS DISMISS ED. (ORDER PRONOUNCED IN THE COURT ON 22 ND NOVEMBER, 2013). SD/- SD/- (HARI OM MARATHA) (N.K.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 22 ND NOVEMBER , 2013. VR/- COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE LD.CIT 4. THE CIT(A) 5. THE D.R ASSISTANT REGISTRAR, ITAT, JODHPUR.