Leather Graphica, Kolkata V. ITO, Ward - 32(1), , Kolkata

ITA 2108/KOL/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 1425 (ITAT-KOLKATA)
• Duration Of Justice: 5 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-03-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 06-03-2019
• Assessment Year: 2006-2007
• Appeal Filed On: 08-10-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: C J SINGH JCITSRDR
• Section: 143(3); 40(a)(ia); 194C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH SMC KOLKATA BEFORE SHRI S.S, GODARA, JUDICIAL MEMBER ITA NO.2108/KOL/2018 ASSESSMENT YEAR:2006-07 LEATHER GRAPHICA C/O SUBASH AGARWAL & ASSOCIATES, SIDDHA GIBSON, 1, GIBSON LANE, SUITE-213, 2 ND FLOOR, KOLKATA-700069 [ PAN NO.AACFL 4157 B ] / V/S . INCOME TAX OFFICER, WARD-32(1), AAYAKAR BHAWAN, PORBA, 110, SHANTIPALLY, KOLKATA-107 /APPELLANT .. /RESPONDENT /BY APPELLANT SHRI SUBASH AGARWAL, ADVOCATE /BY RESPONDENT SHRI C.J.SINGH, JCIT-SR-DR /DATE OF HEARING 06-03-2019 /DATE OF PRONOUNCEMENT 22-03-2019 /O R D E R THIS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2006-07 , ARISES AGAINST THE COMMISSIONER OF INCOME-TAX (APPEALS)-9, KOLKATAS O RDER DATED 29.05.2018 PASSED IN CASE NO.386/CIT(A)-9/WD-32(1)/2014-15/KOL INVOLVIN G PROCEEDINGS U/S. 143(3) R.W.S. 254 R.W.S. 251 OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. THE ASSESSEES FIRST SUBSTANTIVE GROUND CHALLENG ES CORRECTNESS OF BOTH THE LOWER AUTHORITIES ACTION DISALLOWING 20% ITS CASH PAYMEN TS EXCEEDING OF 20,000/- AMOUNTING TO 2.85 LAC; COMING TO 57,000/- ON ACCOUNT OF PURCHASES MADE FROM M/S S.R. LEATHERS. THERE IS NO DISPUTE THAT THIS ASSESS EE IS A DEALER IN TANNING SKIN LATTER CASE REVENUE AND LATTER HON'BLE JURISDICTIONAL HIGH COURTS DECISION IN CIT VS. CPL TANNERY 318 ITR 179 (2008) (CAL) HOLDS THAT CASH PA YMENTS IN THIS LINE OF LEATHER BUSINESS IS COVERED UNDER RULE DD(F)(II) OF THE INC OME TAX RULES, 1962 AS THE ITA NO.2108/KOL/2018 A.Y. 2006- 07 LEATHER GRAPHICA VS. ITO WD-32(1), KO L. PAGE 2 PAYEES/ SUPPLIERS HAD TO BE RECOGNIZED AS PURCHASER OF HIDES/SKIN. I ADOPT THE SAID DETAILED REASONING MUTATIS MUTANDIS TO DELETE THIS FIRST DISALLOWANCE OF 57,000/-. 3. NEXT COMES UNDISCLOSED INCOME ADDITION. MR. AGAR WAL IS FAIR ENOUGH IN NOT PRESSING FOR THIS GROUND KEEPING IN MIND SMALLNESS OF THE AMOUNT INVOLVED. I DECLINE THIS SECOND SUBSTANTIVE GROUND IN ABOVE TERMS ACCOR DINGLY. 4. NEXT COMES SEC. 40(A)(IA) DISALLOWANCE MADE OF 3,04,122/- MADE IN BOTH LOWER PROCEEDINGS. THE ASSESSING OFFICER AS WELL AS CIT(A) TREAT ASSESSEES TANNING CHARGES PAID TO MD. ANWAR AND M/S R.H. TANNERY TO B E CONTRACTUAL PAYMENTS U/S/. 194C OF THE ACT. THERE IS NO NEXUS IN EITHER IN ASS ESSMENT ORDER OR CIT(A)S FINDINGS THAT THEY ARE EXCEEDED IN EARLIER OR WRITTEN CONTRA CT BETWEEN ASSESSEE AND THESE TWO PAYEES. I THEREFORE DELETE THE IMPUGNED DISALLOWANC E IN THIS COUNT ALONE. 5. THIS ASSESSEES APPEAL IS PARTLY ALLOWED IN ABOV E TERMS. ORDER PRONOUNCED IN OPEN COURT ON 22/03/2019 SD/- (S.S. GODARA) JUDICIAL MEMBE R KOLKATA, *DKP/SR.PS - 22/03/2019 / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-LEATHER GRAPHICA C/O SUBASH AGARWAL & AS SOCIATES SIDDHA GIBSON, 1, GIBSO N LANE, SUITE-213, 2 ND FLOOR, KOLKAKTG-69 2. /RESPONDENT-ITO WD-32(1), AAYAKAR BHAWAN, POORBA, 1 10, SHANTIPALLY, KOLKATA-107 3. ' % / CONCERNED CIT 4. % - / CIT (A) 5. & ))' , ' / DR, ITAT, KOLKATA 6. + / GUARD FILE. BY ORDER/ , /TRUE COPY/ ',