The ACIT, Circle-9, Ahmedabad V. M/s. Pioneer Construction Co., Ahmedabad

ITA 2447/AHD/2004

• Counselvise Citation: [2009] 114 COUNSELVISE.COM (IT) 8954 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 year(s) 1 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-09-2009
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 20-08-2009
• Assessment Year: 1996-1997
• Appeal Filed On: 18-08-2004
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NEETA SHAH SENIOR
• Assessee Lawyers: J P SHAH
• Section: 148

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'B' [BEFORE SHRI R V EASWAR VICE-PRESIDENT] [AND SHRI P K BANSAL ACCOUNTANT MEMBER) ITA NO.2447/AHD/2004 WITH C O NO.272/AHD/2004 (ASSESSMENT YEAR: 1996-97) THE ASSISTANT COMMISSIONER OF INCOME- TAX, CIRCLE-9, AHMEDABAD V/S M/S PIONEER CONSTRUCTION CO., 1, KANCHI CO-OP. SOCIETY, OPP. THALTEJ TEKRA, SG HIGHWAY, AHMEDABAD [APPELLANT] [RESPONDENT] APPELLANT BY :- SMT. NEETA SHAH, SENIOR DR RESPONDENT BY:- SHRI J P SHAH O R D E R PER P K BANSAL (ACCOUNTANT MEMBER): THE APPEAL AS WELL AS CROSS OBJECTION HAVE BEEN FILED AGAINST THE ORDER O F THE CIT(A) DATED 17-06-2004. IN THE APPEAL FILED BY THE REVENU E, THE ONLY GROUND TAKEN READS AS UNDER:- THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DE LETING THE ADDITION OF RS.12,07,250/- MADE ON ACCOUNT OF TRUCK HIRE CHA RGES PAID FOR 17 TRACTORS WHICH WERE FOUND NON-EXISTENCE. 2 SINCE BOTH THE GROUNDS TAKEN IN THE CROSS OBJECT ION WERE NOT PRESSED, THEREFORE, THE CROSS OBJECTION FI LED BY THE ASSESSEE STANDS DISMISSED, AS NOT PRESSED. 2 3 NOW COMING TO THE APPEAL OF THE REVENUE, THE BRI EF FACTS OF THE CASE ARE THAT THE AO NOTED THAT THE AS SESSEE HAS CLAIMED EXPENSES FOR THE CONSTRUCTION WORK OF AIZWA L AIRPORT, MIZORAM FOR 53 TRACTORS HIRED BY IT. TO VERIFY THE GENUINENESS OF THE PAYMENT, REQUEST WAS MADE TO JT. DIT (INV.), JA IPUR TO VERIFY THE TRACTOR NUMBERS AS TO WHEN AND HOW THE OWNER RE CEIVED THE PAYMENT. IT WAS NOTED BY THE AO THAT ON VERIFICATIO N IT WAS FOUND THAT OUT OF 18 TRACTORS BEARING REGISTRATION NO.RJ- 19, ONLY TWO NUMBERS RELATED TO THE TRACTORS AND THE BALANCE REL ATED TO THE OTHERS SUCH AS SCOOTERS, MINI-BUSES, ETC. ON THE BA SIS OF THE STATEMENT RECORDED DURING THE AY 1997-98 ON 14-03-2 000 OF SHRI RAM PRATAP LEGHA AND SHRI KUNDANMAL JAKHAD, THE AO REOPENED THE ASSESSMENT U/S 148 OF THE ACT. THE AO ULTIMATEL Y ON THE BASIS OF AY 1997-98, DISALLOWED A SUM OF RS.12,07,2 50/- AS BEING INCURRED BY THE ASSESSEE FOR THE TRACTORS NOT IN EXISTENCE. 4 THE ASSESSEE WENT IN APPEAL BEFORE THE CIT(A) AN D CONTENDED THAT DURING THE YEAR THE ASSESSEE HAD MAD E THE TOTAL PAYMENT AT RS.22,36,710/- TO FOUR PARTIES THROUGH A CCOUNT PAYEE CHEQUES, NOT RS.25,08,000/- AS WAS POINTED OUT BY T HE AO. THE IMPUGNED CASE IS DIFFERENT FROM AY 1997-98. DURING AY 1997- 98 THE ASSESSEE DID NOT HAVE ANY OPPORTUNITY TO LOO K INTO THE GENUINENESS OF THE REPORT OF THE JT. DIT (INV.), JA IPUR. DURING THIS YEAR THE ASSESSEE HAS VERIFIED FROM THE RTO OF FICE, JODHPUR AND NOTED THAT THE REVENUE HAS GIVEN WRONG NUMBERS OF THE TRACTORS IGNORING ALPHABET R TO THE RTO OFFICE WH ILE AFTER GIVING CORRECT NUMBERS IT WAS FOUND BY THE ASSESSEE THAT ALL THE REGISTRATION NUMBERS RELATED TO THE TRACTORS. THE C OMPARATIVE 3 CHART WAS BROUGHT BY THE ASSESSEE BEFORE THE CIT(A) ALONG WITH THE CERTIFICATE OF THE RTO, JODHPUR. THE COMPARATIV E CHART IS PRODUCED AT PAGE-9 OF THE ORDER OF CIT(A). THUS, IT WAS CONTENDED BY THE ASSESSEE THAT THERE IS NO DISCREPA NCY IN THE REGISTRATION NUMBERS OF THE TRACTORS TRANSPORTED BY ABC INDIA LTD.TO AIZWAL AND THE ASSESSEE HAS RIGHTLY CLAIMED THE DEDUCTION FOR THE EXPENDITURE INCURRED BY IT BUT DISPUTED BY THE AO ON ACCOUNT OF WRONG REGISTRATION NUMBERS. THE CIT(A) A FTER APPRECIATING THE FACTS OF THE CASE OF THE ASSESSEE FOR THIS YEAR, DELETED THE DISALLOWANCE BY OBSERVING AS UNDER:- 9 I HAVE CONSIDERED THE FACTS OF THE CASE, THE ORD ER OF THE AO AND VARIOUS SUBMISSIONS MADE BY THE APPELLANT. THE APPE LLANT HAS FILED FIRST PAPER BOOK DATED 24-12-2003 IN WHICH THE DETA ILS OF PROCEEDINGS BEFORE THE AO FOR AY 1997-98 AND ONWARDS TILL THE P ROCEEDINGS BEFORE THE HONBLE TRIBUNAL TOOK PLACE INCLUDING TH E COPY OF THE LETTER DATED 28-08-2003 FILED BEFORE THE TRIBUNAL INDICATI NG THE IMPACT OF THE REGISTRATION NUMBERS ON WHICH THE R.T.O., JODHPUR S ENT THE REPORT AS PER THE REQUEST OF THE ADDITIONA5 DIT, JAIPUR AS TH E NUMBERS SENT TO R.T.O, BY THE AC. WERE WRONG NUMBERS. THE APPELLANT FILED FURTHER SUBMISSIONS VIDE LETTER DATED 26-05-2004 AND ALONG WITH THESE SUBMISSIONS FILED TAX AUDIT REPORT AND COPIES OF AU DITED ACCOUNTS, COPY OF STATEMENTS OF KUNDANMAL JAKHAD ARID SHRI LE GHA RECORDED DURING THE ASSTT. YR. 1997-98, COPY OF SUB CONTRACT WORK ACCOUNT FOR ASSTT. YR. 1996-97 INCLUDING WORK EXECUTED BY THE F OUR TRACTOR ARRANGERS AND THE CORRESPONDING PAYMENT MADE TO THE M, TRANSPORTERS BILLS ISSUED BY THE ABC INDIA LTD. HAVING. TRANSPOR TED 56 TRACTORS TO AIZWAL HIRED FROM FIVE PERSONS, CERTIFIED COPY OF T HE RT.O., JODHPUR IN RESPECT OF 16 TRACTORS CERTIFYING THAT THEY WERE AFT TRACTORS AND NOT OTHER VEHICLES ALONG WITH CORRESPONDING COMPARATIVE VEHICLES OF REGISTRATION NUMBERS SENT BY THE ASSESSING OFFICER EARLIER1 COPIES OF LEDGER A/C. OF FOUR TRACTORS ARRANGERS AS APPEARING IN THE BOOKS OF ACCOUNT AND DETAILS OF PAYMENT TO FOUR TRACTOR ARRA NGERS WITH BANK ACCOUNTS IN WHICH THE PAYMENTS WERE CREDITED. 4 SINCE THE APPELLANT HAD FILED THE CERTIFICATE FROM THE DISTRICT TRANSPORT OFFICER, JODHPUR CERTIFYING THE CORRECT VEHICLES NU MBERS AS TRACTORS IN RESPECT OF 16 CORRECT REGISTRATION NUMBERS AS APPEA RING IN THE TRANSPORT BILLS OF ABC INDIA LTD. WERE PRODUCED FOR THE FIRST TIME BEFORE ME; COPIES OF THE SAME WERE FORWARDED TO THE ASSESSING OFFICER BY THIS OFFICE FETTER DATED 5-01-2004 A COPY OF WHICH WAS A LSO FORWARDED TO THE CIT, AHMEDABAD-IV FOR INFORMATION. ALONGWITH TH IS CERTIFICATE OF R.T.O, JODHPUR, THE ASSESSEES WRITTEN SUBMISSIONS D ATED 24-12-2003 WERE ALSO FORWARDED TO THE ASSESSING OFFICER WHERE THE DETAILS OF CORRECT REGISTRATION NUMBERS CERTIFYING AS TRACTORS AS COMPARED TO THE EARLIER REPORT OF R.T.O. WAS MENTIONED. THE A.O. WA S REQUESTED TO CERTIFY THE CORRECTNESS OF VEHICLES AS PER REGISTR ATION NUMBERS AS APPEARING IN THE TRANSPORT BILLS AND CERTIFIED BY R TO JODHPUR AS BELONGING TO THE TRACTORS. HOWEVER, THE ASSESSING O FFICER VIDE HIS LETTER DATED 21-11-2004 ONLY WROTE A LETTER TO THE R.T.O., JODHPUR TO ASCERTAIN WHETHER THE CORRECT REGISTRATION NUMBERS WERE OF TRACTORS ONLY AND COPY OF THIS LETTER WAS SENT TO ME. HOWEVE R, THEREAFTER THERE HAS BEEN NO REPORT FROM THE ASSESSING OFFICER. SIN CE I HAVE PERSONALLY VERIFIED THE CORRECT REGISTRATION NUMBER S OF 18 VEHICLES AS APPEARING IN THE BILLS OF THE TRANSPORTER ABC INDIA LTD. WITH THE REGISTRATION NUMBERS PERTAINING TO THE TRACTORS AS CERTIFIED BY THE R.T.O., JODHPUR BY ITS CERTIFICATE DATED 25-08 AND SUBMITTED BY THE APPELLANT BEFORE ME AND IN THE ABSENCE OF ANY REPLY FROM THE ASSESSING OFFICER AND AS THE TRACTORS NUMBERS ARE T ALLYING WITH THE NUMBERS APPEARING IN THE TRANSPORT BILLS OF ABC IND IA LTD., I PROCEED TO ACCEPT THESE REGISTRATION NUMBERS AS BELONGING T O THE TRACTORS AND TRANSPORTED BY THE ABC INDIA LTD. TO AIZWAL IN NOVE MBER, DECEMBER, 1995. ACCORDINGLY, A MINIMUM OF 52 TRACTORS WAS AVA ILABLE FOR USE AT AIZWAL WITH THE APPELLANT DURING THE ASSTT. YR. 199 6-97, EVEN IF IT IS PRESUMED THAT FOUR OTHER VEHICLES CONSIDERED BY THE ASSESSING OFFICER AS OTHER THAN THE TRACTORS AS CERTIFIED BY THE R.T. O., BIKANER WERE NOT AVAILABLE. AS FAR AS THE AMOUNT, WHICH IS ALLOWABLE FOR TRACTOR HIRING CHARGES DURING THE YEAR, THE SAME HAS BEEN CLAIMED BY THE APPELLANT AT RS.22,36,710/-, AS PER THE VOUCHERS FOR PAYMENT TO FOUR TRACTOR ARRANGERS RE. 95/- PER TRIP, THE SAME IS CONSIDERED AS GENUINE SINCE THE TOTAL AMOUNT IS LESS THAN THE AMOUNT PAYABLE AS PER THE CALCULATION OF THE ASSESS1NG OFFICER RE. 550!- PER TRACTOR PER DAY TOTALING TO RE. 24,64,000!-. THE APPELLANT ALSO PAID THE ENTIRE AMO UNT OF RE. 22,36,710/- DURING THIS YEAR BY ACCOUNT PAYEE CHEQU ES TO THREE TRACTOR ARRANGERS AT AIZWAL FROM VAYA BANK BY ACCOU NT PAYEE CHEQUES AND TO THE FOURTH TRACTOR ARRANGER FROM VIS NAGAR CO. OP BANK. THE ASSESSING OFFICER HAS NOT DISPUTED THE PA YMENTS TO THESE 5 FOUR PERSONS DURING THIS ASSESSMENT YEAR. THE ASSES SING OFFICER HAS NOT FOUND ANY FAULT WITH THE BOOKS OF ACCOUNT OF TH E APPELLANT AND THE PAYMENTS MADE TO FOUR TRACTOR ARRANGERS HAVE NOT BE EN DISPUTED DURING THE ASSESSMENT YEAR UNDER CONSIDERATION. WHI LE SENDING THE REGISTRATION NUMBERS TO R.T.O., JODHPUR, THE ASSESS ING OFFICER HAD NOT REPORTED THE CORRECT REGISTRATION NUMBERS AS AP PEARING IN THE TRANSPORT BILLS OF ABC INDIA LTD. AND HENCE, THERE COULD HAVE BEEN MISTAKE IN THE TYPE OF VEHICLES. HOWEVER, WHEN THE CORRECT REGISTRATION NUMBERS WERE NOTED DOWN AND FORWARDED TO THE R.T.O. , JODHPUR, HE HAS CERTIFIED THE CORRECT NATURE OF VEHICLES, WHICH WERE TRACTORS. !N VIEW OF ALL THE ABOVE FACTS, THERE IS NO REASON FOR DISALLOWING ANY TRACTOR HIRE EXPENSES CLAIMED BY THE APPELLANT DURI NG THE YEAR 1996- 97. I, THEREFORE, HOLD THAT THE DISALLOWANCE MADE B Y THE ASSESSING OFFICER OUT OF TRACTOR HIRING CHARGES WAS NOT JUSTI FIED. THE DISALLOWANCE MADE BY THE AO IS, THEREFORE, DELETED. 5 BEFORE US, THE LEARNED AR RELIED ON THE ORDER OF THE CIT(A) AND POINTED OUT THAT THE FACTS INVOLVED DURI NG THE YEAR ARE DIFFERENT FROM AY 1997-98. DURING THE YEAR THE ASSESSEE HAD OPPORTUNITY TO VERIFY FROM THE RTO OFFICE WHETHER T HE VEHICLES USED ARE TRACTORS OR NOT. THE AO HAS MENTIONED WRON G NUMBERS OF THE TRACTORS EXCLUDING ONE ALPHABET R DUE TO W HICH RTO OFFICE HAS INFORMED THAT THE IMPUGNED VEHICLES ARE NOT THE TRACTORS. THE CIT(A) HAS DULY APPRECIATED THE FACTS AND DELETED THE ADDITION. THE LEARNED DR, ON THE OTHER HAND, VE HEMENTLY RELIED ON THE ORDER OF THE AO. 6 WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS AND, PERUSED THE MATERIAL ON RECORD ALONG WITH THE ORDER OF THE AUTHORITIES BELOW. WE NOTED THAT THE AO DISALLOWED THE EXPENDITURE MAINLY ON THE BASIS OF THE REPORT OF TH E ITO AS OBTAINED BY THE JT. DIT (INV.), JAIPUR OBTAINED FRO M THE RTO OFFICE, JODHPUR. WE ALSO NOTED THAT THE ASSESSEE HA S ALSO OBTAINED THE REPORT FROM THE RTO OFFICE, JODHPUR AN D IN EACH OF 6 THE 18 CASES, THE ALPHABET R WAS MISSED BY THE RE VENUE WHILE WRITING A LETTER TO THE RTO, JODHPUR. ON THE BASIS OF CORRECT VEHICLE NUMBER, RTO, JODHPUR HAS SPECIFICALLY POINT ED OUT THAT EACH OF THE VEHICLES IS TRACTOR. IN VIEW OF THESE F ACTS, WE ARE OF THE VIEW THAT NO INTERFERENCE IS CALLED FOR IN THE ORDER OF THE CIT(A). IN OUR OPINION, THE CIT(A) HAS RIGHTLY DELE TED THE DISALLOWANCE. WE ACCORDINGLY UPHOLD THE ORDER OF TH E CIT(A). 7 IN THE RESULT, THE REVENUES APPEAL IS DISMISSED AND THE CROSS OBJECTION FILED BY THE ASSESSEE IS DISMIS SED, AS NOT PRESSED. ORDER PRONOUNCED IN THE OPEN COURT TODAY ON 18-09-2 009 SD/- SD/- (R V EASWAR) VICE-PRESIDENT (P K BANSAL) ACCOUNTANT MEMBER DATE : 18-09-2009 COPY OF THE ORDER FORWARDED TO : 1. M/S PIONEER CONSTRUCTION CO., 1, KANCHI CO-OP. S OCIETY, OPP. THALTEJ TEKRA, SG HIGHWAY, AHMEDABAD 2. THE ACIT, CIRCLE-9, AHMEDABAD 3. CIT CONCERNED 4. CIT(A)-XII, AHMEDABAD 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE BY ORDER DEPUTY REGISTRAR ASSISTANT REGISTRAR