M/s Piyush Jain & Company, New Delhi V. ACIT, New Delhi

ITA 2514/DEL/2017

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 8486 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 8 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2011-2012
• Appeal Filed On: 27-04-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GAURAV DUDEJA
• Keywords: Corroborative evidences; TDS
• Section: 143(3); 143(2); 254(2); 13

Judgement Text

ITA NO.- 2514/DEL/2017. M/S PIYUSH JAIN & CO. PAGE 1 OF 15 IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: F: NEW DELHI) BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER ITA NO:- 2514/DEL/2017 ( ASSESSMENT YEAR: 2011-12) M/S PIYUSH JAIN & CO. X-10, GREEN PARK MAIN, NEW DELHI. VS. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-24(1), NEW DELHI. PAN NO: AAJFP0653M APPELLANT RESPONDENT ASSESSEE BY : SHRI AJAY WADHWA, ADV. REVENUE BY : SHRI GAURAV DUDEJA, SR. DR ORDER PER ANADEE NATH MISSHRA, AM (A) THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE IMPUGNED APPELLATE ORDER DATED 23.02.2017 PASSED BY LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-11, NEW DELHI, [IN SHORT, LD.CIT(A)] PERTAINING TO ASSESS MENT YEAR 2011-12. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL:- 1. THAT THE ORDER OF THE COMMISSIONER OF INCOME TA X (APPEALS) [THE LD. CIT(A)], NEW DELHI, DATED 15.04.2014, IS BAD IN LA W AND ON FACTS. 2. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FACT S IN SUSTAINING THE PART DISALLOWANCE OF RS. 4,66,681/- OUT OF THE TOTAL DIS ALLOWANCES OF RS. 7,58,687/- MADE BY THE LD. ASSESSING OFFICER. ITA NO.- 2514/DEL/2017. M/S PIYUSH JAIN & CO. PAGE 2 OF 15 2.1 THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FAC TS IN SUSTAINING THE DISALLOWANCE OF RS. 4,66,681/- ON ACCOUNT OF COMMIS SION PAID BY THE APPELLANT FIRM TO THREE PARTIES NAMELY SHRI ARVIND ADUKIA, SHRI SIDDHARTH SARNA AND SHRI GURPREET SINGH BRAR DESPITE THE FACT THAT THE APPELLANT PROVIDED ALL THE SUPPORTING EVIDENCES TO PROVE GENU INENESS OF COMMISSION PAID. 3. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, A MEND, SUBSTITUTE, DELETE AND MODIFY ANY OR ALL THE GROUNDS OF APPEAL, WHICH ARE WITHOUT PREJUDICE TO ONE ANOTHER, BEFORE OR AT THE TIME OF HEARING OF THE AP PEAL. (B) ASSESSMENT ORDER DATED 26.02.2014 WAS PASSED BY THE ASSESSING OFFICER (AO, FOR SHORT) UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 (I.T. ACT, FOR SHORT), WHEREIN TOTAL INCOME WAS ASSESSED AT RS. 50,06,500/- (ROUND ED OFF) AS AGAINST RETURNED INCOME OF RS. 29,24,460/-. THE ADDITION MADE BY THE AO INCLU DED AN AMOUNT OF RS. 7,58,687/- ON ACCOUNT OF DISALLOWANCE OF COMMISSION PAID BY THE A SSESSEE. THE RELEVANT PORTION OF THE AFORESAID ASSESSMENT ORDER DATED 26.02.2014 IS REPR ODUCED AS UNDER: ITA NO.- 2514/DEL/2017. M/S PIYUSH JAIN & CO. PAGE 3 OF 15 ITA NO.- 2514/DEL/2017. M/S PIYUSH JAIN & CO. PAGE 4 OF 15 ITA NO.- 2514/DEL/2017. M/S PIYUSH JAIN & CO. PAGE 5 OF 15 (C) THE ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A) . VIDE AFORESAID IMPUGNED APPELLATE ORDER DATED 23.02.2017, THE LD. CIT(A) DE LETED AN AMOUNT OF RS. 2,92,006/- OUT OF THE AFORESAID DISALLOWANCE OF RS. 7,58,687/- AND SUSTAINED THE REMAINING DISALLOWANCE AMOUNTING TO RS. 4,66,681/-. THE RELE VANT PORTION OF THE AFORESAID IMPUGNED APPELLATE ORDER DATED 23.02.2017 OF LD. CI T(A) IS REPRODUCED AS UNDER: ITA NO.- 2514/DEL/2017. M/S PIYUSH JAIN & CO. PAGE 6 OF 15 ITA NO.- 2514/DEL/2017. M/S PIYUSH JAIN & CO. PAGE 7 OF 15 ITA NO.- 2514/DEL/2017. M/S PIYUSH JAIN & CO. PAGE 8 OF 15 ITA NO.- 2514/DEL/2017. M/S PIYUSH JAIN & CO. PAGE 9 OF 15 (D) THIS PRESENT APPEAL HAS BEEN FILED BY THE ASSES SEE AGAINST THE AFORESAID IMPUGNED APPELLATE ORDER DATED 23.02.2017 OF LD. CI T(A). IN THE COURSE OF APPELLATE ITA NO.- 2514/DEL/2017. M/S PIYUSH JAIN & CO. PAGE 10 OF 15 PROCEEDINGS IN INCOME TAX APPELLATE TRIBUNAL (ITAT , FOR SHORT), A PAPER BOOK CONTAINING THE FOLLOWING PARTICULARS WAS FILED FROM THE ASSESSEES SIDE: 1. COPY OF ITR ACKNOWLEDGEMENT FOR AY 2011-12 2. COMPUTATION OF INCOME FOR AY 2011-12 3. COPY OF FINANCIAL STATEMENTS FOR THE YEAR ENDED 31.03.2011 4. COPY OF TAX AUDIT REPORT6 FOR AY 2011-12 5. NOTICE DATED 10.09.2012 ISSUED U/S 143(2) OF THE ACT 6. NOTICE DATED 23.07.2013 ISSUED U/S 143(2) AND 14 2(1) OF HE ACT IN RESPECT OF DISALLOWANCE OF RS. 4,66,681/- OUT O F RS. 7,58,687/- 7. DETAILS OF COMMISSION RECEIVED AND PAID FOR THE AY 2011-12 8. COPY OF CONFIRMATIONS FROM THE PARTIES IN RESPEC T OF COMMISSION PAID. 9. REPLY DATED 29.08.2013 FURNISHED TO LD. AO 10. REPLY DATED 24.09.2013 FURNISHED TO LD. AO 11. REPLY DATED 07.02.2014 FURNISHED TO LD. AO 12. REPLY DATED 10.02.2014 FURNISHED TO LD. AO 13. WRITTEN SUBMISSION DATED 15.10.2015 FILED BEFOR E CIT(A) ALONG WITH FOLLOWING DETAILS: A. DETAILS OF TDS DEDUCTED ON THE PAYMENT OF COMMI SSION. B. COPY OF BOOKING FORMS WITH BUILDERS 14. WRITTEN SUBMISSION DATED 20.10.2015 FILED BEFO RE CIT(A). 15. REMAND REPORT DATED 24.01.2017 FURNISHED BY LD . CIT(A) 16. WRITTEN SUBMISSION DATED 21.02.2017 FILED BEF ORE CIT(A). (D.1) IN ADDITION, A COPY OF BANK STATEMENT OF THE ASSESSEE IN AXIS BANK WAS ALSO SUBMITTED DURING THE APPELLATE PROCEEDINGS IN ITAT. ITA NO.- 2514/DEL/2017. M/S PIYUSH JAIN & CO. PAGE 11 OF 15 (D.2) MOREOVER, A LETTER DATED 16.01.2020, CERTIFYI NG THAT VARIOUS DOCUMENTS WERE FILED BEFORE THE LOWER AUTHORITIES AT THE TIME OF PROCEED INGS BEFORE THEM, WAS ALSO FILED, WHICH IS REPRODUCED BELOW FOR EASE OF REFERENCE: ITA NO.- 2514/DEL/2017. M/S PIYUSH JAIN & CO. PAGE 12 OF 15 (E) AT THE TIME OF HEARING BEFORE US, THE LD. COUNS EL FOR ASSESSEE SUBMITTED THAT THE ONLY REASON FOR WHICH THE LD. CIT(A) HAS SUSTAI NED THE AFORESAID DISALLOWANCE OF RS. 4,66,681/- IS THAT THE ASSESSEE DID NOT FURNISH ORI GINAL CONFIRMATION LETTERS FROM THESE THREE PARTIES NAMELY MR. ARVIND ADUKIA, MR. SIDDHAR TH SARNA AND MR. GURPRETT SINGH BRAR; ALTHOUGH PHOTOCOPIES OF THE CONFIRMATION LETT ERS WERE SUBMITTED. IT WAS SUBMITTED BY THE LD. COUNSEL FOR ASSESSEE THAT THE CONFIRMATION WAS OBTAINED BY THE ASSESSEE THROUGH E-MAIL, WHICH IS WHY ORIGINAL CONF IRMATION LETTERS COULD NOT BE OBTAINED. IT WAS FURTHER SUBMITTED BY THE LD. COUNS EL THAT BECAUSE OF SUBSTANTIAL LAPSE OF TIME, THE ORIGINAL CONFIRMATION LETTERS ARE NOT AVAILABLE PRESENTLY. HOWEVER, THE LD. COUNSEL FOR ASSESSEE SUBMITTED THAT THE REQUIREMENT OF FILING ORIGINAL CONFIRMATION MAY BE WAIVED IN THE PRESENT CASE, BECAUSE THE GENUINEN ESS OF THE PAYMENTS TOTALING THE ITA NO.- 2514/DEL/2017. M/S PIYUSH JAIN & CO. PAGE 13 OF 15 AFORESAID RS. 4,66,681/- HAS BEEN PROVED BEYOND DOU BT BY THE ASSESSEE BY SUPPORTING EVIDENCES AND THE AMOUNT SHOULD NOT BE DISALLOWED M ERELY BECAUSE XEROX COPIES OF THE CONFIRMATIONS HAVE NOT BEEN SUPPLEMENTED WITH ORIGI NAL CONFIRMATION LETTERS. HE TOOK US THROUGH THE AFORESAID PAPER BOOK FILED FROM THE ASSESSEES SIDE DURING APPELLATE PROCEEDING IN ITAT, AND ALSO, THE COPY OF THE AFORE SAID BANK ACCOUNT; TO ESTABLISH THAT AFORESAID PAYMENTS TOTALING RS. 4,66,681/- ARE GENU INE AND ARE ELIGIBLE FOR DEDUCTION. THE LD. COUNSEL FOR ASSESSEE ALSO PLACED RELIANCE O N ORDER DATED 26.09.2019 OF CO- ORDINATE BENCH OF ITAT IN THE ITA NO.-865/DEL/2015 IN THE CASE OF ACIT VS. VARUN BEVERAGES LTD; ORDER DATED 15.04.2016 OF HIGH COURT OF CALCUTTA IN THE CASE OF ASHOK SURANA V. CIT [2017] 79 TAXMANN.COM 318 (CALCUTTA); ORDER DATED 16.07.2015 OF CO- ORDINATE BENCH OF ITAT, DELHI IN THE CASE OF CHEIL INDIA (P.) LTD. VS. ITO IN ITA NO. 6183/DEL/2014; ORDER DATED 23.03.2009 OF HIGH COURT OF DELHI IN THE CASE OF CIT VS. HI LUX AUTOMOTIVE (P.) LTD. [2009] 183 TAXMAN 260 (DEL HI); AND ORDER DATED 18.07.2003 OF HIGH COURT OF DELHI IN THE CASE OF CIT VS. S.J. KNITTING & FINISHING MILLS (P.) LTD. [2004] 136 TAXMAN 13 (DELHI). THE LD. DEPARTMENTAL REPRESENTATIVE (LD. DR, FOR SHORT) WAS ALSO OF THE VIEW THAT THE AFORESAID DOCU MENTS RELIED UPON BY THE LD. COUNSEL FOR ASSESSEE DO PROVE THAT THE CLAIM OF AFORESAID A MOUNT OF RS. 4,66,681/- MADE BY THE ASSESSEE IS GENUINE AND ALLOWABLE UNDER I.T. ACT. HOWEVER, THE LD. DR EXPRESSED APPREHENSION WHETHER THE AFORESAID DOCUMENTS [REFER RED TO IN THE FOREGOING PARAGRAPHS (D) AND (D.1) OF THIS ORDER] WERE MADE A VAILABLE TO THE AO FOR THE CONSIDERATION OF THE AO. THE LD. DR CONTENDED THAT THE AFORESAID ADDITION OF RS. 4,66,681/- MAY BE DELETED IF THE AFORESAID DOCUMENT S WERE MADE AVAILABLE TO THE AO FOR THE CONSIDERATION OF THE AO. IN REJOINDER, TH E LD. COUNSEL FOR ASSESSEE AFFIRMED ITA NO.- 2514/DEL/2017. M/S PIYUSH JAIN & CO. PAGE 14 OF 15 THAT HE WAS MAKING A CATEGORICAL STATEMENT STANDING AT THE BAR OF THE COURT-ROOM, THAT ALL THE AFORESAID DOCUMENTS WERE AVAILABLE BEFORE T HE AO WHICH WERE FURTHER CONFIRMED BY THE CERTIFICATE VIDE AFORESAID LETTER DATED 16.0 1.2020. (F) WE HAVE HEARD BOTH SIDES. WE HAVE CONSIDERED T HE ORDERS AND JUDICIAL PRECEDENTS BROUGHT TO OUR ATTENTION AT THE TIME OF HEARING OR REFERRED TO IN THE RECORDS. BOTH SIDES ARE IN AGREEMENT THAT THE AFORE SAID DOCUMENTS AND EVIDENCES PROVED THE GENUINENESS OF THE AFORESAID EXPENSES TO TALING RS. 4,66,681/- AND THAT IT WAS ALLOWABLE UNDER I.T. ACT. IN VIEW OF THIS, WE DIRECT THE AO TO DELETE THE AFORESAID DISALLOWANCE TOTALING RS. 4,66,681/-. HOWEVER, IN V IEW OF THE APPREHENSION EXPRESSED BY THE LD. DR THAT ALL AFORESAID DOCUMENTS[REFERRED TO IN FOREGOING PARAGRAPHS (D) AND (D.1) OF THIS ORDER] MAY NOT HAVE POSSIBLY BEEN AVA ILABLE TO THE AO FOR THE CONSIDERATION OF THE AO, WE GIVE LIBERTY TO REVENUE TO MOVE AN APPLICATION UNDER SECTION 254(2) OF I.T. ACT FOR RECALLING THIS ORDER AND FOR RESTORATION OF APPEAL IF IT IS FOUND THAT THE AFORESAID DOCUMENTS RELIED UPON BY T HE LD. COUNSEL FOR ASSESSEE WERE NOT AVAILABLE TO THE AO FOR THE CONSIDERATION OF TH E AO. (G) IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 20/01/2020. SD/- SD/- (H.S. SIDHU) (ANADEE NA TH MISSHRA) JUDICIAL MEMBER ACCOUN TANT MEMBER DATED: 20/01/2020 POOJA/- ITA NO.- 2514/DEL/2017. M/S PIYUSH JAIN & CO. PAGE 15 OF 15 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI DATE OF DICTATION DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER