The Dy. Commissioner of Income-tax, Jammu V. M/s. J&K Coop Supply & Marketing P.ltd, Jammu

ITA 255/ASR/2012

• Counselvise Citation: 25520914 RSA 2012
• Duration Of Justice: 1 year(s) 6 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-12-2013
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 12-12-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 31-05-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: AMRIK CHAND
• Assessee Lawyers: VIRENDER K MAINI
• Keywords: Opportunity of being heard
• Section: 194C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.S. SIDHU, JUDICIAL MEMBER AND SH. B.P.JAIN, ACCOUNTANT MEMBER I.T.A. NO.255(ASR)/2012 ASSESSMENT YEAR:2008-09 PAN :AAAAT0881B DY COMMR. OF INCOME TAX, VS. M/S. J & K COOP SUPPLY & CIRCLE-2, JAMMU. MARKETING (P) LTD. B.C.ROAD, JAMMU. (APPELLANT) (RESPONDENT) APPELLANT BY:SH.AMRIK CHAND, DR RESPONDENT BY:SH.VIRENDER K. MAINI, CA DATE OF HEARING: 12/12/2013 DATE OF PRONOUNCEMENT:20/12/2013 ORDER PER BENCH ; THIS APPEAL OF THE REVENUE ARISES FROM THE ORDER O F THE CIT(A), JAMMU DATED 26.03.2012 FOR THE ASSESSMENT YEAR 200 8-09. THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. CIT(A) WAS RIGHT IN DELETING THE ADDITION MADE ON ACCOUNT OF N ON DEDUCTION OF TDS ON FREIGHT PAID WHEN THE G.R. WERE ISSUED BY TH E TRANSPORTER CONCERNED IN THE NAME OF THE ASSESSEE WHICH TANTAMO UNT TO ORAL AGREEMENT. ITA NO.255(ASR)/2012 2 2. ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. C IT(A) HAS FAILED TO APPRECIATE THAT THE ASSESSEE DURING THE P ERIOD RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION, EXECUTED THE W ORK OF CARRIAGE OF GOODS BY HIRING TRUCKS ON SETTLED TERMS WHICH CLEAR LY GOES TO ESTABLISH THE EXISTENCE OF CONTRACT AND ATTRACT THE PROVISION S OF SECTION 194C OF THE INCOME TAX ACT, 1961 ON THE AGGREGATE AMOUNT EX CEEDING RS.50,000/- TO THE TRUCK OWNERS. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS A COOPERATIVE SOCIETY ENGAGED IN TRADING OF FERTILIZERS, CEMENT, MEDICINES, TOR STEEL, BITUMEN, PESTICIDES AND LPG CYLINDERS ETC. THE ASSE SSEE HAS DECLARED GROSS SALES OF RS.57,94,66,115/- AT A GROSS PROFIT OF RS .2,52,34,210/- AT A G.P. RATE OF 4.35% AND NET LOSS HAS BEEN DECLARED AT RS.1,61, 90,652/-. THE AO OBSERVED THAT THE ASSESSEE HAS MADE FREIGHT PAYMENT S OF RS.59,28,667/- IN CONTRAVENTION OF PROVISIONS OF SECTION 194C OF THE ACT AND THE SAME WERE DISALLOWED IN VIEW OF THE PROVISIONS OF SECTION 40( A)(IA) OF THE ACT BY OBSERVING AT PAGE 5 TO 10 OF THE ORDER, WHICH FOR T HE SAKE OF CONVENIENCE IS REPRODUCED AS UNDER: FREIGHT EXPENSES: DURING THE COURSE OF ASSESSMENT PROCEEDINGS, IT WAS NOTED THAT THE ASSESSEE HAD DEB ITED FREIGHT CHARGES OF RS.2,57,50,476/- IN THE P & L ACCOUNT. VIDE QUES TIONNAIRE DATED 06.09.2010, THE ASSESSEE WAS ASKED TO FILE DETAILS IN RESPECT OF FREIGHT CHARGES PAID AND WHETHER TDS HAS BEEN DEDUCTED ON T HESE PAYMENTS. IN RESPONSE TO THIS, THE A/R OF THE ASSESSEE FILED THE PARTY WISE DETAILS OF FREIGHT PAID IN EXCESS OF RS.50,000/- WHICH HAS BEEN PLACED ON RECORD AND STATED THAT- THE ASSESSEE SOCIETY HAS PAID FREIGHT ON ACCOUNT O F RANSPORTATION OF FERTILIZER ON BEHALF OF GOVT. OF I NDIA TO DIFFERENT LOCATIONS OF J & K . THE RACKS OF FERTILIZERS UNLOA DED AT RAILWAY ITA NO.255(ASR)/2012 3 GODOWN IS TO BE TRANSPORTED WITHIN THE PRESCRIBED S TIPULATED PERIOD OF TIME. FOR TRANSPORTATION OF THE SAME, THE ASSESSEE SOCIETY ARRANGES INDIVIDUAL TRUCKS AS PER ITS REQUIREMENT KEEPING IN VIEW THE LOAD TO BE TRANSPORTED. SINCE THE SOCIETY ENGAGED IN THE TRANS PORTATION BUSINESS OF FERTILIZER DOES NOT OWN ANY TRUCK, IT HAS TO HIR E THE TRUCK FROM THE MARKET EVERY TIME AS AND WHEN THERE IS REQUIREMENT FOR THE SAME. THE SOCIETY HAS PAID THE FREIGHT ONLY TO THE SAID HIRED INDIVIDUAL TRUCK DRIVERS/TRUCK OWNERS. THE FREIGHT PAID TO THE TRUCK DRIVERS/OWNERS VARY FROM TIME TO TIME WHICH FLUCTUATES DUE TO DEMA ND AND SUPPLY AS THE ASSESSEE HAS NOT ENTERED INTO IN ANY SPECIFIC C ONTRACT FOR ANY SPECIFIC PERIOD AT ANY SPECIFIC AGGREGATE WITH ANY OF THE TRUCK OWNERS/DRIVER. SINCE NO CONTRACT EITHER ORALLY OR W RITTEN HAS BEEN EXECUTED BY THE SOCIETY WITH ANY TRANSPORT CO. OR T RANSPORT CONTRACTOR FOR ANY SPECIFIED PERIOD OR FOR ANY SPEC IFIED QUANTITY OR ANY PRE AGREED SPECIFIED RATE HENCE EACH TRIP IS A SEPARATE CONTRACT. THE VERY FACT THAT DIFFERENT RATES OF TRANSPORTATIO N ARE PAID TO SAME TRUCK DRIVER/OWNERS IN ANY GIVEN FINANCIAL YEAR SHO WS THERE CANNOT BE A CONTINUOUS CONTRACT FOR THE YEAR UNDER CONSIDERAT ION. HENCE, THE RATES FIXED WITH ANY TRUCK DRIVER/OWNER WAS RESTRIC TED TO ANY SINGLE TRIP ONLY AFTER WHICH A FRESH RATE WOULD BE NEGOTIA TED DEPENDING ON THE PREVAILING MARKET CONDITION AND THE SOCIETY MAY OR MAY NOT HIRE THE SAID TRUCK OWNER AGAIN DEPENDING ON THE RATE QU OTED BY HIM. THE PERUSAL OF THE PROVISIONS OF SECTION 194C REVE ALS THAT TAX IS TO BE DEDUCTED AT SOURCE WHERE ANY SUM IS PAID FOR CARRYING OUT ANY WORK IN PURSUANCE OF CONTRACT BETWEEN THE CONTRACTO R AND VARIOUS PERSONS MENTIONED IN VARIOUS CLAUSES UNDER SUB S. 1 OF SEC. 194C . SUB. S(3) PROVIDES THAT NO DEDUCTION SHALL BE MADE WHERE THE AMOUNT TO BE PAID OR CREDITED DOES NOT EXCEED RS.20,000/-. IT HAS BEEN CLEARLY CLARIFIED BY CBDT VIDE CIRCULAR NO.715 DATED 08.08. 1995 IN ANSWER TO: QUESTION 9. IN THE CASE OF PAYMENTS TO TRANSPORTER S, CAN EACH GR BE SAID TO BE SEPARATE CONTRACT, EVEN THOUGH PAYMENTS FOR SEVERAL GRS ARE MADE UNDER ONE BILL? ANSWER: NORMALLY EACH GR CAN BE SAID TO BE A SEPARA TE CONTRACT, IF THE GOODS ARE TRANSPORTED CONTINUOUSLY IN PURSUANCE OF A CONTRACT FOR A SPECIFIC PERIOD OF QUANTITY, EACH GR WILL NOT BE A SEPARATE CONTRACT AND ALL GRS RELATING TO THAT PERIOD OR QUANTITY WIL L BE AGGREGATED FOR THE PURPOSE OF THE TDS. ITA NO.255(ASR)/2012 4 FROM THE SAID CLARIFICATION BY CBDT CIRCULAR 715 (S UPRA), IT IS CLEAR THAT IF CONTRACTS ARE WITH TRUCK OWNERS/DRIVERS AND GR IS A SEPARATE THEN THE PAYMENT MADE FOR THAT TRUCK HAS TO BE TREA TED AS A SEPARATE PAYMENT. THE ASSESSEE SOCIETY HAS PAID FREIGHT TO T HE TRUCK OWNERS/DRIVERS, FOR EACH TRUCK THEY HAVE MADE SEPAR ATE PAYMENT BECAUSE EACH TRUCK WAS FOR SEPARATE DESTINATION. TH EREFORE, IT CANNOT BE SAID THAT THERE WAS CONTRACT BETWEEN THE ASSESSE E-SOCIETY AND THE TRUCK OWNERS. FURTHER, SUBMITTED THAT THE DETAILS O F THE FREIGHT WHICH HAVE BEEN ALREADY FURNISHED TO YOUR GOODSELF, MORE THAN 3500 TRIPS WERE MADE FOR TRANSPORTING THE GOODS (FERTILIZER) A ND IN THESE TRIPS PAYMENT EXCEEDING 20,000/- HAS BEEN MADE BY THE SOC IETY 53 TIMES AMOUNTING TO A TOTAL OF RS.15,02,170/- IN VIOLATION OF PROVISIONS OF SECTION 194C OF THE ACT. FROM THE SAID DETAILS, IT DOES NOT INDICATE THAT TRIPS WERE MADE CONTINUOUSLY UNDER A CONTRACT . MERELY BECAUSE CERTAIN TRUCKS WERE HIRED ON CERTAIN OCCASIONS, IT DOES NOT LEAD TO CONCLUSION THAT ALL THE TRIPS WERE MADE CONTINUOUSL Y UNDER THE SPECIFIC CONTRACT. ADMITTEDLY, THERE IS NO SPECIFIC CONTRACT. THE CIT(A) JAMMU IN THE CASE OF M/S. SHARM CONSTRUC TION CO. CIRCLE_II, JAMMU APPEAL NO.363/07-08 ORDER DATED 26.11.2008 HAS GIVEN SPECIFIC FININGS AS I HAVE GONE THROUGH THE FACTS OF THE CASE AND SUBMISSIONS MADE BY THE LD. COUNSEL FOR THE APP ELLANT. THE APPELLANT HAD VERY SPECIFICALLY SUBMITTED BEFORE TH E AO THAT PAYMENT OF FREIGHT AND TOLL TAX OF EACH TRUCK, WHICH CARRIE D THE CEMENT, WAS MADE TO THE DRIVER OF THE TRUCK. THE APPELLANT HAD ALSO SUBMITTED THE DETAILED STATEMENT OF EACH INDIVIDUAL ENTRY WHICH T HE A.O. HAD MENTIONED IN HIS LETTER THE NUMBER OF EACH TRUCK, A MOUNT PAID AND THE NUMBER OF BAGS CARRIED BY EACH TRUCK. DESPITE SUBMI TTING COMPLETE DETAILS IN RESPECT OF FREIGHT PAYMENT TO THE TRUCK OWNERS AND TOLL TAX PAYMENT TO THE GOVERNMENT TO WHICH THE PROVISIONS O F SECTION 194C DO NOT APPLY., THE AO PROCEEDED TO MAKE DISALLOWANCE U /S 40(A)(IA). THE A.O. HAD ALSO NEVER QUESTIONED ANYWHERE THAT THE DE TAILS FURNISHED BY THE APPELLANT WERE WRONG. A PERUSAL OF BILLS OF CEMENT COMPANIES ALSO REVEAL THAT THESE DO NOT INCLUDE THE FREIGHT P AYMENT MADE BY THE APPELLANT AND SO THE CONCLUSION DRAWN BY THE AO THA T THE FREIGHT PAYMENT ARE HIT BY THE PROVISIONS OF SECTION 40(A)( IA) OF THE ACT IS NOT CORRECT. HENCE, THE ADDITION MADE IN THIS GROUND I S DELETED. THE DEPARTMENT HAS NOT PREFERRED ANY APPEAL AGAINST THE SAID ORDER BEFORE THE ITAT, AMRITSAR BENCH AND ACCEPTED THE SA ME. THE ASSESSEE HAS FURTHER PLACED RELIANCE ON THE FO LLOWING DECISIONS ITA NO.255(ASR)/2012 5 COMMISSIONER OF INCOME TAX VS. UNITED RICE LAND LTD (2008) 217 CTR (P&H) WHEREIN IT IS HELD TH AT PAYMENT TO TRANSPORTERS FOR ARRANGING TRUCKS HAS R ECORDED A FINDING OF FACT THAT THERE WAS NEITHER ANY ORAL OR WRITTEN AGREEMENT BETWEEN THE ASSESSEE AND THE TRANSPORTERS FOR CARRIAGE OF GOODS NOR IT HAS BEEN PROVED THAT ANY F REIGHT CHARGES WERE PAID TO THEM IN PURSUANCE OF A CONTRAC T FOR A SPECIFIC PERIOD, QUANTITY OR PRICE-TRIBUNAL TOO HAS CLEARLY STATED THAT NOTHING HAS BEEN BROUGHT ON RECORD BY T HE AO TO PROVE THAT THERE WAS WRITTEN OR ORAL AGREEMENT BETW EEN THE PARTIES FOR CARRIAGE OF GOODS- THEREFORE, ASSESSEE WAS NOT LIABLE TO DEDUCT TAX U/S 194C FROM PAYMENTS MADE TO THE TRANSPORTERS. INCOME TAX OFFICER VS. BHOURKA ROADLINES LTD (2008) 115 TTG (MUMBAI) WHEREIN IT IS HELD THAT ASS ESSEE ENGAGED TRUCKS THROUGH AGENTS AND SUPPLIERS AND FO R EACH TRUCK THEY HAVE MADE SEPARATE PAYMENT BECAUSE EACH TRUCK WAS FOR SEPARATE DESTINATION, THEREFORE, IT CANNOT BE S AID THAT THERE WAS CONTRACT BETWEEN THE SUPPLIER AND NOT WITH THE TRUCK OWNERS/DRIVERS. CIT TRANSPORT CORPN VS INCOME TAX OFFICER (2007) 13 SOT 479 (MUMBAI) WHEREIN IT IS HELD THAT THERE B EING NO MATERIAL TO SHOW THAT ALL THE TRIPS FOR TRANSPORTIN G GOODS WERE UNDER A SINGLE CONTRACT AND PAYMENT FOR EACH TRIP B EING LESS THAN RS.20,000, THE PROVISIONS OF SECTION 194C WERE NOT ATTRACTED. THIS POSITION IS MADE CLEAR BY CBDT CIRC ULAR NO.715 DATED 08.08.1995. INCOME TAX OFFICER VS INDIAN ROAD LINES, ITAT AMRITSAR BENCH. IN VIEW OF THE AFORESAID DISCUSSIONS, THE PROVISIO NS OF SECTION 94C COULD NOT BE INVOKED SINCE PAYMENT FOR EACH TRI P WAS LESS THAN RS.20,000/-. AFTER CONSIDERING THE SUBMISSIONS MADE ON BEHALF O F THE ASSESSEE SOCIETY WITH REFERENCE TO THE FACTS OF THE CASE, I HOLD THAT THE ASSESSEE WAS REQUIRED TO DEDUCT THE INCOME TAX AT S OURCE WHERE ITA NO.255(ASR)/2012 6 THE PAYMENT IN EXCESS OF RS.50,000/- WAS MADE TO EA CH TRUCK OWNERS AND DEPOSIT THE SAME IN THE CENTRAL GOVERNME NT ACCOUNT WITHIN THE PRESCRIBED PERIOD. THE ASSESSEE WAS REQUIRED TO DEDUCT TAX AT SOURCE ON FREIGHT PAYMENT S IN EXCESS OF RS.50,000/- TO THE TRUCK OWNERS. TOTAL FREIGHT P AYMENTS IN EXCESS OF RS.50,000 TO THE TRUCK OWNERS COMES TO RS.59,28,667/- WHICH HAS BEEN WORKED AS PER DETAILS GIVEN IN THE ANNEXURE A FORMING PART OF THE ASSESSMENT ORD ER, ON WHICH TAX WAS REQUIRED TO BE DEDUCTED U/S 194C OF T HE ACT BUT THE ASSESSEE HAS NEITHER DEDUCTED THE TAX NOR DEPOS ITED THE SAME IN THE CENTRAL GOVT. ACCOUNT WITHIN THE PRESCR IBED PERIOD OF TIME. THE FACTS OF THE CASE LAWS ON WHICH THE RE PRESENTATIVE OF THE ASSESSEE HAS TRIED TO RELY ARE QUITE DIFFERE NT FROM THE FACTS OF THE CASE OF ASSESSEE SOCIETY AND AS SUCH SAME ARE DISTINGUISHABLE. IT IS FURTHER MENTIONED HERE THAT SIMILAR DISALLOWANCE HAS BEEN MADE BY MY PREDECESSOR IN THE A.Y. 2007-08. THEREFORE, THE PAYMENT OF RS.59,28,667/- M ADE BY THE ASSESSEE SOCIETY IN CONTRAVENTION OF THE PROVISIONS OF SECTION 194C OF THE ACT DOES NOT QUALIFY FOR DEDUCTION AND AS SUCH, SAME IS DISALLOWED, KEEPING IN VIEW THE PROVISIONS OF SECTION 40(A)(IA) OF THE ACT WHICH WOULD RESULT IN DISALLOW ANCE OF RS.59,28,667/-.. 3. THE LD. CIT(A) ACCEPTED THE CONTENTION OF THE AS SESSEE AND MENTIONED IN HIS ORDER THAT THE AR APPEARING BEFORE HIM ARGUED ON THE SAME LINES AS BEFORE THE A.O. AND DELETED THE ADDITION B Y FOLLOWING CIRCULAR NO.715 DATED 8.8.1995 OF CBDT AND HELD THAT THERE W AS NO APPLICATION OF SECTION 40(A)(IA) OF THE ACT READ WITH SECTION 194- C OF THE I.T. ACT AND DISALLOWANCE MADE BY THE AO WAS VACATED BY OBSERVIN G IN PARA 8 TO 10 OF HIS ORDER, WHICH IS REPRODUCED FOR THE SAKE OF CONV ENIENCE AS UNDER: 8. I HAVE CAREFULLY CONSIDERED THE SUBMISSION MADE AND THE ASSESSMENT ORDER. THE FACTUAL POSITION IS NOT DENIE D BUT THE ITA NO.255(ASR)/2012 7 DISALLOWANCE IS MADE ON THE GROUND THAT THE CASE LA WS CITED IN VIEW OF FACTS OF THE CASE WERE DISTINGUISHABLE AND IDENTICA L DISALLOWANCE WAS MADE IN A.Y.07-08 ALSO. AS PER THE FACTS CULLED OUT FROM THE RECORDS THE SOCIETY ARRANGES INDIVIDUAL TRUCKS AS PER ITS REQUIREMENT KEEPING IN VIEW THE LOAD OF FERTILIZERS TO BE CARRIED. THE FREIGHT IS PAID TO INDIVIDUAL DRIVERS/TRUCK OWNERS. THE FREIGHT PAID ALSO VARIES FROM TIME TO TIME AND FLUCTUATES DUE TO DEMAND AND SUPPL Y. NO SPECIFIC CONTRACT IS ENTERED INTO BY SOCIETY WITH ANY OF TH E TRUCK OWNER FOR ANY SPECIFIED PERIOD OR QUANTITY OR AS PER ANY PREAGRE ED RATES. EACH TRUCK IS PAID SEPARATE PAYMENT FOR EACH TRIP AS THE DESTINATION WAS ALSO NOT SAME. 9. THESE FACTS ARE UNCONTROVERED. FROM THE FACTS AS ABOVE IT IS CLEAR THAT THERE EXISTED NO ORAL AS WELL AS WRITTEN CONTRACT WITH THE PAYEES I.E. THE TRUCK DRIVERS AND HENCE THE PROVISI ON OF SECTION 194C OF THE ACT WERE NOT APPLICABLE AS THERE WAS NO CONT RACT EITHER FOR ANY SPECIFIED PERIOD OR ANY SPECIFIED QUANTITY. IN THE PRESENT CASE, THERE CANNOT BE SAID THAT ANY ARRANGEMENT AS TO THE PREFI XED RATES OR TRIPS WAS ALSO PRESENT. IN VIEW OF THIS EACH G.R. HAS TO BE TREATED AS A SEPARATE CONTRACT AND SINCE NO PAYMENT EXCEEDS RS.2 0,000/- FOR ANY TRIP NO TDS WAS DEDUCTIBLE. THE DECISIONS OF HONBL E P & H HIGH COURT IN CASE OF M/S. UNITED RICE MILLS 217 CTR AND OF HONBLE ITAT, AMRITSAR IN CASE OF M/S. INDIAN ROAD LINES 45 DTR 49 ARE APPLICABLE ON THE FACTS OF THE CASE. 10. IN VIEW OF THIS, IT IS HELD THAT NO TDS WAS DED UCTIBLE AS EACH CONTRACT WAS BELOW RS.20,000/- AND HENCE THERE WAS NO APPLICATION OF SECTION 40(A)(IA) R.W. S.194-C OF I.T.ACT AND THE D ISALLOWANCE MADE IS VACATED 4. THE LD DR ARGUED THAT THERE IS NOTHING ON RECORD THAT SEPARATE PAYMENT TO EACH TRIP HAS BEEN PAID AND ACCORDINGLY, HE RELIED UPON THE ORDER OF THE AO THAT THERE IS CONTINUING CONTRACT AND PAY MENT IN EXCESS OF RS.50,000/- HAS BEEN MADE TO THE INDIVIDUAL TRUCK O WNERS AND THEREFORE, THE PROVISIONS OF SECTION 194C OF THE ACT CLEARLY APPLI ES IN VIEW OF CIRCULAR ITA NO.255(ASR)/2012 8 NO.715 DATED 08.08.1995 AND THE AO HAS CORRECTLY MA DE DISALLOWANCE UNDER SECTION 40(A)(IA) OF THE ACT. 5. THE LD. COUNSEL FOR THE ASSESSEE, AT THE OUTSET RELIED UPON THE ARGUMENTS MADE BEFORE THE AO AND THE LD. CIT(A) AND FURTHER RELIED UPON THE DECISION OF THE HONBLE PUNJAB & HARYANA HIGH C OURT IN THE CASE OF CIT VS. UNITED RICE LAND LTD. (2008) 217 CTR 332 AND DECISION OF ITAT, AMRITSAR BENCH IN THE CASE OF ITO VS. INDIAN ROADLI NES REPORTED IN (2010) 45 DTR (ASR)(TRIB.) 49 AND CBDT CIRCULAR NO.716 DAT ED 08.08.1995 WHICH ARE PART OF THE RECORD AND DECISION OF ITAT (SPECIA L BENCH) VISAKHAPATNAM IN THE CASE OF MERILYN SHIPPING & TRANSPORT, VISAKH APATNAM VS. ADDL. CIT REPORTED IN (2012) 70 DTR 81 IS ALSO PLACED ON REC ORD. HE, THEREFORE, PRAYED THAT THE ORDER PASSED BY THE LD. CIT(A) BE C ONFIRMED AND REVENUES APPEAL BE DISMISSED. 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. THE LD. COUNSEL FOR THE ASSESSEE MAINLY RELIED UPON CBDT CIRCULAR NO.715 DATED 08.08.1995, WHICH IS THE MAIN CLAIM ON WHICH THE PRESENT ISSUE REVOLVES. THE CLAIM OF THE ASSESSEE IS THAT EACH GR IS A SEPARATE CONTRACT AND THERE IS NO CONTINUING CONTRACT. IT IS A SETTLED LA W THAT A PERSON WHO CLAIMS HAS TO PROVE IT. THE BALL CANNOT BE THROWN INTO THE COURT OF THE AO. NOTHING HAS BEEN PLACED BEFORE THE AO AND THE LD. CIT(A) OR EVEN BEFORE US TO PROVE ITA NO.255(ASR)/2012 9 THAT EACH GR IS A SEPARATE CONTRACT AND NOT A CONTI NUING CONTRACT. IT WAS ARGUED BY THE LD. COUNSEL FOR THE ASSESSEE THAT DET AILS OF THE FREIGHT WERE FURNISHED BEFORE THE AO WITH REGARD TO MORE THAN 3 500 TRIPS WHICH WERE MADE FOR TRANSPORTING THE FERTILIZERS. NO DETAILS O F PAYMENT WHETHER THEY ARE MADE EACH GR WISE OR PAYMENTS ARE MADE AS A CONTINU ING ACCOUNT WITH A PARTICULAR INDIVIDUAL, HAVE BEEN PLACED ON RECORD F OR OUR PERUSAL. THE AO HAS NOT MENTIONED ABOUT THE EXAMINATION OF SUCH DE TAILS, MAY BE POSSIBLE THE SAME WERE NOT PLACED BEFORE THE AO. AS PER CIRC ULAR NO.715 DT. 08.08.1995 OF CBDT, IF THE PAYMENTS ARE MADE AS A C ONTINUING CONTRACT THEN IT WILL BE TREATED AS A CONTRACT AND PROVISIONS OF SECTION 194C SHALL BE APPLICABLE IF IT EXCEEDS THE LIMIT PRESCRIBED IN TH E ACT. THE LD. CIT(A) HAS MENTIONED THAT EACH TRUCK IS PAID A SEPARATE PAYMEN T FOR EACH TRIP, AS THE DESTINATIONS WERE ALSO NOT THE SAME. WHAT WAS THE M ATERIAL BEFORE THE LD. CIT(A) FOR GIVING SUCH FINDINGS? WHETHER A NEW EVID ENCE WAS PLACED BEFORE HIM? WHETHER THE INDIVIDUAL ACCOUNT OF TRU CK OPERATORS WERE PLACED ON RECORD W.R.T. EXAMINATION WHETHER PAYMENTS HAVE BEEN MADE AS A CONTINUING PAYMENT/LUMPSUM PAYMENT OR GR-WISE. EVEN IF THE DESTINATIONS ARE NOT THE SAME, THE QUESTION IS THAT THE PAYMENT MADE TO AN INDIVIDUAL IS A CONTINUING CONTRACT OR PAYMENT IS MADE EACH GR WISE LESS THAN RS.20,000/- HAS TO BE ASCERTAINED BY BRINGING THE MATERIAL ON R ECORD. NO SUCH DETAIL HAS ITA NO.255(ASR)/2012 10 BEEN BROUGHT ON RECORD BY THE ASSESSEE. EVEN IF THE LD. CIT(A) HAS GIVEN THE FINDING ON EXAMINATION OF RECORDS THEN THE SAME RE MAINED UNREBUTTED TO THE AO I.E. WITHOUT GIVING ANY OPPORTUNITY OF EXAMINATI ON BY THE AO. THE LD. CIT(A) CANNOT DECIDE THE ISSUE WITHOUT HEARING / OR WITHOUT REMANDING THE MATTER TO THE FILE AO IN THIS REGARD. THEREFORE, TH E FACT REMAINS THAT THE ASSESSEE IS REQUIRED TO PRODUCE THE DETAILS ALONGWI TH GRS AND COPY OF ACCOUNT OF EACH INDIVIDUAL TO WHOM PAYMENTS HAVE BE EN MADE AND THE AO HAS TO FIND OUT WHETHER IT IS A CONTINUING CONTRACT STRICTLY IN ACCORDANCE WITH CIRCULAR NO.715 DATED 08/08/1995 OF CBDT AND PROVI SIONS CONTAIN IN SECTION 194C OF THE ACTS AND ACCORDINGLY DECIDE THE ISSUE DENOVO BUT BY AFFORDING ADEQUATE OPPORTUNITY OF BEING HEARD TO TH E ASSESSEE. THUS, THE WHOLE ISSUE IS SET ASIDE TO THE FILE OF AO TO DECID E THE SAME DENOVO AS PER OUR DIRECTIONS HEREINABOVE. 7. AS REGARDS THE RELIANCE IN THE CASE OF ITO VS. INDIAN ROAD LINES (SUPRA), THE FACTS IN THE SAID CARE ARE DIFFERENT, AS DECIDED BY US IN THE CASE OF ITO VS. INDIAN ROAD LINES FOR THE ASSESSMENT YEAR 2 005-06 IN ITA NO.123(ASR)/2013 DATED 19 TH DEC., 2013, AS IN THE PRESENT CASE AND ALSO THE FACTS AS IN THE CASE OF M/S. UNITED RICE LAND LTD. (SUPRA) ARE DIFFERENT AND CANNOT BE MADE APPLICABLE IN THE PRESENT FACTS AND CIRCUMSTANCES OF THE CASE. ITA NO.255(ASR)/2012 11 ACCORDINGLY, AS DIRECTED HEREINABOVE, THE PRESENT I SSUES ARE SET ASIDE TO THE FILE OF AO, WHO WILL DECIDE THE SAME DENOVO, AS DIR ECTED HEREINABOVE. 8. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I N ITA NO.255(ASR)/2012 IS ALLOWED FOR STATISTICAL PURPOSE S. ORDER PRONOUNCED IN THE OPEN COURT ON 20TH DECEMBER., 2013. SD/- SD/- (H.S. SIDHU) (B.P. JAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 20TH DECEMBER, 2013 /SKR/ COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE:M/S. J & K COOP SUPPLY & MARKETING P. LTD. JAMMU 2. THE DCIT CIR.2, JAMMU. 3. THE CIT(A) 4. THE CIT 5. THE SR DR, ITAT, AMRITSAR. TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR. ITA NO.255(ASR)/2012 12