Keshubhai Nathabhai Jadav, V. The Income Tax Officer, Ward- 1(4), Veraval

ITA 265/RJT/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 6659 (ITAT-RAJKOT)
• Duration Of Justice: 2 year(s) 11 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-03-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 21-03-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 16-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AVINASH KUMAR
• Assessee Lawyers: MJ RANPURA
• Keywords: Wrong claim; Corroborative evidences
• Section: 194C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH , RAJKOT BEFORE SHRI S.V. MEHROTRA , ACCOUNTANT MEMBER AND SHRI K. NAR A SIMHA CHARY , MEMBER ITA NO. 265 / RJT /201 4 ASS T. YEAR : 2007 - 08 KESHUBHAI NATHABHAI JADAV AT & POST VILLAGE PRASHNAVADA, TA. SUTRAPADA, DIST. JUNAGADH PAN : ABOPJ1871H (APPELLANT) VS ITO, WARD - 1(4), VERAVAL (RESPONDENT) APPELLANT BY : SHRI M.J. RANPURA, C.A RESPONDENT BY : SHRI AVINASH KUMAR, DR DATE OF HEARING : 2 1 /0 3 /201 7 DATE OF PRONOUNCEMENT : 22 /0 3 /201 7 O R D E R PER K. NAR A SIMHA CHARY, MEMBER, JM : THIS IS AN APPEAL CHALLENGING ORDER DATED 06.02.2014 PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) - 3, RAJKOT (FOR SHORT HEREINAFTER REFERRED TO AS LD. CIT(A) ). 2. BRIEFLY STATED FACTS ARE THAT THE ASSESSEE IS AN INDIVIDUAL DERIVING INCOME FROM BUSINESS UNDER PROPRIETARY CONCERN, BHAVANI TRANSPORTS CO. ENGAGED IN THE BUSINESS OF TRANSPORTATION. FOR THE ASSESSMENT YEAR 2007 - 08, ASSESSEE FILED RETURN OF INCOME ON 30.1 0.2007 DECLARING TOTAL INCOME OF RS.1,25,487/ - . DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTICED THAT A SUM OF RS.2,70,832/ - WAS DISALLOWABLE 2 ITA NO. 265/RJT/2014 KESHUBHAI NATHABHAI JADHAV U/S 40(A)(IA) OF THE INCOME TAX ACT, 1961 (FOR SHORT HEREINAFTER REFERRED TO AS THE ACT) FOR NO N - COMPLIANCE WITH THE PROVISIONS OF SEC. 194C OF THE ACT AND ANOTHER SUM OF RS.4,88,416/ - ON ACCOUNT OF BOGUS CLAIM OF TRANSPORT FREIGHT EXPENSES. ASSESSEE CHALLENGED THE SAME IN APPEAL, BUT THE APPEAL ENDED UP IN DISMISSAL AND CONFIRMATION OF THE ADDITIO N MADE ON THESE TWO GROUNDS. AGGRIEVED BY THE IMPUGNED ORDER, ASSESSEE IS BEFORE US IN THIS APPEAL. 3. T HE MAIN CONTENTION OF THE ASSESSEE IS THAT THE PAYMENT TO TRUCK DRIVERS IN RESPECT OF THE DISALLOWANCE U/S 40(A)(IA) OF THE ACT WAS LESS THAN RS. 2,000 / - ON EACH TIME, AS SUCH NOT LIABLE FOR DISALLOWANCE U/S 40(A)(IA) OF THE ACT. INSOFAR AS RS.4,88,416/ - IS CONCERNED, HIS CONTENTION IS THAT THE ASSESSING OFFICER HAS NOT FURNISHED THE CORRECT REGISTRATION NUMBERS OF THE TRUCKS TO G.S.C.L FOR CONFIRMATION , WHICH RESULTED IN DENIAL OF THE SAME BY THE COMPANY AND, CONSEQUENTLY RESULTED IN THE ADDITION. HE, THEREFORE, PRAYED THAT AN OPPORTUNITY MAY BE GRANTED TO THE ASSESSEE TO BRING THE TRUTH TO THE NOTICE OF THE AUTHORITIES THROUGH RELEVANT DOCUMENTARY EVI DENCES. 4. PER CONTRA , THE LD. DR SUBMITTED THAT , AS A MATTER OF FACT THIS ARGUMENT WAS ADVANCED BEFORE THE LD. CIT(A) AND THE LD. CIT(A) , IN ORDER TO VERIFY THE VERACITY OF THE CONTENTION, DIRECTED THE ASSESSING OFFICER TO VERIFY THE CLAIM AND TO REPORT BUT IN SPITE OF THE BEST OPPORTUNITY GRANTED, ASSESSEE FAILED TO AVAIL THE SAME , A S SUCH , HAVING NO OTHER OPTION BUT TO CONFIRM THE ADDITIONS MADE BY THE ASSESSING OFFICER, THE LD. CIT(A) DISMISSED THE APPEAL. 3 ITA NO. 265/RJT/2014 KESHUBHAI NATHABHAI JADHAV 5. PARAGRAPH 4 OF THE IMPUGNED ORDER READS AS FOLLOWS : - 4. IN ORDER TO VERIFY THE NEW CLAIMS MADE BY THE AR BEFORE ME IN RESPECT OF THE ADDITIONS MADE, I DIRECTED THE A.O. TO VERIFY THE CLAIMS MADE AND SUBMIT THE REPORT VIDE THIS OFFICE LETTER DATED 18 - 12 - 2013. ACCORDINGLY, THE A.O. ACTING ON MY DIRECTIONS HAS ISSUED NOTICES TO THE APPELLANT TO FURNISH THE BOOKS OF ACCOUNTS AND THE SUPPORTING EVIDENCE FOR VERIFICATION ON 06 - 01 - 2014 AND AGAIN ON 20 - 1 - 2014. HOWEVER, AS SEEN FROM THE REPORT SUBMITTED BY THE A.O. ON 30 - 1 - 2014, THERE WAS NO COMPLIA NCE FROM THE APPELLANT TO THE SAID NOTICES ISSUED ON 06 - 01 - 2014 AND 20 - 1 - 2014 FIXING COMPLIANCE ON 10 - 1 - 2014 & 27 - 1 - 2014 RESPECTIVELY. THEREFORE, THE A.O. COULD NOT MAKE ANY VERIFICATION IN RESPECT OF THE CLAIMS MADE AGAINST THE ADDITION MADE. THEREFORE, I HAVE NO OTHER OPTION, EXCEPT TO CONFIRM THE ADDITION MADE BY THE A.O. HENCE, THE ADDITION MADE AT RS.2,70,832/ - AND RS.4,88,416/ - STANDS CONFIRMED. 5. BEFORE US, THE ASSESSEE UNDERTOOK THAT IF AN OPPORTUNITY IS GRANTED TO HIM, HE WILL NOT FAIL TO AVAIL THE SAME; AS SUCH HE PRAYED TO SET - ASIDE THE MATTER TO THE FILE OF ASSESSING OFFICER AS A LAST OPPORTUNITY. THE ORDER OF LD. CIT(A) MAKES IT ABUNDANTLY C LEAR THAT THE REPORT SUBMITTED BY THE ASSESSING OFFICER ON 30.1.2014 ESTABLISHES THAT THERE WAS NO RESPONSE FROM THE ASSESSEE FOR THE NOTICES ISSUED TO HIM IN THE REMAND PROCEEDINGS. HOWEVER, SINCE NO RIGHTS ARE CRYSTALLIZED UNDER AN EX - PARTE ORDER AND IT IS NOT IN THE INTEREST OF JUSTICE TO PERPETUATE AN EX - PARTE ORDER, AND MORE PARTICULARLY WHEN THE ASSESSEE COMES FORWARD WITH A PRAYER FOR AN OPPORTUNITY AS A LAST CHANCE, IN VIEW OF THE UNDERTAKING EXTENDED ON BEHALF OF THE ASSESSEE BEFORE U S, WE ARE OF THE CONSIDERED OPINION THAT THE INTEREST OF JUSTICE WOULD BE SERVED BY GIVING AN OPPORTUNITY TO THE ASSESSEE HAVING REGARD TO THE FACTS AND CIRCUMSTANCES OF THE CASE. WE, THEREFORE, WHILE PLACING ON RECORD THE UNDERTAKING OF ASSESSEE MADE BEF ORE US, SET - ASIDE THE 4 ITA NO. 265/RJT/2014 KESHUBHAI NATHABHAI JADHAV MATTER TO THE FILE OF ASSESSING OFFICER FOR CONSIDERING THE CLAIM OF ASSESSEE IN RESPECT OF THE TWO ADDITIONS MADE. NEEDLESS TO SAY , THE ASSESSEE SHALL CO - OPERATE WITH THE AUTHORITIES BELOW IN TAKING THE PROCEEDINGS TO ITS LOGICAL CO NCLUSION. WE MAKE IT AMPLY CLEAR THAT THIS IS THE LAST OPPORTUNITY GRANTED TO THE ASSESSEE. WITH THIS VIEW OF THE MATTER, WE ALLOW THE GROUND FOR STATISTICAL PURPOSE. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. ORDER P RONOUNCED IN THE OPEN COURT ON 2 2 N D MARCH, 2017. SD/ - SD/ - ( S.V. MEHROTRA ) ACCOUNTANT MEMBER ( K. NAR A SIMHA CHARY ) JUDICIAL MEMBER MUMBAI, DATE : 2 2 N D MARCH , 201 7 *SSL* COPY TO : 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT(A) CONCERNED 4) THE CIT CONCERNED 5) THE D.R, RAJKOT 6) GUARD FILE BY ORDER DY./ASSTT. REGISTRAR I.T.A.T, RAJKOT