ADIT, New Delhi V. M/s. Hyundai Engineering & Contruction Co. Ltd., New Delhi

ITA 2716/DEL/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 97005 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 3 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-08-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC 2
• Next Hearing Date: 06-08-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 02-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUDHARANJAN SENAPATI
• Keywords: Business expenditure; Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH SMC - 2 , NEW DELHI BEFORE SHRI H.S.SIDHU , JUDICIAL MEMBER ITA NO. 2716 /DEL/201 4 AY: 200 7 - 08 ADIT, CIRCLE 1(2)(INTERNATIONAL TAX) VS. HYUNDAI ENGINEERING & NEW DELHI CONSTRUCTION CO.LTD. ROOM NO.576, HOTEL SAMRAT CHANAKYAPURI NEW DELHI 110 021 PAN : AAACH 2622 L (APPELLANT) (RESPONDENT) A PPELLANT BY : SH. SUDHARANJAN SENAPATI, SR.D.R. RESPONDENT BY : NONE ORDER THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER DT. 28.2. 2014 OF LD.CIT(A) - XX I X, NEW DELHI FOR THE ASSESSMENT YEAR 200 7 - 08 , ON THE FOLLOWING GROUNDS. 1 . ON THE FACTS AND CIRCUMSTANCES OF CASE , WHETHER LD.CIT(A) WAS CORRECT IN DELETING THE ADDITION OF RS.1,43,60,817/ - AND HOLDING THAT FREIGHT EXPENSES WERE ALLOWABLE EXPENDITURE BEING REVENUE IN NATURE IN SPITE OF THE FACTS THAT THESE WERE MAINLY ADMINISTRATIVE EXPENSES AND THE ASSESSEE HAD EARNED MEAGER AMOUNT AS OTHER INCOME FROM THIS PROJECT. 2. ON THE FACTS AND CIRCUMSTANCES OF CASE , WHETHER LD.CIT(A) WAS CORRECT IN DELETING THE ADDITION O F RS.19,90,820/ - AND HOLDING THAT THESE EXPENSES WERE BUSINESS EXPENDITURE IN SPITE OF THE FACT THAT THE ASSESSEE FAILED TO ESTABLISH THEIR GENUINENESS BEFORE THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS. 3. THE APPELLANT CRAVES TO A DD, AMEND, MODIFY OR LATER ANY GROUNDS OF APPEAL AT ANY TIME OR BEFORE THE HEARING OF THE APPEAL. ITA NO. 2716 /DEL/2014 A.Y. 200 7 - 08 HYUNDAI ENGINEERING & CONSTRUCTION CO.LTD., N.DEL 2 2. NOTICE OF HEARING WAS ISSUED TO THE ASSESSEE ON THE ADDRESS GIVEN IN FORM NO.36, WHICH IS RETURNED ON 28.7.2015 WITH THE POSTAL AUTHORITIES REMARK HYUNDIA ENGINEERING CORPN. LEFT 3. KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE, I AM OF THE CONSIDERED VIEW THAT NO USEFUL PURPOSE WOULD BE SERVED TO ISSUE NOTICE AGAIN AND AGAIN TO THE ASSESSEE AT THE ADDRESS GIVEN IN RECORDS. THEREFORE, I AM DECIDING THE ISSUE IN DISPUTE EX PARTE QUA THE ASSESSEE, AFTER HEARING THE LD.SR.D.R. 4. THE ASSESSING OFFICER COMPLETED THE ASSESSMENT U/S 144C(3) OF THE ACT ON 25.2.2010 BY MAKING THE VARIOUS ADDITIONS INCLUDING THE ADDITION IN DISPUTE. 4.1. AGGRIEVED BY THE ADDITION MADE BY THE A.O. THE ASSESSEE FILED APPEAL BEFORE THE LD. FIRST APPELLATE AUTHORITY WHO VIDE IMPUGNED ORDER DT. 28.2.2014 DELETED THE ADDITION IN DISPUTE. 4.2. BEING AGGRIEVED THE REVENUE HAS FILED THE PRESENT APPEAL AGAINST THE ORDER OF THE FIRST APPELLATE AUTHORITY. 4.3. AT THE TIME OF HEARING LD.SR.D.R. RELIED ON THE ORDER OF THE A.O. AND THE CONTENTIONS RAISED BY THE REVENUE IN THE GROUNDS OF APPEAL. 4.4. AFTER HEARING THE LD.SR.D.R., PERUSING THE RELEVA NT MATERIAL AVAILABLE ON RECORD, I AM OF THE VIEW THAT THE LD. FIRST APPELLATE AUTHORITY HAS ADJUDICATED THE ISSUE IN DISPUTE IN PARA NO.6.1 AND 6.2 PAGES 4 AND 5 OF THE IMPUGNED ORDER. FOR THE SAKE OF CONVENIENCE THE SAME IS REPRODUCED HEREUNDER. 6.1 THE APPELLANT HAS SUBMITTED THAT THE AMOUNT OF RS. 19,90,8201 - HAS BEEN PAID TO M / S SHYAM ENTERPRISES TOWARDS THEIR SERVICE CHARGES FOR GETTING BACK THE REFUND FROM EXCISE DEPARTMENT. THE APPELLANT HAS FURNISHED COPY OF DEBIT NOTE FROM M / S SHYAM ENTERPRISE IN R ESPECT OF THESE PAYMENTS, COPY OF ITA NO. 2716 /DEL/2014 A.Y. 200 7 - 08 HYUNDAI ENGINEERING & CONSTRUCTION CO.LTD., N.DEL 3 ACKNOWLEDGEMENT OF INCOME - TAX RETURN OF M / S SHYAM ENTERPRISES OF A.Y. 2007 - 08, COPY OF BANK ACCOUNT OF ML / SHYAM ENTERPRISES, PAN AND OTHER ASSESSMENT PARTICULARS OF M / S SHYAM ENTERPRISES AND COPY OF TDS CERTIFICATE I N RESPECT OF PAYMENTS MADE TO M / S SHYAM ENTERPRISES. THE APPELLANT HAS SUBMITTED THAT THESE DETAILS WERE SO FURNISHED TO THE AO DURING ASSESSMENT PROCEEDINGS AND, THEREFORE, THESE ARE NOT IN THE NATURE OF ADDITIONAL EVIDENCE. 6.2 I HAVE DULY CONSIDERED T HE SUBMISSIONS MADE BY THE APPELLANT AND OTHER DOCUMENTS FURNISHED BY THE APPELLANT IN SUPPORT OF THE TRANSACTION. VARIOUS DOCUMENTS FURNISHED BY THE APPELLANT ESTABLISHED THE GENUINENESS OF PAYMENT BY THE APPELLANT TO M / S SHYAM ENTERPRISES. THE PAYMENTS H AVE BEEN MADE THROUGH ACCOUNT PAYEE CHEQUES. THE AO HAS NOT GIVEN ANY COGENT REASON WHY THE RATE AT WHICH M / S SHYAM ENTERPRISES HAD CHARGED IS NOT JUSTIFIABLE. VIEWING FROM THE PROSPECTIVE OF THE APPELLANT, THE PAYMENT REPRESENTS GENUINE BUSINESS EXPENDITU RE. ACCORDINGLY, I HOLD THAT NO DISALLOWANCE CAN BE MADE ON THIS ACCOUNT. THE AO IS DIRECTED TO GRANT THE RELIEF ACCORDINGLY. GROUND OF APPEAL IS ALLOWED. 5. AFTER GOING THROUGH THE FINDING GIVEN BY THE LD. FIRST APPELLATE AUTHORITY, I AM OF THE CONSIDE RED VIEW THAT THE ASSESSEE HAS FILED ALL THE RELEVANT DOCUMENTARY EVIDENCES BEFORE THE A.O. AS WELL AS BEFORE THE LD. FIRST APPELLATE AUTHORITY WHICH HAS PROPERLY BEEN APPRECIATED BY THEM AND THE ADDITION IN DISPUTE HAS BEEN RIGHTLY BEEN DELETED BY THE LD. FIRST APPELLATE AUTHORITY. I AM OF THE VIEW THAT NO INTERFERENCE IS CALLED FOR IN THE WELL REASONED ORDER PASSED BY THE LD. FIRST APPELLATE AUTHORITY, I UPHOLD THE IMPUGNED ORDER BY DISMISSING THE APPEAL FILED BY THE REVENUE. 6 . IN THE RESULT THE APPEAL BY THE REVENUE IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON 20 TH AUGUST, 2015 . SD/ - ( H.S.SIDHU ) JUDICIAL MEMBER DATED: THE 20 TH AUGUST, 2015 *MANGA ITA NO. 2716 /DEL/2014 A.Y. 200 7 - 08 HYUNDAI ENGINEERING & CONSTRUCTION CO.LTD., N.DEL 4 COPY OF THE ORDER FORWARDED TO: 1. APPELLANT; 2.RESPONDENT; 3.CIT; 4.CIT(A); 5.DR; 6.GUARD FILE BY ORDER ASST. REGISTRAR