M/s SGSIL Geophysical Services Pvt. Ltd., New Delhi V. ACIT, New Delhi

ITA 2757/DEL/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 81871 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 5 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-10-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 21-10-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 06-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B R R KUMAR SENIOR
• Assessee Lawyers: KRISHNAMOHAN K MENON

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH G : NEW DELHI) BEFORE SHRI GEORGE GEORGE K., JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER ITA NO.2757/DEL./2013 (ASSESSMENT YEAR : 2007-08) M/S. SGSIL GEOPHYSICAL SERVICES PVT. LTD., VS. ACIT , RANGE 10, (FORMERLY KNOWN AS M/S. SCINTREX NEW DELHI. GEOPHYSICAL SERVICES (INDIA) PVT. LTD.), CSC, C / 9, VASANT KUNJ, NEW DELHI. (PAN : AAHCS2860A) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI KRISHNAMOHAN K. MENON, ADVOCATE REVENUE BY : SHRI B.R.R. KUMAR, SENIOR DR ORDER PER B.C. MEENA, ACCOUNTANT MEMBER : THIS APPEAL FILED BY THE ASSESSEE EMANATES FROM THE ORDER OF THE CIT (APPEALS)-X, NEW DELHI DATED 16.01.2013 FOR THE ASS ESSMENT YEAR 2007-08. 2. THE ASSESSEE IS A PRIVATE LIMITED COMPANY ENGAGE D IN THE BUSINESS OF DIFFERENT TYPES OF GEOPHYSICAL SERVICES, SUCH AS, G EOLOGICAL SURVEYS LIKE GRAVIMETER, MAGNETIC, RESISTIVITY AND BOREHOLE LOGG ING AND PERFORATION. DURING THE YEAR, THE ASSESSEE HAS PROVIDED BOREHOLE LOGGIN G SERVICES FOR COAL AND COAL BED METHANE AND SERVED VARIOUS CUSTOMERS LIKE ESSAR OIL LIMITED, GREAT EASTERN ENGERGY CORPORATION LTD., PARSON OVERSEAS P VT. LTD. AND RELIANCE ITA NO.2757/DEL/2013 2 INDUSTRIES LTD. THE ASSESSEE HAS DEBITED RENT FOR THE PREMISES AT VARIOUS PROJECT SITES LIKE JALORE IN RAJASTHAN, SHADOL IN MADHYA PR ADESH AND ASANSOL IN WEST BENGAL. THE ASSESSING OFFICER DISALLOWED THE PAYME NT OF RENT OF RS.1,42,400/- ON THE BASIS THAT NO RENT AGREEMENT WAS PRODUCED. THE CIT (A) HAS CONFIRMED THE ADDITION AND NOW THE ASSESSEE IS IN APPEAL BEFO RE US BY TAKING THE FOLLOWING GROUNDS :- 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX *(A PPEALS) [HEREINAFTER REFERRED TO AS CITA] IS INCORRECT, IL LEGAL, AGAINST THE STATUTORY PROVISIONS AND LIABLE TO BE SET ASIDE. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE CITA ERRED IN CONFIRMING THE ACTION OF THE LD. ASSESSING OFFICER [HEREINAFTER REFERRED TO AS AO] IN TREATI NG THE AMOUNT OF RS.1,42,400/- PAID TOWARDS RENT FOR BUSINESS PURPOS ES AS AN IMPERMISSIBLE CLAIM FOR DEDUCTION ON THE SOLE PREMI SE THAT THERE WAS NO RENT AGREEMENT, EVEN THOUGH THERE WERE OTHER DOCUMENTS. 3. THAT THE ORDER APPEALED AGAINST IS CONTRARY TO T HE FACTS, LAW AND PRINCIPLES OF NATURE JUSTICE. 3. GROUNDS NO.1 & 3 ARE GENERAL IN NATURE AND DO NO T REQUIRE ANY ADJUDICATION. 4. THE ONLY SUBSTANTIAL GROUND IS GROUND NO.2 IN WH ICH THE ADDITION OF RS.1,42,400/- HAS BEEN CHALLENGED. 5. WE HAVE HEARD BOTH THE SIDES ON THE ISSUE. ALTH OUGH ADMITTEDLY THERE WAS NO RENT AGREEMENT, HOWEVER, THE ASSESSEE SUBMIT TED VARIOUS RECEIPTS SIGNED BY THE HOUSE OWNERS AND THE AMOUNT WAS PETTY. THE RECEIPTS FOR THE RENT HAVE ITA NO.2757/DEL/2013 3 BEEN TAKEN BY THE ASSESSEE AFTER AFFIXATION OF REVE NUE STAMP ON THE RECEIPT. DUE TO THE NATURE OF THE WORK CONDUCTED BY THE ASSE SSEE IN VARIOUS SMALL TOWNS AND PLACES AND THAT TOO FOR A SHORT PERIOD, WE FIND THAT IT WILL NOT BE PRACTICAL TO ENTER INTO A RENT AGREEMENT IN SUCH PLACES AND SINC E THE ASSESSEE HAS PRODUCED THE RECEIPTS FOR THE PAYMENT AND THAT TOO OF A VERY PETTY AMOUNT IN COMPARISON TO THE TOTAL TURNOVER OF THE ASSESSEE, WE FIND THAT THE ASSESSEE DESERVES THE RELIEF AND NO ADDITION ON THIS COUNT IS CALLED FOR. THERE FORE, WE DIRECT TO DELETE THE ADDITION. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON THIS 22 ND DAY OF OCTOBER, 2014. SD/- SD/- (GEORGE GEORGE K.) (B.C. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE 22 ND DAY OF OCTOBER, 2014 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-X, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR/ITAT