Shri Urmit H. Patel, Baroda V. The Income Tax Officer, Ward-2(4), Baroda

ITA 2768/AHD/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 6097 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 3 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-02-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 25-10-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ADITYA SHUKLA
• Section: 148

Judgement Text

, - IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH SMC BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER ./ ITA NO. 2768/AHD/2016 / ASSESSMENT YEAR: 2011-12 URMIT H. PATEL 101, VIMAL RESIDENCY FLAT , 7-AMARKUNJ SOCIETY BPC ROAD, AKOTA BARODA. PAN : ADTPP 5029 Q VS ITO, WARD-2(4) BARODA. / (APPELLANT) / (RESPONDENT) ASSESSEE BY : SHRI TEJ SHAH, AR REVENUE BY : SHRI ADITYA SHUKLA, SR.DR / DATE OF HEARING : 14/02/2018 /DATE OF PRONOUNCEMENT : 16/02/2018 O R D E R PRESENT APPEAL IS DIRECTED AT THE INSTANCE OF THE A SSESSEE AGAINST ORDER OF LD.CIT(A)-4, VADODARA DATED 20.7.2016 PASS ED FOR THE ASSTT.YEAR 2011-12. 2. THOUGH THE ASSESSEE HAS TAKEN FOUR GROUNDS OF AP PEAL INCLUDING SUB-GROUNDS, BUT HIS GRIEVANCE REVOLVES AROUND A SI NGLE ISSUE VIZ. THE LD.CIT(A) HAS ERRED IN UPHOLDING RE-OPENING OF THE ASSESSMENT UNDER SECTION 148 OF THE INCOME TAX ACT AND ERRED IN CONF IRMING ADDITION OF RS.5.00 LAKHS. ITA NO.2768/AHD/2016 - 2 - 3. THE LD.COUNSEL FOR THE ASSESSEE DID NOT PRESS GR OUND RELATING TO VALIDITY OF REOPENING OF THE ASSESSMENT UNDER SECTI ON 148. HENCE THIS FOLD OF GRIEVANCE IS REJECTED. 4. AS FAR AS NEXT FOLD OF GRIEVANCE IS CONCERNED, I T EMERGES OUT FROM RECORD THAT THE ASSESSEE HAS FIELD HIS RETURN OF IN COME ON 29.9.2011 DECLARING TOTAL INCOME AT RS.10,59,450/-. THE ASSE SSEE HAS CLAIMED CREDIT OF RS.50,000/- REPRESENTING TDS DEDUCTED BY M/S.P.K . CLOROCHEM P.LTD. THE AO OBSERVED THAT RECEIPT OF RS.5.00 LAK HS OUGHT TO HAVE BEEN RECEIVED FROM M/S.P.K. CLOROCHEM P.LTD. HAS NOT BEE N ACCOUNTED FOR BY THE ASSESSEE, HENCE HE MADE AN ADDITION OF RS.5.00 LAKHS. ON THE OTHER HAND, THE CASE OF THE ASSESSEE IS THAT THOUGH M/S.P .K. CLOROCHEM P.LTD. HAS ISSUED A TDS CERTIFICATE EXHIBITING DEDUCTION O F TDS, BUT ACTUALLY NOT PAID A SUM OF RS.5.00 LAKHS TO THE ASSESSEE. C ERTIFICATE TO THIS EFFECT WAS ISSUED BY M/S.P.K. CLOROCHEM P.LTD. WHICH IS AV AILABLE AT PAGE NO.35 OF THE PAPER BOOK. IT READS AS UNDER: TO, WHOM SO EVER IT MAY CONCERN WE P K CHLOROCHEM PVT LTD. HEREBY STATE THAT MR. UR MIT HIRUBHAI PATEL WAS GIVEN A WORK FOR WHICH HE WAS TO GET COMMISSION OF RS. 5 LACS IN F.Y:2010-2011 FOR THE ORDER ETC. O F BIOTOR INDUSTRIES LTD. SINCE THE WORK IS NOT COMPLETED BY HIM WE HAVE NOT PAID THE SAID SUM TO HIM FOR AMOUNT PROVIDE BY US RS.5 LACS AND T DS OF RS.50000/- TILL DATE. THANKS, YOURS FAITHFULLY, FOR P.K. CHLOROCHEM P.LTD. SD/- DIRECTOR ITA NO.2768/AHD/2016 - 3 - 5. ON THE STRENGTH OF THIS CERTIFICATE, THE ASSESSE E CONTENDED THAT HE HAS NEVER RECEIVED A SUM OF RS.5.00 LAKHS, AND THER EFORE IT COULD NOT BE INCLUDED IN THE TOTAL TAXABLE INCOME OF THE ASSESSE E. ON THE OTHER HAND, THE LD.DR SUBMITTED THAT ONCE THE ASSESSEE HAS CLAI MED CREDIT OF ALLEGED TDS DEDUCTED BY THE PAYER, THEN CORRESPONDING RECEI PT OUGHT TO BE ACCOUNTED FOR. THE LD.COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, SUBMITTED THAT LET TDS CREDIT BE WITHDRAWN FROM THE ASSESSEE, BUT HOW THE GROSS RECEIPT COULD BE ADDED. 6. ON DUE CONSIDERATION OF THE ABOVE FACTS, I AM OF THE OPINION THAT MERELY ON THE BASIS OF A TDS CERTIFICATE IT CANNOT BE ASSUMED THAT A RIGHT TO RECEIVE PAYMENT WAS ACCRUED TO THE ASSESSEE IN M ERCANTILE SYSTEM OF ACCOUNTANCY OR SUCH PAYMENTS WERE ACTUALLY BE RECEI VED WHEN THE PAYER DEPOSING THAT NO SUCH PAYMENT WAS EVER CREDIT ED TO THE ACCOUNTS OF THE ASSESSEE, NOR IT WAS PAID. THUS, ON THE BAS IS OF TDS CERTIFICATE, WHICH IN REALITY NOT MATERIALIZED, THE GROSS RECEIP TS CANNOT BE ADDED. I ALLOW APPEAL OF THE ASSESSEE AND DELETE ADDITION OF RS.5.00 LAKHS. CONSEQUENTLY, CREDIT OF RS.50,000/- GIVEN TO THE AS SESSEE BE WITHDRAWN. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. PRONOUNCED IN THE OPEN COURT ON 16 TH FEB., 2018. SD/- (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED, 16/02/2018