ITO, Hisar V. M/s. Truck Operator Association, Hansi

ITA 2974/DEL/2012

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 4632 (ITAT-DELHI)
• Duration Of Justice: 6 year(s) 1 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-08-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 09-05-2017
• Assessment Year: 2002-2003
• Appeal Filed On: 14-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Charitable institution
• Section: 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D NEW DELHI BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER & SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER I.T.A. NO.2974/DEL/2012 ASSESSMENT YEAR: 2002-03 ITO, WARD-4, HISAR. VS. M/S. TRUCK OPERATOR ASSOCIATION, TOSHAM ROAD, HANSI TAN/PAN: AAAAT 5752B (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI AMIT JAIN, SR.D.R. RESPONDENT BY: NONE DATE OF HEARING: 26 07 2018 DATE OF PRONOUNCEMENT: 07 08 2018 O R D E R PER AMIT SHUKLA, J.M.: THE AFORESAID APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE IMPUGNED ORDER DATED 22.03.2012, PASSED BY THE CIT(APPEALS), ROHTAK FOR THE QUANTUM OF ASSESSMENT PASSED U/S.143(3) FOR THE ASSESSMENT YEAR 2002-03. IN THE GROUNDS OF APPEAL, THE REVENUE HAS RAISED THE FOLLOWING GRO UNDS:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LD. CIT(A) HAS ERRED IN HOLDING THAT THE AMOUNT OF RS.85,64,76 2/- IS NEITHER GROSS RECEIPT NOR INCOME OF THE ASSESSEE WITHOUT AP PRECIATING THE FACT THAT THESE PAYMENTS WERE RECEIVED BY THE ASSES SEE AS FREIGHT AS TRADE RECEIPTS AS RESULT A OF (ORAL/WRITTEN) CONTRA CT WITH CERTAIN PARTIES. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) HAS ERRED IN NOT APPRECIATING THE FACT THAT THE FRE IGHT OF I.T.A. NO.2974/DEL/2012 2 RS.85,64,762/- WERE THE RECEIPT OF THE ASSESSEE AS THE ASSESSEE HAS RECEIVED THEM DURING NORMAL COURSE OF BUSINESS AND IT HAS CLAIMED CREDIT/REFUND OF TDS OF RS. 183345/- DEDUCTED OUT O F THE SAID RECEIPT. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) HAS ERRED IN NOT APPRECIATING THE FACTS THAT THE AMOUNT OF RS.85,64,762/- RECEIVED AS FREIGHT SHOULD HAVE BEEN ACCOUNTED FOR IN THE BOOKS OF THE ASSESSEE AS RECEIPT/REVENUE AND THE ASSESSEE SHOULD HAVE CLAIMED THE EXPENSES MADE BY IT AGAINST THESE RECEIPTS INCLUDING PAYMENTS MADE TO TRUCK OWNERS WHO PHYSICA LLY TRANSPORT THE GOODS. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT (A) HAS ERRED IN HOLDING THAT THE AO HAS NOT GIVEN ANY ADVERSE FINDINGS REGARDING THE CLAIM OF EXPENDITURE BY THE ASSESSEE. (I) THE CIT (A) HAS FAILED TO APPRECIATE THAT THE A SSESSEE HAS NOT TAKEN ENTIRE RECEIPT AND EXPENDITURE THROUGH PROFIT & LOSS ACCOUNT. (II) THE CIT (A) HAS ALSO FAILED TO APPRECIATE THAT FINDINGS ABOUT EXPENDITURE WOULD BE MADE BY THE AO ONLY AFTER SUCH CLAIMS ARE MADE BY THE ASSESSEE. 2. THE FACTS IN BRIEF ARE THAT THE ASSESSEE WAS REG ISTERED AS A SOCIETY FOR WHICH IT HAS APPLIED FOR REGISTRATION U/S. 12AA, HOWEVER AS NOTED BY THE ASSESSING OFFICER THE REGIS TRATION U/S.12AA WHICH WAS REJECTED BY THE LD. CIT, WAS GRA NTED BY THE TRIBUNAL. HOWEVER, POST PASSING OF ASSESSMENT O RDER, HON'BLE PUNJAB & HARYANA HIGH COURT HAD SET ASIDE TH E ORDER OF THE TRIBUNAL GRANTING REGISTRATION AND HELD THAT ASSESSEES ACTIVITIES ARE NOT COVERED U/S. 2(15), HENCE IT WAS NOT A CHARITABLE INSTITUTION. LEARNED ASSESSING OFFICER F OR DIFFERENT REASONS DENIED BENEFIT OF SECTION 11 AND HAS TREATE D THE ENTIRE RECEIPTS OF RS.85,64,762/- AS INCOME AND TAX ED THE I.T.A. NO.2974/DEL/2012 3 ASSESSEE IN THE STATUS OF AOP. 3. LD. CIT(A) HELD THAT THE LEARNED ASSESSING OFFIC ER HAS COMPLETELY FAILED TO APPRECIATE THE FACT THAT THE I NCOME OF THE ASSESSEE WAS ONLY BY WAY OF COMMISSION OF RS.7,80,8 24/- ON THE FREIGHT RECEIPTS OF RS.85,64,762/- AND THE EXCE SS OF EXPENDITURE OVER INCOME WAS ONLY RS.81,024/- AND EV EN IF THE REGISTRATION U/S.12AA HAS BEEN CANCELLED THEN ALSO THE AMOUNT OF RS.85,64,762/- CANNOT BE TAXED IN THE HAN DS OF THE ASSESSEE, BECAUSE IT IS NEITHER THE GROSS RECEI PTS NOR INCOME OF THE ASSESSEE. 4. NONE APPEARED ON BEHALF OF THE ASSESSEE DESPITE SERVICE OF NOTICE; THEREFORE, WE ARE PROCEEDING TO DECIDE T HE APPEAL ON MERITS BASED ON MATERIAL AVAILABLE ON RECORD. 5. AFTER HEARING THE LEARNED DEPARTMENT REPRESENTAT IVE AND ON PERUSAL OF THE RELEVANT FINDINGS, WE FIND TH AT THE ASSESSEE DOES NEITHER OWN ANY TRUCK NOR ANY RECEIPT S FROM FREIGHT BELONG TO THE ASSESSEE. IT IS ASSOCIATION O F TRUCK OPERATORS. THE GOODS OF VARIOUS PARTIES ARE BOOKED FOR CARRIAGE AND GOODS ARE TRANSPORTED IN TRUCKS OWNED BY THE MEMBERS (TRUCK OWNERS) OF THE ASSESSEES SOCIETY. T HE FREIGHT IS CHARGED FROM THE CONCERN PARTIES FOR PROVIDING T HE TRANSPORTATION SERVICES. THE ASSESSEE ONLY GETS COM MISSION WHICH IS VOLUNTARILY CONTRIBUTED BY THE MEMBERS TO THE ASSESSEE SOCIETY WHICH IS FIXED ON THE BASIS OF DIS TANCE FOR WHICH GOODS ARE CARRIED. THE GROSS FREIGHT RECEIVED BY THE ASSESSEE FROM VARIOUS PARTIES BY CHEQUE IS PAID TO THE I.T.A. NO.2974/DEL/2012 4 CONCERNED TRUCK OWNERS WHO ALL ARE THE MEMBERS OF A SSESSEE SOCIETY AND ASSESSEE MAINTAINS THE COLLECTION AND D ISTRIBUTION OF FREIGHT RECEIPTS AND THE ENTIRE AMOUNT IS GIVEN BACK TO THE OWNERS. UNDER THESE FACTS, THE GROSS FREIGHT OF RS. 85,64,762/- CANNOT BE HELD TO BE GROSS RECEIPT OR INCOME OF THE ASSESSEE. THE ASSESSEE HAS ALREADY SHOWN COMMISSION OF RS.7,8 0,824/- AND AFTER CLAIMING THE EXPENDITURE, EXCESS OVER EXP ENDITURE OF RS.81,024/- IS THE INCOME. THUS, THE FINDING OF THE LD. CIT(A) IN DELETING THE SAID ADDITION ON THE GROUND THAT IT IS NEITHER GROSS RECEIPT NOR INCOME OF THE ASSESSEE IS CORRECT ON FACTS, AND THEREFORE, SAME IS UPHELD. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 7 TH AUGUST, 2018. SD/- SD/- [PRASHANT MAHARISHI] [AMIT SHUKLA] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 7 TH AUGUST, 2018 PKK: