R.N TRAVELS P. LTD, MUMBAI V. ITO 8(1)(1), MUMBAI

ITA 3082/MUM/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 0941 (ITAT-MUMBAI)
• Duration Of Justice: 8 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 28-04-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N HEMALATHA
• Assessee Lawyers: KETAN K VED
• Section: 148; 11

Judgement Text

- IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI , BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER ./ I.T.A. NO S . 3082 & 3083/MUM/2017 ( / ASSESSMENT YEAR S : 2010 - 11 & 2011 - 12 ) M/S. R. N. TRAVELS PVT. LTD. 29/2, BABU GENU NAGAR, GHODAPDEO ROAD, NEAR RETIWALA INDUSTRIES, COTTON GREEN, MUMBAI - 400 033 / VS. ITO - 8(1)(1), MUMBAI ./ ./ PAN/GIR NO. AADCR 6006 M ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI KETAN K. VED / RESPONDENT BY : MS. N. HEMALATHA / DATE OF HEARING : 09.10.2017 / DATE OF PRONOUNCEMEN T : 01.01.2018 / O R D E R PER SHAMIM YAHYA , A. M.: THESE ARE APPEAL S BY THE ASSESSEE AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS) PERTAIN ING TO THE ASSESSMENT YEAR S 2010 - 11 AND 2011 - 12 RESPECTIVELY. 2. SINCE THE ISSUE S ARE C OMMON AND THE APPEALS WERE HEARD TOGETHER, THESE ARE BEING DISPOSED OF BY THIS COMMON ORDER. 2 ITA NO. 3082 & 3083/MUM/2017 M/S. R. N. TRAVELS PVT. LTD. VS. ITO 3. THE COMMON GROUNDS OF APPEAL READ AS UNDER: 1. THE LEARNED CIT(A) ERRED IN FACTS IN CONFIRMING THE ADDITION OF RS. 17,14,960/ - MADE BY THE LEARNED ASSESSING O FFICER IN RESPECT OF PAYMENTS MADE TO THE CREDIT CARD COMPANY TOWARDS USE OF CORPORATE PETRO CARD. 2. THE LEARNED CIT(A) FAILED TO APPRECIATE THE FACT THAT THE BUSINESS OPERATIONS OF THE APPELLANT COMPANY WERE CLOSED ON 31.03.2009 AND THE SAID PETRO CARD HAD BEEN USED DURING THE YEAR UNDER CONSIDERATION BY THE SISTER CONCERN OF THE APPELLANT AND PAYMENTS TO THE CREDIT CARD COMPANY WERE MADE DIRECTLY BY THE SISTER CONCERN. 3. THE LEARNED CIT(A) ERRED IN FACTS IN CONFIRMING THE ADDITION MADE BY THE LEARNE D ASSESSING OFFICER ONLY ON THE BASIS OF A TRANSACTION REPORTED IN INDIVIDUAL TRANSACTION STATEMENT WITHOUT APPRECIATING THE FACT THAT THE APPELLANT HAD NEITHER MADE ANY PAYMENT NOR CLAIMED ANY EXPENDITURE IN RESPECT OF CREDIT CARD EXPENSES AND HENCE THERE IS NO QUESTION OF SUBSTANTIATING THE SOURCE OF THE IMPUGNED EXPENDITURE. 4. THE LEARNED CIT(A) ERRED IN CONFIRMING THE ADDITION MADE BY THE LEARNED ASSESSING OFFICER WITHOUT GIVING DUE WEIGHTAGE TO THE FACT THAT THE PAYMENTS MADE BY THE SISTER CONCERN O F THE APPELLANT WERE DULY REFLECTED IN THE BANK STATEMENTS AS WELL AS IN BOOKS OF ACCOUNTS OF THE SISTER CONCERN WHICH WERE FURNISHED TO THE LEARNED ASSESSING OFFICER. FOR ASSESSMENT YEAR 2010 - 11 RS. 17,14,960/ - FOR ASSESSMENT YEAR 2011 - 12 RS.8,21,160 / - 4. FOR ASSESSMENT YEAR 2010 - 11, THERE IS ONE MORE GROUND WHICH READ AS UNDER: ADDITION ON THE BASIS OF FORM 26AS: 5. THE LEARNED CIT(A) ERRED IN CONFIRMING THE ADDITION MADE BY THE LEARNED ASSESSING OFFICER IN RESPECT OF AMOUNT OF RS. 12,372/ - RECEI VED BY THE APPELLANT DURING THE YEAR UNDER CONSIDERATION AND REFLECTED IN FORM 26AS WITHOUT APPRECIATING THE FACT THAT THE SAID AMOUNT IS RECEIVED IN RESPECT OF DEBT WHICH WAS DULY REFLECTED IN THE BOOKS OF THE APPELLANT AS INCOME IN EARLIER YEARS. 6. WI THOUT PREJUDICE TO WHAT IS STATED IN GROUND NO. 5 AND STRICTLY IN THE ALTERNATIVE, THE APPELLANT CLAIMS THAT THE LEARNED CIT(A) ERRED IN NOT ALLOWING CREDIT FOR TAX DEDUCTED AT SOURCE RS. 135/ - ON RECOVERY OF OLD DEBT WHICH WAS ALSO REFLECTED IN FORM 26AS. 3 ITA NO. 3082 & 3083/MUM/2017 M/S. R. N. TRAVELS PVT. LTD. VS. ITO 5. SINCE, FACTS ARE IDENTICAL , THE FACTS AND FIGURES FROM ASSESSMENT YEAR 2010 - 11 ARE BEING REFERRED AND CONSIDERED HEREUNDER: BRIEF FACTS OF THE CASE IS THAT NOTICE U/S 148 WAS ISSUED AS THE INCOME TO THE EXTENT OF RS . 17,14,964/ - HAS ESCAPED ASSESSMENT. THE ASSESSING OFFICER WRITES THAT NO INCOME TAX RETURN HAS BEEN FILED BY THE ASSESSEE ON THE PREMISE THAT IT HAS SHUT DOWN ITS BUSINESS OPERATIONS AND THE BANK STATEMENT COULD NOT BE OBTAINED AS BANKS WERE CHARGING HEAVY OPERATING ACCOUNT CHARGES WHICH TH E ASSESSEE COULD NOT BEAR. THE ASSESSEE DID NOT FILE RETURN IN COMPLIANCE OF NOTICE U/S 148 ALSO. IT WAS NOTED THAT THE ASSESSEE HAS SPENT RS . 17,02,592/ - ON CREDIT CARD BILLS OF AMERICAN EXPRESS BANKING CORPORA TION AND HAS ALSO RECEIPT OF RS. 12 , 372/ - AS PE R ITS/26AS STATEMENT. THE ASSESSEE WAS GIVEN COPY OF THESE STATEMENTS. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSEE SUBMITTED THAT RS . 12,372/ - ACTUALLY PERTAINS TO INCOME OF EARLIER YEAR THOUGH REPORTED IN FORM N. 26AS OF THE CURRENT YEAR AS THE SAME WA S RECEIVED IN THIS YEAR. AS REGARDS CREDIT CARD PAYMENTS, IT WAS SUBMITTED THAT ITS PETRO CARD WAS USED BY R.N LOGISTICS PVT. LTD AND ALL THESE PAYMENTS WERE MADE BY M/S R.N. LOGISTICS PVT. LTD AND NOT BY THE ASSESSEE. IT WAS SUBMITTED THAT FOR THE PURPOSE OF CONVENIENCE, THE PETRO CARD WAS USED BY OTHER COMPANY . SINCE NO EXPLANATION WAS GIVEN IN THIS ASPECT, THE ASSESSING OFFICER ADDED THE AMOUNT. 6. UPON THE ASSESSEES APPEAL, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) CONFIRMED THE ACTION OF THE ASSE SSING OFFICER. HE HELD AS UNDER: 4 ITA NO. 3082 & 3083/MUM/2017 M/S. R. N. TRAVELS PVT. LTD. VS. ITO F ROM THE FACTS OF THE CASE IT IS CLEAR THAT THE CREDIT CARD BELONGS TO TH E ASSESSEE AND THE EXPENSES WERE PAID THROUGH THIS CARD. THE ASSESSEE HAS SIMPLY SUBMITTED THAT THE PAYMENTS ARE MADE BY M/S R N LOGISTICS P VT . LTD FO R THE SAKE OF CONVENIENCE. IT IS NOT UNDERSTOOD AS TO HOW THE CARD CAN BE HANDED OVER TO SOME OTHER COMPANY FOR ITS USE. THERE ALSO DOES NOT APPEAR TO BE ANY SUCH WRITTEN ARRANGEMENT B ETWEEN THE TWO COMPANIES. THE ASSESSING OFFICER HAS NOTED IN THE ASSESSM ENT ORDER THAT THE APPELLANT WAS GIVEN SUFFICIENT OPPORTUNITY TO FURNISH DETAILS OF THE EXPENSES WHICH WERE NOT FILED. IT APPEARS THAT NO EVIDENCE IN SUPPORT OF THE CLAIM IS FURNISHED BEFORE ASSESSING OFFICER DESPITE VARIOUS OPPORTUNITIES. NO SUCH EVIDENCE IS FILED EVEN DURING APPELLATE PROCEEDING. IN ABSENCE OF REQUISITE DETAILS, RETURN OF INCOME ETC, IT IS TO BE ASSUMED UNDER THE FACTS OF THE CASE THAT THE EXPENSES ACTUALLY PERTAIN TO THE ASSESSEE COMPANY AS IT IS THROUGH ITS CARD THAT THE PAYMENTS ARE MA DE. SINCE THE SOURCE OF SUCH PAYMENTS ARE NOT CLEARLY ESTABLISHED THEREFORE, THE ADDITION MADE BY THE ASSESSING OFFICER IS SUSTAINED. 7. AGAINST THE ABOVE ORDER, THE ASSESSEE IS IN APPEAL BEFORE ITAT. 8. I HAVE HEARD BOTH THE COUNSELS AND PERUSED THE RE CORDS. THE LD. COUNSEL OF THE ASSESSEE PLEADED THAT THE ASSESSEES PETROL CARD WAS USED BY SISTER CONCERN. HE PLEADED THAT DUE TO UNAVOIDABLE CIRCUMSTANCES, THE ASSESSEE WAS NOT IN A POSITION TO SUBMIT ALL THE NECESSARY FACTS AND DOCUMENTS BEFORE THE AUTHO RITIES BELOW. HE PLEADED THAT AN OPPORTUNITY MAY BE GIVEN TO THE ASSESSEE SO THAT HE CAN PRODUCE THE BOOKS OF ACCOUNTS OF THE SISTER CONCERN ALSO TO OXYGENATE ITS CLAIM. 9. UPON CAREFUL CONSIDERATION, IN THE INTEREST OF JUSTICE, I REMIT THE ISSUE RAISED IN THESE APPEALS TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSING OFFICER IS DIRECTED TO CONSIDER THE ISSUE AFRESH IN LIGHT OF THE SUBMISSIONS BEING MADE BY THE ASSESSEES COUNSEL. THE ASSESSEE IS ALSO DIRECTED TO CO - OPERATE AND FURNISH THE SISTER CONCE RNS BOOKS AND DOCUMENT IN SUPPORT OF ITS CLAIM. AS REGARDS, THE OTHER ISSUE RAISED FOR 5 ITA NO. 3082 & 3083/MUM/2017 M/S. R. N. TRAVELS PVT. LTD. VS. ITO ASSESSMENT YEAR 2010 - 11, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFIRMING THE ADDITION MADE BY THE ASSESSING OFFICER IN RESPECT OF AVERMENT OF RS.12,372 / - REFERRED IN GROUND NOS. 5 AND 6 ABOVE, THE SAME IS ALSO REMITTED TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSEE SHALL PRODUCE THE NECESSARY EVIDENCE TO SUBSTANTIATE THE CLAIM MADE UNDER THIS GROUND BEFORE THE ASSESSING OFFICER. 10. IN THE RESULT, THE SE APPEALS BY THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 01.01.2018 SD/ - (S HAMIM YAHYA ) / A CCOUNTANT MEMBER MUMBAI ; DATED : 01.01.2018 . . ./ ROSHANI , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT - CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD F ILE / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI