M/s B Banamber & Co, Cuttack V. ITO, Dhenkanal

ITA 312/CTK/2013

• Counselvise Citation: 31222114 RSA 2013
• Duration Of Justice: 1 year(s) 5 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-10-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 20-10-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 17-05-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S C MOHANTY
• Assessee Lawyers: S N SAHU

Judgement Text

I.T.A. NO. 312 / CTK ./20 1 3 ASSESSMENT YEAR: 20 0 9 - 20 1 0 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK BEFORE SHRI S .V. MEHROTRA (ACCOUNTANT MEMBER) , AND SHRI GEORGE MATHAN (JUDICIAL MEMBER) I.T.A. NO. 312 / CTK / 20 1 3 ASSESSMENT YEAR : 20 0 9 - 20 1 0 M/S. B. BANAMBER & CO.,........................ .. ............ .. .APP ELL ANT BHAIRABI SAHI, TALCHER - 759 107, ANGUL, ORISSA [PAN : AA DFB 2121 Q ] - VS. - INCOME TAX OFFICER , .............. ............................ RESPONDENT WARD - 2, DHENKANAL APPEARANCES BY: SHRI S.N. SAHU , A.R., FOR THE ASSE SSEE SHRI S.C. MOHANTY, D.R, FOR THE DEPARTMENT DATE OF CONCLUDING THE HEARING : OCTOBER 2 0 , 2 01 4 DATE OF PRONOUNCING THE ORDER : OCTOBER 22 , 201 4 O R D E R PER GEORGE MATHAN : TH IS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF LD. CO MMISSIONER OF INCOME TAX (APPEALS) - I , B HUBANESWAR IN I.T. APPEAL NO. 0482/11 - 12 DATED 12 . 0 4 .20 1 3 FOR THE ASSESSMENT YEAR 20 0 9 - 1 0 . 2 . SHRI S.N. SAHU , A.R., REPRESENTED ON BEHALF OF THE ASSESSEE AND SHRI S.C. MOHANTY , D.R, REPRESENTED ON BEHALF OF THE REVENU E . 3. AT THE TIME OF HEARING, IT WAS SUBMITTED BY THE LD. A.R. THAT THE RE ARE TWO ISSUES IN THE APPEAL FILED BY THE ASSESSEE. IT WAS THE SUBMISSION THAT THE FIRST ISSUE WAS AGAINST THE NON - GRANTING OF TDS CREDIT, AND THE SECOND WAS AGAINST THE ESTIMATED DISALLOWANCE OF THE EXPENSES. IT WAS THE SUBMISSION BY THE LD. A.R. THAT THE ASSESSEE IS A PARTNERSHIP I.T.A. NO. 312 / CTK ./20 1 3 ASSESSMENT YEAR: 20 0 9 - 20 1 0 PAGE 2 OF 3 FIRM. IT WAS THE SUBMISSION THAT AS PER THE DEED OF PARTNERSHIP SHRI BANAMBAR BHUTIA BEING THE PART OF THE FIRST PART IN THE PARTNERSHIP HAD BEEN AUTHORI ZED TO OBTAIN THE CONTRACT WORKS IN HIS OWN NAME AND THE BUSINESS WAS TO BE CONDUCTED BY THE ASSESSEES PARTNERSHIP FIRM. IT WAS THE SUBMISSION THAT CONSEQUENTLY CONTRACT BUSINESSES IN THE NATURE OF CIVIL CONTRACT WERE OBTAINED AND THE INCOME WAS OFFERED IN THE HANDS OF THE FIRM. IT WAS THE SUBMISSION THAT THE TDS ON THE CONTRACTS WERE DEDUCTED IN THE NAME OF SHRI BANAMBAR BHUTIA AND CONSEQUENTLY THOUGH THE INCOME WAS OFFERED IN THE HANDS OF THE ASSESSEE - FIRM, THE ASSESSING OFFICER HAD NOT GRANTED BENEFIT OF THE TDS WHICH HAD BEEN DEDUCTED ON THE CONTRACTS. IT WAS THE SUBMISSION THAT IN VIEW OF THE PROVISIONS OF SECTION 199 OF THE ACT AS INCOME HAS BEEN OFFERED IN THE HANDS OF THE FIRM, CREDIT OF THE TDS WAS ALSO LIABLE TO BE GRANTED IN THE HANDS OF THE FIR M. 4 . IN REPLY, LD. D.R. SUBMITTED THAT THE ASSESSEE HAD NOT FILED DECLARATION AS REQUIRED UNDER SECTION 37BA OF THE INCOME TAX RULES. IT WAS THE SUBMISSION IF THE NECESSARY DECLARATION WAS GIVEN, THE BENEFIT OF THE TDS COULD BE GRANTED TO THE ASSESSEE. 5 . WE HAVE HEARD THE RIVAL SUBMISSIONS. A PERUSAL OF THE RULE 37BA SHOWS THAT IF THE INCOME IS OFFERED IN THE HANDS OF A PERSON OTHER THAN THE PERSON IN WHOSE NAME THE TDS IS DEDUCTED, THEN THE BENEFIT OF TDS MUST BE GIVEN IN THE HANDS OF THE PERSON, WHO OF FERS THE INCOME SUBJECT TO THE CONDITION THAT THE INTIMATION IN RESPECT OF SUCH INCOME BEING OFFERED MUST BE GIVEN. IN THESE CIRCUMSTANCES, THE ASSESSING OFFICER IS DIRECTED TO GRANT THE ASSESSEE THE BENEFIT OF THE TDS IN RESPECT OF THE INCOME OFFERED IN T HE ASSESSEE - FIRM AFTER OBTAINING NECESSARY DECLARATION UNDER RULE 37BA. IN THE RESULT, THE SAID ISSUE IS ALLOWED FOR STATISTICAL PURPOSES. 6. IN RESPECT OF SECOND GROUND BEING AGAINST THE ACTION OF THE LD. CIT(APPEALS) IN RESTRICTING THE DISALLOWANCE OF TH E EXPENDITURE AT 5%, IT WAS THE SUBMISSION THAT ADMITTEDLY THE ASSESSEE COULD NOT PRODUCE THE BOOKS FOR VERIFICATION. IT WAS THE SUBMISSION THAT THE DISALLOWANCE AT 5% OF THE EXPENDITURE WAS EXCESSIVE AND THE SAME MAY BE REDUCED TO AN AD HOC FIGURE. 7. IN REPLY, LD. D.R. VEHEMENTLY SUPPORTED THE ORDER OF THE ASSESSING OFFICER. I.T.A. NO. 312 / CTK ./20 1 3 ASSESSMENT YEAR: 20 0 9 - 20 1 0 PAGE 3 OF 3 8. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. AS THE ASSESSEE HAS ADMITTEDLY NOT PRODUCED BOOKS OF ACCOUNT BEFORE THE ASSESSING OFFICER, THE DISALLOWANCE OUT OF THE EXPENDITURE IS CONF IRMED TO AN EXTENT OF RS.50,000/ - AS AGAINST THE 5% DISALLOWANCE DIRECTED BY THE LD. CIT(APPEALS). IN THE RESULT, THIS ISSUE IS PARTLY ALLOWED. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 22 ND OCTOBER , 2014. SD/ - SD/ - S .V. MEHROTRA GEORGE MATHAN ( ACCOUNTANT MEMBER) ( JUDICIAL MEMBER) KOLKATA, THE 22 ND D AY OF OCTO BER , 201 4 COPIES TO : (1) THE ASSESSEE (2) THE DE PARTMENT (3) COMMISSIONER OF INCOME - TAX (APPEALS) (4) COMMISSIONER OF INCOME TAX ( 5 ) THE DEPARTMENTAL REPRESENTATIVE ( 6 ) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL CUTTACK B ENCH, CUTTACK LAHA/SR. P.S.