ITO, New Delhi V. M/s. Jyoti Metal and Allied Industries Pvt. Ltd., New Delhi

ITA 3383/DEL/2010

• Counselvise Citation: 338320114 RSA 2010
• Duration Of Justice: 4 year(s) 8 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-03-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 05-01-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 09-07-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Business income; Tax effect
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: D NEW DELHI BEFORE SHRI I. C. SUDHIR, JUDICIAL MEMBER AND SHRI J. S. REDDY, ACCOUNTANT MEMBER I.T.A .NO. - 3383 /DEL/201 0 (ASSESSMENT YEAR - 2006 - 0 7 ) ITO VS. M/S JYOTI METAL AND ALLIED WARD - 4 ( 2 ), INDUSTRIES PVT. LTD., NEW DELHI. NEW DELHI . PAN: AA B C J3790 (APPELLANT) (RESPONDENT) I.T.A .NO. - 3 260 /DEL/2010 (ASSESSMENT YEAR - 2006 - 07) M/S JYOTI METAL AND ALLIED VS. ITO INDUSTRIES PVT. LTD., WARD - 4(2), NEW DELHI. NEW DELHI. PAN: AA B C J3790 (APPELLANT) (RESPONDENT) REVENUE BY: - SH. VIVEK KUMAR, SR.DR. ASSESSEE BY: - SH. GAUTAM JAIN, CA. DATE OF HEARING: 05.0 1.201 5 ORDER PRONOUNCED ON: 23 . 03 .201 5 ORDER PER I. C. SUDHIR , J M ITA NO. 3 383 /DEL/2010 2. T HE REVENUE HAS QUESTIONED THE FIRST APPELLATE ORDER ON THE FOLLOWING GROUNDS: 1. THE ORDER OF THE LEARNED CIT(APPEALS) IS ERRONEOUS & CONTRARY TO FACTS & LAW. ITA NO. 3383 & 3260/DEL/2010 2 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED CIT(APPEALS) HAS ERRED IN DELETING THE ADDITION OF RS.5,18,470/ - MADE BY THE AO U/S 68 OF THE I.T. ACT BEING THE UNEXPLAINED UNVERIFIED PURCHASE. 2.1 THE LD. CIT(A) IGNORED THE FACT THAT THE ASSESSEE DID NOT DISCHARGE THE ONUS OF PROVING THE EXISTENCE OF THE SUPPLIER AND GENUINENESS OF THE PURCHASE. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED CIT(APPEALS) HAS ERRED IN DELETING THE ADDITION OF RS. 2,40, 000/ - MADE BY THE AO BY DISALLOWING THE CONSU LTATION FEES CLAIMED AGAINST THE INCOME FROM HOUSE PROPERTY. 3.1 THE LD. CIT(A) IGNORED THE FACT THAT NO SUCH EXPENSES ALLOWED TO BE ADJUSTED AGAINST THE INCOME FROM HOUSE PROPERTY AS PER THE PROVISIONS OF SECTION 24 OF THE I.T.ACT. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED CIT(APPEALS) HAS ERRED IN RESTRICTING THE ADDITION OF RS.2,28,000/ - TO RS.39,200/ - MADE BY THE AO BY DISALLOWING THE SALARY. 4.1 THE LD. CIT(A) IGNORED THE FACT THAT THE ASSESSEE HAD SHOWN EXPENSES TO THE TUNE OF RS.10,00,000/ - INCLUDING SALARY OF RS.3,32,000/ - AGAINST BUSINESS RECEIPTS OF RS.5,18,470/ - . 5. THE APPELLANT CRAVES TO LEAVE TO ADD, TO ALTER, OR AMEND ANY GROUNDS OF THE APPEAL RAISED ABOVE AT THE TIME OF THE HEARING. 2. AT THE OUTSET OF HEA RING THE LD. AR WITH THE ASSISTANCE OF THE COMPUTATION FILED , SUBMITTED THAT THE TOTAL TAX EFFECT OF THE APPEAL IS ONLY RS.3,18,282/ - , HENCE HAVING TAX EFFECT BELOW RS.4,00,000/ - THE APPEAL IS NOT MAINTAINABLE AS PER THE CBDT INSTRUCTION NO. 5/2014 [F. NO. 279/MISC. 142/2007 ITJ (PT)] DATED 10.07.2014. A C OPY OF THE COMPUTATION OF THE TAX EFFECT OF TH E APPEAL HAS ALSO BEEN SUPPLIED TO THE PARTIES. THE LD. AR SUBMITTED FURTHER THAT THE ABOVE ITA NO. 3383 & 3260/DEL/2010 3 INSTRUCTION IS ALSO APPLICABLE IN THE PENDING APPEAL AND CITED DECISION OF THE DELHI BENCH OF THE TRIBUNAL IN THE CASE OF ITO VS. HAR BHAJAN SINGH KOHLI, ITA NO. 4343/DEL/2011 (A.Y. 2007 - 08) ORDER DATED 9.12.2012. 3. THE LD. SR. DR HOWEVER PLACED RELIANCE ON THE ASSESSMENT ORDER. 4. WE FIND FROM THE ABOVE CITED ORDER O F THE TRIBUNAL THAT THE HON BLE JURISDICTIONAL DELHI HIGH COURT IN THE CASE OF CIT VS. DELHI RACE CLUB LTD. IN ITA NO. 128/2008 ORDER DATED 03.03.2011 BY FOLLOWING ITS EARLIER ORDER DATED 02.08.2010 IN ITA NO. 179/1991 IN THE CASE OF CIT VS. M/S P.S. JAIN & CO. H AS HEL D THAT SUCH CBDT CIRCULAR WOULD ALSO BE APPLICABLE TO THE PENDING CASES. THERE IS ALSO NO DISPUTE THAT AS PER SECTION 268A OF THE IT ACT, 1961, SUCH INSTRUCTION OF THE CBDT HAS STATUTORY FORCE. WE THUS FIND THAT THE PRESENT APPEAL HAVING TAX EF FECT BELOW RS.4,00,000/ - HAS BEEN PRE FERRED BY THE REVENUE IN VIOLATION OF THE ABOVE INSTRUCTION OF THE CBDT HENCE IT IS NOT MAINTAINABLE. THE APPEAL IS ACCORDINGLY DISMISSED AS NOT MAINTAINABLE. ITA NO. 3260/DEL/2010 5. THE ASSESSEE HAS QUESTIONED DISALLOWANCES OF CERTAIN EXPENSES ON ACCOUNT OF SALARY, TRAVELLING, TELEPHONE, CONVEYANCE, PRINTING AND STATIONERY, STAFF WELFARE, REPAIR AND MAINTENANCE SUSTAINED BY THE LD. CIT(A). 6. AT THE TIME OF HEARING THE LD. AR FAIRLY SUBMITTED TH AT IDENTICAL ISSUES HAVE BEEN DECIDED BY THE TRIBUNAL AGAINST THE PRESENT ASSESSEE IN THE ITA NO. 3383 & 3260/DEL/2010 4 ASSESSMENT YEARS 2005 - 06 & 2007 - 08 VIDE ORDER DATED 31.10.2014 IN ITA NOS. 1824 & 3473/DEL/2010. 7. IN VIEW OF ABOVE DECISION, WE FIND THAT DURING THE YEAR UNDER CON SIDERATION AS WELL THE LD. CIT(A) HAS RESTRICTED THE DISALLOWANCES IN QUESTION MADE BY THE AO TO THE REASONABLE EXTENT, KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE CASE AND THAT THE ASSESSEE WAS NOT ABLE TO SUPPORT THE CLAIMED EXPENSES FULLY. WE THU S DO NOT FIND REASON TO INTERFERE WITH THE FINDING OF LD. CIT(A) IN THIS REGARD. THE SAME IS UPHELD. IN RESULT, GROUNDS INVOLVING THE ISSUES ARE REJECTED. 8. THE APPEAL IS ACCORDINGLY DISMISSED. 9. IN RESULT, BOTH THE APPEALS ARE DISMISSED. ORDER PRONOUN CED IN THE OPEN COURT ON 23 /03/2015. SD/ - SD/ - ( J. S. REDDY ) ( I. C. SUDHIR ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 23 /03/2015 *AK VERMA* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR