Shri Neeraj Kumar, Muzaffarnagar V. ITO, Muzaffarnagar

ITA 3552/DEL/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 3965 (ITAT-DELHI)
• Duration Of Justice: 7 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 05-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHIMA NEB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI SMC BENCH, NEW DELHI BEFORE SHRI B.P. JAIN, ACCOUNTANT MEMBER ITA NO. 3552 /DEL/201 7 [A.Y. 20 13 - 14 ] SHRI NEERAJ KUMAR VS. THE I.T.O PROP. M/S AGGARWAL SUGAR & CHEMICALS WARD 2(1) 34/5, SOUTH CIVIL LINES MUZAFFARNAGAR MUZAFFARNAGAR PAN : ABCPK 1122 A [ ASSESSEE ] [RESPONDENT] DATE OF HEARING : 2 8 . 1 2 .2017 DATE OF PRONOUNCEMENT : 11 .01 .201 8 ASSESSEE BY : SHRI ANKIT GUPTA , ADV. REVENUE BY : MS. ASHIMA NEB, SR. DR ORDER THIS APPEAL OF THE ASSESSEE ARISES FROM THE ORDER OF THE LD. CIT(A) , MUZAFFARN AGAR VIDE ORDER DATED 31 . 03 .201 7 FOR A.Y. 20 13 - 14 . 2 . THE ASSESSEE HAS RAISED AS MANY AS 15 GROUND S OF APPEAL . GROUND NO. 1 IS GENERAL IN NATURE AND REQUIRES NO ADJUDICATION. 3. GROUND NOS 2 TO 6 RELATE TO THE ADDITION OF RS. 36 LAKHS ON ACCOU NT OF RETENTION CHARGES MADE BY THE ASSESSING OFFICER WHICH WAS CONFIRMED BY THE LD. CIT(A). 2 ITA NO. 3552 /DEL/201 7 4. I HAVE HEARD THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES, PERUSED THE ORDERS OF THE A.O AND THE LD. CIT(A) AND THE PB FILED ON BEHALF OF THE ASSESSEE. THE UN DISPUTED FACTS OF THE PRESENT CASE ARE THAT THE ASSESSEE IS A COMMISSION AGENT OF M/S KESAR ENTERPRISES LTD [KEL] ON SALE AND PURCHASE OF SUGAR OF DIFFERENT SUGAR MILLS IN THE YEAR UNDER CONSIDERATION . KEL WRONGLY ISSUED DEBIT NOTE FOR RS. 3 6 LAKHS ON 19.1 .2013 BY DEBIT TO SUNDRY DEBTORS AND CREDITING OF RETENTION CHARGES FOR THE SAID AMOUNT. THE CORRESPONDING ENTRY ON THE SAME DATE WAS PASSED BY THE ASSESSEE BY DEBITING TO RETENTION CHARGES AND CREDITING TO S UNDRY DEBT ORS CONTROL ACCOUNT I.E. M/S KEL AMOU NTING TO RS. 36 LAKHS. IN FACT, THE ASSESSEES CASE IS THAT KEL, AS A MATTER OF FACT, HAS SENT A SUNDRY CREDITOR CONTROL ACCOUNT WHERE THERE IS NO ENTRY OF RS. 36 LAKHS. IN FACT, THE AO AS WELL AS THE LD. CIT(A) HAVE MISUNDERSTOOD THE FACTS ON RECORD THA T KEL IS MAINTAINING TWO ACCOUNTS I.E. AS SUNDRY DEBTOR CONTROL ACCOUNT AND THE OTHER AS SUNDRY CREDITOR CONTROL ACCOUNT. THE SUNDRY DEBT OR CONTROL ACCOUNTS IS WITH RESPECT TO RETENTION CHARGES AND THE SUNDRY CREDITOR CONTROL ACCOUNT IS IN FACT IS FOR THE MAIN BUSINESS OF THE ASSESSEE FOR EARNING COMMISSION BY THE ASSESSEE FROM KEL FOR SELLING SUGAR. KEL ACTUALLY SENT THE SUNDRY CREDITOR CONTROL ACCOUNT TO THE A O WIT H A VIEW TO GET THE COMMISSION EARNED BY THE ASSESSEE VERIFIED AND THERE IS NO DISPUTE WITH REGARD TO 3 ITA NO. 3552 /DEL/201 7 THE RETENTION CHARGES AND IT IS JUST A CONTRA ENTRY AND THE INCOME HAS BEEN OFFERED IN THE F.Y. 2013 - 14 IS A MATTER OF RECORD AND THERE IS NO LOSS TO THE REVENUE IN THIS RESPECT. ACCORDINGLY, THE ASSESSING OFFICER WAS NOT JUSTIFIED IN MAKING TH E ADDITION. THE ORDER OF THE LD. CIT(A) IS REVERSED AND THE ASSESSING OFFICER IS DIRECTED TO DELETE THE ADDITION SO MADE BY HIM. THUS, GROUND NOS. 2 TO 6 ARE ALLOWED. 5. AS REGARDS GROUND NOS. 7 AND 8, THE ASSESSING OFFICER MADE AN ADDITION OF RS. 6 0,000/ - AND RS. 1 LAKH TO THE INCOME OF ASSESSEE ON ACCOUNT OF UNSECURED LOANS SINCE THE PARTY GIVING LOAN HAD DEPOSITED CASH IN THE S.B. ACCOUNT OF THE DEPOSITOR. 6. I HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES, PERUSED THE ORDERS OF THE A.O AND THE LD. CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. THERE IS NO DISPUTE TO THE FACT THAT THE CASH HAD BEEN DEPOSITED IN THE SB ACCOUNT OF THE DEPOSITOR BUT AT THE SAME TIME, BOTH DEPOSITORS ARE ASSESSED TO TAX WHO HAVE PLACED ON R ECORD COPY OF BANK ACCOUNT, CONFIRMATION PARTICULARS IN WHICH NO DEFECT HAS BEEN POINTED OUT. MOREOVER, CASH HAS NOT BEEN DEPOSITED IMMEDIATELY PRIOR TO THE ISSUANCE OF CHEQUES BY THE DEPOSITOR IS A MATTER OF RECORD. ACCORDINGLY, NO ADDITION IS CALLED FO R SINCE THE 4 ITA NO. 3552 /DEL/201 7 IDENTITY, CREDIT WORTHINESS AND GENUINENESS OF THE TRANSACTION IS NOT IN DISPUTE. ACCORDINGLY, ADDITION SO MADE IS DIRECTED TO BE DELETED. ORDER OF THE LD. CIT(A) IS REVERSED. 7. AS REGARDS GROUND NO. 9 IS CONCERNED, AN ADHOC DISALLOWANC E OF RS. 10,192/ - WAS MADE BY THE ASSESSING OFFICER ON ACCOUNT OF PERSONAL USE OF CAR WHICH WAS CONFIRMED BY THE LD. CIT(A). 8. AFTER HEARING BOTH THE SIDES, I FIND THAT THE DISALLOWANCE HAS BEEN MADE PURELY ON ADHOC AND ESTIMATE BASIS WITHOUT BRIN G IN G ON RECORD ANY SPECIFIC DEFECT ON ANY EXPENSE OF PERSONAL NATURE AND THEREFORE, NO ADDITION ON THIS COUNT IS CALLED FOR. THE ADDITION SO MADE IS DIRECTED TO BE DELETED. GROUND NO. 9 IS ALLOWED. 9. GROUND NOS. 10 TO 13 ARE GENERAL IN NATURE AND NEED N O ADJUDICATION. 10. GROUND NO. 14 IS CONSEQUENTIAL. 5 ITA NO. 3552 /DEL/201 7 1 1 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. THE ORDER IS PRO NOUNCED IN THE OPEN COURT ON 11 . 0 1 .201 8 . SD/ - [B.P. JAIN] ACCOUNTANT MEMBER DATED: 11 TH JANUARY, 2018 VL/ COPY FORWARDED TO: 1 . ASSESSEE 2 . RESPONDENT 3 . CIT 4 . CIT(A) 5 . DR ASST. REGISTRAR, ITAT, NEW DELHI