Sachin Kumar Bhol, Nayagarh V. ITO, Khurda Ward, Khurda

ITA 368/CTK/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5083 (ITAT-CUTTACK)
• Duration Of Justice: 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 28-09-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P R MOHANTY
• Keywords: TDS; Set aside

Judgement Text

P A G E 1 | 6 IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK BEFORE SHRI CHANDRA MOHAN GARG , JUDICIAL MEMBER ITA NO. 368 /CTK/201 8 ASSESSMENT YEA R: 2011 - 12 SACHIN KUMAR BHOL, HARIPUR, GADADHAR PRASAD, ITAMATI, NAYAGARH VS. ITO, KHURDA WARD, KHURDA PAN/GIR NO. AHPPB 1796 A (APPELLANT ) .. ( RESPONDENT ) ASSESSEE BY : SHRI P.R.MOHANTY, AR REVENUE BY : SHRI SUBHENDU DUTTA, DR DATE OF HEARING : 0 2 / 0 5 / 201 9 DATE OF PRONOUNCEMENT : 13 / 0 5 / 201 9 O R D E R THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS) - 1, BHUBANESWAR DATED 19.4.2018 IN I.T.APPEAL NO.220/16 - 17 FOR THE ASSESSMENT YEAR 201 1 - 12. 2. THE SOLE GROUND/ ISSUE INVOLVED IN THIS APPEAL IS THAT THE C OMMISSIONER OF INCOME TAX(APPEALS) HAS ERRED IN CONFIRMING THE DISALLOWANCE OF RS.4,14,200/ - CLAIMED UNDER THE HEAD ITA NO.368/CTK/2018 ASSESSMENT YEAR: 2011 - 12 P A G E 2 | 6 TRANSPORTATION CHARGES WITHOUT CONSIDERING THE SUBMISSIONS OF THE ASSESSEE FROM ITS PROPER PROSPECTIVE. 3. I HAVE HEARD THE RIVAL SUBMISSIONS, INTER ALIA, IMPUGNED ASSESSMENT AND FIRST APPELLATE ORDER ALONGIWTH COPIES OF AUDIT REPORT AND TDS CERTIFICATE SUBMITTED BY THE ASSESSEE. LD A.R. SUBMITTED THAT THE ASSESSEE IS A RETAIL FOREIGN LIQUOR VENDOR. THE ASSES SEE PURCHASED GOODS FROM ORISSA STATE BEVERAGE CORPORATION LIMITED AT BHUBANESWAR AND TRANSPORTED THE SAME THROUGH TRANSPORTERS TO HIS SHOP SITUATED AT NAYAGARH, WHICH IS 90 KM AWA Y FROM BHUBANESWAR. LD A.R. FURTHER SUBMITTED THAT A QUALIFIED AUDITOR HAS CHECKED AND AUDITED THE BOOKS OF ACCOUNT OF THE ASSESSEE AND THERE IS NO DISCREPANCY OR ANY ADVERSE REMARK BY THE AUDITOR ON THE CLAIM OF THE ASSESSEE REGARDING TRANSPORTATION CHARGES. LD A.R. FURTHER SUBMITTED THAT FROM THE COPY OF TDS CERTIFICATE, IT I S APPARENT THAT THE ASSESSEE PURCHASED 461 CONSIGNMENTS FROM ORISSA STATE BEVERAGE CORPORATION LIMITED WHICH WERE TRANSPORTED TO NAYAGARH BY LOCAL TRANSPORTERS THROUGH 230 TRIPS AND THE ASSESSEE HAD PAID RS.1800/ - PER TRIP TO THE DRIVER/OWNER AGAINST TRANS PORTATION, WHICH IS NECESSARY FOR THE PURPOSE OF BUSINESS OF THE ASSESSEE. LD A.R. ALSO SUBMITTED THAT THE ALLEGATION OF THE ASSESSING OFFICER THAT THE PAYMENT HAS BEEN MADE TO FOUR PERSONS IS NOT REASONABLE AS THE TRANSPORTATION OF ITA NO.368/CTK/2018 ASSESSMENT YEAR: 2011 - 12 P A G E 3 | 6 FOREIGN LIQUOR IS VERY SENSITIVE ISSUE AND THE ASSESSEE CANNOT RELY ON THE NEW DRIVERS/PERSONS FOR EVERY CONSIGNMENT AND, THEREFORE, THE ASSESSEE PROCURED THE SERVICES OF LIMITED FOUR PERSONS FOR TRANSPORTATION TO ENSURE THE SINCERITY AND DEDICATION TOWARDS TRANSPORTATION WORK OF FOREIGN LIQUOR WITHOUT ANY HINDRANCE AND AS PER THE DIRECTION OF EXCISE DEPARTMENT, GOVERNMENT OF ODISHA. 4. LD A.R. SUBMITTED THAT NO DISCREPANCY OR DEFECT HAS BEEN POINTED OUT BY THE LOWER AUTHORITIES IN THE QUANTUM CLAIMED BY THE ASSESSEE AND THE CLAIM OF THE ASSESSEE HAS BEEN DISMISSED ONLY ON HYPER TECHNICAL GROUND THAT THE ASSESSEE HAS MENTIONED NAMES OF FOUR PERSONS (OWNERS) IN ALL THE VEHICLES USED FOR TRANSPORTATION AND THE ALLEGED OWNERS ARE DIFFERENT WITH THE SAME VEHICLE NUMBERS. LD A.R. VEHEMENTLY POINTED OUT THE ASSESSEE HAD MADE PAYMENTS TO THE OWNERS ONLY WHO GENERALLY WORKS LOCAL TRANSPORTATION., WHO MAY BE THE OWNER OF THE VEHICLE OR MAY NOT BE OWNER OF THE VEHICLE AND SOMETIMES THE OWNER OF THAT VEHICLE IS DIFFERENT FROM THE DRIVER. THEREFORE, THIS GROUND OF MATCHING THEORY OF THE AUTHORITIES BELOW IS NOT PRACTICALLY ACCEPTABLE. THEREFORE, THE CLAIM OF THE ASSESSEE REGARDING TRANSPORTATION CHARGES MAY KINDLY BE ALLOWED. ITA NO.368/CTK/2018 ASSESSMENT YEAR: 2011 - 12 P A G E 4 | 6 5. REPLY TO ABOVE, LD D.R. SUBMITTED THAT THE ASSESSEE HAS MADE PAYMENTS ONLY TO FOUR PERSONS AND THE ALLEGED OWNERS ARE DIFFERENT WITH THE SAME VEHICLE NUMBERS, THEREFORE, THE AO WAS RIGHT IN DISALLOWING THE TRANSPORTATION PAYMENTS AND THE CIT(A) WAS ALSO CORRECT IN CONFIRM THE ADDITION. LD D.R. ALSO DREW M Y ATTENTION TO PARAS AND 4 & 5 OF THE FIRST APPELLATE ORDER AND SUBMITTED THAT THE DISALLOWANCE MADE BY THE AO IS JUSTIFIED AS THE ASSESSEE HAS NOT BEEN ABLE TO PRODUCE BILLS AND VOUCHERS IN SUPPORT OF THE TRANSPORTATION PAID BY HIM. 6. ON CAREFUL CONSIDER ATION OF THE RIVAL SUBMISSIONS, FIRST OF ALL, I MAY POINT OUT THAT THE LD D.R. HAS NOT CONTROVERTED THE FACT THAT THE ASSESSEE CAN ONLY BUY FOREIGN LIQUOR FROM SPECIFIED VENDOR I.E. ORISSA STATE BEVERAGE CORPORATION LTD., SITUATED AT BHUBANESWAR AND HAS TO TRANSPORT THE GOODS FROM BHUBANESWAR TO THE STOCK POINT AT NAYAGARH, WHICH IS 90 KMS AWAY FROM BHUBANESWAR. FURTHER, FROM THE TDS CERTIFICATE SUBMITTED BY THE ASSESSEE, I ALSO OBSERVE THAT UNDISPUTEDLY, THE ASSESSEE PURCHASED 46 1 CONSIGNMENTS WHICH WERE TRANSPORTED TO NAYAGARH TO THE SHOP OF THE ASSESSEE BY USING LOCAL TRANSPORTATION VEHICLES. I AM IN AGREEMENT WITH THE CONTENTION OF LD A.R. THAT IT IS NOT COMPULSORY THAT THE DRIVER OF THE VEHICLE IS ALWAYS THE OWNER OF THE VEHICLE BUT HE MAY BE OWNER OF THE VEHICLE AND HE MAY NOT BE THE OWNER OF ITA NO.368/CTK/2018 ASSESSMENT YEAR: 2011 - 12 P A G E 5 | 6 THE VEHICLE . BUT IN BOTH THE SITUATION, THE ASSESSEE MAKES PAYMENT OF TRANSPORTATION CHARGES TO THE DRIVERS WHO ARE DRIVING THE VEHICLE AND SUCH KIND OF LOCATION TRANSPORTATION SERVICE PROVIDER DO NOT ISSUE ANY BILL TO THE SERVICE RECEIVER FOR PAYMENT OF RS.1800/ - PER TRIP. IN MY CONSIDERED OPINION, IT IS ALSO A CLEAR MAJOR CAUTION THAT THE TRANSPORTATION OF FOREIGN LIQUOR SHOULD BE DONE AS PER RULES AND PROCEDURE PROVIDED BY THE EXCISE DEPARTMENT OF GOVERNMENT OF ODISHA AND ALSO REQUIRES SPECIFIC GUIDANCE OF FOREIGN LIQUOR VENDOR. DURING TRANSPORTATION, SUCH REQUIRED CAUTION AND CARE HAS TO BE TAKEN BY THE TRANSPORTER, WHO IS TRANSPORTING THE VEHICLE FROM BHUBANESWAR TO NAYAGARH. THEREFORE, THE ASSESSEE IS COM PELLED TO TAKE SERVICE FROM THE LIMITED PERSONS WHO ARE WELL - KNOWN AND COMPETENT WITH THE LOCAL REQUIREMENTS FOR TRANSPORTATION OF FOREIGN LIQUOR. THEREFORE, THE SERVICE RENDERED BY THE LIMITED FOUR PERSONS CANNOT BE DOUBTED ONLY ON THE ALLEGATION OF DIFF ERENT VEHICLE NUMBERS. 7. IN VIEW OF FOREGOING DISCUSSION, I AM INCLINED TO HOLD THAT THE AO WAS NOT CORRECT IN MAKING DISALLOWANCE OF IMPUGNED TRANSPORTATION CHARGES AND THE CIT(A) WAS NOT JUSTIFIED IN UPHOLDING THE SAME. THEREFORE, I SET ASIDE THE ORD ER OF THE CIT(A) AND ALLOW THE SOLE GROUND OF THE ASSESSEE. ITA NO.368/CTK/2018 ASSESSMENT YEAR: 2011 - 12 P A G E 6 | 6 8 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON 13 / 0 5 /201 9 . S D/ - ( CHANDRA MOHAN GARG ) JUDICIALMEMBER CUTTACK; DATED 13 / 0 5 /20 9 B.K.PARIDA, SPS COPY OF THE ORDER FORWARDED TO : BY ORDER SR. PVT. SECRETARY, ITAT, CUTTACK 1. THE APPELLANT : SACHIN KUMAR BHOL, HARIPUR, GADADHAR PRASAD, ITAMATI, NAYAGARH 2. THE RESPONDENT. ITO, KHURDA WARD, KHURDA 3. THE CIT(A) - 1, BHUBANESWAR 4. PR.CIT - 1, BHUBANESWAR 5. DR, ITAT, CUTTACK 6. GUARD FILE. //TRUE COPY//