Addl. CIT, SPECIAL RANGE- 9, New Delhi V. WAPCOS Ltd., New Delhi

ITA 3915/DEL/2018

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 4653 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-04-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2013-2014
• Appeal Filed On: 23-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Onus to prove
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F, NEW DELHI BEFORE SH. ANIL CHATURVEDI, ACCOUNTANT MEMBER AND SH. KULDIP SINGH, JUDICIAL MEMBER (THROUGH VIDEO CONFERENCING) ITA NO.3915/DEL/2018 (FOR ASSESSMENT YEAR : 2013-14) ADDL. CIT, SPECIAL RANGE 9, NEW DELHI PAN : AAACW 0764 A VS. M/S. WAPCOS LTD., 5 TH FLOOR, KAILASH BUILDING, 26 K.G. MARG, NEW DELHI -110001 (APPELLANT) (RESPONDENT) A SSESSEE BY SHRI SATYAJEET GOYAL, ADV. RE VENUE BY MS. FARHAT KHAN, DR DATE OF HEARING: 0 8 .04.2021 DATE OF PRONOUNCEMENT: 08 .04.2021 ORDER PER ANIL CHATURVEDI , AM : THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-9, NEW DELHI DATED 22.03.2018 FOR ASSESSMENT YEARS 2013-14. 2. THE RELEVANT FACTS AS CULLED FROM THE MATERIAL ON RECORDS ARE AS UNDER : 2 3. ASSESSEE IS A GOVERNMENT OF INDIA UNDERTAKING AND A MINI RATNA COMPANY STATED TO BE ENGAGED IN THE BUSINESS OF PROVIDING TECHNICAL CONSULTANCY SERVICES ON TURNKEY BASIS IN THE FIELD OF HYDRO POWER IN INDIA AND ABROAD. ASSESSEE ELECTRONICALLY FILED ITS RETURN OF INCOME FOR A.Y. 2013-14 ON 29.09.2013 DECLARING TOTAL INCOME OF RS. 88,87,97,810/-. THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER ASSESSMENT WAS FRAMED U/S 143(3) VIDE ORDER DATED 29.02.2016 AND THE TOTAL INCOME WAS DETERMINED AT RS.92,96,66,110/-. 4. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A) WHO VIDE ORDER DATED 22.03.2018 IN APPEAL NO.19/16-17 GRANTED SUBSTANTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY THE ORDER OF CIT(A), REVENUE IS NOW BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS: 1. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD CIT(A) HAS ERRED IN NOT APPRECIATING THE FACTS OF THE ADDITION OF RS.2,29,32,300/- ON ACCOUNT OF HIRING OF VEHICLE EXPENSES WHICH WERE ADDED BACK TO THE INCOME OF THE ASSESSEE. 5. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, AO NOTICED THAT THE ASSESSEE HAS CLAIMED EXPENSES ON HIRING OF VEHICLE AMOUNTING TO RS.764.11 LAKH. THE ASSESSEE WAS ASKED TO FURNISH THE DETAILS OF VEHICLE EXPENSES HIRED ALONG WITH BUSINESS JUSTIFICATION TO WHICH ASSESSEE MADE THE SUBMISSIONS WHICH WERE NOT FOUND ACCEPTABLE TO AO. AO NOTED THAT THE ASSESSEE HAS NOT BEEN ABLE TO PRODUCE A LIST OF VEHICLES HIRED ON MONTHLY BASIS AND COULD ALSO NOT FURNISH THE DETAILS OF THE PERSONS TO WHOM THE VEHICLES HIRED WERE ALLOTTED. AO NOTED THAT THE ASSESSEE BY 3 CHOOSING TO NOT FURNISH THE INFORMATION CALLED FOR, HAS NOT DISCHARGED ITS ONUS TO PROVE THAT THE ENTIRE EXPENSE CLAIMED ON ACCOUNT OF VEHICLE HIRING IS FOR BUSINESS PURPOSES. HE THEREFORE CONCLUDED THAT ENTIRE EXPENDITURE CLAIMED BY THE ASSESSEE ON ACCOUNT OF VEHICLE HIRING CANNOT BE SAID FOR THE PURPOSE OF BUSINESS. HE THEREAFTER DISALLOWED 20% OF THE TOTAL EXPENSES AMOUNTING TO RS.2,29,32,300/- AND ADDED IT BACK TO THE INCOME. 6. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A) WHO FOR THE REASONS NOTED IN THE ORDER DELETED THE ADDITION MADE BY THE AO. AGGRIEVED BY THE ORDER OF CIT(A), REVENUE IS NOW BEFORE US. 7. BEFORE US, LD. DR TOOK US TO THE OBSERVATION MADE BY THE AO AND SUBMITTED THAT ASSESSEE HAS NOT PROVED THE JUSTIFICATION FOR INCURRING OF EXPENSES NOR HAS ASSESSEE FURNISHED THE DETAILS CALLED FOR BY THE AO. HE SUBMITTED THAT IN SUCH A SITUATION, THE AO WAS REASONABLE ENOUGH TO DISALLOW 30% OF THE EXPENSES AND CIT(A) SHOULD HAVE UPHELD THE ORDER OF AO. LEARNED AR ON THE OTHER HAND, REITERATED THE SUBMISSIONS MADE BEFORE THE AO AND CIT(A) AND FURTHER POINTED TO THE FINDINGS OF CIT(A) WHEREIN CIT(A) HAD INTER ALIA NOTED THAT SUFFICIENT DOCUMENTS WERE FURNISHED BY THE ASSESSEE IN SUPPORT OF THE CLAIM OF VEHICLE HIRE EXPENSES. HE THUS SUPPORTED THE ORDER OF CIT(A). 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT GROUND IS WITH 4 RESPECT TO DELETING THE AD HOC ADDITION OF VEHICLE EXPENSES MADE BY AO BUT DELETED BY CIT(A). WE FIND THAT CIT(A) WHILE DELETING THE ADDITION HAS INTER ALIA NOTED THAT ASSESSEE IS A PUBLIC SECTOR UNDERTAKING AND IT HAS BEEN CONSISTENTLY CLAIMING THE VEHICLE HIRE CHARGES AND THE SAME HAS BEEN ACCEPTED BY THE REVENUE AUTHORITIES IN EARLIER YEARS AND IN SUBSEQUENT YEARS. HE HAS FURTHER GIVEN A FINDING THAT THE AO HAD PROCEEDED TO DISALLOW THE EXPENSES ON AD HOC BASIS WITHOUT POINTING OUT ANY SPECIFIC DEFECTS OR INCIDENTS WHICH COULD PROVE THAT THE EXPENSES WAS NOT FOR THE PURPOSE OF BUSINESS AND THAT THE AO WAS SIMPLY CARRIED AWAY BY THE QUANTUM OF EXPENDITURE. CIT(A) HAS FURTHER GIVEN A FINDING THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS SUFFICIENT DOCUMENTS WERE FURNISHED BY THE ASSESSEE TO SUPPORT ITS CLAIM OF EXPENSES AND THE ALLEGATION OF THE AO OF NOT FURNISHING THE LOG BOOK AND OTHER DETAILS OF VEHICLE HIRE EXPENSES BY THE ASSESSEE IS NOT BASED ON THE MATERIAL ON RECORD. BEFORE US, REVENUE HAS NOT POINTED TO ANY FALLACY IN THE FINDINGS OF CIT(A). WE THEREFORE FIND NO REASON TO INTERFERE WITH THE ORDER OF CIT(A) AND THUS THE GROUND OF REVENUE IS DISMISSED. 9. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED ORDER PRONOUNCED IN THE OPEN COURT ON 08.04.2021 SD/- SD/- (KULDIP SINGH) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE:- 08 .04.2021 PY* 5 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI