The ITO-1, Ratlam V. Shri Ravi Kumar Pirodia, Ratlam

ITA 408/IND/2017

• Counselvise Citation: [2018] 112 COUNSELVISE.COM (IT) 5379 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 4 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-10-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 01-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B J BORICHA
• Keywords: Business income; Depreciation; TDS
• Section: 194C; 154

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO.408/IND/2017 ASSESSMENT YEAR: 2010-11 ITO - 1 RATLAM / VS. SHRI RAVI KUMAR PIRODIA, 85, CHANDNI CHOWK, RATLAM (M.P.) ( REVENUE ) ( RESPONDENT ) P.A. ADQPP7261F REVENUE BY SHRI B.J. BORICHA, SR. DR RESPONDENT BY NONE DATE OF HEARING: 23.10.2018 DATE OF PRONOUNCEMENT: 26 .10.2018 / O R D E R PER MANISH BORAD, A.M: THIS APPEAL OF REVENUE PERTAINING TO A.Y. 2010-11 IS DIRECTED AGAINST THE ORDER OF LD. COMMISSIONER OF INC OME TAX(APPEALS)-UJJAIN, (IN SHORT CIT(A)), DATED 30.03. 2017 WHICH IS ARISING OUT OF THE ORDER U/S 154 OF THE INC OME TAX ACT 1961(HEREINAFTER CALLED AS THE ACT) FRAMED ON RAV I KUMAR PIRODIA 2 07.05.2015 BY ITO-1, RATLAM. THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPEAL: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE LD. CIT(A) ERRED IN: 1.WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LD. CIT(A) WAS JUSTIFIED IN DELETING THE ADDIT ION OF RS.10,39,262/- MADE BY ASSESSING OFFICER ON ACCOUNT OF CONTRACTUAL RECEIPTS. 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LD. CIT(A) WAS JUSTIFIED IN HOLDING THAT AMOUN T OF RS.10,39,262/- REPRESENTING CONTRACT RECEIPT WAS INCLUDED IN THE SALES WITHOUT ANY VERIFICATION BY C IT(A) OR GETTING SAME VERIFIED FROM THE ASSESSEE OFFICER. NOTE: THE MATTER IF COVERED UNDER THE EXCEPTION AS MENTIONED IN PARA 8(C) OF CIRCULAR 21/2015. 2. WHEN THE CASE WAS CALLED UP NONE APPEARED ON BEHALF O F THE ASSESSEE, NOR ANY ADJOURNMENT APPLICATION WAS FILED. CASE HEARD WITH THE ASSISTANCE OF LD. DEPARTMENTAL REPRESENTATIVE (DR) AS WELL AS MATERIAL AVAILABLE ON RECOR D. 3. BRIEF FACTS OF THE CASE AS CULLED OUT FROM THE RECO RDS ARE THAT THE ASSESSEE BEING AN INDIVIDUAL DECLARED INCOME OF RS.4,70,780/- IN THE RETURN OF INCOME FILED ON 10.0 9.2010 ALONG WITH DECLARING AGRICULTURAL INCOME OF RS.30,000/- . THE CASE SELECTED FOR SCRUTINY. ASSESSMENT U/S 143(3 ) OF THE ACT FRAMED ON 05.03.2013, ASSESSING INCOME OF RS.4,93,720/-. SUBSEQUENTLY, ON PERUSAL OF THE ASSESSM ENT RAV I KUMAR PIRODIA 3 RECORD THE LD. ASSESSING OFFICER NOTICED THAT CONTRAC T RECEIPT OF RS.10,39,262/- HAS NOT BEEN DISCLOSED IN THE PROFIT AND LOSS ACCOUNT AND HE ALSO OBSERVED THAT THE TA X HAS BEEN DEDUCTED AT SOURCE U/S 194C OF THE ACT ON TH E ALLEGED RECEIPTS BY THE DEDUCTOR. EXCESS DISALLOWANCE OF DEPRECIATION ON VEHICLE WAS ALSO NOTICED AT RS.21,366/- . LD. ASSESSING OFFICER ADDED BOTH THE AMOUNTS I.E. CONTRACTUAL RECEIPT OF RS.10,39,262/- AND EXCESS DEPRECIATION AT RS.21,366/- AND ASSESSED THE INCOME AT RS.15,54,350/-. 4. AGGRIEVED ASSESSEE PREFERRED AN APPEAL BEFORE LD. CI T(A) AND PARTLY SUCCEEDED AS THE ALLEGED DISALLOWANCE ON DEPRECIATION OF RS.21,366/- WAS CONFIRMED AND ADDITIO N ON ACCOUNT OF CONTRACTUAL RECEIPT OF RS.10,39,262/- WAS DELETED BY CIT(A) OBSERVING THAT THE IMPUGNED AMOUNT HAS BEEN DISCLOSED BY THE ASSESSEE UNDER THE HEAD SALES IN THE AUDITED PROFIT AND LOSS ACCOUNT. 5. NOW, THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL, RAISING SOLE GRIEVANCE FOR THE DELETION OF ADDITION OF RS.10,39,262/- ON ACCOUNT OF CONTRACTUAL RECEIPTS BY L D. CIT(A). 6. THE LD. DEPARTMENTAL REPRESENTATIVE(DR) VEHEMENTLY ARGUED SUPPORTING THE ORDER OF THE ASSESSING OFFICER . RAV I KUMAR PIRODIA 4 7. WE HAVE HEARD THE RIVAL CONTENTIONS AND CAREFULLY PERUSED THE MATERIAL AVAILABLE ON RECORD. THE LD. ASSESS ING OFFICER MADE THE ADDITION OF RS.10,39,262/- PRESUMING THAT THE ASSESSEE HAS NOT DISCLOSED THE ALLEGED CONTRACT REC EIPTS IN THE PROFIT AND LOSS ACCOUNT. THE MATTER CAME UP BEFO RE THE LD. CIT(A). COMPLETE DETAILS WERE EXAMINED BY HIM AND HE CAME TO THE CONCLUSION THAT THE IMPUGNED AMOUNT OF RS.10,39,262/- FORMS PART OF THE TOTAL SALES RECORDED IN THE BOOKS OF ACCOUNT WHICH WERE DULY AUDITED U/S 44AB OF THE ACT. THE LD. CIT(A) DELETED THE IMPUGNED ADDITION OF RS.10,39,262/- OBSERVING AS FOLLOWS: GROUND NO. 2,3,4,5,6,7,8 & 9:-THROUGH THESE GROUND S OF APPEAL THE APPELLANT HAS CHALLENGED THE ADDITION OF RS.10,39,262/- ON ACCOUNT OF CONTRACT RECEIPT. THE APPELLANT HAS SUPPLIED DISPLAY COUNTERS TO THE TITA N COMPANY LTD. THE APPELLANT HAS RAISED THE BILL OF RS.55,000/- DATED 24.04.2009 AND OF RS.9,84,262/- DATED 06.07.2009. THE TITAN INDUSTRIES DEDUCTED THE TDS @ 2% ON THE ABOVE CITED AMOUNT. THE AO TREATED THE ABOVE AMOUNT AS CONTRACT RECEIPT AND MADE THE ADDITION ON THE GROUND THAT THE APPELLANT HAS NOT DISCLOSED THE CONTRACT RECEIPT WHILE FILING THE RET URN OF INCOME. THE APPELLANT WHILE FILING THE RETURN OF IN COME CONSIDERED THE ABOVE AMOUNT AS SALE AND INCLUDED IN THE TOTAL SALES. SINCE, THE APPELLANT HAS ALREADY INCLUDED THIS AMOUNT IN THE SALES, THE AO IS NOT JU STIFIED IN MAKING FURTHER ADDITION. THIS WILL TANTAMOUNT TO DOUBLE ADDITION ON THE SAME INCOME. THEREFORE, THE ADDITION MADE BY THE AO AMOUNTING TO RS,.10,39,262/ - RAV I KUMAR PIRODIA 5 IS DELETED. THEREFORE, THE APPEAL ON THESE GROUNDS IS ALLOWED. 8. WE HAVE PERUSED THE DETAILED FINDING OF LD. CIT(A) AND GONE THROUGH THE SUBMISSIONS GIVEN BY THE ASSESSEE B EFORE THE LD. CIT(A) AND FIND THAT THE ASSESSEE SOLD DISPLA Y COUNTERS TO THE TITAN INDUSTRIES LTD. BANGALORE AND RAIS ED THE INVOICE WHICH WERE DULY ENTERED IN THE SALES REG ISTER. THE TAX WAS DEDUCTED AT SOURCE @ 2% BY M/S TITAN INDUSTRIES LTD. TREATING THE ALLEGED SALES AS A CONTRACT UAL PAYMENT. HOWEVER, THE ALLEGED AMOUNT FORMS PART OF THE TOTAL SALES. 9. NOW, WHETHER THE SALES HAVE BEEN DISCLOSED AS SALES OR CONTRACT RECEIPTS WILL NOT MAKE ANY IMPLICATION ON THE INCOME OFFERED BY THE ASSESSEE BECAUSE GROSS RECEIPTS INCLUDES TOTAL TURNOVER OF THE ASSESSEE ACHIEVED THROU GH SALES OR THE CONTRACT RECEIPTS AS BOTH ARE PART OF THE T OTAL TURNOVER. WE, THEREFORE, ARE OF THE CONSIDERED OPINI ON THAT AS THE ALLEGED AMOUNT OF RS.10,39,262/- HAS BEEN INCL UDED IN THE GROSS RECEIPTS OF THE ASSESSEE FORMING PART AND AUDITED PROFIT AND LOSS ACCOUNT. LD. CIT(A) HAS RIGHTL Y DELETED THE IMPUGNED ADDITION. NO INTERFERENCE IS TH EREFORE, CALLED FOR IN THE FINDING OF THE LD. CIT(A). WE UPHO LD THE SAME AND DISMISS BOTH THE GROUNDS RAISED BY THE REVENU E. RAV I KUMAR PIRODIA 6 10. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMI SSED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 26 .1 0.2018. SD/- (KUL BHARAT) SD/- (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER INDORE; DATED : 26/10/2018 CTX? P.S/. . . COPY TO: ASSESSEE/AO/PR. CIT/ CIT (A)/ITAT (DR)/GUAR D FILE. BY ORDER ASSISTANT REGISTRAR