The ACIT, Bhopal V. M/s. Bhaskar Multnet Pvt.,Ltd., Bhopal

ITA 410/IND/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 2751 (ITAT-INDORE)
• Duration Of Justice: 11 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-07-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 13-07-2010
• Assessment Year: 2006-2007
• Appeal Filed On: 03-08-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: APARNA KARAN
• Assessee Lawyers: S S DESH

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI V.K. GUPTA, ACCOUNTANT MEMBER ITA NO.410IND/2009 A.YS. 2006-07 ASSTT. COMMISSIONER OF INCOME TAX 1(2), BHOPAL APPELLANT VS. M/S. BHASKAR MULTINET PVT. LTD., 6-DWARAKA SADAN, MP NAGAR, ZONE-1, BHOPAL PAN AABCB 4192 C RESPONDENT APPELLANT BY : SMT. APARNA KARAN, SR. DR RESPONDENT BY : SHRI S.S. DESHPANDE, CA O R D E R PER JOGINDER SINGH THE REVENUE HAS CHALLENGED THE ORDER OF THE LEARNED CIT(A) DATED 29.5.2009 WHEREIN THE FIRST GROUND RAISED PERTAINS TO DELETING THE ADDITION OF RS.21,16,387/- MADE ON ACCOUNT OF NON-D EDUCTION OF TDS U/S 40(A)(IA) OF THE ACT. DURING HEARING OF THIS APPEAL , WE HAVE HEARD MRS. APARNA KARAN, LD. SR. DR AND SHRI S.S. DESHPANDE, L D. COUNSEL FOR THE 2 ASSESSEE. THE SUBMISSION ON BEHALF OF THE REVENUE I S THAT THE ASSESSING OFFICER, DURING SCRUTINY, FOUND THAT THE ASSESSEE COMPANY DEDUCTED TDS WHILE MAKING THE PAYMENTS TO ELECTRICI TY BOARDS AMOUNTING TO RS.21,16,387/- (RS.10,78,942/- TO RSEB AND RS.5,18,740/- & RS.5,18,700/- MADE TO MPEB). THE LD. ASSESSING OF FICER WAS OF THE VIEW THAT SINCE THE GOVERNMENT BODIES ARE ASSESSED TO TAX, THEREFORE, THE ASSESSEE WAS SUPPOSED TO DEDUCT TAX ESPECIALLY WHEN THE ASSESSEE COMPANY HAS NOT OBTAINED NO DEDUCTION CERTIFICATE F ROM THE RESPECTIVE GOVERNMENT. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSESSEE STRONGLY DEFENDED THE IMPUGNED ORDER BY SUBMITTING THAT THE ASSESSEE COMPANY IS ENGAGED IN CABLE TV BUSINESS AT BHOPAL, INDORE, JAIPUR ETC. AND IS USING THE POLES OF RSEB AND MPEB WHICH ARE U SED FOR TRANSMISSION ACROSS THE CITY FOR WHICH THE ASSESSEE COMPANY PAID POLE RENT TO THE ELECTRICITY BOARDS, THEREFORE, THERE IS NO LIABILITY TO DEDUCT THE TAX. 2. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF LD. REPRESENTATIVES OF BOTH SIDES AND PERUSED THE MATERIAL AVAILABLE ON RE CORD. UNDER THE FACTS MENTIONED ABOVE AND AS PER CIRCULAR NO.699 DATED 30 .1.1995 OF CBDT, THERE IS NO NEED OF DEDUCTION OF TAX IF PAYEE IS A GOVERNMENT/LOCAL AUTHORITY. THIS CIRCULAR HAS BEEN VERY MUCH FOLLOWE D BY THE LD. FIRST APPELLATE AUTHORITY, CONSEQUENTLY, THERE IS NO MERI T IN THE GROUND OF THE 3 REVENUE BECAUSE THE PAYEES ARE THE GOVERNMENT BODIE S. THIS GROUND OF THE APPEAL OF THE REVENUE IS, THEREFORE, DISMISSED. 3. THE NEXT GROUND PERTAINS TO DELETING THE ADDITIO N OF RS.99,160/- MADE ON ACCOUNT OF VEHICLE RUNNING AND MAINTENANCE EXPENSES. THE CRUX OF ARGUMENTS ON BEHALF OF REVENUE IS IN SUPPOR T TO THE ASSESSMENT ORDER WHEREAS THE ASSESSEE HAS DEFENDED THE IMPUGNE D ORDER. ON PERUSAL OF RECORD AND AFTER HEARING THE RIVAL S UBMISSIONS, IT IS SEEN THAT THE ASSESSING OFFICER MADE AN ADDITION OF RS.99,160/- ON ACCOUNT OF DISALLOWANCE OF RUNNING VEHICLE AND MAIN TENANCE EXPENSES BY DISALLOWING 10% OF CLAIMED EXPENSES OF RS.9,91,6 00/- ON ADHOC BASIS ON THE GROUND THAT THE BOOKS WERE NOT PRODUCE D. HOWEVER, THE STAND OF THE ASSESSEE IS THAT FIRSTLY, THE BOOKS WE RE NEVER CALLED FOR BY THE LD. ASSESSING OFFICER AND SECONDLY, THE SAME WE RE VERY MUCH MAINTAINED. THERE IS A FURTHER MENTION IN THE IMPUG NED ORDER THAT THE EXPENSES ARE COVERED UNDER PROVISIONS OF FBT, CONSE QUENTLY, 20% OF THESE EXPENSES, FBT HAVE BEEN ALREADY PAID BY THE A SSESSEE COMPANY. IN VIEW OF THESE UNCONTROVERTED FACTUAL MA TRIX, WE FIND NO INFIRMITY IN THE IMPUGNED ORDER, THEREFORE, THIS GR OUND OF THE REVENUE IS ALSO DISMISSED. FINALLY, THE APPEAL OF THE REVENUE IS DISMISSED. 4 ORDER PRONOUNCED IN OPEN COURT ON 14 TH JULY, 2010. (V.K. GUPTA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 14 TH JULY, 2010 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, G UARD FILE !VYAS!