M/s. Dev Transport, Ahmedabad V. The Income tax Officer,Ward-3(1), Baroda

ITA 4167/AHD/2008

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 0466 (ITAT-AHMEDABAD)
• Duration Of Justice: 10 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-11-2009
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 03-11-2009
• Assessment Year: 2005-2006
• Appeal Filed On: 31-12-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: C K MISHRA
• Assessee Lawyers: ANIL R SHAH
• Keywords: Additional evidence; TDS; Set aside
• Section: 143(3); 40(a)(ia)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH D AHMEDABAD BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER, AND SHRI D. C. AGRAWAL, ACCOUNTANT MEMBER ITA NO.4167/AHD/2008 ASSESSMENT YEAR: 2005-06 DATE OF HEARING:3.11.09 DRAFTED:10.11.09 M/S. DEV TRANSPORT 14, KAILASHDHAM SHOPPING CENTRE, NEW SAMA ROAD, BARODA, PAN NO.AADFD6855D V/S . INCOME TAX OFFICER, WARD-3(1), BARODA (APPELLANT) .. (RESPONDENT) APPELLANT BY :- SHRI ANIL R SHAH, AR RESPONDENT BY:- SHRI C.K. MISHRA, SR. DR O R D E R PER MAHAVIR SINGH, JUDICIAL MEMBER:- THIS APPEAL BY THE ASSESSEE IS ARISING OUT OF THE ORDER OF COMMISSIONER OF INCOME-TAX (APPEALS)-II, BARODA IN APPEAL NO.CAB/II -242/07-08 DATED 2-11-2008. THE ASSESSMENT WAS FRAMED BY THE ITO, WARD-3(1) BAR ODA U/S. 143(3) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS T HE ACT) VIDE HIS ORDER DATED 14-12- 2007 FOR THE ASSESSMENT YEAR 2005-06. 2. THE FIRST ISSUE IN THIS APPEAL OF THE ASSESSEE I S AGAINST THE ORDER OF CIT(A) CONFIRMING THE ADDITION MADE BY THE ASSESSING OFFIC ER ON ACCOUNT OF CASH CREDITS AS THERE ARE NINETEEN CASH CREDITS IN ALL EXCEPT SHRI MAYUR K PARIKH (HUF) WHICH HAS BEEN ACCEPTED BY THE CIT(A), WHICH IS NOT BEFORE US . WE FIND THAT CIT(A) HAS DISCUSSED THIS ISSUE IN PARA-2.2 OF HIS APPELLATE ORDER AS UNDER:- 2.2. IN APPEAL THE AUTHORIZED REPRESENTATIVE, SHRI DINESH JAIN, CA ALONG WITH MS. PRIYANKA SHARMA ATTENDED AND FILED WRITTEN SUBMISSIONS. SINCE THE AUTHORIZED REPRESENTATIVE FILED ADDITIONAL EVIDENCE AN OPPORTUNITY WAS GIVEN TO THE ASSESSING OFFICER TO GIVE HIS COMMENTS. VIDE REMAND REPORT DATED ITA NO.4167/AHD/2008 A.Y. 2005-06 M/S. DEV TRANSPORT V. ITO WD-3(1) BARODA PAGE 2 2.10.2008, THE ASSESSING OFFICER SUBMITTED THAT APA RT FROM A RECEIPT FROM MAYUR K PARIKH (HUF) OF RS.6,82,000/- THE APPELLANT WAS UNABLE TO GIVE ANY SUBMISSION. FOR SOME PERSONS THE ASSESSEE FURNISHED 7/12 AND 8A EXTRACT ONLY WITHOUT ANY EVIDENCE OF AGRICULTURAL INCOME EA RNED. THE ASSESSING OFFICER TRIED TO ISSU9E SUMMONS TO MAHESHBHAI VAGHA LA AND SHRI JAGDISHBHAI SHAH FROM WHOM THE APPELLANT HAD CLAIMED TO HAVE TA KEN DEPOSITS OF RS.74,000/- AND RS.46,000/- RESPECTIVELY. BOTH THE SUMMONS WERE RETURNED UNSERVED WITH THE NOTING INCOMPLETE ADDRESS. THE ASSESSING OFFICER GAVE AN OPPORTUNITY TO THE ASSESSEE TO GIVE THE COMPLETE ADDRESS. FURTHER, THE ASSESSING OFFICER ASKED SHRI VIJAY PATEL PARTNER OF THE FIRM TO PRODUCE THE ABOVE PERSONS. THE ASSESSEE FILED TO DO SO EVEN ON FRESH OPPORTUNITY. WITH REGARD TO THE DEPOSIT OF RS.1,1,000/- RECEIVED FROM SHRI KIRANKUMAR BALWANTBHAI, IT WAS NOTED THAT THERE WAS A CASH DEP OSITS IN THE ACCOUNT OF SHRI KIRANKUMAR BALWANTBHAI OF RS.95,000/- JUST THE DAY BEFORE THE CHEQUES WAS ISSUED IN THE NAME OF M/S. DEV TRANSPORT. NO SA TISFACTORY EXPLANATION WAS GIVEN BY SHRI KIRANKUMAR BALWANTBHAI WITH REGAR D TO THIS CASH DEPOSIT. IN SHORT, THE ASSESSING OFFICER COULD SATISFACTORILY C ONFIRM RS.6,8,000/- RECEIVED FROM MAYUR K. PARIKH (HUF) ONLY. FOR THIS, THE CIT(A) FINALLY HAS CONFIRMED THE ADDI TION BY GIVING FOLLOWING FINDING IN PARA-2.4 AS UNDER:- 2.4 I HAVE CONSIDERED THE ASSESSMENT ORDER AND THE SUBMISSIONS OF THE AUTHORIZED REPRESENTATIVE. DURING THE ASSESSMENT ST AGE THE APPELLANT PLEADED HE WOULD FILE EVIDENCE WITH REGARD TO THE D EPOSITS GIVEN. HE HOWEVER, FAILED TO DO SO. SINCE HE PLEADED THAT ADEQUATE OP PORTUNITY WAS NOT GIVEN TO HIM TO FILE EVIDENCE, THE ASSESSING OFFICER WAS DIR ECTED TO GIVE A FRESH OPPORTUNITY TO THE APPELLANT AND LOOK INTO THE ADDI TIONAL EVIDENCE FILED BY HIM. THE ASSESSING OFFICERS REMAND REPORT CLEARS THE DE POSITS TO THE EXTENT OF RS.6,82,000/- ONLY. SINCE THE APPELLANT HAS NOT BEE N ABLE TO SATISFACTORILY EXPLANATION THE IDENTITY, THE CREDITWORTHINESS AND THE GENUINENESS OF THE TRANSACTION ENTERED INTO THE ADDITION MADE BY THE A SSESSING OFFICER IS CONFIRMED TO THE EXTENT OF RS.1,64,80/- (1946890 682000). IN VIEW OF THE ABOVE, WE ARE OF THE VIEW THAT THE C IT(A) HAS NOT DISCUSSED THE INDIVIDUAL CASH CREDITS AND FINDINGS REGARDING CRED ITWORTHINESS, GENUINENESS OF TRANSACTION AND IDENTITY OF THE CREDITORS IS NOT DI SCUSSED INDIVIDUALLY AND A GENERAL DISCUSSION IS CARRIED OUT. IN VIEW OF THIS, THE FAC TS REGARDING INDIVIDUAL CASH HAS NOT BEEN BROUGHT ON RECORD BY CIT(A). ACCORDINGLY, WE H AVE NO ALTERNATIVE EXCEPT TO SET ASIDE THIS ISSUE TO THE FILE OF CIT(A) AND HE IS DI RECTED TO DISCUSS EACH OF THE CREDITORS INDEPENDENTLY. ACCORDINGLY, THIS ISSUE O F THE ASSESSEES APPEAL IS SET ASIDE TO THE FILE OF CIT(A) AS INDICATED ABOVE. ITA NO.4167/AHD/2008 A.Y. 2005-06 M/S. DEV TRANSPORT V. ITO WD-3(1) BARODA PAGE 3 3. THE NEXT ISSUE IN THIS APPEAL OF THE ASSESSEE IS AGAINST THE ORDER OF CIT(A) CONFIRMING THE DISALLOWANCE MADE BY THE ASSESSING O FFICER U/S.40(A)(IA) OF THE ACT. 4. AFTER HEARING THE RIVAL CONTENTIONS AND GOING TH ROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE RECORDS, WE FIND THAT THE CIT(A) HAS PASSED A CRYPTIC ORDER BY STATING THAT THE PAYMENTS AMOUNTING TO RS. 7,19,394/- IS MADE TO ONE SHRI P.H. PATEL WITHOUT DEDUCTING TAX AND ACCORDINGLY BY GIVING FOLLOWING FINDINGS IN PARA- 3 AND 3.1 CONFIRMED THE ADDITION. 3. THE SECOND GROUND OF APPEAL IS PERTAINING TO DI SALLOWANCE OF RS.7,19,394/- U/S.40(A)(IA). THE ASSESSING OFFICER NOTED THAT THE PAYMENT HAS BEEN MADE AMOUNTING TO RS.7,19,394/- TO ONE SHRI P. H. PATEL FOR CARTING. SINCE THE APPELLANT DID NOT DEDUCT TAX AS REQUIRED U/S.194C OF THE INCOME-TAX ACT, THE ASSESSING OFFICER INVOKED THE PROVISIONS O F SECTION 40(A)(IA) AND DISALLOWED THE EXPENDITURE CLAIMED. 3.1 IN APPEAL, THE AUTHORIZED REPRESENTATIVE ADMITT ED THAT NO TDS HAS BEEN DEDUCTED DURING THE YEAR. IN VIEW OF THE FACT THAT DEDUCTION OF TDS IS MANDATORY THE ASSESSING OFFICER WAS JUSTIFIED IN IN VOKING THE PROVISIONS OF SECTION 40(A)(IA) AND THE ADDITION IS CONFIRMED. BEFORE US LD. COUNSEL FOR THE ASSESSEE FILED THAT T HIS AMOUNT RS.7,19,394/- IS ON ACCOUNT OF CARTING EXPENSES AND HE FILED A NOTE, WH ICH READS AS UNDER:- NOTE-2 1. DEV TRANSPORT THE ASSESSEE HAS TYPES OF TRANS ACTIONS WITH P.H. PATEL. (A) SALE OF DIESEL FOR WHICH, AMOUNT IS RECEIVABLE AND (B) CARTING EXPENSES FOR WHICH AMOUNT IS PAYABLE. 2. DURING ASSESSMENT YEAR 2005-06, AGGREGATE AMOUNT OF DIESEL SOLD TO P.H. PATEL IS RS.5,44,034/- AND AGGREGATE AMOUNT CARTING EXPENSES INCURRED IS RS.7,19,394/-. THEREFORE, THE NET AMOUNT PAYABLE ON ACCOUNT OF CARTING EXPENSES IS RS.1,75,560/- (7,19,394 5,44,034). 3. THE ABRIDGED ACCOUNT OF P.H. PATEL IN THE BOOKS OF DEV TRANSPORT (ASSESSEE) IS REFLECTED BELOW:- DEBIT AMOUNT (RS) CREDIT AMOUNT (RS) DIESEL SOLD 5,44,034/- CARTING EXPENSES 7,19,394/- AMOUNTS PAID 2,95,195/- AMOUNTS RECEIVED. 1,19,835/ - CONTRA ENTRY. 30,000/- CONTRA ENTRY. 30,000/- TOTAL 8,69,229 TOTAL 8,69,229 WE FIND THAT CIT(A) HAS NOT GONE INTO THESE DETAILS AND WITHOUT GOING THROUGH THE DETAILS AND THE DATE OF PAYMENT AND MOREOVER WHETHE R THE SAME IS SUBJECT TO DEDUCTION OF TAX OR NOT, HAS CONFIRMED THE ADDITION . WE FEEL THAT BASIC REQUIREMENT ITA NO.4167/AHD/2008 A.Y. 2005-06 M/S. DEV TRANSPORT V. ITO WD-3(1) BARODA PAGE 4 FOR DISPOSAL OF THIS APPEAL IS LACKING IN THE ORDER OF THE CIT(A) AND ACCORDINGLY THE SAME IS SET ASIDE TO THE FILE OF CIT(A) AND HE IS D IRECTED TO PASS A SPEAKING ORDER AFTER TAKING EVIDENCE FROM THE ASSESSEE AND ASSESSE E WILL CO-OPERATE WITH THE CIT(A) AS AND WHEN REQUIRED. 5. THE NEXT ISSUE IN THIS APPEAL OF THE ASSESSEE IS DISALLOWANCE OF 1/10 OF TELEPHONE, PETROL AND OFFICE EXPENSES ON ESTIMATE B ASIS. LD. COUNSEL FOR THE ASSESSEE HAS NOT PRESSED THIS ISSUE. HENCE, WE DISM ISS THE SAME AS NOT PRESSED. 6. IN THE RESULT, ASSESSEES APPEAL IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 13/11/2009 SD/- SD/ (D.C.AGRAWAL) (MAHAVI R SINGH) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) AHMEDABAD, DATED : 13/11/2009 *DKP COPY OF THE ORDER FORWARDED TO :- 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT(APPEALS)-II, BARODA 4. THE CIT CONCERNS. 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER, /TRUE COPY/ DEPUTY / ASSTT.REGISTRAR ITAT, AHMEDABAD