The ACIT, 3(1), Bhopal V. Sanee Infrastructure Pvt. Ltd., Bhopal

ITA 468/IND/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1501 (ITAT-INDORE)
• Duration Of Justice: 6 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-02-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 09-08-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Section: 154

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA NOS. 467 AND 468/IND/2012 A.YS.2005-06 & 2007-08 ASSTT.COMMISSIONER OF INCOME TAX 3(1), BHOPAL :: APPELLANT VS SANEE INFRASTRUCTURE PVT. LTD. BHOPAL PAN AAGCS 8307M :: RESPONDENT APPELLANT BY SHRI R.A. VERMA RESPONDENT BY SHRI ARUN JAIN DATE OF HEARING 11.02.2013 DATE OF PRONOUNCEMENT 11.02.2013 O R D E R PER JOGINDER SINGH , JUDICIAL MEMBER THE REVENUE IS AGGRIEVED BY THE IMPUGNED ORDERS B OTH DATED 3 RD MAY, 2012 PASSED BY THE LEARNED FIRST APPELLATE AUTHORITY, BHOPAL, WHEREBY THE RESPECTIVE ADDITION OF 2 RS.36,35,072/- (A.Y. 2005-06) AND RS. 62,13,155/- ( A.Y. 2007- 08) MADE ON ACCOUNT OF ALLEGED INADMISSIBILITY OF P ROVISION OF ROAD REPAIR BY PASSING AN ORDER U/S 154 OF THE ACT HAS BEEN DELETED. 2.1 DURING HEARING, THE LEARNED SENIOR DR STRONGLY DEFENDED THE ADDITION MADE BY THE ASSESSING OFFICER WHEREAS THE COUNSEL FOR THE ASSESSEE ASSERTED THAT THE CONCLUSION DRAWN IN THE IMPUGNED ORDERS IS PERFECTLY JUSTIFIED. 2.2 WE HAVE CONSIDERED THE RIVAL ASSERTIONS MADE BY THE LEARNED RESPECTIVE COUNSEL AND PERUSED THE MATERIAL AVAILAB LE ON RECORD. THE FACTS, IN BRIEF, ARE THAT THE ASSESSEE CONSTRUC TED ROADS FOR THE GOVERNMENT ON CONTRACT AND MADE PROVISION OF RS. 36 ,35,072/- FOR ROAD REPAIRING. THE ASSESSING OFFICER WAS OF T HE VIEW THAT THE PROVISION HAS BEEN WRONGLY ALLOWED, THEREFORE, HE I SSUED NOTICE U/S 154 OF THE ACT ASKING THE ASSESSEE AS TO WHY RE CTIFICATION SHOULD NOT BE MADE. THE LEARNED ASSESSING OFFICER M ADE DISALLOWANCE OF THE CLAIMED AMOUNT. ON APPEAL, THE LEARNED CIT(A) CONSIDERED THE SUBMISSIONS OF THE ASSESSEE A ND CONCLUDED THAT THE ASSESSING OFFICER DID NOT CONSIDER THE EXP LANATION OF THE ASSESSEE IN PROPER PERSPECTIVE. UNCONTROVERTEDLY, T HE GOVERNMENT RETAINED 15% OF THE CONTRACT VALUE FOR S TRICT 3 ADHERENCE OF THE CONDITION OF GUARANTEE TO REPAIR T HE ROAD FOR THE NEXT THREE/FIVE YEARS FROM COMPLETION OF CONSTRUCTI ON OF THE ROAD AND IF THE ASSESSEE DOES NOT REPAIR THE ROAD, THE G OVERNMENT IS TO GET THE ROADS REPAIRED OUT OF 15%. IN PARA 2.3 OF T HE IMPUGNED ORDER, THERE IS A FINDING THAT IN ITS REPLY THE ASS ESSEE IN RESPONSE TO NOTICE U/S 154, FILED WRITTEN REPLY AND THE ORDE R WAS PASSED WITHOUT CONSIDERING THIS REPLY OF THE ASSESSEE ALON G WITH EXPLANATION AND THE DETAILED SUBMISSIONS AS TO WHY THE ASSESSMENT ORDER SHOULD NOT BE RECTIFIED. THE ROAD REPAIRING IS ALLOWABLE OR NOT IS A DEBATABLE ISSUE AND CAN BE DE CIDED ONLY AFTER EXAMINATION OF FACTS IN DETAIL AND HEARING TH E ASSESSEE. SUCH LETTER WAS IGNORED BY THE ASSESSING OFFICER. IN VIEW OF THE DEBATABLE NATURE, WE ARE OF THE VIEW THAT IT IS NOT PERMISSIBLE U/S 154 WHICH IS BEYOND THE JURISDICTION. THUS, THE RE CTIFICATION ORDER PASSED BY THE ASSESSING OFFICER WAS RIGHTLY H ELD TO BE INVALID. THE OBJECT OF THE PROVISION IS THE RECTIFI CATION OF MISTAKE IN THE RECORD WHICH IS APPARENT AND NOT BY THE LONG DRAWN PROCESS. THEREFORE, WE FIND NO INFIRMITY IN THE CON CLUSION DRAWN IN THE IMPUGNED ORDER. IDENTICAL IS THE SITUATION F OR THE A.Y. 2007-08. FINALLY, BOTH THE APPEALS OF THE REVENUE STAND DIS MISSED. 4 THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 11.2.2013. SD SD (R.C.SHARMA) (JOGINDER SINGH ) ACCOUNTANT MEMBER JUDICIAL ME MBER DATED: 11.2.2013 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, GU ARD FILE DN/-111112