Hind Supply Corporation, Kolkata V. ITO, Ward - 33(2), Kolkata, Kolkata

ITA 476/KOL/2009

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 9306 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 11 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-03-2011
• Appeal Filed By: Assessee
• Bench Allotted: C
• Assessment Year: 2003-2004
• Appeal Filed On: 30-03-2009
• Court: TRIBUNAL
• Department Lawyers: A K PRAMANIK
• Assessee Lawyers: S K DASGUPTA
• Section: 40A(3)

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL, BEN CH C, KOLKATA () BEFORE , , , , , SHRI MAHAVIR SINGH, JUDICIAL MEMBER. /AND . .. . ! ! ! !. .. . , '# SHRI C.D.RAO, ACCOUNTANT MEMBER $ $ $ $ / ITA NOS . 476-478/KOL/2009 %& '(/ ASSESSMENT YEARS : 2003-04, 2004-05 & 2005-06 (*+ / APPELLANT ) M/S.HIND SUPPLY CORPORATION (PAN: AABFH 9237 K) - % - - VERSUS - . (-.*+/ RESPONDENT ) I.T.O., WARD-33(2), KOLKATA *+ / 0 '/ FOR THE APPELLANT: SHRI S.K.DASGUPTA -.*+ / 0 '/ FOR THE RESPONDENT: SHRI A.K.PRAMANIK '1 / ORDER 234 234 234 234 PER BENCH THE ABOVE THREE APPEALS ARE FILED BY THE ASSESSEE A GAINST SEPARATE ORDERS DATED 02.01.2009 AND 14.01.2009 RESPECTIVELY OF THE CIT( A)-XX, KOLKATA PERTAINING TO A.YRS. 2003-04, 2004-05 AND 2005-06. AS IDENTICAL G ROUND HAS BEEN RAISED BY THE ASSESSEE IN ALL THE YEARS FOR THE SAKE OF CONVENIEN CE ALL THE THREE APPEALS ARE BEING DISPOSED OF BY A COMMON ORDER. 2. THE ONLY ISSUE RAISED BY THE ASSESSEE IN THIS A PPEAL IS RELATING TO ADDITION MADE U/S 40A(3) OF THE IT ACT, 1961. 2 3. THE BRIEF FACTS OF THE ISSUE ARE THAT THE AO WH ILE DOING SCRUTINY ASSESSMENT OBSERVED FROM THE BANK STATEMENT FILED BY THE ASSES SEE THAT MANY CHEQUES WERE ISSUED BY THE ASSESSEE FOR MAKING PAYMENTS TO DIFFERENT PE RSONS/PARTIES FROM WHOM THE ASSESSEE CLAIMED TO HAVE MADE PURCHASES DURING THE FINANCIAL YEAR RELEVANT TO ASSESSMENT YEARS 2003-04, 2004-05 AND 2005-06. HE F URTHER OBSERVED THAT ALL THESE CHEQUES ISSUED BY THE ASSESSEE WERE OTHERWISE NOT C ROSSED OR ACCOUNT PAYEE CHEQUES. FURTHER MORE THE ASSESSEE CATEGORICALLY ADMITTED TH AT ALL THE PURCHASES WERE MADE DURING THE FINANCIAL YEAR RELEVANT TO ASSESSMENT YE ARS THROUGH THE BEARER CHEQUES. THEREFORE, HE MADE DISALLOWANCE OF 20% BY INVOKING PROVISION OF SECTION 40A(3) OF THE IT ACT, 1961. 3.1. ON APPEAL THE LD. CIT(A) CONFIRMED THE SAME BY OBSERVING THAT 6. REMAND REPORTS WERE CALLED FOR FROM THE ASSESSI NG OFFICER. THE REMAND REPORTS WERE SUBMITTED BY THE ASSESSING OFFICER, WH EREIN IT WAS STATED THAT THE APPELLANT HAD MADE PAYMENTS TO THE MIDDLEMEN OR AGE NTS AND THEREFORE THE CASE OF THE APPELLANT WAS OUTSIDE THE PURVIEW OF CB DT CIRCULAR NO.8 OF 2006, AS IT DOES NOT APPLY TO THE PAYMENTS MADE TO MIDDLE MEN OR AGENTS. IT WAS ALSO STATED BY THE ASSESSING OFFICER THAT THE APPELLANT WAS ASKED TO PRODUCE REQUIRED CERTIFICATES FROM VETERINARY DOCTOR. BUT T HE APPELLANT FAILED TO FURNISH SUCH CERTIFICATES BEFORE HIM. IN RESULT, THE ASSESS ING OFFICER SUBMITTED THAT THE APPELLANT DID NOT SATISFYING ALL THE CONDITIONS AS LAID DOWN IN THE SAID CBDT CIRCULAR. 7. I HAVE PERUSED THE ASSESSMENT ORDER AND THE REM AND REPORTS AND ALSO CONSIDERED THE SUBMISSIONS MADE BY THE APPELLANT. I T IS AN ADMITTED POSITION THAT PAYMENTS EXCEEDING RS.20,000/- WERE MADE BY TH E APPELLANT OTHERWISE THAN BY CROSSED OR ACCOUNT PAYEE CHEQUES. AND, SUCH PAYMENTS ARE MADE IN CONTRAVENTION OF THE PROVISIONS OF SECTION 40A(3). I AM INCLINED TO AGREE WITH THE ASSESSING OFFICER THAT THE CASE OF THE APPELLAN T IS NOT COVERED BY CBDT CIRCULAR NO.8 OF 2006, AS IT DOES NOT SATISFY THE C ONDITIONS LAID DOWN THEREIN. THE ADDITION MADE BY THE ASSESSING OFFICER IS JUSTI FIED AND IS THEREFORE CONFIRMED. THE APPEAL ON THESE GROUNDS IS DISMISSED . 3.2. AGGRIEVED BY THIS THE ASSESSEE IS IN FURTHER A PPEAL BEFORE US. 4. AT THE TIME OF HEARING BEFORE US, THE LD. COUNS EL APPEARING ON BEHALF OF THE ASSESSEE WHILE REFERRING TO PAGE NO.166 OF THE PAPE R BOOK WHICH IS THE CERTIFICATE ISSUED BY MILITARY AUTHORITY REGARDING SUPERVISION OF SLAUGHTERING OF LIVESTOCK, FURTHER CONTENDED THAT THE ASSESSEE IS FULLY COVERE D BY CBDT CIRCULAR NO.8 OF 2006 3 DATED 6.10.2006. THEREFORE, THE REVENUE IS NOT JUST IFIED IN DISALLOWING 20% OF THE PAYMENT MADE TO THE PURCHASES U/S 40A(3) OF THE IT ACT. HE FURTHER SUBMITTED THAT THE AO HAS DISALLOWED EVEN THE SELF CHEQUES DRAWN BY TH E ASSESSEE FOR THE UTILIZATION OF CASH FOR DAY-TO-DAY REQUIREMENTS. THEREFORE, HE REQ UESTED TO DELETE THE ADDITION MADE BY THE REVENUE AUTHORITIES. 5. ON THE OTHER HAND, THE LD. DR RELIED ON THE ORDE RS OF THE REVENUE AUTHORITIES. 6. AFTER HEARING THE RIVAL SUBMISSIONS AND ON CARE FUL CONSIDERATION OF THE MATERIALS AVAILABLE ON RECORD, IT IS OBSERVED THAT THE CERTIFICATE PLACED AT PAGE 116 OF PAPER BOOK ON WHICH THE LD. AR RELIED UPON, IS NOT AVAILABLE WITH THE LD. CIT(A). IT IS EVIDENT FROM THE DATE OF CERTIFICATE THAT IS 25 TH APRIL, 2009 AND THE FACT THAT THE LD. CIT(A) HAS DISMISSED THE APPEAL OF THE ASSESSEE BY OBSERVING THAT THE ASSESSEE HAS FAILED TO FURNISH CERTIFICATE BEFORE HIM., THEREFOR E, IN THE INTEREST OF JUSTICE, WE SET ASIDE THE MATTER TO THE FILE OF THE LD. CIT(A) FOR FRESH CONSIDERATION IN VIEW OF THE CERTIFICATE ON WHICH THE LD. AR HAS PLACED RELIANCE UPON. WE FURTHER DIRECT LD. CIT(A) TO SEGREGATE THE CASH WITHDRAWALS MADE BY THE ASSES SEE FOR HIS DAY-TO-DAY REQUIREMENTS FROM THE DISALLOWANCE MADE U/S 40A(3) OF THE IT ACT. 7. IN THE RESULT THE APPEALS OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. '1 #5' 3 5% 6 7 '1 #5' 3 5% 6 7 '1 #5' 3 5% 6 7 '1 #5' 3 5% 6 7 8 88 8 ORDER PRONOUNCED IN THE OPEN COURT ON 09.03.2011. SD/- SD/- , , , , MAHAVIR SINGH, JUDICIAL MEMBER . .. . ! ! ! !. .. . , ,, , '# '# '# '# , C.D.RAO, ACCOUNTANT MEMBER. ( (( (!# !# !# !#) )) ) DATE: 09.03.2011. R.G.(.P.S.) 4 '1 / -9 :'9';- COPY OF THE ORDER FORWARDED TO: 1. M/S.HIND SUPPLY CORPORATION, 4, ACHAMBIT SHAW ROAD, 2 ND FLOOR, KOLKATA- 700022. 2 THE I.T.O., WARD-33(2), KOLKATA 3. THE CIT, 4. THE CIT(A)-XX, KOLKATA 5. DR, KOLKATA BENCHES, KOLKATA .9 -/ TRUE COPY, '1%5/ BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES