ACIT, Kota V. BALAJI SALT COMPANY, Kota

ITA 477/JPR/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 2132 (ITAT-JAIPUR)
• Duration Of Justice: 1 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-08-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 06-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S L CHANDEL
• Keywords: Rectification of order; Audit objection
• Section: 143(3); 154

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR JH HKKXPAN] YS[KK LNL; ] DS LE{K BEFORE: SHRI BHAGCHAND, ACCOUNTANT MEMBER VK;DJ VIHY LA-@ ITA NO. 477/JP/2017 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2010-11 ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-1, KOTA. CUKE VS. M/S BALAJI SALT COMPANY, 1-TA-17, VIGYAN NAGAR, KOTA. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AAGFB 7552 A VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SHRI S.L. CHANDEL (ADDL.CIT) FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY: NONE (ADJ. APPLICATION REJECTED) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 31/07/2017 MN?KKS'K.KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 02/08/2017 VKNS'K@ ORDER PER: BHAGCHAND, A.M. THIS IS AN APPEAL FILED BY THE REVENUE EMANATES FRO M THE ORDER OF THE LD. CIT(A), ALWAR DATED 01/03/2017 FOR THE A.Y. 2010-11, WHEREIN THE REVENUE HAS TAKEN SOLE GROUND OF APPEAL, WHICH I S AGAINST DELETING THE ADDITION OF RS. 5,45,870/- MADE U/S 154 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) CONSIDERING THAT INVOKING O F PROVISIONS OF SECTION 40(A)(IA) OF THE ACT CANNOT BE CONSIDERED A S MISTAKE APPARENT FROM RECORD. ITA 477/JP/2017_ ACIT VS M/S BALAJI SALT COMPANY 2 2. THE ASSESSING OFFICER IN HIS ORDER U/S 154 OF THE ACT HAS OBSERVED THAT THE ASSESSEE PAID FREIGHT FOR FLY ASH TRANSPORTATION FROM 01/04/2009 TO 30/09/2009 OF RS. 15,05,932/-. IN THE AUDIT, IT WAS NOTICED THAT THE ASSESSEE HAD NOT DEDUCTED TDS ON PA YMENT OF FREIGHT OF RS. 5,45,870/-, THEREFORE, THESE EXPENDITURE WAS NOT ALLOWABLE AND ADDED IN THE INCOME OF THE ASSESSEE. 3. THE LD. CIT(A) AFTER CONSIDERING THE SUBMISSIONS HAS DELETED THE ADDITION BY HOLDING AS UNDER:- 5.3 I HAVE GONE THROUGH THE RECTIFICATION ORDER A S WELL AS SUBMISSIONS MADE BY THE APPELLANT. FOLLOWING FACTS HAVE EMERGED; 1. THAT THE REGULAR RETURN OF/INCOME FILED BY THE A PPELLANT WAS SUBJECTED TO ASSESSMENT UNDER SECTION 143(3) OF THE ACT. 2. THAT AFTER COMPLETION OF ASSESSMENT UNDER SECTIO N 143(3) OF THE ACT, THE AUDIT PARTY HAS RAISED THE Q UESTION ABOUT NON-DEDUCTION OF TDS ON AN AMOUNT OF RS. 5,45,870/- PAID ON ACCOUNT OF FREIGHT FOR FLY ASH TRANSPORTATION. 3. THAT ON THE BASIS OF AUDIT OBJECTION, THE A.O HA S INVOKED SECTION 154 OF THE ACT HOLDING IT AS MISTAKE APPARE NT FROM RECORD AND ADDED THE AMOUNT OF RS. 5,45,870/- TO THE ASSESSED INCOME UNDER SECTION 40(A)(IA) OF THE ACT. 4. THAT THE APPELLANT HAS SUBMITTED THAT INVOCATION OF SECTION 40(A)(IA) OF THE ACT IS NOT A MISTAKE APPAR ENT FROM RECORDS AND CANNOT BE INVOKED U/S 154 OF THE A CT ITA 477/JP/2017_ ACIT VS M/S BALAJI SALT COMPANY 3 AND CITED VARIOUS JUDICIAL RULINGS ON THIS ISSUE IN HIS FAVOUR. 5.3.2 I HAVE CONSIDERED THE ABOVE MENTIONED FACTS A ND SUBMISSIONS OF THE APPELLANT ALONG WITH THE VARIOUS JUDGMENTS C ITED. AFTER CONSIDERING THE FACTUAL MATRIX OF THE CASE, IT IS M Y CONSIDERED VIEW THAT ISSUE RELATED TO SECTION 40(A)(IA) OF THE ACT IS A DEBATABLE ISSUE AS SOME EXCEPTIONS ARE ALSO ENSHRIN ED IN THE ACT ITSELF. I HAVE ALSO TAKEN INTO CONSIDERATION TH AT THE REGULAR ASSESSMENT WAS MADE UNDER SECTION 143(3) OF THE ACT . I HAVE ALSO TAKEN INTO ACCOUNT HONBLE ITAT, CHANDIGARH ON THE SIMILAR ISSUE, WHERE IT HAS BEEN DECIDED AS UNDER; 'THUS, THE ISSUE OF ALLOWABILITY OF EXPENDITURE IN VIEW OF THE PROVISIONS OF SECTION 40(A)(IA) OF THE ACT OR NOT I S HIGHLY DEBATABLE AND SUCH DEBATABLE ISSUES CANNOT BE DECID ED BY WAY OF RECTIFICATION UNDER SECTION 154 OF THE ACT. THE LIMITED MANDATE PROVIDED UNDER SECTION 154 OF THE IT ACT IS TO CORR ECT ANY MISTAKE APPARENT FROM RECORD AND THE ADJUDICATION O F DEBATABLE ISSUE IS NOT COVERED BY WAY OF RECTIFICATION UNDER SECTION 154 OF THE ACT. I HAVE ALSO TAKEN INTO CONSIDERATION APEX COURT JU DGMENT AS UNDER; IN A LANDMARK JUDGMENT THE SUPREME COURT IN T.S. BA LARAM, ITO V. VOLKART BROTHERS [1971] 82 ITR 50 (SC) HELD THAT A MISTAKE APPARENT ON THE RECORD MUST BE OBVIOUS AND PATENT M ISTAKE AND NOT SOMETHING WHICH CAN BE ESTABLISHED BY A LONG DR AWN PROCESS OF REASONING ON POINTS ON WHICH THERE MAY CONCEIVAB LY BE TWO OPINIONS. A DECISION ON A DEBATABLE POINT OF LAW IS NOT A MISTAKE APPARENT FROM THE RECORD. RECTIFICATION UNDER SECTION 154 CAN ONLY BE MADE W HEN GLARING MISTAKE OF FACT OR LAW HAS BEEN COMMITTED BY THE OF FICER PASSING THE ORDER AND IT BECOMES APPARENT FROM THE RECORD. RECTIFICATION IS NOT POSSIBLE IF THE QUESTION IS DEBATABLE. MOREO VER, THE POINT WHICH IS NOT EXAMINED ON FACT OR IN LAW CANNOT BE DEALT WITH AS ITA 477/JP/2017_ ACIT VS M/S BALAJI SALT COMPANY 4 MISTAKE APPARENT ON THE RECORD. CIT V. HERO CYCLES (P.) LTD. [1997] TAXMAN 271/228 ITR 463 (SC). THEREFORE, IN VIEW OF SURROUNDING FACTS AND JUDICI AL PRONOUNCEMENTS, IT IS MY CONSIDERED VIEW THAT INVOK ING THE PROVISION OF SECTION 40(A)(IA) OF THE ACT CANNOT BE CONSIDERED UNDER SECTION 154 OF THE ACT AS IT CANNOT BE CONSTR UED AS MISTAKE APPARENT FROM RECORD. THEREFORE, THE ADDITI ON OF RS. 5,45,870/- MADE UNDER SECTION 154 OF THE ACT IS DEL ETED AND APPELLANTS GROUND OF APPEAL OIL THE ISSUE IS ALLOW ED. 4. NOW THE REVENUE IS IN APPEAL BEFORE THIS BENCH. TH E LD SR. DR HAS REITERATED THE ARGUMENTS AS MADE BEFORE THE LD CIT(A) AND PRAYED TO ALLOW THE APPEAL. ON THE CONTRARY, NONE WAS ATTEND ED ON BEHALF OF THE ASSESSEE. 5. IN THIS CASE, THE LD CIT(A) HAD DELETED THE ADDIT ION BY FOLLOWING THE CHANDIGARH ITAT DECISION IN THE CASE OF ITO VS R AJINDER KUMAR SHISHODIA, WHEREIN THE ITAT HAD UPHELD THE DELETION O F THE ADDITION U/S 40(A)(IA) BY PASSING AN ORDER U/S 154 OF THE ACT. TH E LD CIT(A) HAS ALSO FOLLOWED THE DECISION OF THE HON'BLE SUPREME COURT I N THE CASE OF T.S. BALARAM, ITO VS VOLKART BROTHERS (SUPRA). HE HAS PAS SED A SPEAKING ORDER, THEREFORE, I FIND NO ANY CONTRARY MATERIAL WH ATEVER REPORTED BY THE LD. CIT(A) IN HIS ORDER, THEREFORE IN ABSENCE OF ANY MATERIAL AGAINST THE FINDING OF THE LD. CIT(A), I HAVE NO ALTERNATE B UT TO CONCUR WITH THE ITA 477/JP/2017_ ACIT VS M/S BALAJI SALT COMPANY 5 FINDING OF THE LD. CIT(A), ACCORDINGLY, THE GROUND OF REVENUES APPEAL IS DISMISSED. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 02/08/2017. SD/- HKKXPAN (BHAGCHAND) YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 02 ND AUGUST, 2017 *RANJAN VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- THE ACIT, CIRCLE-01, KOTA. 2. IZR;FKHZ @ THE RESPONDENT- M/S BALAJI SALT COMPANY, KOTA. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 477/JP/2017) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR