Sardar Nahar Singh, Ranchi V. ITO, Ranchi

ITA 49/RAN/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 2192 (ITAT-RANCHI)
• Duration Of Justice: 11 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2002-2003
• Appeal Filed On: 20-03-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANDIP RAJ
• Assessee Lawyers: S K PODDAR
• Section: 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL: RANCHI BENCH SMC, RANCHI BEFORE SH. SHAMIM YAHYA, ACCOUNTANT MEMBER ITA NO. 49/RAN/2015 ASSESSMENT YEAR: 2002-03 SH. SARDAR NAHAR SINGH, PROP: M/S. COOLER ENTERPRISES, MAIN ROAD, RANCHI-834001, JHARKHAND. (PAN:AGJPS4821N) VS. INCOME TAX OFFICER, WARD-2(2), RANCHI (APPELLANT) (RESPONDENT) APPELLANT BY SH. S.K. PODDAR, ADVOCATE RESPONDENT BY SANDIP RAJ, ADDL. CIT DATE OF HEARING 01.03.2016 DATE OF PRONOUNCEMENT 02.03.2016 O R D E R THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF LD. CIT(A), DATED 10.12.2014 AND PERTAINS TO THE ASSESSMENT YEA R 2002-03. 2. THE ONLY ISSUE PRESSED BY THE ASSESSEE THAT THE LD. CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS. 2,77,076/- MADE ON T HE BASIS OF TDS CERTIFICATE WHICH RELATES TO COMMISSION RECEIPT. IN THIS CASE, THE ASSESSING OFFICER, DURING THE COURSE OF ASSESSMENT PROCEEDINGS, HAD MADE ADDI TION OF RS. 2,77,076/- ON THE GROUND THAT THE ASSESSEE RECEIVED COMMISSION OF RS. 2,77,076/- AS PER TDS CERTIFICATE FILED ALONGWITH THE RETURN OF INCOME. T HE ASSESSING OFFICER HAD OBSERVED THAT AUDITED PROFIT & LOSS ACCOUNT REFLECT S RECEIPTS FROM SALES AND JOB WORK. THERE WAS NO ENTRY IN THE PROFIT & LOSS ACCOU NT UNDER THE HEAD COMMISSION, AS SUCH, THE ASSESSING OFFICER CONCLU DED THAT THE COMMISSION 2 ITA NO. 49/RAN/2015 AY: 2002-03 RECEIVED WAS NOT DISCLOSED, AND MADE THE ADDITION. BEFORE THE LD. CIT(A), THE ASSESSEE MADE THE FOLLOWING SUBMISSIONS: THE APPELLANT HAS NOT RECEIVED ANY SPECIFIC AMOUNT AS COMMISSION. APPELLANT IS WORKING FOR VOLTAS SELLING THEIR AIR C ONDITIONERS AND COOLERS AND OTHER MACHINES. THE APPELLANT IS ALSO M AINTAINING THE MACHINES SO SOLD TO SOME CORPORATE SECTORS LIKE M/S . LIFE INSURANCE CORPORATION, M/S. CMPDI LTD. PAYMENTS MADE FOR THE JOB WORK WHICH IS MAINTENANCE CHARGES WERE SUBJECT TO DEDUCTION OF TD S. VOLTAS LTD. ALLOWED REBATE/COMMISSION TO THE APPELL ANT ON THE SALES MADE BY THEM. SUCH AMOUNT OF REBATE RECEIVED WAS CR EDITED IN THE PROFIT & LOSS ACCOUNT FOR RS. 4,14,320/-. ON THIS AMOUNT O F REBATE TDS WAS DEDUCTED AND CERTIFICATES WERE FILED. IN FORM NO. 1 6A THERE IS NO NOMENCLATURE AS REBATE U/S. 194C. THE LEARNED ASSES SING OFFICER COMPLETELY MISUNDERSTOOD THE TDS CERTIFICATE AND PR ESUMED THAT THE APPELLANT RECEIVED SOME COMMISSION WHICH WAS NOT AC COUNTED FOR. WHATEVER AMOUNT WAS RECEIVED FROM M/S. VOLTAS LTD. TOWARDS REBATE AND ALSO FROM LIC OR CMPDIL FOR JOB WORK WAS RECEIV ED BY ACCOUNT PAYEE CHEQUE DULY DEPOSITED IN OUR BANK ACCOUNT AND ACCOUNTED FOR IN OUR REGULAR BOOKS OF ACCOUNTS. THERE IS NO COMMISSI ON RECEIVED OVER AND ABOVE WHICH WAS NOT ACCOUNTED FOR. TO CONCLUDE, WE SUBMIT THAT NO SEPARATE COMMISSION WAS RECEIVED, THE ALLEGED AMOUNT OF COMMISSION STANDS ACCOUNTED FOR U NDER THE HEAD REBATE. THE ADDITION MADE, THEREFORE, IS UNJUSTIF IED AND ILLEGAL. 5. LD. CIT(A) DID NOT PROPERLY APPRECIATE THE ABOV E SUBMISSIONS AND PROCEEDED TO CONFIRM THE AOS ACTION. AGAINST THE A BOVE ORDER, THE ASSESSEE IS IN APPEAL BEFORE ITAT. 6. I HAVE HEARD BOTH THE COUNSEL AND PERUSED THE R ECORDS. LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT THE AUTHORITIES BELOW HAVE CLEARLY ERRED IN APPRECIATING THE CONTENTS OF THE TDS CERTIFICATE. LD. COUNSEL SU BMITTED THAT THE ASSESSEE HAS NOT RECEIVED ANY COMMISSION. HE FURTHER SUBMITTED T HAT IT HAS BEEN CLEARLY EXPLAINED THAT THE ASSESSEE RECEIVED REBATE/COMMISS ION ON SALES MADE ON BEHALF OF THE M/S. VOLTAS LTD. THE ASSESSEE SUBMITTED THAT ACTUALLY THERE IS NO RECEIPT OF COMMISSION, BUT IT RELATES TO REBATE/COMMISSION AND THE ASSESSEE HAS DULY ACCOUNTED FOR RS. 4,14,320 OF SUCH INCOME, AND THE LD. CIT(A) HAS NOT APPRECIATED THE SAME. LD. COUNSEL ALSO SUBMITTED I N THIS CASE THAT THE ASSESSING 3 ITA NO. 49/RAN/2015 AY: 2002-03 OFFICER HAS EARLIER INITIATED PROCEEDINGS UNDER SEC TION 154 OF THE INCOME-TAX ACT, 1961 (FOR SHORT THE ACT) BUT ON ASSESSEES E XPLANATION AND SUBMISSION, PROCEEDINGS UNDER SECTION 154 OF THE ACT WERE DROPP ED AND THE CASE WAS REOPENED. LD. COUNSEL SUBMITTED THAT THERE HAS BEEN TOTAL LACK OF APPLICATION OF MIND BY THE AUTHORITIES BELOW. 7. UPON CAREFUL CONSIDERATION, I FIND THAT THE ADD ITION HAS BEEN MADE ON THE BASIS OF TDS CERTIFICATE IN WHICH THE INCOME WAS SH OWN AS COMMISSION AMOUNTING TO RS. 2,77,076/-. AUTHORITIES BELOW HAVE INSISTED THAT THIS AMOUNT IS NOT REFLECTED IN THE PROFIT AND LOSS ACCOUNT. THE A SSESSEE HAS DULY EXPLAINED THAT THE SAID COMMISSION ACTUALLY RELATES TO RECEIPT OF REBATE/COMMISSION FROM M/S. VOLTAS LTD. A TOTAL SUM OF RS. 4,14,320/- HAS ALREA DY BEEN REFLECTED IN THE PROFIT AND LOSS ACCOUNT IN THIS REGARD. I FIND THAT THE AB OVE SUBMISSIONS ARE CLEAR AND COGENT AND THE AUTHORITIES BELOW HAVE ERRED IN APPR ECIATING THE SAME. HENCE, I SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND D ELETE THE ADDITION. 8. IN THE RESULT, THIS APPEAL OF THE ASSESSEE STAN DS ALLOWED. THE DECISION IS PRONOUNCED IN THE OPEN COURT ON 2 ND MARCH, 2016. SD/- (SHAMIM YAHYA) ACC OUNTANT MEMBER DATED: 2 ND MARCH, 2016. RAJESH, SR.PS/- COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) - 5. THE DR, ITAT, RANCHI 6. GUARD FILE BY ORDER SR. P.S., ITAT, RANCHI