JAISAN DAS, BUNDI V. ACIT, Kota

ITA 491/JPR/2013

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 3002 (ITAT-JAIPUR)
• Duration Of Justice: 2 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-07-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 10-07-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 03-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANITA RI TESH
• Assessee Lawyers: M K JAIN
• Keywords: Opportunity of being heard

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH SMC JAIPUR BEFORE SHRI B.R. JAIN, ACCOUNTANT MEMBER ITA NO. 491/JP/2013 ASSESSMENT YEAR: 2008-09 PAN NO. AAUPD3818N JAISAN DAS, VS. THE A.C.I.T. PROP. M/S R.S. TRADERS CIRCLE-1, KOTA LAL BIHARI JI KA CHOWK, BUNDI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI M.K. JAIN RESPONDENT BY : MS. ANITA RITESH DATE OF HEARING : 10.07.2013 DATE OF PRONOUNCEMENT : 10.07.2013 ORAL ORDER PER B.R. JAIN, A.M. THIS APPEAL BY ASSESSEE AGAINST THE ORDER DATED 13 TH FEBRUARY, 2013 OF LD. CIT (APPEALS), AJMER RAISES THE SOLITARY GROUND AS UNDE R :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE , THE LEARNED ASSESSING OFFICER HAS WRONGLY DISALLOWED RS. 1,83,200/- OF TH E COMMISSION EXPENSES CLAIMED BY THE APPELLANT AND SUSTAINED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS), AJMER. 2. BRIEFLY THE FACTS ARE THAT THE ASSESSEE IS A KAC HHA ARTIA AND EARNED INCOME BY WAY OF COMMISSION ON FOOD-GRAIN ITEMS. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAS ALSO PAID COMMISSION AMOUNTING TO RS. 1,83,200/- TO SIX PERSONS NAMELY RAJMAL, LATOOR LAL, MAHAVEER, RAM LAXMAN, RAM RATAN AND SURAJ MAL. THE ASSESSING OFFICER REQUIRED THE ASSESSEE TO PRODUCE DETAILS OF TRANSACTIONS FOR WHICH THE COMMISSION IS PAID TO THE AFORESAID PERSONS ALONGWITH THEIR POSTAL ADDRESSES, PAN, CONTACT NUMBERS ETC. IN ABSENCE 2 OF SUCH DETAILS, VERIFICATION COULD NOT BE MADE. TH E ASSESSING OFFICER, THEREFORE, DID NOT ACCEPT THE GENUINENESS OF THE CLAIM AND PROCEEDED T O DISALLOW THE DEDUCTION OF RS. 1,83,200/- CLAIMED BY THE ASSESSEE. THE RETURNED IN COME OF RS. 1,62,850/- STOOD ASSESSED AT RS. 3,69,661/-. 3. THE LD. CIT(A) DID NOT FIND ANY MERIT IN THE ASS ESSEES CLAIM THAT THE COMMISSION WAS PAID TO OBTAIN THE BUSINESS FROM FARMERS THROUG H THESE PERSONS TO WHOM THE COMMISSION IS CLAIMED TO HAVE BEEN PAID. AGREEING W ITH THE FINDINGS REACHED BY THE ASSESSING OFFICER, THE LD. CIT(A) CONFIRMED THE DIS ALLOWANCE. 4. SRI M.K. JAIN, LEARNED COUNSEL FOR THE ASSESSEE CONTENDS THAT THE COMMISSION HAS BEEN PAID FOR PROCURING BUSINESS BY THE ASSESSEE FR OM A PARTICULAR COMMUNITY AS THE GOODS THAT WERE BROUGHT TO THE MANDI AT APPELLANTS SHOP WERE ON ACCOUNT OF THE LIAISON DONE BY THE AFORESAID SIX PERSONS. THE SERVICES OF THESE PERSONS WERE UTILIZED IN THE EARLIER YEARS AS WELL AS IN SUBSEQUENT YEARS AND CO MMISSION FOR SUCH WORK WERE ALSO PAID TO THEM IN THOSE YEARS AND IS A MATTER OF RECORD OF THE ASSESSING OFFICER. THE AUTHORITIES BELOW, HOWEVER, HAVE NOT APPRECIATED THE BUSINESS N ECESSITY AND THE FACTUM OF ACTUAL BUSINESS RETAINED BY THE ASSESSEE ON ACCOUNT OF THE WORK DONE BY THEM. IT WAS, THEREFORE PRAYED TO DELETE THE DISALLOWANCE. 5. ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENTATI VE CONTENDS THAT THE ASSESSEE HAS NOT LAID ANY RELIABLE MATERIAL ON RECORD TO SUBSTAN TIATE HIS CLAIM THAT THE SERVICES OF THE AFORESAID SIX PERSONS TO WHOM COMMISSION HAS BEEN P AID DURING THE YEAR UNDER CONSIDERATION WAS FACTUALLY RENDERED. IN ABSENCE OF SUCH DETAILS, THE DISALLOWANCE MADE CANNOT BE DELETED. 3 6. I HAVE HEARD PARTIES WITH REFERENCE TO MATERIAL ON RECORD. IN THE INTEREST OF SUBSTANTIAL JUSTICE, I CONSIDER IT APPROPRIATE TO S ET ASIDE THE DISALLOWANCE AND REMIT THE MATTER BACK TO THE LD. ASSESSING OFFICER SO THAT TH E ASSESSEES CLAIM THAT THE COMMISSION PAID TO THEM WAS FACTUALLY FOR BUSINESS PURPOSE AND WORK DONE BY THEM IS VERIFIED BY THE ASSESSING OFFICER AND DECISION TAKEN AFRESH AFTER A FFORDING REASONABLE AND EFFECTIVE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 7. IN THE RESULT, THE APPEAL STANDS ALLOWED FOR STA TISTICAL PURPOSES ONLY. ORDER PRONOUNCED IN THE OPEN COURT AFTER HEARING O F BOTH THE PARTIES ON 10/07/2013. SD/- (B.R. JAIN) ACCOUNTANT MEMBER JAIPUR, DATED : 10.07.2013 * RANJAN COPY FORWARDED TO :- 1. SHRI JAISAN DAS, BUNDI 2. THE ACIT, CENTRAL CIRCLE-1, KOTA 3. THE CIT (A) 4. THE CIT 5. THE D/R GUARD FILE (ITA NO. 491/JP/2013) BY ORDER, AR ITAT JAIPUR.