JCIT (OSD), New Delhi V. M/s. Studio Digital Prints Pvt. Ltd., New Delhi

ITA 5035/DEL/2011

• Counselvise Citation: 503520114 RSA 2011
• Duration Of Justice: 3 year(s) 9 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-09-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 20-08-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 11-11-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Additional evidence
• Section: 143(3)

Judgement Text

ITA NO. 5035/DEL/2011 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G , NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI O.P. KANT, ACCOUNTANT MEMBER I.T.A. NO. 5035 /DEL/201 1 A.Y. : 2008 - 09 JCIT (OSD), CIRCLE 9(1), ROOM NO. 163, CR BUILDING, NEW DEL HI VS. M/S STUDIO DIGITAL PRINTS PVT. LTD., 1796, KOTLA MUBARAKPUR, NEW DELHI 110 003 (PAN: AAVFS1531R) (APPELLANT) (RESPONDENT) DEPARTMENT BY : SHRI SUJIT KUMAR, SR. DR ASSESSEE BY : SHRI SANAT KAPOOR, ADV. DATE OF HEARING : 20 - 0 8 - 2015 DATE OF ORDER : 01 - 0 9 - 2015 ORDER PER H.S. SIDHU : J M REVENUE HAS FILED THIS APPEAL AGAINST THE IMPUGNED ORDER DATED 3 0. 8 .201 1 PASSED BY THE LD. CIT(A) - XII, NEW DELHI RELEVANT TO ASSESSMENT YEAR 2008 - 09. 2. THE FOLLOWING GR OUNDS HAVE BEEN RAISED : - 1. THE LD. CIT(A) ERRED, IN LAW AND ON THE FACTS AND CIRCUMSTANCES OF THE CASE IN DELETING THE ADDITION OF RS. 16,54,864/ - MADE BY AO BY DISALLOWING THE CLAIM OF JOB WORK WITHOUT BRINGING RELEVANT MATERIAL ON RECORDS. 2. THE L D. CIT(A) ERRED IN LAW AND ON THE FACTS AND CIRCUMSTANCES OF THE CASE IN DELETING THE ADDITION OF RS. ITA NO. 5035 / D EL /20 1 1 ( JCIT V STUDIO DIGITAL PRINTS P LTD.) 2 2,39,050/ - MADE BY AO U/S. 41(1) OF THE ACT BY ADMITTING ADDITIONAL EVIDENCE WITHOUT GIVING AN OPPORTUNITY TO THE AO IN VIOLATION OF RULE 46A OF THE I. T. RULES. 3. THE APPELLANT CRAVES TO AMEND MODIFY, ALTER, ADD OR FOREGO ANY GROUND OF APPEAL AT ANY TIME BEFORE OR DURING THE HEARING OF THIS APPEAL. 3. THE FACTS NARRATED BY THE REVENUE AUTHORITIES ARE NOT DISPUTED, THEREFORE, THE SAME ARE NOT REPEATE D HERE FOR THE SAKE OF CONVENIENCE. 4. AFTER HEARING BOTH THE PARTIES, WE ARE OF THE CONSIDERED VIEW THAT LD. CIT(A) HAS NOT PASSED A SPEAKING ORDER ON THE ISSUE IN DISPUTE AND DELETED THE ADDITION IN DISPUTE, CONTRARY TO THE LAW AND FACTS OF THE CASE, WH ICH IS NOT SUSTAINABLE UNDER THE LAW. FOR THE SAKE CONVENIENCE, THE ORDER OF THE LD. CIT(A) IS REPRODUCED HEREUNDER: - 1. THIS APPEAL IS FILED AGAINST THE ORDER PASSED BY THE DY. COMMISSIONER OF INCOME - TAX, CIRCLE - 9(1), NEW DELHI (HEREINAFTER REFERRED TO A S 'THE AO') ON 28.12.10 U/S. 143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS 'THE ACT') FOR ASSESSMENT YEAR 2008 - 09. IN THIS ORDER THE ASSESSING OFFICER DETERMINED THE ASSESSED INCOME AT RS.4,37,940/ - AFTER MAKING THE FOLLOWING ADDITIONS/DIS ALLOWANCES TO THE RETURNED INCOME OF RS. 14,55,972/ - . 2. DURING THE COURSE OF APPELLATE PROCEEDING SH. NAYAK, CA, APPEARED. HIS POWER OF, ATTORNEY HAS BEEN PLACED ON RECORD. WRITTEN SUBMISSION MADE BY HIM HAVE BEEN CONSIDERED. ITA NO. 5035 / D EL /20 1 1 ( JCIT V STUDIO DIGITAL PRINTS P LTD.) 3 3. THE APPELLANT HAS TAKE N THE FOLLOWING GROUNDS OF APPEAL: 1. THAT THE LD. ASSESSING OFFICER IS WRONG IN LAW AND IN FACTS IN MAKING ADDITION/DISALLOWANCE OF LABOUR CHARGES PAID UNDER THE HEAD 'JOB WORK' AMOUNTING TO RS.16,54,864/ - FOR THE REASON THAT TDS IS NOT DEDUCTED, WHICH I S NOT APPLICABLE FOR THESE PAYMENTS. 2. THAT THE LD. AO IS WRONG IN LAW AND IN FACTS IN MAKING ADDITION/DISALLOWANCE OF OUTSTANDING SUNDRY CREDITORS AMOUNTING TO RS.2,39,O5O/ - . 3. THAT THE ADDITIONS/DISALLOWANCES MADE ARE BASED ON MERE SURMISES AND CO NJUNCTURES AND THE SAME CANNOT BE JUSTIFIED BY ANY MATERIAL ON RECORD. 4. THE APPELLANT CRAVES LEAVE TO ADD, AMEND, ALTER AND/OR DELETE ANY OF THE ABOVE GROUNDS OF APPEAL AT OR BEFORE THE TIME OF HEARING. SUBMISSIONS OF THE ASSESSEE: GROUND OF APPEAL NO. 1: THAT THE AO IS WRONG IN LAW AND IN FACTS IN MAKING ADDITION/DISALLOWANCE OF LABOUR CHARGES PAID UNDER THE HEAD 'JOB WORK' AMOUNTING TO RS.16,54,864/ - FOR THE REASON THAT TDS IS NOT DEDUCTED, WHICH IS NOT APPLICABLE FOR THESE PAYMENTS. WE ARE SUB MITTING HEREWITH THE DETAILS OF PAYMENT MADE TO VARIOUS WORKER AGAINST VARIOUS PETTY JOB WORKS DONE WHICH IS DEBITED UNDER THE HEAD 'JOB WORK EXPENSES'. IT ITA NO. 5035 / D EL /20 1 1 ( JCIT V STUDIO DIGITAL PRINTS P LTD.) 4 CAN BE SEEN THE EACH PAYMENT IS NOT COVERED UNDER CHAPTER XVII OF THE IT ACT, 1961. ALL THE JOB WORK ARE IN - HOUSE AND EACH PAYMENTS ARE LESS THAN RS.50,000/ - IN THE YEAR. HENCE TDS PROVISIONS ARE APPLICABLE. THUS THE DISALLOWANCE MADE BY THE AO IS NOT CALLED FOR. IT IS THEREFORE PRAYED TO KINDLY GIVE DIRECTION TO AO IS DELETE THE DISALLOWANCE. FINDINGS IN VIEW OF THE ABOVE FACTS AS WELL AS THE FINDINGS OF THE AO IN HER ASSESSMENT ORDER IT IS CLEAR THAT ASSESSEE IS NOT COVERED FOR TDS UNDER ANY PROVISION AND I AM SATISFIED THAT THE ASSESSEE IS NOT LIABLE FOR TDS. HENCE ADDITION IS DELETED. GROUND OF APP EAL NO.2: THAT THE AO IS WRONG IN LAW AND IN FACTS IN MAKING ADDITION / DISALLOWANCE OF OUTSTANDING SUNDRY CREDITORS AMOUNTING TO RS. 2,39,050/ - . AS STATED IN THE ASSESSMENT ORDER, OUTSTANDING SUNDRY CREDITORS INCLUDE: M/S ARUN MALHOTRA & ASSOCIATED RS.120782/ - M/S SIGN COLOURS INDIA RS.118268/ - TOTAL RS.239050/ - THE APPELLANT ONLY FURNISHED DETAILS OF THE OUTSTANDING TO THE AO. THE APPELLANT WAS GIVEN ANY OPPORTUNITY TO EXPLAIN ITS POSITION FOR DISALLOWANCE FOR THE AFORESAID AMOUNT. IN THIS REGARD, IT IS HEREBY SUBMITTED THAT SO FAR AS M/S. ARUN MALHOTRA & ASSOCIATES IS CONCERNED, THEY ARE THE STATUTORY AUDITOR OF THE COMPANY, WHO HAVE NOT ITA NO. 5035 / D EL /20 1 1 ( JCIT V STUDIO DIGITAL PRINTS P LTD.) 5 PRESSURIZED FOR THE PAYMENT. BUT IT DOES NOT MEAN THE AMOUNT IS NOT PAYABLE. IT IS STILL A LIABILIT Y OF THE COMPANY, WHICH CANNOT BE DENIED. FURTHER THE MATTER IS SUBJUDICIED AND PENDING WITH DISTT. COURT, PATIALA HOUSE OR THE OUTSTANDING AMOUNT AGAINST THE OTHER PARTY VIZ. M/S. SIGN COLOURS INDIA. IN THIS REGARD, WE ARE SUBMITTED HEREWITH THE RELEVAN T DOCUMENT IN THIS REGARD. FINDINGS IN VIEW OF THE FACTS STATED ABOVE AS WELL AS THAT STATED IN THE ASSESSMENT ORDER IT IS SEEN THAT CREDITORS ARE NOT STATIC HENCE ADDITION OF RS.239050/ - IS HEREBY DELETED: . GROUND OF APPEAL 3 & 4: THE GROUND NO.3 & 4 A RE GENERAL IN NATURE. IN THE RESULT, THE APPEAL IS ALLOWED. (KA VITA BHATNAGAR) 5. AFTER GOING THROUGH THE AFORESAID ORDER, WE ARE OF THE VIEW THAT LD. CIT(A) HAS DELETED THE ADDITION IN DISPUTE WITHOUT PASSING A SPEAKING ORDER AND SECONDLY, THE ADDIT IONAL EVIDENCE ADMITTED BY THE LD. CIT(A) IS ALSO IN VIOLATION OF RULE 46A OF THE I.T. RULES. THEREFORE, THE ORDER IS NOT SUSTAINABLE IN THE EYES OF LAW AND DESERVE TO BE CANCELLED. WE CANCEL THE IMPUGNED ORDER WITH THE DIRECTION TO THE LD. CIT(A) TO PAS S A SPEAKING ORDER ON THE ISSUE IN DISPUTE, AFTER HEARING THE PARTIES, ESPECIALLY THE ORDER ON ADDITIONAL EVIDENCE UNDER RULE 46A OF THE I.T. RULES. ITA NO. 5035 / D EL /20 1 1 ( JCIT V STUDIO DIGITAL PRINTS P LTD.) 6 6 . IN THE RESULT, THE APPEAL FILED BY THE REVENUE STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PR ONOUNCED IN THE O PEN C OURT ON 01 / 9 /20 15. SD / - S D/ - [ O.P. KANT] [ H.S. SIDHU ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 01 / 9 /201 5 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES ITA NO. 5035 / D EL /20 1 1 ( JCIT V STUDIO DIGITAL PRINTS P LTD.) 7