THE ITO, Hyderabad V. M/s Murari Trading, Hyderabad

ITA 52/HYD/2010

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 3021 (ITAT-HYDERABAD)
• Duration Of Justice: 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-07-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 07-07-2010
• Assessment Year: 2006-2007
• Appeal Filed On: 13-01-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VASUNDHARA SINHA
• Assessee Lawyers: A V RAGHURAM

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B', HYDERABAD BEFORE SHRI G.C.GUPTA, VICE PRESIDENT AND SHRI CHANDRA POOJARI, ACCOUNTANT MEMEBR ITA NO.51 & 52/HYD/2010 ASSTT. YEAR 2003-04 & 2006-07 ITO WARD-6(1) HYDERABAD V/S. M/S MURARI TRADING, HYDERABAD (PAN NO.AAGFM 3090 E) (APPELLANT) (RESPONDENT) APPELLANT BY : SMT. VASUNDHARA SINHA, DR RESPONDENT BY : SHRI A.V. RAGHU RAM O R D E R PER SHRI G.C. GUPTA, VICE PRESIDENT: THESE TWO APPEALS BY THE REVENUE FOR THE ASSESSMENT YEAR S 2003-04 AND 2006-07 ARE DIRECTED AGAINST THE ORDER O F THE CIT(A). THESE ARE BEING DISPOSED OFF WITH THIS CONSOLIDATED ORD ER. 2. THE APPEAL OF THE REVENUE FOR THE ASSESSMENT YEAR 20 03-04 IN ITA NO.51/H/2010 IS TIME BARRED BY 6 DAYS. WE HAVE HE ARD THE PARTIES ON THIS ISSUE. WE FIND THAT THE DELAY WAS DUE TO REASONA BLE CAUSE ON THE PART OF THE REVENUE OFFICERS IN FILING THE APPEAL BEFORE THE TRIBUNAL AND ACCORDINGLY THE DELAY IN FILING THE APPEAL FOR TH E ASSESSMENT YEAR 2003-04 BY THE REVENUE IS CONDONED. ITA NOS 51 & 52/HYD/2010 M/S MURARI TRADING, HYDERABAD. 2 3. THE IDENTICAL GROUNDS OF APPEAL OF THE REVENUE FOR BOTH THE ASSESSMENT YEARS 2003-04 AND 2006-07 ARE AS UNDER: '(I) THE ORDER OF THE LEARNED CIT (APPEALS) IS ERR ONEOUS IN LAW OR IN FACTS OR BOTH. (II) THE HON'BLE CIT (A) ERRED IN ACCEPTING THE ASS ESSEE'S CONTENTION THAT THE AGREEMENT WITH THE SUB-AGENTS W AS A FINANCIAL GUARANTEE AGREEMENT, WITHOUT REASONABLE G ROUNDS. (III) THE NEED FOR ENGAGING A MIDDLEMAN ITSELF HAS NOT BEEN ESTABLISHED BY THE ASSESSEE, BEFORE THE ASSESSING O FFICER OR BEFORE THE CIT (APPEALS), AS THE ASSESSEE FIRM WAS ACTUALLY GETTING ITS COMMISSION ON REGULAR BASIS'. 4. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT TH E ISSUE IN THE GROUNDS OF APPEAL OF THE REVENUE IS COVERED IN FAV OUR OF THE ASSESSEE WITH THE DECISION OF THE TRIBUNAL IN ASSESSEE'S OWN CA SE FOR THE ASSESSMENT YEAR 2004-05 AND 2005-06 IN ITA NO.458 & 459/HYD/2009 DATED 23-7-2009 AND THE FACTS OF THE CASE OF THE ASSESSEE FOR THE RELEVANT ASSESSMENT YEARS UNDER APPEAL BEFO RE THE TRIBUNAL ARE IDENTICAL. THE LEARNED DEPARTMENTAL R EPRESENTATIVE COULD NOT CONTROVERT THE SUBMISSION OF THE LEARNED COUNSEL F OR THE ASSESSEE. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT THE ISSUE REGARDING THE DISALLOWANCE OF COMMISSION PAYMENTS MADE TO SUB AGENTS BY THE ASSESSEE IS COVERED IN FAVOUR OF THE ASSESSEE WI TH THE DECISION OF THE COORDINATE BENCH OF THE TRIBUNAL IN ASSESSE E'S OWN CASE FOR THE ASSESSMENT YEARS 2004-05 AND 2005-06 (SUPRA) AND THE FACTS OF THE CASE OF THE ASSESSEE FOR THE RELEVANT ASSESSMENT YEARS IN APPEAL BEFORE US ARE IDENTICAL WITH THE FACTS OF THE CA SE OF THE ASSESSEE IN THE ASSESSMENT YEARS 2004-05 AND 2005-06. WE BEI NG IN ITA NOS 51 & 52/HYD/2010 M/S MURARI TRADING, HYDERABAD. 3 AGREEMENT WITH THE DECISION OF THE COORDINATE BENCH OF THE TRIBUNAL IN ASSESSEE'S OWN CASE FOR THE ASSESSMENT YEARS 2004-05 AND 2005-0 6 (SUPRA) DECIDE THE ISSUE OF DISALLOWANCE OF COMMISSION PAYM ENTS IN FAVOUR OF THE ASSESSEE AND THE GROUNDS OF APPEAL OF THE REVENUE ARE DISMISSED. 6. IN THE RESULT BOTH THE APPEALS OF THE REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE COURT ON 16.7.2010 SD/- SD/- (CHANDRA POOJARI) (G.C. GUPTA) ACCOUNTANT MEMBER VICE-PRESIDENT PVV/SPS DATE: 16/7/2010 COPY FORWARDED TO: 1. THE INCOME TAX OFFICER, WARD-6(1), 7TH FLOOR, D BL OCK, IT TOWERS, AC GUARDS, HYDERABAD 2. M/S MURARI TRADING, 6-3-456/A/2 419, MODEL HOUSE, P UNJAGUTTA, HYDERABAD 3. THE COMMISSIONER OF INCOME-TAX (APPEALS) IV, HYDERAB AD. 4 THE COMMISSIONER OF INCOME-TAX-III, HYDERABAD 5 THE DEPARTMENTAL REPRESENTATIVE, ITAT, HYDERABAD.