CHHUTTANLALL MATTURMAL, MUMBAI V. ITO 21(1)(1), MUMBAI

ITA 5371/MUM/2011

• Counselvise Citation: 537119914 RSA 2011
• Duration Of Justice: 2 year(s) 9 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-04-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 24-12-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 18-07-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: M L PERUMAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH C, MUMBAI BEFORE SHRI R.C SHARMA, ACCOUNTANT MEMBER AND DR. S.T.M. PAVALAN, JUDICIAL MEMBER ITA NO. 5371/MUM/2011 ASSESSMENT YEAR: 2007-08 M/S. CHHUTTANLALL MATTUMAL 55, SWASTIK PLAZA, V.L. MEHTA ROAD, JVPD, VILE PARLE (W), MUMBAI-400 049 VS. ITO-21(1)(1) MUMBAI (APPELLANT) (RESPONDENT) PERMANENT ACCOUNT NO. :-AADFC 1390 E ASSESSEE BY : SHRI NISHIT GANDHI REVENUE BY : SHRI M. L. PERUMAL DATE OF HEARING : 03.04.2014 DATE OF PRONOUNCEMENT : 22.04.2014 O R D E R PER DR. S.T.M. PAVALAN, JM: THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER OF THE LD.CIT(A)-32, MUMBAI DATED 07.03.2011 FOR THE ASSES SMENT YEAR 2007-08. 2. IN GROUND NO. 1, THE ASSESSEE HAS AGITATED THE A CTION OF THE LD.CIT(A) UPHOLDING AN AD HOC DISALLOWANCE OF RS.81,363/- MAD E BY THE AO BEING 25% OF RS.3,25,499/- CLAIMED BY THE ASSESSEE IN RESPECT OF TRAVELLING EXPENDITURE. THE SAID DISALLOWANCE HAS MADE BY THE AO, AS THE ASSESSEE DI D NOT PRODUCE ANY BILLS/VOUCHERS FOR VERIFICATION. IT IS OBSERVED THA T THE SAID ISSUE ON ADHOC DISALLOWANCE WAS NOT PRESSED BY THE ASSESSEE BEFORE THE FIRST APPELLATE AUTHORITY IE., THE LD.CIT(A) AND THEREBY THE SAID DISALLOWANCE HAS BEEN CONFIRMED. IN VIEW OF THE FACT THAT THE ISSUE ON THIS GROUND IS FACTUAL IN NA TURE AND NOT LEGAL IN NATURE, THE ASSESSEE CANNOT AGITATE THIS ISSUE AFRESH AT THE SE COND APPELLATE STAGE IN THE ABSENCE OF SUFFICIENT CAUSE. IN VIEW OF THAT MATTER , THE ADDITION/DISALLOWANCE MADE ON THIS COUNT IS UPHELD. ITA NO. 5371/MUM/2011 M/S. CHHUTTANLALL MATTUMAL ASSESSMENT YEAR: 2007-08 2 3. GROUND NO. 2 RELATES TO THE DISALLOWANCE OF RS.9 9,242/- UNDER SECTION 40(A)(IA) FOR NON DEDUCTION OF TDS IN RESPECT OF IN TEREST PAID TO M/S. ACME TRADING CORPORATION. 3.1 BRIEFLY STATED, DURING THE ASSESSMENT PROCEEDIN GS, THE AO NOTED THAT THE ASSESSEE HAD PAID RS.99,242/- BUT HAD NOT DEDUCTED TDS. ACCORDINGLY, THE AO DISALLOWED THE SAID PAYMENT U/S 40(A) (IA) OF THE A CT AND ADDED THE SAME TO THE INCOME OF THE ASSESSEE. DURING THE FIRST APPELLATE PROCEEDINGS, THE ASSESSEE TOOK A PLEA THAT THE ASSESSEE PAID THE INTEREST TO M/S. AC ME TRADING CORPORATION WHICH WAS A PROPRIETY CONCERN OF ANIL KUMAR GUPTA (HUF). THE SAID CORPORATION GAVE FORM NO. 15G TO THE ASSESSEE AND ACCORDINGLY THERE WAS NO RE QUIREMENT OF THE ASSESSEE FOR DEDUCTION OF TAX WHILE MAKING PAYMENT OF INTEREST T O M/S. ACME TRADING CORPORATION. HOWEVER, THE LD.CIT(A) REJECTED THE CO NTENTION OF THE ASSESSEE AS THE CONDITIONS FOR FILING A VALID DECLARATION FORM 15G, U/R 29C R/W 197A(1) WAS NOT SATISFIED BY THE ASSESSEE. AGGRIEVED BY THE IMPUGNE D DECISION, THE ASSESSEE HAS RAISED THIS GROUND IN THE APPEAL BEFORE US. 3.2 BEFORE US, THE LD.AR FOR THE ASSESSEE HAS STATE D THAT THE CASE OF THE ASSESSEE IS SQUARELY COVERED BY THE DECISION OF THE GUJARAT HIGH COURT IN THE CASE OF CIT VS. VALIBHAI KHANBHAI MANKAD AND THE DECISION OF THE TRIBUNAL IN THE CASE OF KARWAT STEEL TRADERS VS. ITO IN ITA NO. 6822/MUM/2011 AND PRAYED THAT THE DISALLOWANCE MADE ON THIS COUNT IS TO BE DELETED. ON THE OTHER H AND, THE LD.DR HAS VEHEMENTLY OBJECTED TO THE CLAIM OF THE ASSESSEE STATING THAT THE ASSESSEE HAS NOT SATISFIED THE STATUTORY REQUIREMENT FILING A PROPER FORM FOR NOT DEDUCTING THE TDS AND IN THE ABSENCE OF WHICH THE ASSESSEE IS NOT ENTITLED TO CL AIM THE EXPENDITURE. 3.3 WE HAVE HEARD BOTH THE SIDES AND PERUSED THE MA TERIAL ON RECORD, IT IS PERTINENT TO MENTION THAT THE LD.CIT(A), FROM PERUS AL OF FORM NO. 15G WHICH HAS BEEN FILED DURING THE APPELLATE PROCEEDINGS, HAS NO TED THAT ON THE SAID FORM NO. 15G THERE IS NO MENTION OF THE DATE AND PLACE OF VERIFI CATION IN THE SAID FORM 15G. EVEN THE NAME OF THE PERSON WHO IS VERIFYING THIS FORM H AS NOT BEEN MENTIONED, THOUGH SOME SIGNATURE IS APPEARING ON THE SAID FORM. IN PA RT II OF THE SAID FORM, WHICH IS MEANT TO BE FILLED UP BY THE RECIPIENT OF FORM 15G, NO SIGNATURE OR DETAILS ETC. ARE MENTIONED BY THE PERSON WHO IS RESPONSIBLE FOR PAYI NG THE INCOME (APPELLANT IN THIS ITA NO. 5371/MUM/2011 M/S. CHHUTTANLALL MATTUMAL ASSESSMENT YEAR: 2007-08 3 CASE.) THUS FORM NO. 15G FILED BY THE ASSESSEE IS N OT A VALID FORM AS IT IS NOT VERIFIED BY THE CONCERNED PARTIES IN THE PRESCRIBED MANNER AND HENCE IT HAS NO LEGAL SANCTITY. THE LD.CIT(A), AMONG OTHER THINGS, HAS FU RTHER NOTED THAT THE PERUSAL OF RULE NO. 29C WHICH PRESCRIBES FOR FILING SUCH FORM NO. 15G, MAKES IT CLEAR THAT DECLARATION CAN BE FILED ONLY BY AN INDIVIDUAL AND NOT ANY OTHER PERSON. HENCE, ACCORDING TO THE LD.CIT(A), FAILURE TO DEDUCT TDS M AKES THE ASSESSEE LIABLE FOR DISALLOWANCE U/S 40(A)(IA). AS REGARDS THE FACTS, I T IS NOT DISPUTED THAT THE ASSESSEE HAS NOT FILED THE PROPER FORM 15G AS PER THE REQUIR EMENT OF THE STATUTE FOR CLAIMING EXEMPTION FROM NON DEDUCTION OF TDS ON THE PAYMENT OF INTEREST AS OBSERVED BY THE LD.CIT(A). IN THE ABSENCE OF THE ASSESSEE, SATI SFYING THE STATUTORY REQUIREMENT, THE ASSESSEE HAS TO DEDUCT THE TDS. THE CASES RELIE D ON BY THE LD.AR ARE DISTINGUISHABLE ON FACTS AND NOT APPLICABLE TO THE CASE IN HAND. IN VIEW OF THAT MATTER, WE ARE OF THE CONSIDERED OPINION THAT THE L D.CIT(A) IS JUSTIFIED IN CONFIRMING THE IMPUGNED DISALLOWANCE MADE ON THIS COUNT. GROUND NO. 2 IS DISMISSED. 4. GROUND NO. 3 RELATES TO THE DISALLOWANCE OF OTHE R ADMINISTRATIVE EXPENSES OF RS.38,016/- BEING 20%. IT IS OBSERVED THAT THE SAID ISSUE ON ADHOC DISALLOWANCE WAS NOT PRESSED BY THE ASSESSEE BEFORE THE FIRST APPELL ATE AUTHORITY IE., THE LD.CIT(A) AND THEREBY THE SAID DISALLOWANCE HAS BEEN CONFIRME D. IN VIEW OF THE FACT THAT THE ISSUE ON THIS GROUND IS FACTUAL IN NATURE AND NOT L EGAL IN NATURE, THE ASSESSEE CANNOT AGITATE THIS ISSUE AFRESH AT THE SECOND APPELLATE S TAGE IN THE ABSENCE OF SUFFICIENT CAUSE. IN VIEW OF THAT MATTER, THE ADDITION/DISALLO WANCE MADE ON THIS COUNT IS UPHELD. GROUND NO. 3 IS DISMISSED . 5. GROUND NO. 4, BEING GENERAL IN NATURE & GROUND N O. 5, BEING NOT PRESSED BY THE ASSESSEE, THE ADJUDICATION OF THE SAID GROUNDS IS NOT REQUIRED AND HENCE THE SAME ARE DISMISSED . 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 22 ND DAY OF APRIL, 2014. SD/- SD/- (R.C. SHARMA) (DR. S.T.M. PAVALAN) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 22.04.2014. *SRIVASTAVA ITA NO. 5371/MUM/2011 M/S. CHHUTTANLALL MATTUMAL ASSESSMENT YEAR: 2007-08 4 COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR C BENCH //TRUE COPY// BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.