Graphic Aids, Kolkata V. A.C.I.T Cir - 29,kolkata, Kolkata

ITA 555/KOL/2013

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 3095 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 10 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-02-2016
• Appeal Filed By: Assessee
• Bench Allotted: C
• Assessment Year: 2008-2009
• Appeal Filed On: 14-03-2013
• Court: TRIBUNAL
• Department Lawyers: S M DAS
• Assessee Lawyers: OM PRAKASH BAID
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH: K OLKATA [BEFORE SHRI MAHAVIR SINGH, JM] I.T.A NO.555/KOL/2013 ASSESSMENT YEAR: 2008-09 GRAPHIC AIDS VS. ASSISTANT COMMISSIONER OF IN COME-TAX, (PAN: AACFG8396D) CIRCLE-29, KOLKATA. ( APPELLANT ) ( RESPONDENT ) DATE OF HEARING: 02.02.2016 DATE OF PRONOUNCEMENT: 02.02.2016 FOR THE APPELLANT: SHRI OM PRAKASH BAID, FCA FOR THE RESPONDENT: SHRI S. M. DAS, JCIT, SR. DR ORDER THIS APPEAL BY ASSESSEE IS ARISING OUT OF ORDER OF CIT(A)-XVI, KOLKATA VIDE APPEAL NO. 45/CIT(A)-XVI/CIR-29/10-11/KOL DATED 02.01.2013. AS SESSMENT WAS FRAMED BY ACIT, CIRCLE- 29, KOLKATA U/S. 143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR ASSESSMENT YEAR 2008-09 VIDE HIS ORDER DATED 21.12. 2010. 2. THE FIRST ISSUE IN THIS APPEAL OF ASSESSEE IS A GAINST THE ORDER OF CIT(A) CONFIRMING THE ACTION OF AO IN DISALLOWING COMPUTER MAINTENANCE CH ARGES OF RS.28,090/- FOR NON-DEDUCTION OF TDS U/S. 194J OF THE ACT BY INVOKING THE PROVISIONS OF SECTION 40(A)(IA) OF THE ACT. 3. I HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. I FIND FROM THE FACTS OF THE CASE THAT THE ASSESSEE H AS CARRIED OUT ROUTINE MAINTENANCE OF COMPUTER HARDWARE AND PERIPHERALS ETC. WHICH DOES NOT INVOLV E ANY SPECIALIZED TECHNICAL EXPERTISE. HENCE, THE PAYMENT CANNOT BE TERMED AS FALLING U/S. 194J OF THE ACT BEING PAYMENT FOR TECHNICAL SERVICES. THESE ARE MERELY ROUTINE MAINTENANCE OF COMPUTER HARDWARE AND PERIPHERALS AND ACCORDINGLY, THE PROVISIONS OF SECTION 194J WILL NO T APPLY AND, THEREFORE, DISALLOWANCE U/S. 40(A)(IA) OF THE ACT CANNOT BE MADE. ACCORDINGLY, I DELETE THE ADDITION AND ALLOW THIS ISSUE OF ASSESSEES APPEAL. 4. THE NEXT ISSUE IN THIS APPEAL OF ASSESSEE IS AGA INST THE ORDER OF CIT(A) CONFIRMING THE ACTION OF AO IN RESTRICTING THE DISALLOWANCE AT RS. 33,638/- AS AGAINST THE DISALLOWANCE MADE BY AO AT RS.1,20,6165/-. 5. I HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. I FIND THAT THE AO REQUIRED THE DETAILS OF DELIVERY C HARGES EXPENSES OF RS.6,03,082/- INCURRED BY THE ASSESSEE. THE ASSESSEE PRODUCED VOUCHERS WHICH WERE SELF MADE INTERNAL DEBIT VOUCHERS AND AO WAS NOT SATISFIED ABOUT THE GENUINENESS OF THESE EXPENSES AND ACCORDINGLY, HE TREATED 20% 2 ITA NO.555/KOL/2013 GRAPHIC AIDS, AY 2008-09 2 OF THE EXPENSES AS DISALLOWABLE AND ACCORDINGLY, HE DISALLOWED A SUM OF RS.1,20,616/-. THE CIT(A) RESTRICTED THE DISALLOWANCE AT RS.33,638/- B Y CONSIDERING THE DISALLOWANCE MADE BY AO AT 20% AS VERY HIGH. AGGRIEVED, ASSESSEE IS IN APP EAL BEFORE TRIBUNAL. I FIND FROM THE FACTS OF THE CASE THAT THE EXPENSES INCURRED BY ASSESSEE UND ER THIS HEAD IS RS.3,33,684/- AND NOT RS.6,03,082/- AS IS EVIDENT FROM THE ACCOUNTS OF TH E ASSESSEE ANNEXED HERETO. I ALSO FIND THAT THESE ARE DELIVERY CHARGES AND ASSESSEE HAS FILED C OMPARATIVE FIGURES OF THEIR SALES VIS--VIS DELIVERY CHARGES FOR THE YEAR ENDED 31.03.2007 AND 31.03.2008 WHICH ARE IN TERM OF PERCENTAGE AT 0.21% AND 0.24% OF THE SALES THE TURNOVER IN THE CASE OF THE ASSESSEE HAS INCREASED MANIFOLD I.E. FROM 11.68 CR. TO 14.16 CR. AND ACCORDINGLY, T HERE IS INCREASE IN DELIVERY CHARGES FROM RS.2.41 LAC TO RS.3.33 LAC. NO DOUBT THE DELIVERY CHARGES VOUCHER ARE INTERNAL VOUCHERS BUT THE AO HAS NOT DOUBTED THE GENUINENESS BUT ONLY MADE DI SALLOWANCE FOR THE REASON THAT THESE ARE INTERNAL VOUCHERS. I FIND NO REASON IN MAKING THE DISALLOWANCE OR RESTRICTING THE DISALLOWANCE AT ANY PERCENTAGE. ACCORDINGLY, I DELETE THE DISALLOW ANCE. 6. IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- (MAHAVIR SINGH) ` JUDICIAL MEMBER DATED : 2ND FEBRUARY, 2016 JD. SR. P.S COPY OF THE ORDER FORWARDED TO: 1. APPELLANT GRAPHIC AIDS, C/O BAID & CO. CHARTERED ACCOUNTANTS, MANGALAM APARTMENT, 2, ROWLAND ROAD, GROUND FLOOR, KOLKATA-7 00 020 2. RESPONDENT ACIT, CIR-29, KOLKATA. 3. CIT(A) , KOLKATA 4. CIT , KOLKATA 5. DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, ASSTT. REGISTRAR .