D.C.I.T. RG.9(1), MUMBAI V. M/S. EXPRESSIT LOGISTICS WORLDWIDE LTD., MUMBAI

ITA 5997/MUM/2008

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 55504 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-10-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 05-10-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 03-10-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G P TRIVEDI
• Keywords: Depreciation; Revenue expenditure; Capital expenditure
• Section: 143(3); 133(6); 37(1); 131; 37

Judgement Text

1 ITA 5997/ M/2008, M/S EXPRESSIT LOGISTICS WORLDWIDE LTD. IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E BEFORE SHRI R.S. PADVEKAR, J.M. AND SHRI R.K. PANDA , J.M. ITA NO. 5997/MUM/2008 ASSESSMENT YEAR 2004-05 THE DCIT RG. 9(1), AAYAKAR BHAWAN, M.K. ROAD, MUMBAI - 400 020. VS. M/S EXPRESSIT LOGISTICS WORLDWIDE LTD., B-42, QUEENS APARTMENT, NARGIS DUTT ROAD, BANDRA (W), MUMBAI 400050. PAN AABCE0314K APPELLANT RESPONDENT APPELLANT BY MR. G.P. TRIVEDI RESPONDENT BY MR. HIRO RAI DATE OF HEARING 3.10.2011 DATE OF PRONOUNCEMENT 12.10.2011 ORDER PER R.K. PANDA A.M. THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER DT. 03.07.2008 OF THE CIT(A)- IX, MUMBAI RELATING TO A. Y. 2004-05. 2. GROUNDS OF APPEAL NO. 1 BY THE REVENUE READS AS UNDER:- THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN HO LDING THAT THE NETWORK DEVELOPMENT EXPENSES OF `. 93,20,773/- ARE ALLOWABLE AS REVENUE EXPENSES ON THE GROUNDS THAT THE ASSESSEE HAS NOT S TARTED A NEW LINE OF BUSINESS BUT THE EXPENSES WERE INCURRED TO EXTEND T HE BUSINESS BY OPENING NEW BRANCHES. 2 ITA 5997/ M/2008, M/S EXPRESSIT LOGISTICS WORLDWIDE LTD. 2.1 FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESSE E COMPANY WAS INCORPORATED ON 1.5.2002 AND IS ENGAGED IN THE BUSI NESS OF RENDERING COURIER SERVICES, BOOKING OF CARGO BY AIR, SEA AND LAND AND IS ALSO IN THE BUSINESS OF LOGISTICS MANAGEMENT. DURING THE COURSE OF ASSESSM ENT PROCEEDINGS, THE A.O. NOTED THAT THE ASSESSEE HAS INCURRED VARIOUS REVENU E EXPENSES SUCH AS SALARY, COMMUNICATION EXPENSES, RENT, OFFICE EXPENSES AND O THER ADMINISTRATIVE EXPENSES AT THE NEWLY ESTABLISHED BRANCHES, REGIONA L OFFICES, CORPORATE OFFICES TO STABILIZE AND SUPPORT THE NEWLY SET-UP NETWORK O F ITS BRANCHES. THE SAID EXPENSES WERE CLASSIFIED UNDER THE HEAD NETWORK DE VELOPMENT EXPENSES AND THE AMOUNT COMES TO ` 93,22,773/-. THE ASSESSEE, HOWEVER, HAS NOT DEBIT ED THIS AMOUNT TO THE P&L ACCOUNT BUT HAS PREFERRED TO MAKE A CLAIM OF THIS AMOUNT AS A REVENUE EXPENDITURE U/S 30 AND/OR SECTI ON 37(1) OF THE ACT IN THE COMPUTATION OF INCOME. IN VIEW OF THE ABOVE, THE A .O. ASKED THE ASSESSEE TO SHOW CAUSE AS TO WHY THE CLAIM SHOULD NOT BE DISALL OWED AND HELD TO FORM PART OF THE PRELIMINARY EXPENDITURE TO BE AMORTISED OVER FIVE YEARS AS DECIDED BY THE ASSESSEE. 2.2 THE ASSESSEE IN RESPONSE TO THE ABOVE FURNISHED DETAILED SUBMISSION AND CITED A SERIES OF DECISIONS TO THE PROPOSITION THAT IF THE NATURE OF EXPENSES ARE ALLOWABLE AS INCURRED FOR BUSINESS PURPOSES, IT SHO ULD BE ALLOWED IN TOTO IRRESPECTIVE OF THE FACT THAT IT WAS CLAIMED TO BE DEFERRED REVENUE EXPENDITURE FOR THE PURPOSE OF COMPANIES ACT OR TO SHOW HIGHER BOOK PROFIT TO ITS SHAREHOLDERS. NOT BEING SATISFIED WITH THE VARIOUS EXPLANATIONS GIVEN BY THE ASSESSEE AND DISTINGUISHING THE VARIOUS DECISIONS C ITED BEFORE HIM, THE A.O. HELD THAT THE AMOUNT OF ` 93,22,773/- HAS TO BE DISALLOWED AS ON THE CAPITAL ACCOUNT AND ALLOWED THE SAME TO BE AMORTISED AS DON E BY THE ASSESSEE IN ITS ACCOUNTS. 2.3 BEFORE THE LD. CIT(A), IT WAS SUBMITTED THAT TH E EXPENSES ARE PURELY OF REVENUE NATURE AND WERE LAID OUT WHOLLY AND EXCLUSI VELY FOR THE PURPOSE OF BUSINESS, THEREFORE, THE SAME HAS TO BE ALLOWED AS DEDUCTION U/S 30 & 37 OF 3 ITA 5997/ M/2008, M/S EXPRESSIT LOGISTICS WORLDWIDE LTD. THE I.T. ACT IN THE YEAR OF INCURRENCE OF THE SAID EXPENSES. IT WAS SUBMITTED THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF REN DERING COURIER SERVICES AND IN ORDER TO STRENGTHEN THE NETWORK AND EXPAND ITS E XISTING BUSINESS, THE COMPANY HAS SET UP OFFICES, COLLECTION CENTRE, BRAN CHES ETC. AT VARIOUS LOCATIONS DURING THE YEAR UNDER CONSIDERATION AND FOR THIS PU RPOSE, THE COMPANY HAS INCURRED VARIOUS EXPENSES OF REVENUE NATURE. THE NE TWORK DEVELOPMENT EXPENSES CONSIST OF NORMAL BUSINESS, BUSINESS RELAT ED REVENUE EXPENSES SUCH AS SALARIES, COMMUNICATION EXPENSES, RENT, CONVEYAN CE, TRAVELING AND OTHER SUCH ADMINISTRATIVE EXPENSES IN THE COURSE OF ITS B USINESS. FOR THE PURPOSE OF ACCOUNTS, THE SAID EXPENSES WERE TREATED AS DEFERRE D REVENUE EXPENDITURE UNDER THE CAPTION OF NETWORK DEVELOPMENT EXPENSES AND IN THE BALANCE SHEET, THE SAID EXPENDITURE IS SHOWN UNDER THE HEAD MISC. EXPENSES. IT WAS SUBMITTED THAT ALL EXPENSES ARE REVENUE IN NATURE A ND NO CAPITAL EXPENDITURE HAS BEEN DEBITED. NO NEW ASSET HAS COME INTO EXISTE NCE AND THESE ARE NOT INCURRED BEFORE THE SET UP OF THE BUSINESS. THE BU SINESS WAS ALREADY SET-UP IN EARLIER YEAR AND THEREFORE THE QUESTION OF APPLYING SECTION 35D ALSO DOES NOT ARISE. IT WAS SUBMITTED THAT EVEN IF IT IS TREATED AS DEFERRED REVENUE EXPENDITURE THE SAME SHOULD BE ALLOWED FULLY IN THE YEAR OF ITS INCURRENCE IRRESPECTIVE OF ACCOUNTING TREATMENT GIVEN BY THE COMPANY. THE DECI SION OF OF HONBLE SUPREME COURT IN THE CASE OF KEDARNATH JUTE MANUFAC TURING CO. LTD. VS. CIT REPORTED IN 82 ITR 363 AND VARIOUS OTHER DECISIONS WERE ALSO RELIED UPON. 2.4 BASED ON THE ARGUMENTS ADVANCED BY THE ASSESSEE , THE LD. CIT(A) DELETED THE ADDITION BY HOLDING AS UNDER: I HAVE CAREFULLY CONSIDERED THE APPELLANTS SUBMIS SION, DETAILS OF EXPENSES INCURRED AND AOS CONTENTION AS WELL. FROM THE DETAILS, IT CAN BE SEEN THAT THE BUSINESS WAS ALREADY SET UP IN THE EARLIER YEARS AND THE EXPENDITURE HAD BEEN INCURRED FOR EXPANDING ITS EXI STING BUSINESS BY SETTING UP COLLECTION CENTERS BRANCHES AT VARIOUS L OCATIONS AND FOR THIS PURPOSE, THE COMPANY HAS INCURRED VARIOUS EXPENSES SUCH AS SALARIES, COMMUNICATION EXPENSES, RENT, TRAVELLING, ETC. THER E IS MERITS IN THE APPELLANTS CONTENTION THAT THE APPELLANTS CLAIM I S TO BE ALLOWED IRRESPECTIVE OF ACCOUNTING TREATMENT GIVEN BY THE C OMPANY. THE 4 ITA 5997/ M/2008, M/S EXPRESSIT LOGISTICS WORLDWIDE LTD. APPELLANTS CONTENTION IS ALSO SUPPORTED BY THE HON 'BLE SUPREME COURT JUDGMENT IN THE CASE OF KEDARNATH JUTE MANUFACTURIN G CO. LTD. (SUPRA). A PERUSAL OF THE NATURE OF EXPENSES CLEARLY SHOWS T HAT THE ASSESSEE HAS NOT STARTED A NEW LINE OF BUSINESS, BUT EXPENSES WE RE INCURRED FOR THE PURPOSE OF EXTENDING THE BUSINESS BY OPENING UP NEW BRANCHES AND IN THE PROCESS, CERTAIN EXPENSES WERE INCURRED. THEREF ORE, THE EXPENDITURE INCURRED CANNOT BE TREATED AS CAPITAL EXPENDITURE. THE APPELLANTS CONTENTION IS SUPPORTED BY JUDGMENTS DELIVERED BY H ONBLE HIGH COURTS IN THE CASE OF HINDUSTAN COMMERCIAL BANK LTD. (21 I TR 353 ALL) BANK OF COCHIN LTD. VS. CIT (50 ITR 211 KER) CIT VS. ALU MINUM INDUSTRIES LTD. (214 ITR 541 KER). THERE IS FORCE IN THE APPEL LANTS CONTENTION THAT REVENUE EXPENSES ARE ALLOWABLE, EVEN IF IN BOOKS EX PENDITURE IS TREATED AS DEFERRED REVENUE EXPENDITURE. THIS GROUND OF APP EAL IS ALLOWED IN APPELLANTS FAVOUR. AGGRIEVED WITH THE ORDER OF THE LD. CIT(A) DELETING THE ADDITION, THE REVENUE IS IN APPEAL BEFORE US. 3. AFTER HEARING BOTH THE SIDES, WE DO NOT FIND ANY IN FIRMITY IN THE ORDER OF THE LD. CIT(A). THE GENUINENESS OF THE EXPENDITURE ARE NOT DOUBTED BY THE A.O. IT IS ONLY THE ALLOWABILITY OF THE SAME DURING THIS YEAR AS PER THE COMPUTATION OF INCOME OR ITS ALLOWABILITY OVER A PERIOD OF 5 YEARS AS PER ACCOUNTING TREATMENT GIVEN IN THE BOOKS OF ACCOUNT. IT HAS BEEN HELD IN VARIOUS JUDICIAL DECISIONS THAT REVENUE EXPENDITURE IS ALLOWABLE IN THE YEAR O F ITS INCURRENCE U/S 37(1) OF THE ACT IRRESPECTIVE OF ACCOUNTING TREATMENT GIVEN BY THE ASSESSEE. WHETHER THE ASSESSEE IS ENTITLED TO A PARTICULAR DEDUCTION OR NOT WILL DEPEND ON THE PROVISION OF LAW RELATING THERETO AND NOT ON THE VI EW WHICH THE ASSESSEE MIGHT TAKE OF HIS RIGHTS NOR CAN THE EXISTENCE OR ABSENCE OF ENTRIES IN HIS BOOKS OF ACCOUNT BE DECISIVE OR CONCLUSIVE IN THE MATTER. IF THE NATURE OF EXPENSES ARE SUCH THAT THESE ARE ALLOWABLE AS INCURRED FOR BUSIN ESS PURPOSE, IT SHOULD BE ALLOWED IN TOTO IRRESPECTIVE OF THE FACT THAT IT WA S CLAIMED TO BE DEFERRED REVENUE EXPENDITURE FOR THE PURPOSE OF COMPANIES AC T. FURTHER, THE ASSESSEE HAS ALREADY SET UP ITS BUSINESS IN THE PRECEDING AS SESSMENT YEAR. THEREFORE, THE EXPENDITURE INCURRED BY THE ASSESSEE FOR ITS VA RIOUS BRANCHES WHICH ARE REVENUE IN NATURE HAS TO BE ALLOWED AS DEDUCTION DU RING THE YEAR. IN THIS VIEW OF THE MATTER, THE GROUND RAISED BY THE REVENUE IS DISMISSED. 5 ITA 5997/ M/2008, M/S EXPRESSIT LOGISTICS WORLDWIDE LTD. 4. GROUNDS OF APPEAL NO. 2 READS AS UNDER:- THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN DE LETING DISALLOWANCE OF VARIOUS EXPENSES IN THE NATURE OF C ONVEYANCE CHARGES, TELEPHONE EXPENSES, MISCELLANEOUS EXPENSES , PRINTING & STATIONERY, REPAIRS & MAINTENANCE AND DEPRECIATION OF VEHICLES AGGREGATING TO `. 4,42,375/- WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE FAILED TO SUBSTANTIATE THE CLAIM OF EXPEND ITURE BY COMPLETE AND VERIFIABLE DETAILS. 5. AFTER HEARING BOTH THE SIDES, WE FIND THE A.O. D ISALLOWED THE FOLLOWING EXPENSES ON ADHOC BASIS HOLDING THE SAME TO BE EXPE NSES INCURRED TO BE FOR NON-BUSINESS PURPOSE OR FOR PERSONAL PURPOSE. (A) CONVEYANCE EXPENSES OF ` 56,810/- (B) TELEPHONE EXPENSES OF ` ` 62,735/- (C) MISCELLANEOUS EXPENSES OF ` 75,150/- (D) PRINTING AND STATIONERY EXPENSES OF ` 1,56,066 (E) REPAIRS AND MAINTENANCE EXPENSES OF ` 52,198/ (F) DEPRECIATION ON VEHICLE OF ` 39,416/- 5.1 BEFORE THE LD. CIT(A), IT WAS SUBMITTED THAT TH E A.O. HAS NOT GRANTED ANY SPECIFIC OPPORTUNITY BEFORE MAKING THE ABOVE DISALL OWANCE. IT WAS SUBMITTED THAT EACH AND EVERY EXPENSES HAS BEEN INCURRED FOR THE PURPOSE OF BUSINESS, LARGE PART OF THE EXPENSES WERE BY ACCOUNT PAYEE CH EQUES, STATUTORY AND TAX AUDITORS HAVE NOT POINTED OUT ANY MISTAKE OR RESERV ATION AND THERE CANNOT BE AN ELEMENT OF PERSONAL USE IN A CORPORATE ENTITY. I T WAS FURTHER SUBMITTED THAT NO SUCH DISALLOWANCES WERE MADE IN THE ORDER PASSED U/S 143(3) FOR A.Y. 2003- 04. 5.2 BASED ON THE ARGUMENTS ADVANCED BY THE ASSESSEE , THE LD. CIT(A) DELETED THE DISALLOWANCE ON THE GROUND THAT NO ADHOC DISALL OWANCE IS SUSTAINABLE UNLESS SOME EVIDENCE IS BROUGHT ON RECORD TO PROVE THAT THE SAME HAS BEEN INCURRED FOR NON-BUSINESS PURPOSE OR THAT THE SAME IS BOGUS. AGGRIEVED WITH SUCH ORDER OF THE LD. CIT(A), THE REVENUE IS IN APP EAL BEFORE US. 6 ITA 5997/ M/2008, M/S EXPRESSIT LOGISTICS WORLDWIDE LTD. 6. AFTER HEARING BOTH THE SIDES, WE FIND THERE IS N O INFIRMITY IN THE ORDER OF THE LD. CIT(A) . FROM THE ORDER OF THE A.O. IT IS SEEN THAT HE HAS NOT CONFRONTED THE ASSESSEE ABOUT THE DISCREPANCIES, IF ANY. HE ME RELY DISALLOWED VARIOUS EXPENSES ON ADHOC BASIS ON THE GROUND THAT PERSONAL ELEMENT IN THOSE EXPENSES CANNOT BE RULED OUT. FURTHER WE FIND MERI T IN THE SUBMISSION OF THE LD. COUNSEL FOR THE ASSESSEE THAT THERE CANNOT BE A N ELEMENT OF PERSONAL USE IN A CORPORATE ENTITY AND NO DISALLOWANCE HAS BEEN MAD E IN THE SCRUTINY ASSESSMENT FOR A.Y. 2003-04. SINCE THE A.O. HAS NOT BROUGHT ON RECORD SPECIFIC EVIDENCE OF ANY EXPENDITURE WHICH IS PERSO NAL IN NATURE OR WHICH IS NOT FOR THE PURPOSE OF BUSINESS, THEREFORE, WE ARE OF T HE CONSIDERED OPINION THAT NO ADHOC DISALLOWANCE CAN BE MADE UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE. WE, THEREFORE, UPHOLD THE ORDER OF THE LD. C IT(A) ON THIS ISSUE AND THE GROUND RAISED BY THE REVENUE IS DISMISSED. 7. GROUND NO. 3 READS AS UNDER:- THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN DI RECTING THE ASSESSING OFFICER TO DELETE THE ADDITION OF `. 7,58,898/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF COURIER CHARGES WIT HOUT APPRECIATING THE FACT THAT THERE WAS NO RESPONSE BY THE PARTY NA MELY M/S. AIRBONE EXPRESS (INDIA) PVT. LTD. TO THE NOTICE ISS UED BY THE ASSESSING OFFICER U/S.133(6) AND SUMMONS ISSUED U/S .131 OF THE I.T. ACT AND THAT THE ASSESSEE NEITHER PRODUCED THE SAID PERSON NOR MADE ANY EFFORTS TO SUBSTANTIATE ITS CLAIM. 7.1 FACTS OF THE CASE IN BRIEF ARE THAT THE A.O. DU RING THE COURSE OF ASSESSMENT PROCEEDINGS ISSUED NOTICE U/S 133(6) TO CERTAIN PARTIES TO VERIFY THE GENUINENESS OF THE TRANSACTIONS WITH THEM. IN THE CASE OF AIRBORNE EXPRESS INDIA PVT. LTD. TO WHOM COURIER CHARGES OF ` 7,58,898/- WAS CLAIMED TO HAVE BEEN PAID BY THE ASSESSEE, THERE WAS NO RESPONSE FR OM THE SAID PARTY ALTHOUGH THE NOTICES WERE SERVED ON THE PARTY ON 29.8.2006. THE A.O. INFORMED THE ASSESSEE ABOUT THIS AND REQUESTED TO PRODUCE THE SA ID PARTY WITH THE BOOKS OF ACCOUNT AND RECONCILE THE SAID EXPENDITURE. IT WAS EXPLAINED BY THE ASSESSEE THAT THE SAID PARTY IS NOT COOPERATING AND REQUESTE D THE A.O. TO ISSUE 7 ITA 5997/ M/2008, M/S EXPRESSIT LOGISTICS WORLDWIDE LTD. SUMMONS TO THE PARTY. SUMMONS U/S 131 WAS ISSUED TO THE PARTY. HOWEVER, THERE WAS NO RESPONSE EVEN AFTER LAPSE OF MORE THAN TWO MONTHS. IT WAS EXPLAINED BY THE ASSESSEE THAT AIRBRONE EXPRESS (IN DIA) P. LTD. IS SHYING AWAY FROM GOVERNMENT AUTHORITIES. HOWEVER, THE A.O. WAS NOT CONVINCED WITH THE EXPLANATION GIVEN BY THE ASSESSEE. ACCORDING TO HIM ASSESSEES CORPORATE STATUS HAVE TO DEAL WITH NOT ONLY INCOME-TAX DEPART MENT BUT WITH SEVERAL OTHER GOVERNMENT AND SEMI GOVERNMENT AUTHORITIES. SINCE T HE ASSESSEE FAILED TO SUBSTANTIATE THE CLAIM OF EXPENDITURE MADE IN THIS REGARD, THE A.O. RELYING ON THE DECISION OF HONBLE SUPREME COURT IN THE CASE O F DURGAPRASAD MORE DISALLOWED THE COURIER CHARGES OF ` 7,58,898/- PAID TO AIRBRONE EXPRESS INDIA P. LTD. 7.2 BEFORE THE LD. CIT(A) IT WAS SUBMITTED THAT PAR TY-WISE DETAILS WERE FILED BEFORE THE A.O., AND ALL THE PAYMENTS WERE MADE BY A/C PAYEE CHEQUES. THE PAN AND WARD WITH WHICH INCOME-TAX RETURN OF THE PA RTY IS FILED WAS GIVEN TO THE A.O. INSPITE OF HAVING SUFFICIENT TIME AT HIS DISPOSAL, THE A.O. DID NOT ENFORCE THE ATTENDANCE OF THE SAID PARTY. IT WAS S UBMITTED THAT IF THE PARTY DID NOT TURN UP THE ASSESSEE CANNOT BE BLAMED FOR IT. THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF ORISSA CORPORATION REP ORTED IN 159 ITR 78, THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE O F SHRENIK TRADING CO. REPORTED IN 90 ITR 396 AND CIT VS. GOODLAS NEROLAC PAINTS LTD. REPORTED IN 188 ITR 1 AND VARIOUS OTHER DECISIONS WERE BROUGHT TO T HE NOTICE OF THE LD. CIT(A). ON THE BASIS OF THE ARGUMENTS ADVANCED BEFORE HIM, THE LD. CIT(A) DELETED THE ADDITION ON THE GROUND THAT THERE WAS SUFFICIENT EV IDENCE ON RECORD FILED BY THE ASSESSEE IN SUPPORT OF THE EXISTENCE OF THE PARTY. THE SAID PARTY HAS PAN AND HAS BEEN FILING HIS RETURN OF INCOME AND THE PAYMEN T WAS MADE BY A/C PAYEE CHEQUES. THE COPY OF LEDGER ACCOUNT ALONG WITH BANK STATEMENT WERE ALSO FURNISHED IN SUPPORT OF THE CLAIM. MERELY BECAUSE THE SAID PARTY DID NOT TURN UP BEFORE THE A.O. IN RESPONSE TO NOTICE U/S 133(6) , THE CLAIM OF THE ASSESSEE CANNOT BE REJECTED. AGGRIEVED WITH SUCH ORDER OF T HE LD. CIT(A), THE REVENUE IS IN APPEAL BEFORE US. 8 ITA 5997/ M/2008, M/S EXPRESSIT LOGISTICS WORLDWIDE LTD. 8. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY B OTH THE SIDES, PURSUED THE ORDERS OF THE ASSESSING OFFICER AND THE CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DECISIONS CITED BEFORE US. THERE IS NO DISPUTE TO THE FACT THAT THE NOTICE ISSUED U/S 133(6) WERE NOT COMPLIED WITH BY THE PARTY FOR WHICH A SUMMON U /S 131 WAS SERVED. HOWEVER, IN RESPONSE TO THE SAID SUMMON ALSO THE PA RTY NAMELY AIRBRONE EXPRESS INDIA P. LTD. DID NOT APPEAR BEFORE THE A.O . FOR WHICH THE A.O. DISALLOWED THE SAID EXPENSES ON THE GROUND THAT THE ASSESSEE FAILED TO SUBSTANTIATE THE CLAIM. FROM THE VARIOUS DETAILS FI LED BY THE ASSESSEE BEFORE THE A.O. AND CIT(A) IT IS SEEN THAT THE ASSESSEE HAS PR OVIDED PAN OF THE PARTY AND THE JURISDICTION OF THE A.O. BEFORE WHOM IT IS ASSE SSED. THE PAYMENTS HAVE BEEN MADE BY A/C PAYEE CHEQUES AND ALL THE DETAILS WERE FURNISHED BEFORE THE A.O. IT WAS ALSO REQUESTED BEFORE THE A.O. THAT SI NCE THE PARTY IS NOT COOPERATING, SUMMON U/S 131 MAY BE ISSUED. UNDER T HESE CIRCUMSTANCES, WE ARE OF THE CONSIDERED OPINION THAT THE ASSESSEE HAS DISCHARGED THE ONUS CAST UPON IT. MERELY BECAUSE THE OTHER PARTY DID NOT AT TEND THE OFFICE OF THE A.O. IN RESPONSE TO THE SUMMON U/S 131, THE ASSESSEE, IN OU R OPINION, CANNOT BE BLAMED FOR IT. THE PARTY HAS ALSO NOT DENIED THE T RANSACTIONS. THE A.O. HAS ENOUGH POWER TO ENFORCE THE ATTENDANCE OF THE OTHER PARTY WHICH HE FAILED TO DO IN THE INSTANT CASE. WHEN THERE WAS NO RESPONSE TO THE SUMMON U/S 131, WE FIND NO COERCIVE ACTION HAS BEEN TAKEN BY THE A.O. AGAINST THE SAID PARTY. UNDER THESE CIRCUMSTANCES, WE ARE OF THE CONSIDERED OPINION THAT NO ADDITION WAS CALLED FOR BY THE A.O. AND THE ORDER OF THE LD. CIT(A) DELETING THE ADDITION IS JUSTIFIED. THE GROUND RAISED BY THE REVENUE IS ACC ORDINGLY DISMISSED. 9 ITA 5997/ M/2008, M/S EXPRESSIT LOGISTICS WORLDWIDE LTD. 9 . IN THE RESULT, APPEAL FILED BY THE REVENUE IS DIS MISSED. ORDER PRONOUNCED ON 12.10.2011. SD/- SD/- (R.S. PADVEKAR) (R.K. PANDA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED 12.10.2011. RK COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 35, MUMBAI 4. THE CIT 25, MUMBAI 5. THE DR BENCH, E 6. MASTER FILE // TUE COPY// BY ORDER DY/ASSTT. REGISTRAR ITAT, MUMBAI