Gowthami Infratech Private Limited, Hyderabad V. Dy.CIT, Circle-2(2), Hyderabad

ITA 605/HYD/2014

• Counselvise Citation: 60522514 RSA 2014
• Duration Of Justice: 9 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-01-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 06-01-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 03-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G APARNA RAO
• Assessee Lawyers: S VENUGOPAL; G SIVARAMA KRISHNA PRASAD

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO. 605/HYD/2014 ASSESSMENT YEAR: 2009-10 GOWTHAMI INFRATECH PRIVATE LIMITED, SOMAJIGUDA, HYDERABAD. [PAN: AACCK 6892 K] VS DY. COMMISSIONER OF INCOME TAX, CIRCLE-2(2), HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI G. SIVARAMA KRISHNA PRASAD & SHRI S. VENUGOPAL FOR REVENUE : S MT. G.APARNA RAO DATE OF HEARING : 0 6 - 0 1 - 201 5 DATE OF PRONOUNCEMENT : 16 - 01 - 2015 O R D E R PER B. RAMAKOTAIAH, A.M. : THIS IS AN APPEAL BY ASSESSEE ON CONFIRMING THE ENT IRE MOBILIZATION ADVANCE AS TURNOVER OF THE ASSESSEE BY THE COMMISSIONER OF INCOME TAX(APPEALS) IN HIS ORDER DA TED 15-01-2014. THERE IS ONE MORE ISSUE OF DISALLOWANCE OF AMOUNT P AID TO ROC. THESE ISSUES ARE CONSIDERED IN THIS ORDER AFTER HEA RING THE LD.AR, LD.DR AND ALSO SEEKING CLARIFICATIONS ON ISSUES. I.T.A. NO. 605 /HYD/14 GOWTHAMI INFRATECH P. LTD., :- 2 -: 2. BRIEFLY STATED, ASSESSEE IS A CIVIL CONTRACTOR A ND HAS ENTERED INTO CERTAIN CONTRACTS WITH M/S.MAYTAS INFRA LTD., PRESENTLY KNOWN AS M/S.IL&FS ENGINEERING AND CONSTRUCTION COMPANY L TD., TO PERFORM CERTAIN CIVIL AND ELECTRICAL SUPPLY/ERECTIO N WORKS. DURING THE YEAR, ASSESSEE RECEIVED RS.2,416.94 LAKHS AS MO BILIZATION ADVANCE AGAINST CIVIL WORKS, OUT OF WHICH ASSESSEE EXECUTED WORKS TO AN EXTENT OF RS.1055.32 LAKHS AND RAISED AN INVOICE AND SHOWED THE SAME AS TURNOVER. APART FROM THE OTHER TURNOVERS I N OTHER CONTRACTS, ASSESSEE ALSO HAD AN ELECTRICAL CONTRACT EXECUTED T O AN EXTENT OF RS.79.35 LAKHS ON WHICH IT RAISED INVOICES. THUS, ASSESSEE RECEIVED DURING THE YEAR AN AMOUNT OF RS.2,416.94 LAKHS AND THE NET AMOUNT PAYABLE TO M/S.MAYTAS INFRA LTD., BOTH CIVIL AND EL ECTRICAL WORK WAS AT DETERMINED RS.1227.25 LAKHS AS ON 31-03-2009. THE DETAILS ARE AS UNDER: OPENING BALANCE AS ON 01-04-2008 (RECEIVABLE FROM MAYTAS INFRA ON ELECTRICAL WORKS) 235.48 ADD: WORKS EXECUTED CIVIL 1055.32 ADD: WORKS EXECUTED ELECTRICAL 79.35 SUB TOTAL 1370.15 LESS: AMOUNT RECEIVED FROM MAYTAS INFRA INCLUDING MOBILIZATION ADVANCES (2416.91+168.51) (-)2585.45 LESS: TDS ON RS.1055.32 LAKHS (-)11.95 NET AMOUNT PAYABLE TO MAYTAS INFRA 1227.25 THE ASSESSING OFFICER VERIFIED THE TDS CERTIFICATES RECEIVED FROM M/S.MAYTAS INFRA LTD., WHICH HAD SHOWED THE TOTAL R ECEIPTS ON WHICH TDS WAS MADE AT RS.31.01 CRORES. ASSESSING OFFICER ISSUED A SHOW CAUSE NOTICE TO THE ASSESSEE THAT THE TDS CERTIFICA TES ISSUED BY M/S.MAYTAS INFRA LTD., RESULTED IN A TURNOVER OF RS .31.01 CRORES AND AS ASSESSEE HAS SHOWN TURNOVER OF RS.10.27 CRORES ( IGNORING I.T.A. NO. 605 /HYD/14 GOWTHAMI INFRATECH P. LTD., :- 3 -: ELECTRICAL TURNOVER), HE ASKED WHY THE DIFFERENCE O F RS.20.73 CRORES SHOULD NOT BE TREATED AS INCOME OF THE ASSESSEE. A SSESSEE EXPLAINED THAT IT HAS RECEIVED ONLY RS.2416.94 LAKHS BUT THE SAID COMPANY DEDUCTED TAX BOTH ON THE MOBILIZATION ADVANCE OF TH E ABOVE AMOUNT AND ALSO ON THE BILLS RAISED TO AN EXTENT OF RS.105 5.32 LAKHS WHICH RESULTED IN THE ADDITIONAL TURNOVER. IT ALSO SUBMI TTED RE-CONCILIATION OF ITS ACCOUNTS TURNOVER VIZ-A-VIZ TDS CERTIFICATES AND AMOUNTS PAYABLE. ASSESSING OFFICER IN THE ORIGINAL ASSESSME NT GAVE CREDIT OF ONLY ADVANCE RECEIVEABLE TO AN EXTENT OF RS.337.92 LAKHS AND MADE AN ADDITION OF RS.2,073 LAKH TO THE INCOME RETURNED . 3. ASSESSEE COMPANY SUBMITTED BEFORE THE LD.CIT(A) THAT AMOUNT RECEIVED FROM M/S.MAYTAS INFRA LTD., WAS ONLY RS.2, 416.94 LAKHS AND ASSESSING OFFICER NOT ONLY IGNORED THE TURNOVER OF ELECTRICAL WORKS BUT ALSO AMOUNT PAYABLE UNDER CIVIL WORKS. A SSESSEE SUBMITTED THAT THE TOTAL AMOUNT PAYABLE TO M/S.MAYT AS INFRA LTD., WAS RS.1227.25 LAKHS. THE LD.CIT(A), HOWEVER, DID NOT CONSIDER THE RE-CONCILIATION AND OBSERVED THAT ASSESSEE HAS NOT FURNISHED ALL THE TDS CERTIFICATES THEREFORE, THERE IS SUPPRESSION OF TURNOVER AND DIRECTED THE ASSESSING OFFICER TO VERIFY THE TDS CE RTIFICATES AND ENTRIES IN THE BANK ACCOUNT TO ARRIVE AT THE EXACT FIGURE OF THE AMOUNT RECEIVED. THE LD.CIT(A) DID NOT TAKE INTO C ONSIDERATION THE CONFIRMATIONS RECEIVED FROM M/S.MAYTAS INFRA LTD.. ASSESSEE IS AGGRIEVED ON THE ORDERS OF THE CIT(A). 4. IN THE MEAN TIME, ASSESSING OFFICER PASSED CONSE QUENTIAL ORDERS VIDE ORDER DT.13-03-2014 WHEREIN HE ACCEPTED THAT THE TOTAL MOBILIZATION ADVANCE RECEIVED FOR CIVIL CONTRACTS W AS AT RS.2,416.94 LAKHS. THEREFORE TO THE EXTENT THAT ASSESSEE HAS S UPPRESSED THE TURNOVER BASED ON THE TDS CERTIFICATES DOES NOT AR ISE. IN FACT THERE IS EVIDENCE THAT THE SAID COMPANY DEDUCTED THE TDS TWICE BOTH AT I.T.A. NO. 605 /HYD/14 GOWTHAMI INFRATECH P. LTD., :- 4 -: THE TIME OF PAYING MOBILIZATION ADVANCE AND ALSO AT THE TIME OF RAISING THE BILL THEREBY RESULTING IN CONFUSION IN THE MIND OF THE ASSESSING OFFICER WHICH LEAD TO THE ADDITION. IN T HE CONSEQUENTIAL ORDER ASSESSING OFFICER DETERMINED THE GROSS-RECEIP TS AT RS.2,416.94 LAKHS ONLY. BUT, ASSESSING OFFICER CONFUSED FURT HER AND IGNORED THE AMOUNT OUTSTANDING AGAINST M/S.MAYTAS INFRA LTD ., OF RS.1227.24 LAKHS. IN FACT ASSESSING OFFICER AT THE TIME OF ASSESSMENT TOOK ONLY RS.337.92 LAKHS AS OUTSTANDING AND EXCLUDED THAT. HOWEVER, IN THE CONSEQUENTIAL ORDER THIS AMO UNT WAS ALSO IGNORED AND THE ENTIRE RS.2,416.94 LAKHS WAS TREATE D AS WORKS EXECUTED BY THE ASSESSEE-COMPANY, WHEN ASSESSEE ADM ITS THAT IT HAS COMPLETED THE TURNOVER OF RS.1055.32 IN CIVIL WORKS AND RS.79.35 IN ELECTRICAL WORKS. THE CONSEQUENTIAL ORDER NOT ONLY IGNORED THE OUTSTANDING AMOUNT GIVEN ALREADY CREDIT IN THE ASSE SSMENT ORDER BUT ALSO IGNORED THE TURNOVER TOWARDS THE ELECTRICAL SE RVICES. THEREBY, THE NET RELIEF GIVEN CONSEQUENT TO THE ORDER OF THE CIT(A) WAS ONLY RS.683.06 LAKHS AND ASSESSING OFFICER TREATED THE A MOUNT OF RS.1,389.44 LAKHS AS SUPPRESSED TURNOVER AND BROUGH T TO TAX. 5. AFTER RECONCILIATION OF THE GROSS AMOUNTS PAYABL E, GROSS TURNOVERS AND TDS CERTIFICATES, WE ARE OF THE OPINI ON THAT BOTH ASSESSING OFFICER AT THE TIME OF ASSESSMENT AND CIT (A) AT THE TIME OF APPELLATE ORDER AND THE PRESENT ASSESSING OFFICER I N THE CONSEQUENTIAL ORDER DID NOT CONSIDER THE FACTS APPR OPRIATELY. AS SEEN FROM THE CONSEQUENTIAL ORDER, THE ASSESSING OFFICER ADMITS THAT GROSS MOBILIZATION ADVANCE RECEIVED WAS RS.2,416.94. THI S AMOUNT CANNOT BE CONSIDERED AS WORK EXECUTED BY THE ASSESSEE-COMP ANY AS ASSESSEE HAS ALREADY SHOWN IN THE BOOKS OF ACCOUNTS AMOUNT OUTSTANDING TOWARDS M/S.MAYTAS INFRA LTD., AT RS.12 27.25. IN VIEW OF RECONCILIATION FURNISHED, WHICH LD.CIT(DR) ALSO VERIFIED AND ACCEPTED, WE DO NOT SEE ANY REASON TO CONFIRM ANY A DDITION ON THIS I.T.A. NO. 605 /HYD/14 GOWTHAMI INFRATECH P. LTD., :- 5 -: ISSUE. ASSESSING OFFICER IS DIRECTED TO DELETE THE ADDITIONS SO CONFIRMED IN THE CONSEQUENTIAL ORDER. ASSESSEE'S G ROUND ON THIS ISSUE IS ALLOWED. 6. NEXT ISSUE FOR CONSIDERATION IS WITH REFERENCE T O DISALLOWANCE OF AN AMOUNT OF RS.1,80,381/- TOWARDS EXPENDITURE FOR INCREASE OF AUTHORIZED SHARE CAPITAL. IT WAS THE SUBMISSION BE FORE THE LD.CIT(A) THAT ASSESSEE PAID ONLY AN AMOUNT OF RS.1,50,000/- AND NOT RS.1,80,381/-. THE LD.CIT(A) DIRECTED THE ASSESSIN G OFFICER TO VERIFY THE EXACT AMOUNT PAID AND DISALLOW THE AMOUNT ACCOR DINGLY. IN SPITE OF FURNISHING THE ROC FEES CHALLAN OF RS.1,50,000/- , THE ASSESSING OFFICER CONFIRMED THE ADDITION OF RS.1,80,381/-. IT WAS THE ASSESSEE'S CONTENTION THAT ONLY AN AMOUNT OF RS.1,50,000/- IS TO BE DISALLOWED AND NOT RS.1,80,381/-. AS AMOUNT TO BE DISALLOWED U NDER THIS HEAD WAS ONLY RS.1,50,000/-, WE DIRECT THE ASSESSING OFF ICER TO ALLOW BALANCE AMOUNT OF RS.30,381/-. ASSESSEE'S GROUND I N THIS REGARD IS ALLOWED. 7. IN THE RESULT, APPEAL IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 16 TH JANUARY, 2015. SD/- SD/- (SAKTIJIT DEY) (B. RAMAKOTAIAH) JUDICIAL MEMBER ACCOUNTANT MEMBER HYDERABAD, DATED 16 TH JANUARY, 2015. TNMM I.T.A. NO. 605 /HYD/14 GOWTHAMI INFRATECH P. LTD., :- 6 -: COPY TO : 1. GOWTH AMI INFRATECH PRIVATE LIMITED, 6 - 3 - 1109/A/1, 3 RD FLOOR, NAVABHARAT CHAMBERS, SOMAJIGUDA, RAJBHAVAN R OAD, HYDERABAD-500 082. 2. DY. COMMISSIONER OF INCOME TAX, IT TOWERS, CIRCL E-2(2), HYDERABAD. 3. CIT(A)-III, HYDERABAD 4. CIT-II, HYDERABAD 5. D.R. ITAT, HYDERABAD.