M/s Dhirendra Nath Mondal Pvt. Ltd., Kolkata V. ITO, Wd-34(4), Kolkata, Kolkata

ITA 617/KOL/2014

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9073 (ITAT-KOLKATA)
• Duration Of Justice: 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-02-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 07-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K L KANAK
• Assessee Lawyers: N O N E

Judgement Text

I.T.A. NO . 617 / KOL ./201 4 ASSESSMENT YEAR: 200 7 - 20 0 8 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA SMC BENCH, KOLKATA BEFORE SHRI GEORGE MATHAN , JUDICIAL MEMBER I.T.A. NO. 617 / KOL / 20 1 4 ASSESSMENT YEAR : 200 7 - 20 0 8 M/S. DHIRENDRA NATH MONDAL PVT. LTD., ... .... ............. .. .APP ELL ANT 55, NALINI SETH ROAD, KOLKATA - 700 007 [ PAN : A ABCD 0716 C ] - VS. - INCOME TAX OFFICER , ........................... ................... ... . RESPONDENT WARD - 3 ( 4 ), KOLKATA , P - 7, CHOWRINGHEE SQUARE, KOLKATA - 700 069 APPEARANCES BY: N O N E , FOR THE ASSESSEE S HRI K.L. KANAK , J CIT, SR. D.R., FOR THE DEPARTMENT DATE OF CONCLUDING THE HEARING : FEBRUARY 23 , 2 01 5 DATE OF PRONOUNCING THE ORDER : FEBRUARY 23 , 201 5 O R D E R PER GEORGE MATHAN : THIS IS AN APPEAL FILED BY THE ASSESSE E AGAINST THE ORDER OF LD. COMMISSI ONER OF INCOME TAX (APPEALS) - I , KOLKATA IN APPEAL NO. 26 7 / CIT(A) - I / WARD - 3(4)/2009 - 10 D ATED 0 7 . 0 1 .201 4 FOR THE ASSESSMENT YEAR 200 7 - 0 8 . 2. NONE , REPRESENTED ON BEHALF OF THE ASSESSEE AND S HRI K.L. KANAK , JCIT, SR. D.R. REPRESENTED ON BEHALF OF THE REVENUE. 3. IN THE ASSESSEE S APPEAL, THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS: - (1) THAT THE LD. CIT(A) - 1, KOLKATA WAS NOT JUSTIFIED IN CONFIRMING THE DISALLOWANCE OF RS.2,11,620/ - U/S. 40(A)(IA) OF INCOME TAX ACT, 1961. I.T.A. NO . 617 / KOL ./201 4 ASSESSMENT YEAR: 200 7 - 20 0 8 PAGE 2 OF 3 (2) THAT THE LD. CIT(A) - 1/KOLKATA WAS ERRED IN CONFIRMING THE DISALLOWANCE U/S. 40(A)(IA) OF INCOME TAX ACT, 1961 THOUGH TDS WAS NOT DEDUCTABLE ON THE PAYMENT TO DEEPAK TRANSPORT AGENCY. 4. AT THE TIME OF HEARING, IT WAS SUBMITTED BY THE LD. SR. D.R. THAT THE ISSUE IN THE APPEAL WAS RELAT ING TO THE DISALLOWANCE MADE BY THE ASSESSING OFFICER BY INVOKING THE PROVISIONS OF SECTION 40(A)(IA) OF THE ACT ON ACCOUNT OF THE NON - DEDUCTION OF TDS IN RESPECT OF THE PAYMENTS MADE TO THE TRANSPORTERS. IT WAS THE SUBMISSION BY THE LD. SR. D.R. THAT THE ASSESSEE IS A DEALER OF IRON - SHEETS. DURING THE YEAR THE ASSESSEE HAD MADE PURCHASES FROM CHATTRISHGARH AND PAYMENTS HAD BEEN MADE TO M/S. DEEPAK TRANSPORT AGENCY AT BHANPURI, RAIPUR, CHATTRISHGARH TOWARDS TRANSPORTATION OF THE PURCHASES. IT WAS THE SUBMIS SION THAT TDS HAD NOT BEEN DEDUCTED AND CONSEQUENTLY THE ASSESSING OFFICER HAS RIGHTLY INVOKED THE PROVISIONS OF SECTION 40(A)(IA) OF THE ACT. HE VEHEMENTLY SUPPORTED THE ORDER OF THE ASSESSING OFFICER AND LD. CIT(APPEALS). 5. I HAVE CONSIDERED THE SUBMIS SIONS AS ALSO THE ASSESSMENT ORDER AND THE ORDER OF THE LD. CIT(APPEALS). A PERUSAL OF THE ORDER OF LD. CIT(APPEALS) MORE SPECIFICALLY THE GROUNDS RAISED BEFORE THE LD. CIT(APPEALS) SHOWS THAT THE ASSESSEE HAS SPECIFICALLY MENTIONED THAT THE TRANSPORTER IS NOT A CONTRACTOR APPOINTED BY THE ASSESSEE BUT A CONTRACTOR APPOINTED BY THE SUPPLIER COMPANY FOR CARRYING GOODS AT THE OWNERS (SUPPLIERS) RISK AND INSURANCE TERMS TO THE DESTINATION AT KOLKATA. THE SUPPLIER IS A CONSIGNOR WHO IS SENDING HIS GOODS TH ROUGH HIS LORRY CONTRACTOR TO THE ASSESSEE - COMPANY, THE CONSIGNEE. THE ASSESSEE - COMPANY IS NO WAY CONNECTED TO THIS WHOLE OPERATION AND THE ASSESSEE CAME TO THE PICTURE WHEN THE GOODS WERE DELIVERED TO HIM AND THEREAFTER HE BECAME THE OWNER OF THE GOODS. O NCE THIS SUBMISSION OF THE ASSESSEE IS CONSIDERED, THEN IT BECOMES QUITE EVIDENT THAT THE PAYMENT OF THE TRANSPORT COST BECOMES PART OF THE COST OF PURCHASES OF THE ASSESSEE. THIS IS IN VIEW OF THE DECISION OF THE HON BLE SUPREME COURT IN THE CASE OF I.T.A. NO . 617 / KOL ./201 4 ASSESSMENT YEAR: 200 7 - 20 0 8 PAGE 3 OF 3 INDI A M E T E RS LIMITED VS. - STATE O F TAMILNADU IN CIVIL APPEAL NO. 1032 - 33 OF 2003 DATED 07.09.2010 WHEREIN THE HON BLE SUPREME COURT HAS HELD THAT IF THE OWNERSHIP IN THE GOODS GETS TRANSFERRED AT THE PREMISES OF THE BUYER AND THE SUPPLIER HAS THE OBLIGATION OF TRANSPORTING THE GOODS TO THE PREMISES OF THE BUYER, THEN NOTWITHSTANDING THE FACT THAT THE FREIGHT CHARGES WERE RECOVERED SEPARATELY FROM THE BUYER, THE TRANSPORTATION CHARGES SHALL FORM PART OF TURNOVER OF THE SUPPLIER, I.E. COST OF PURCHASES FOR THE BUYER . ONCE THIS IS SO, THEN ADMITTEDLY THE PROVISIONS OF TDS IN RESPECT OF THE SAME WOULD NOT APPLY. IN THESE CIRCUMSTANCES, RESPECTFULLY APPLYING THE PRINCIPLES LAID DOWN BY THE HON BLE SUPREME COURT IN THE CASE OF INDIA M E T ER S LIMITED, THE DISALLOWANCE AS MADE BY THE ASSESSING OFFICER AND AS CONFIRMED BY THE LD. CIT(APPEALS) BY INVOKING THE PROVISIONS OF SECTION 40(A)(IA) OF THE ACT STANDS DELETED. 6 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 2 3 RD FEBRUARY , 201 5 . SD/ - GEORGE MATHAN ( JUDICIAL MEMBER) KOLKATA, THE 2 3 RD D AY OF FEBRUARY , 201 5 COPIES TO : (1) M/S. DHIRENDRA NATH MONDAL PVT. LTD., 55, NALINI SETH ROAD, KOLKATA - 700 007 (2) INCOME TAX OFFICER, WARD - 3(4), KOLKATA, P - 7, CHOWRINGHEE SQUARE, KOLKATA - 700 069 (3) COMMISSIONER OF INCOME - TAX (APPEALS) (4) COMMISSIONER OF INCOME TAX ( 5 ) THE DEPARTMENTAL REPRESENTATIVE ( 6 ) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCHES, KOLKATA LAHA/SR. P.S .