M/s. Gidderbaha Janta Truck Union, Bathinda V. The Assistant Commissioner of Income Tax, Bathinda

ITA 660/ASR/2013

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 1438 (ITAT-AMRITSAR)
• Duration Of Justice: 4 year(s) 9 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 04-07-2018
• Assessment Year: 2008-2009
• Appeal Filed On: 11-11-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAJEEV K GUBGOTRA
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR. BEFORE SH. SANJAY ARORA, ACCOUNTANT MEMBER AND SH. N. K. CHOUDHRY, JUDICIAL MEMBER I.T.A. NO. 660/ASR/2013 AS SESSMENT YEAR: 2008-09 GIDDERBAHA JANTA TRUCK UNION GIDDERBAHA, BATHINDA [PAN: AAAAT 6257H] VS. A.C.I.T., CIRCLE- II, BATHINDA (APPELLANT) (RESPONDENT) APPELLANT BY : SH. TARUN BANSAL (ADV.) RESPONDENT BY: SH. RAJEEV K. GUBGOTRA, (D.R.) DATE OF HEARING: 04.07.2018 DATE OF PRONOUNCEMENT: 28.08.2018 ORDER PER SANJAY ARORA, AM: THIS IS AN APPEAL BY THE ASSESSEE AGITATING THE ORD ER BY THE COMMISSIONER OF INCOME TAX (APPEALS), BATHINDA (CIT(A)' FOR SHO RT) DATED 23.08.2013, PARTLY ALLOWING THE ASSESSEES APPEAL CONTESTING ITS ASSES SMENT U/S. 143(3) OF THE INCOME TAX ACT, 1961 ('THE ACT' HEREINAFTER) DATED 16.12.2 010 FOR THE ASSESSMENT YEAR (AY) 2008-09. 2. THE ISSUE ARISING IN THE INSTANT APPEAL IS THE CORRECT DETERMINATION OF THE ASSESSEE-ASSOCIATION OF PERSONS (AOPS), TAXABLE I NCOME FOR THE RELEVANT YEAR, I.E., IN-SO-FAR AS IT ARISES FROM CONTRACT RECEIPT AS WELL AS THAT STATED TO BE FROM THE SEVERAL PERSONS CONSTITUTING IT FOR THE TIME BEING. THE RELEVANT FACTS MAY BE NOTICED AS FOLLOWS. THE ASSESSEE IS AN AOP FORMED BY TRUCK OWNERS, WHO ARE INDIVIDUALS ITA NO. 660/ASR/2013 (AY 2008-09) GIDDERBAHA JANTA TRUCK UNION GIDDERBAH A V. ASST. CIT 2 OWNING ONE OR MORE TRUCK EACH. IT ENTERS INTO CONTR ACTS FOR TRANSPORTATION OF GOODS WITH SEVERAL AGENCIES, PRIMARILY GOVERNMENT AND SEM I-GOVERNMENT AGENCIES, VIZ. PUNSUP, MARKFED, FCI, PUNJAB STATE WAREHOUSING CORP ORATION, ETC. IT IS ADMITTEDLY FORMED TO PROVIDE OPTIMUM GAIN FOR ITS MEMBERS, THE TRUCK OPERATORS, BY AVOIDING INTERNAL COMPETITION BETWEEN THEM, AS WELL AS SECUR ING A BETTER PRICE THROUGH COLLECTIVE BARGAINING. THE CONTRACT RECEIPT IS, AS CLAIMED, REIMBURSED TO THE INDIVIDUAL TRUCK OWNERS, RETAINING WHAT IS CALLED BILTY CHARGES AT RS.10 PER BILTY (GOODS RECEIPT NOTE GRN). IN ADDITION, IT CLAIMS TO RECEIVE A MONTHLY CONTRIBUTION FROM ITS MEMBERS, FIXED BY RESOLUTION, STATED TO BE AT RS.150/- PER MONTH FOR THE RELEVANT YEAR. THE SAME ENABLES THE U NION TO MEET THE MAINTENANCE COST OF ITS OFFICE, INCLUDING SALARY TO ITS EMPLO YEES. IT FURNISHED ITS RETURN OF INCOME FOR THE RELEVANT YEAR ON 22.01.2009 AT AN IN COME OF RS.5,03,305/-, COMPRISING THE FOLLOWING (PB PG. 28): (A) EXCESS OF RECEIPT OVER EXPENDITURE : RS.2,83, 203/- (#) (B) INTEREST ON INCOME-TAX REFUND : RS. 55,520/- (C) SALES OF SCRAP : RS. 1,64,582/- (#) STATED TO BE THE EXCESS OF CONTRIBUTION FROM ME MBERS (RS.5,46,830) OVER THE EXPENDITURE (RS.2,63,627/-). THE ASSESSING OFFICER (AO) QUERIED THE ASSESSEE ON ITS CONTRACT RECEIPT WHICH, AS PER THE TDS CERTIFICATES (TOWARD TAX DEDU CTED AT SOURCE THEREON), WORKED TO RS.361.66 LACS. AS THE ASSESSEE DID NOT PRODUCE ANY BOOKS OF ACCOUNT, WITH ITS AUTHORIZED REPRESENTATIVE (AR) STATING OF NO CASH B OOK OR LEDGER BEING MAINTAINED, HE ESTIMATED THE ASSESSEES INCOME FROM CONTRACT RE CEIPT AT 6% THEREOF, I.E., AT RS.21,69,950 . THE TOTAL INCOME WAS ACCORDINGLY ASSESSED AT RS.2 3,90,052 , I.E., AFTER INCLUDING INCOME BY WAY OF INTEREST AND SCRAP SALES. THE ASSESSEE AGITATED THE ITA NO. 660/ASR/2013 (AY 2008-09) GIDDERBAHA JANTA TRUCK UNION GIDDERBAH A V. ASST. CIT 3 ADDITION TO ITS RETURNED INCOME IN APPEAL. THE LD. CIT(A) NOTED THAT DESPITE AFFORDING OPPORTUNITY TO PRODUCE ITS BOOKS OF ACCO UNT FOR A DOZEN TIME BY THE AO, THE ASSESSEE DID NOT PRODUCE ITS ACCOUNT BOOKS FOR HIS EXAMINATION, WHO WAS THEREFORE CONSTRAINED TO ESTIMATE THE INCOME AT THE RATE OF 6% OF THE TOTAL FREIGHT RECEIPT . HOWEVER, AS THERE WERE DECISIONS BY THE TRIBUNAL AS WELL BY HIMSELF (LISTED AT PG. 5 OF HIS ORDER), THE LD. CIT(A) APPLIED A NE T PROFIT RATE OF 2%, FURTHER DIRECTING THE AO TO INCLUDE THE INCOME OF RS.2,83,2 03/- DISCLOSED BY THE ASSESSEE, WHICH HAD BEEN, WHILE COMPUTING THE TOTAL INCOME, O MITTED TO THE INCLUDED BY THE AO INASMUCH AS HE HAD, ON APPLYING THE RATE OF 6%, IGNORED THAT RETURNED BY THE ASSESSEE AS EXCESS OF INCOME OVER EXPENDITURE. AGGR IEVED, THE ASSESSEE IS IN SECOND APPEAL. 3. WE HAVE HEARD THE PARTIES, AND PERUSED THE MATER IAL ON RECORD. OUR FIRST OBSERVATION IN THE MATTER IS THAT THE ASS ESSEE IS AN AOP, I.E., A PERSON (A TERM DEFINED U/S. 2(31) OF THE ACT), SE PARATE AND DISTINCT FROM THE SEVERAL PERSONS CONSTITUTING IT FOR THE TIME BEING. AS A READING OF THE SAID PROVISION, INCLUDING EXPLANATION THERETO, WOULD CLARIFY, IT IS OF NO CONSEQUENCE THAT THE AOP IS, AS IN THE PRESENT CASE, NOT INCORP ORATED, OR NOT FORMED WITH THE OBJECT OF DERIVING INCOME, PROFIT OR GAINS. EVEN IF THEREFORE IT WAS TO BE ARGUED THAT IT IS NOT A LEGAL PERSON, IT MATTERS LITTLE; IT BEI NG A SEPARATE ASSESSABLE ENTITY UNDER THE ACT, LIABLE FOR TAXATION ON THE INCOME, IF ANY, ARISING TO OR RECEIVED BY IT. INCOME, BY DEFINITION, CAN ONLY COME FROM OUTSIDE O NESELF. AS SUCH, ANY SURPLUS OUT OF THE CONTRIBUTIONS RECEIVED FROM ITS MEMBERS FOR THE TIME BEING, FOR BEING SPENT TOWARD MAINTENANCE COST, WOULD NOT QUALIFY TO BE INCOME, BEING GOVERNED BY THE PRINCIPLE OF MUTUALITY. THERE IS, HOWEVER, NO F INDING THAT THE SAME IS A SURPLUS OUT OF THE CONTRIBUTIONS FROM THE MEMBERS. IN FACT, THERE COULD NOT BE ANY SUCH FINDING IN THE ABSENCE OF THE ASSESSEE PRODUCING IT S ACCOUNT BOOKS BEFORE THE ITA NO. 660/ASR/2013 (AY 2008-09) GIDDERBAHA JANTA TRUCK UNION GIDDERBAH A V. ASST. CIT 4 REVENUE AUTHORITIES FOR VERIFICATION, CALLED FOR TI ME AND AGAIN; RATHER, IT ADMITTING (THROUGH ITS COUNSEL) TO BE NOT MAINTAINING ANY BO OKS OF ACCOUNT. IN FACT, A REGISTER CONTAINING THE NAMES OF THE MEMBERS AS WEL L AS THE MONTHLY SUBSCRIPTION RECEIVED, INCLUDING THE MODE OF ITS ACCEPTANCE, EV IDENCED BY A RECEIPT, IS THE MINIMUM, PRIMARY RECORD THAT THE ASSOCIATION WOULD, OR IS EXPECTED TO, MAINTAIN. FURTHER, THE SAME WOULD BE EITHER HELD IN CASH OR B ANKED, AS ARE THE CONTRACT RECEIPTS, REQUIRING, AT THE MINIMUM, A CASH BOOK WH ICH AGREES WITH THE COLLECTION (SUBSCRIPTION) REGISTER. HOW, THEN, ONE MAY ASK, COULD THE ADMITTED SURPLUS BE SAID TO BE ARISING OUT OF THE MONTHLY CONTRIBUTION FROM MEMBERS ? THE ONUS TO SHOW THAT ITS INCOME IS EXEMPT UNDER THE ACT IS ON THE ASSES SEE, AND WHICH REMAINS COMPLETELY UNDISCHARGED IN THE PRESENT CASE. EVEN A S, THEREFORE, THE ASSESSEES ARGUMENT IS VALID IN PRINCIPLE, IT COMPLETELY FAILS ON FACTS. THE CONTRACT RECEIPT OF RS.361.66 LACS, ARISE AS IT DOES FROM A SOURCE OUTSIDE ONESELF, I.E., THE CONTRACTEES, WHOSE GOODS ARE BEI NG TRANSPORTED BY THE ASSESSEEE IN LIEU OF FREIGHT CHARGES, IS INCOME BY DEFINITION. THE ASSESSEE RECEIVES THE SAME IN ITS OWN RIGHT; THE PRIVITY OF CONTRACT BEING BETWE EN IT AND THE COMPANY WHOSE GOODS ARE TO BE TRANSPORTED, AND THERE IS NO QUESTI ON OF ANY OVERRIDING TITLE IN FAVOUR OF ANY PERSON, AS THROUGH WHOM THE UNION CHO OSES TO UNDERTAKE THE JOB. THAT THE JOB (TRANSPORTATION WORK) IS ALLOCATED TO ITS MEMBERS IS A MATTER INTERNAL TO THE ASSESSEE, AN ASPECT OF THE MANAGEMENT OF ITS WORK BY IT, AND WHICH HAS NOTHING TO DO, I.E., PER SE , WITH THE CONTRACTEE COMPANIES. THE ASSESSEE CLAIM S THAT IT DOES NOT RETAIN ANY PART OF IT, INCLUDING THE TD S COMPONENT, SAVE THE BILTY CHARGES OF RS.10 (PER BILTY), PAYING OVER THE ENTIR E AMOUNT ON RECEIPT TO THE CONCERNED TRUCK OPERATOR TOWARD HIS HIRE INCOME. TH E CLAIM, COMPLETELY UNEVIDENCED, HAS NOT FOUND FAVOUR WITH THE REVENUE, WHICH PROCEEDS TO ESTIMATE THE ASSESSEES INCOME THEREFROM. THAT IS, IT IS THE QUANTIFICATION OF THE INCOME ITA NO. 660/ASR/2013 (AY 2008-09) GIDDERBAHA JANTA TRUCK UNION GIDDERBAH A V. ASST. CIT 5 WHICH IS IN DISPUTE AND IS REQUIRED TO BE DECIDED B Y US, WHICH CAN ONLY BE ON THE BASIS OF THE MATERIAL ON RECORD . CONTINUING FURTHER, THERE IS, AS AFORE-NOTED, NOTHI NG TO JUSTIFY ITS CLAIM, WITH THE ASSESSEE ADMITTEDLY NOT MAINTAINING ANY BOOKS O F ACCOUNT. IN FACT, THE CLAIM OF DISBURSEMENT OF EVEN THE TDS COMPONENT STANDS MADE BEFORE US FOR THE FIRST TIME; THE ASSESSEE BEFORE THE LD. CIT(A) IN FACT RELYING ON THE DECISION BY THE TRIBUNAL IN MANSA TRUCK OPERATORS UNION V. ITO (IN ITA NO. 296/ASR/2010, DATED 15/6/2011 / PB PGS.70-75), WHEREIN THE INCOME (FROM CONTRACT RECEIPT) STANDS ESTIMATED AT 1.5% THEREOF, CONTENDING FOR ADOPTION OF THIS RATE, I.E., AS AGAINST 6% BY THE AO, WHO DID NOT HAVE THE BENEFIT OF THIS, LATER DECISIO N BY THE AMRITSAR BENCH OF THE TRIBUNAL. EVEN AS AGREED TO BY THE REVENUE IN PRINC IPLE, THE ASSESSEE, WITHOUT DOUBT, DISBURSES A SUBSTANTIAL PART OF ITS CONTRAC T (FREIGHT) RECEIPT. THIS AS THE ASSESSEE HAS NO TRUCKS (VEHICLES) OF ITS OWN. THE CONTRACT WORK IS THEREFORE UNDERSTANDABLY UNDERTAKEN BY HIRING THE SAME FROM/A SSIGNING IT TO, AS STATED, ITS MEMBERS. THE MATTER, THEREFORE, TURNS ON FACTS, WHI CH IS TO BE, AS AFORE-STATED, DECIDED ON THE BASIS OF THE MATERIAL ON RECORD. UPO N THIS, THE LD. COUNSEL, SH. BANSAL, WOULD ARGUE THAT IF THE ASSESSEE COULD SHOW THAT THE ENTIRE SUM (CONTRACT RECEIPT) IS PAID TO ITS MEMBERS AS HIRE CHARGES FO R TRANSPORTATION, THERE IS NO SCOPE FOR ANY INCOME OR FOR IMPUTING THE SAME, FURTHER SU BMITTING THAT THE ASSESSEE BE ALLOWED AN OPPORTUNITY TO SHOW THAT THE ENTIRE AMOU NT, I.E., INCLUSIVE OF TDS, IS PAID OVER AS HIRE CHARGES. THE ARGUMENT, VALID IN PRINCIPLE, FAILS ON FACTS. T HE ASSESSEE HAS, FIRSTLY, ALREADY BEEN ALLOWED MORE THAN ABUNDANT OPPORTUNITY BY THE REVENUE TO EXHIBIT ITS CASE/CLAIMS, AND WHICH IT HAS COMPLETELY FAILE D TO. AS STATED BY THE LD. CIT(A), A DOZEN OPPORTUNITIES WERE PROVIDED BY THE AO ALONE . IT IS IN FACT UNFORTUNATE THAT THE REPRESENTATIVES (I.E., OF EITHER SIDE) DID NOT BRING THIS ASPECT OF THE MATTER TO OUR NOTICE DURING HEARING, WHICH THEY OUGHT TO HAVE SO AS TO EXTEND PROPER ASSISTANCE ITA NO. 660/ASR/2013 (AY 2008-09) GIDDERBAHA JANTA TRUCK UNION GIDDERBAH A V. ASST. CIT 6 TO THE BENCH FOR ARRIVING AT THE CORRECT DECISION I N THE GIVEN FACTS AND CIRCUMSTANCES OF THE CASE. IF THE TRUCKERS ARE PAID A FIXED RATE, AS OTHERWISE THOSE OF THE LONGER ROUTES MAY STAND TO GAIN, THE UNION STAN DS TO GAIN FOR THE DIFFERENCE IN RATES. WHY, IN ANY CASE, WOULD THE TRUCKERS AWAIT T HE REFUND OF TDS, FOR BEING PAID THE SAME? WHERE NOT SO, THE ASSESSEE INVESTS ITS O WN FUNDS TOWARD THE SAME (TDS), WHICH HAS NOT BEEN SHOWN OR CONTENDED; IT, I N FACT, NOT MAINTAINING ANY ACCOUNTS SO AS TO EXHIBIT THE SAME. FURTHER, CLEARL Y, NO CASE FOR REMAND WAS MADE EVEN AT THE FIRST APPELLATE STAGE, WHEREAT THE ASSE SSEE IN FACT ARGUED FOR ADOPTION OF A LOWER RATE (1.5%) OF PROFIT (REFER PG.5 OF THE IM PUGNED ORDER). THE ARGUMENT ITSELF IS A TACIT ADMISSION OF A MARGIN, AT WHATEVE R RATE OR SUM, ARISING TO THE ASSESSEE. AGAIN, IMPLICIT IN THE ARGUMENT OF PAYMENT RETAIN ING WHATEVER SUM OR PERCENTAGE, TO THE TRUCK OPERATORS, IS THE MAINTENA NCE OF RECORD, WHICH IS COMPLETELY ABSENT. AS SUCH, WHILE A GROSS REVENUE O F RS.361.66 LACS ARISES TO THE ASSESSEE ON ACCOUNT OF CONTRACT WORK, IT IS UNABLE TO EXHIBIT THE COST THEREOF, INCURRED BY WAY OF PAYMENTS, AT WHATEVER RATE OR SU M, TO THE INDIVIDUAL TRUCK OPERATORS ENGAGED FOR THE PURPOSE. FURTHER STILL, N O CASE FOR A SET ASIDE HAS BEEN MADE BY THE ASSESSEE EVEN BEFORE US, AS BY SHOWING AVAILABILITY OF RELEVANT MATERIALS, IMPACTING ITS CASE FAVOURABLY, WHICH TH EREFORE MAY NEED TO BE ADMITTED AND CONSIDERED. WHY, IT IS THIS COMPLETE ABSENCE OF ANY MATERIAL WITH THE ASSESSEE THAT LED THE REVENUE TO ESTIMATE ITS INCOME, AND W HICH IT DOES, FOLLOWING THE DECISION BY THE TRIBUNAL IN THE TRUCK UNION, SARDULGARH (IN ITA NO. 330/ASR/2010, DATED 24.09.2010 / COPY ON RECORD), A T 2% OF THE GROSS RECEIPT, ALSO REFERRING TO THE DECISION IN WARSAT HUSSAIN (REPORTED AT 171 ITR 405 (PAT)), WHEREIN IT STANDS HELD THAT ASSESSMENT BY ESTIMATE IS ONE OF THE PROCESSES KNOWN TO THE WORLD OF TAXATION. IN FACT, THE REVENUE WHICH IS NOT IN APPEAL AGAIN ST THE IMPUGNED ORDER, HAS ESTIMATED ONLY THE PART RETAINED ON ACCOUNT OF TAX DEDUCTION AT SOURCE ON CONTRACT ITA NO. 660/ASR/2013 (AY 2008-09) GIDDERBAHA JANTA TRUCK UNION GIDDERBAH A V. ASST. CIT 7 RECEIPT (2%), AND THEREFORE NOT PAID TO IT, AS ITS INCOME, SO THAT A LOWER (OR NIL) ESTIMATION, AS CONTENDED BEFORE US, WOULD IMPLY THA T THE ASSESSEE PAYS OVER THE TDS (DEDUCTED AT 2%) PART AS WELL. AS AFORE-NOTED, THE CONTENTION QUA THE PAYMENT OF THE TDS COMPONENT STANDS RAISED BEFORE US FOR TH E FIRST TIME AND, BESIDES, ONLY EMPHASIZES THE NEED FOR AND, RATHER, HINGES CRITICA LLY ON, THE RECORD, WHICH IS ABSENT. THE PAYMENT OF THE TDS COMPONENT, ASSUMING SO, WOULD ONLY BE ON ITS RECEIPT, SO THAT CONSIGNMENT-WISE RECORD WOULD HAVE TO BE MAINTAINED, OF WHICH THERE IS NO MENTION. IN FACT, THERE COULD BE, AS IN DEED WOULD BE, CASES OF SHORTFALL IN CONTRACT RECEIPT ON ACCOUNT OF EXIGENCIES SUCH A S DELAYED DELIVERY, SHORTAGE OF GOODS, ETC. WHICH WOULD REQUIRE SETTLING OF CLAIMS AND COUNTER CLAIMS BY THE UNION ALL POINTING TO THE ASSESSEE RETAINING A MARGIN, ALBEIT SMALL. APART FROM METICULOUS RECORD, ONLY THE TDS REFUNDED COULD BE D ISBURSED, WHILE THE REFUND (TO THE ASSESSEE) OF THE ENTIRE TDS ITSELF HAS NOT BEEN SHOWN, AS FOR EARLIER YEARS, MUCH LESS ITS DISBURSEMENT, EVEN IF LATER, HOLDING THE AMOUNT IN TRUST FOR THE TRUCK OPERATORS TILL THE SAME (DISBURSEMENT) IS COMPLETE. AGAIN, NON-RECEIPT OF THE ENTIRE TDS IMPLIES COST, SO THAT THE UNION WOULD, RATHER, STAND TO LOOSE. WHY, EVEN FOR THE CURRENT YEAR, THE ASSESSEE, RETURNING AN INCOME OF RS. 5.03 LACS, ADMITS A TAX LIABILITY TO SOME EXTENT, SO THAT IT WOULD NOT BE ENTITLED TO REFUND OF THE E NTIRE TAX DEDUCTED AT SOURCE. THIS LOSS/COST THE ASSESSEE H AVING NO OTHER REGULAR SOURCE OF INCOME, WOULD ENTAIL APPROPRIATION THEREOF, OF WHIC H THERE IS AGAIN NO WHISPER. THE PLEA (OF NO RETENTION BY THE ASSESSEE), IN FACT RUNS COUNTER TO THE ASSESSEES OWN DECLARATION OF AN EXCESS OF INCOME OVER EXPENDI TURE (AT RS.2,83,203/-) PER ITS RETURN OF INCOME FOR THE YEAR (WHICH CANNOT, IN THE ABSENCE OF THE RECORD, BE REGARDED AS ARISING OUT OF CONTRIBUTIONS BY THE MEM BERS), BESIDES TO ITS PLEA FOR ESTIMATION OF INCOME FROM CONTRACT RECEIPT AT, FOLL OWING A DECISION BY THE TRIBUNAL, 1.5% OF THE CONTRACT RECEIPT. LOOKED AT FROM AN ANG LE, THE PLEA IS, THEREFORE, NOT MAINTAINABLE. ITA NO. 660/ASR/2013 (AY 2008-09) GIDDERBAHA JANTA TRUCK UNION GIDDERBAH A V. ASST. CIT 8 THE ONLY ISSUE THAT SURVIVES QUA CONTRACT RECEIPT IS THE REASONABILITY OF ESTIMATION OF THE INCOME THERE-FROM. THE ASSESSEES CASE BEING WHOLLY UN- EVIDENCED, THE SAME HAS NECESSARILY TO BE DECIDED I N THE CONSPECTUS OF THE CASE. THE SAME HAS BEEN TAKEN AT 2% FOLLOWING DECISION BY THE TRIBUNAL CITED SUPRA. THE RATE OF TAX DEDUCTION AT SOURCE IN RESPECT OF CONTR ACT RECEIPT IS AT 2% THEREOF (U/S. 194C), IMPLYING THAT THE BALANCE 98%, AS RECEIVED, GETS DISBURSED TO THE TRUCK DRIVERS BY WAY OF HIRE CHARGES, AND ONLY THE BALANC E RETAINED TOWARD TAX LIABILITY, IS REGARDED AS THE INCOME ARISING TO THE ASSESSEE FROM THE CONTRACT WORK. THE SAME CAN ONLY BE REGARDED AS REASONABLE. IN FACT, THE RE VENUES ESTIMATE AT 2% (OF THE CONTRACT RECEIPT) AGREES WITH THE ASSESSEES CONTEN TION OF THE ENTIRE AMOUNT COLLECTED BEING DISBURSED INASMUCH AS THE SAME IS O NLY NET OF TDS. WE ARE CONSCIOUS OF ANOTHER ORDER BY THE TRIBUNAL, ESTIMAT ING THE INCOME, IN A SIMILAR CASE, AT 1.5%. THE MATTER, IT NEEDS TO BE EMPHASIZED, CAN NOT BE GENERALIZED. IN FACT, IN THE VERY SAME DECISION, THE TRIBUNAL NOTES OF ANOTH ER DECISION BY ITS AMRITSAR BENCH (IN ITA NO. 380/ASR/2003, DATED 28/4/2006), W HEREIN THE PROFIT WAS ESTIMATED AT 3%. WHY, THE ASSESSEE HAS ALSO NOT DIS CLOSED EVEN THE ADMITTED INCOME OF RS.10 PER BILTY. SO, HOWEVER, THE ASSESSE E ADMITTEDLY INCURRING SOME EXPENDITURE TOWARD RUNNING THE ORGANIZATION, WE, ES TIMATING THE SAME AT 0.5%, CONSIDER A PERCENTAGE OF 1.5% (ONE-AND-A-HALF PER C ENT.) AS AN APPROPRIATE RATE OF PROFIT ON THE CONTRACT RECEIPT. THE DECISION IN THE CASE OF CIT V. ROHTAK PUBLIC GOODS MOTOR UNION [2005] 26 IT REP. 264 (P&H), ALSO RELIED AT THE FI RST APPELLATE STAGE, STANDS CONSIDERED AND DISTINGUISHED BY THE L D. CIT(A). WE HAVE ALREADY HELD THAT THE INCOME BY WAY OF SURPLUS OUT OF THE CONTRI BUTIONS BY THE MEMBERS, WHERE SO, WOULD BE EXEMPT ON THE PRINCIPLE OF MUTUALITY. THE PROPOSITION IS WELL-SETTLED, AND THIS IS PRECISELY WHAT THE HONBLE HIGH COURT H AS HELD IN THE SAID DECISION, CLARIFYING, WITH REFERENCE TO DECISION IN CIT V. BANKIPUR CLUB LTD . [1997] 226 ITR 97 (SC), THAT THERE SHOULD BE DEALING OR RELATION W ITH ANY OUTSIDE PARTY. ITA NO. 660/ASR/2013 (AY 2008-09) GIDDERBAHA JANTA TRUCK UNION GIDDERBAH A V. ASST. CIT 9 CONCLUSION 4. THE INCOME THAT ADMITTEDLY STANDS BROUGHT TO TAX IN ASSESSMENT IS THAT ARISING TO THE ASSESSEE-AOP OUT OF THE CONTRACT REC EIPT FROM DIFFERENT CONTRACTEE- COMPANIES. THE ASSESEES STAND BEFORE THE REVENUE, AS BEFORE US, IS WITH REGARD TO THE ESTIMATE OF THE INCOME FROM THE TRANSPORTATION WORK BEING EXCESSIVE, AND WHICH IN FACT HAS FOUND SUBSTANTIAL ACCEPTANCE BY T HE LD. CIT(A), REDUCING THE SAME FROM 6% TO 2%, SO THAT IT IS ONLY THE TDS COMP ONENT THAT FINALLY ENURES TO THE ASSESSEE, WITH THE ASSESSEE BEFORE US CLAIMING EVEN THIS TO BE EXCESSIVE, RAISING A PLEA OF DISBURSEMENT OF THE ENTIRE RECEIPT, I.E., INCLUDING THE TDS. THE SAME, UNSUPPORTED BY ANY MATERIAL, HAS YET FOUND PART ACC EPTANCE BY US, REDUCING THE PROFIT RATE TO 1.5%, I.E., AS URGED BEFORE THE FIRS T APPELLATE AUTHORITY. THE QUESTION, THEREFORE, HAS ALWAYS, AND ONLY RIGHTLY SO, BEEN ON E OF QUANTUM, AND NOT OF THE CHARACTER OF THE RECEIPT, WHICH WOULD IN FACT MAKE QUANTUM IRRELEVANT. THE RECEIPT ARISES TO THE ASSESSEE ON THE BASIS OF TRANSPORTATI ON WORK UNDERTAKEN BY IT, AND WHICH IT DOES THROUGH ITS MEMBERS, PAYING THEM A SU M WHICH, IN THE ABSENCE OF ANY RECORD, LED TO THE ESTIMATION OF ITS INCOME IN THE FIRST PLACE. THE DECISION IN ROHTAK PUBLIC GOODS MOTOR UNION (SUPRA) STANDS RIGHTLY DISTINGUISHED BY THE LD. CIT(A). IN FACT, NO ARGUME NT QUA THE SAID DECISION, EXPLAINING A PROPOSITION ON WHICH THERE IS NO QUARR EL, WAS MADE DURING HEARING, WITH WE ADVERTING THERETO FOR THE REASON THAT THE S AME IS BY THE HONBLE JURISDICTIONAL HIGH COURT AND, FURTHER, MENTIONED I N THE IMPUGNED ORDER AS WELL AS THE ASSESSEES GROUNDS OF APPEAL BEFORE THE LD. CIT (A). FURTHER, THIS BEING A REGULAR SOURCE OF INCOME, THERE IS NO QUESTION OF TWO ADDIT IONS, I.E., ON ACCOUNT OF SURPLUS (RS.2.83 LACS) AND THE OTHER AS A PERCENTAGE OF THE CONTRACT RECEIPT. THE AO, WHO ESTIMATED THE SAME AT 6% OF THE CONTRACT RECEIPT, A CCORDINGLY, HAD RIGHTLY NOT INCLUDED THE ADMITTED SURPLUS, WHICH STANDS THEREFO RE WRONGLY INCLUDED BY THE LD. CIT(A) BY INFERRING ITS EXCLUSION BY THE AO TO BE A MISTAKE. THE ASSESSEE HAS ITA NO. 660/ASR/2013 (AY 2008-09) GIDDERBAHA JANTA TRUCK UNION GIDDERBAH A V. ASST. CIT 10 REPORTED TWO OTHER INCOMES, I.E., INTEREST ON TAX-R EFUND AND SALE OF SCRAP. NO ISSUE IN THEIR RESPECT, AS APPARENT FROM THE ORDERS AS WE LL THE GROUNDS RAISED BEFORE THE FIRST APPELLATE AUTHORITY, STANDS RAISED BEFORE THE REVENUE AUTHORITIES; THE ONLY ISSUE BEING QUA THE ADDITION MADE IN ASSESSMENT. THE SAME, IN ANY CASE, ARISING FROM OUTSIDE ONESELF AS IS CONTRACT RECEIPT, THE QUANTUM OF INCOME FROM WHICH SOURCE IS THE SUBJECT MATTER OF DISPUTE, IS INCOME, AS INDEED IT WOULD BE FOR ANY OTHER PERSON. REFERENCE IN THIS REGARD MAY BE MADE TO THE DECISION IN BANGLORE CLUB V. CIT [2013] 350 ITR 509 (SC), REITERATING THE SETTLED P OSITION OF LAW IN THE MATTER WITH REFERENCE TO SEVERAL JUDICIAL PRECEDENT S. WE DECIDE ACCORDINGLY. 5. IN THE RESULT, THE ASSESSEES APPEAL IS PARTLY A LLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON AUGUST 28, 20 18 SD/- SD/- (N. K. CHOUDHRY) (SANJAY ARORA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 28.08.2018 /GP/SR. PS. COPY OF THE ORDER FORWARDED TO: (1) THE APPELLANT: GIDDERBAHA JANTA TRUCK UNION GIDDERBAHA, BATHINDA (2) THE RESPONDENT: A.C.I.T., CIRCLE- II, BATHI NDA (3) THE CIT(APPEALS), BATHINDA (4) THE CIT CONCERNED (5) THE SR. DR, I.T.A.T TRUE COPY BY ORDER