PRADEEP CHANDRA JHA, BILASPUR(CG) V. DY.. C.I.T. CIRCLE-1(1), BILASPUR(CG)

ITA 69/BIL/2015

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 8952 (ITAT-RAIPUR)
• Duration Of Justice: 2 year(s) 7 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-01-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 21-05-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: O P CHAUDHURY
• Assessee Lawyers: G S AGARWAL
• Keywords: Retrospective amendment
• Section: 201(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, RAIPUR BENCH, RAIPUR BEFORE S/SHRI N.S SAINI, ACCOUNTANT MEMBER AND PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA NO. 69/RPR/2015 ASSESSMENT YEAR : 2010-2011 PRADEEP CHANDRA JHA, M/S. PHIL SYSTEMS, B-11, SAI PLAZA, LINK ROAD, BILASPUR VS. DCIT, CIRCLE 1(1), BILASPUR PAN/GIR NO.AFHPJ 2341 B (APPELLANT ) .. ( RESPONDENT ) ASSESSEE BY : SHRI G.S.AGARWAL, AR REVENUE BY : SHRI O.P. CHAUDHURY, DR DATE OF HEARING : 18/01/ 2018 DATE OF PRONOUNCEMENT : 19 /01/ 2018 O R D E R PER PAVAN KUMAR GADALE, JM THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDE R OF THE CIT(A)- BILASPUR, DATED 6.12.2014 FOR THE ASSESSMENT YEAR 2010 -2011. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : 1. THAT UNDER THE FACTS AND THE LAW, THE LEARNED CLT (APPEALS) ERRED IN MAINTAINING DISALLOWANCE OF RS.21,86,0317- MA DE BY THE LEARNED AO U/S 40(A)(IA) FOR NON DEDUCTION OF TA X U/S 194A FROM FINANCIAL CHARGES PAID TO M/S TATA MOTORS FINANCE L TD. AND M S MAGMA FIN. CORP. LTD., REJECTING THE EXPLANATIONS FI LED, PRAYED THAT DISALLOWANCE OF RS, 21,86,031/- IS UNJUSTIFI ED AND BE DELETED. 2. THAT UNDER THE FACTS AND THE LAW, THE LEARNED CIT (A) ERRED IN NOT FOLLOWING THE JUDICIAL DISCIPLINE IN CONFIRMING T HE DISALLOWANCE 2 ITA NO. 69/RPR/2015 ASSESSMENT YEAR : 2010-2011 U7S 40(A)(IA) AMOUNTING TO RS.21,86,031/- BY NOT CONSI DERING THE DECISION OF AGRA BENCH OF HON'BLE INCOME TAX APPELL ATE TRIBUNAL IN RAJIV KUNIAR VS CIT REPORTED IN 109 DTR 33 RELIED UPON BY THE APPELLANT WHEREIN IT WAS HELD THAT PROVISO INSERTED TO SEC. 201(1) & 40(A)(IA) BY FINANCE ACT 2012 W.E.F 0 1. 02.2012 WAS HAVING RETROSPECTIVE EFFECT. 3. THAT THE LEARNED CIT (APPEALS) FURTHER ERRED IN M AINTAINING THE DISALLOWANCE OF RS.8.00,000/- OUT OF TRUCK RUNNI NG & TRANSPORTATION EXPENSES BY REJECTING THE EXPLANAT IONS. 4. THAT THE LEARNED CIT (A) FURTHER ERRED IN CONFIRM ING THE ADHOC DISALLOWANCE OF RS.1,39,9047- WHICH IS 1/6 TH OF RS.8,39,4247- OUT OF CONVEYANCE EXPENSES, CAR EXPENSES, OFFICE EXPENSES & TELEPHONE EXPENSES MADE BY THE LEARNED AO WHICH IS UNJU STIFIED & BE DELETED. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS ENGA GED IN THE BUSINESS OF TRADING OF COAL AND COAL TRANSPORTATION THRO UGH HIS PROPRIETORSHIP CONCERN 'M/S. PHIL SYSTEM, BILASPUR'. IT FILED THE RET URN OF INCOME FOR THE A.Y. 2010-11 ON 02-10-2010 SHOWING TOTAL INCOME AT RS. 69.75,440/-. THE CASE WAS SELECTED FOR SCRUTINY THROUGH CASS AND THEREFORE, THE ASSESSING OFFICER ISSUED NOTICE U/S 143(2)/142(1), IN RESPONSE TO WHICH, THE COUNSEL OF THE ASSESSEE APPEARED FROM TIME TO TIME, PRODUCED THE BOOKS OF ACCOUNT, BILLS AND VOUCHES AND OTHER DOCUMENTS FOR VERIFICATION. THE ASSESSING OFFICER COMPLETED THE ASSESSMENT AT RS. 1,01,41,550/- BY MAKING ADDITIONS ON DIFFERENT GROUNDS TO THE TOTAL INCOME. 3 ITA NO. 69/RPR/2015 ASSESSMENT YEAR : 2010-2011 4. IN RESPECT OF DISPUTE ISSUE OF NON-DEDUCTION OF TDS, T HE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS NOT DEDUCTED TDS IN RE SPECT OF PAYMENT TO NBFCS U/S. 194A OF THE ACT AND, THEREFORE, BY INVO KING THE PROVISIONS U/S.40(A)(IA), THE ASSESSING OFFICER MADE ADDITION TOWARD S FINANCE CHARGES OF RS.24,51,131/-. SIMILARLY, THE ASSESSEE IS IN THE BUSINESS OF TRANSPORTATIO N AND THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS CLAIMED AN AMOU NT OF RS.4,10,46,223/- UNDER THE HEAD TRUCK RUNNING AND RS.9 ,17,00,267/- UNDER THE HEAD TRANSPORTATION. THE ASSESSING OFFICER FOUND T HAT SOME VOUCHERS ARE MISSING AND MOST OF THEM ARE INTERNAL AND, THEREFO RE, NOT AMENABLE FOR VERIFICATION. FURTHER THE MANAGEMENT OF RECORDS IS AL SO VERY POOR. AS THE VOUCHERS ARE NOT COMPLETE AND ARE NOT AVAILABLE, THE A SSESSING OFFICER FOUND THAT THERE IS POSSIBILITIES OF INFLATION OF EXPENDITU RE IN ORDER TO REDUCE THE TAX AND, ACCORDINGLY, DISALLOWED RS.8,00,000/- ON ADHOC BASIS . SIMILARLY, THE ASSESSING OFFICER, ON PERUSAL OF PROFIT AND LOSS ACCOUNT FOUND THAT THE ASSESSEE HAS CLAIMED VARIOUS EXPENSES ON CONV EYANCE, CAR EXPENSES, OFFICE EXPENSES AND TELEPHONE EXPENSES. HE HAS M ADE DISALLOWANCE AS THE VOUCHERS ARE SELF MADE AND SOME ARE UN VOUCHED AND NOT FULLY OPEN TO VERIFICATION. IN VIEW OF ABOVE, T HE ASSESSING OFFICER 4 ITA NO. 69/RPR/2015 ASSESSMENT YEAR : 2010-2011 DISALLOWED RS.1,39,904/- AND ADDED THE SAME TO THE TOT AL INCOME OF THE ASSESSEE. 5. AGGRIEVED BY THE ORDER OF THE ASSESSING OFFICER, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CIT(A). 6. THE CIT(A) HAS CONFIRMED THE ACTION OF THE ASSESSING O FFICER ON THE DISPUTE ISSUES. HENCE, THE ASSESSEE IS IN APPEAL BEFORE US. 7. BEFORE US, THE LD A.R. SUBMITTED THAT THE CIT(A) E RRED IN ESTIMATING THE ADDITION WITHOUT CONSIDERING THE FACT THAT THAT T HE ASSESSEE HAS OBTAINED CERTIFICATE FROM C.A. IN RESPECT OF NBFCS WHERE THE FINA NCE CHARGES HAVE BEEN PAID. LD A.R. ALSO PRODUCED THE COPY OF BALANCE SH EET AND PROFIT AND LOSS ACCOUNT AND THE CIT(A) HAS NOT CONSIDERED APPLICA TION OF RULE 46A AND NO REMAND REPORT FROM THE ASSESSING OFFICER AND PRAYED F OR ALLOWING THE APPEAL OF THE ASSESSEE. 8. CONTRA, LD D.R. SUPPORTED THE ORDERS OF LOWER AUTH ORITIES. 9. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE OR DERS OF LOWER AUTHORITIES AND MATERIALS AVAILABLE ON RECORD. IN RESPE CT OF FIRST DISPUTED ISSUE U/S.40(A)(IA) OF THE ACT, THE CONTENTION OF LD A. R. THAT THE ASSESSEE IS HAVING CERTIFICATE OF C.A. ISSUED IN RESPECT OF TDS AND D EMONSTRATED BEFORE US IN PAPER BOOK AT PAGE 1 TO 4 EXPLAINING FORM NO. 27A ISSUED BY THE C.A. 5 ITA NO. 69/RPR/2015 ASSESSMENT YEAR : 2010-2011 ON THIS ISSUE, LD D.R. SUBMITTED THAT THIS INFORMATION W AS NOT AVAILABLE WITH THE ASSESSING OFFICER. CONSIDERING THE OVERALL ASPECT OF T HE FACT THAT NBCSS HAVE OFFERED ITS INCOME, THE MATTER HAS TO BE VERIFIED BY THE ASSESSING OFFICER. ACCORDINGLY, WE REMIT THIS ISSUE TO THE ASSESSING O FFICER TO VERIFY THE CLAIM OF THE ASSESSEE AND PASS ORDER AS PER LAW. 10. ON THE SECOND DISPUTED ISSUE WITH RESPECT OF DISALLOWA NCE ON TRUCK RUNNING AND TRANSPORTATION EXPENSES, LD A.R. EMPHASIZ ED THAT THE ASSESSEE IS MAINTAINING BOOKS OF ACCOUNT AND HAVING VOUCHERS. THE ASSESSING OFFICER HAS NOT SPECIFIED ANY PARTICULAR VOUCHER WHICH IS NOT VER IFIABLE AND MAKING ADHOC DISALLOWANCE. THE ASSESSING OFFICER HAS NOT SPECIFIED THAT THE BILLS ARE NOT GENUINE. THE ASSESSING OFFICER HAS NOT DOUBTED THE G ENUINENESS OF THE SAID VOUCHERS BUT MADE THE ADHOC DISALLOWANCE. LOOKING INTO THE FACTS AND CIRCUMSTANCES OF THE CASE, WE REMIT THIS ISSUE TO THE FILE O F THE ASSESSING OFFICER. THE ASSESSEE IS DIRECTED TO SUBMIT ALL THE DETA ILS AND THE ASSESSING OFFICER IS DIRECTED TO PASS THE ORDER. 11. IN RESPECT OF THIRD ISSUE, WE ARE OF THE CONSIDERED V IEW THAT THE CLAIM OF THE ASSESSEE IN RESPECT OF ADHOC DISALLOWANCE OF RS.1,39,9 04/- WHICH IS 1/6 TH OF RS.8,39,424/- OUT OF CONVEYANCE EXPENSES, CAR EXPENSES, OFFICE EXPENSES AND TELEPHONE EXPENSES THE FINDINGS OF THE CIT (A) IS IN ORDER. HENCE, WE CONFIRM THE SAME. 6 ITA NO. 69/RPR/2015 ASSESSMENT YEAR : 2010-2011 12. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 19 /01/2018. SD/- SD/- (N.S SAINI) (PAVAN KUMAR G ADALE) ACCOUNTANT MEMBER JUDICIALMEMBER RAIPUR; DATED 19 /01/2018 B.K.PARIDA, SPS COPY OF THE ORDER FORWARDED TO : BY ORDER, SR.PRIVATE SECRETARY ITAT, RAIPUR 1. THE APPELLANT : PRADEEP CHANDRA JHA, M/S. PHIL SYSTEMS, B-11, SAI PLAZA, LINK ROAD, BILASPUR 2. THE RESPONDENT. DCIT, CIRCLE 1(1), BILASPUR 3. THE CIT(A)-BILASPUR 4. PR.CIT-BILASPUR 5. DR, ITAT, RAIPUR 6. GUARD FILE. //TRUE COPY//