Ashraf Petrol Station, Berhampur V. DCIT, Berhampur Circle, Berhampur

ITA 73/CTK/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 7569 (ITAT-CUTTACK)
• Duration Of Justice: 8 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-11-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 10-11-2016
• Assessment Year: 2012-2013
• Appeal Filed On: 03-03-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: D K PRADHAN
• Assessee Lawyers: D K SHETH

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK SMC BENCH, CUTTACK BEFORE SHRI N.S SAINI, ACCOUNTANT MEMBER ITA NO. 73/CTK/2016 ASSESSMENT YEAR : 2012 - 2013 ASHRAF PETROL STATION, KATHAMENTU SQUARE, ASKA ROAD, BERHAMPUR VS. DCIT, BERHAMPUR CIRCLE AMABPUA, BERHAMPUR. PAN/GIR NO. AAGFA 9237 P (APPELLANT ) .. ( RESPONDENT ) ASSESSEE BY : SHRI D.K.SHETH REVENUE BY : SHRI D.K.PRADHAN, DR DATE OF HEARING : 10 /11 / 2016 DATE OF PRONOUNCEMENT : 10 /11 / 2016 O R D E R THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) - 1, BHUBA N E SWAR , DATED 2.12.2015 , FOR THE ASSESSMENT YEAR 2012 - 2013 . 2. GROUND NO.1 IS GENERAL IN NATURE AND HENCE, REQUIRES NO ADJUDICATION. 3. GROUND NO.2 OF THE APPEAL READS AS UNDER: FOR THAT THE ADDITION OF RS .51,543/ - ON ACCOUNT OF NON - DISCLOSURE OF INCOME IN RESPECT OF RECEIPT OF LORRY CHARGES FROM HPCL AS MADE BY THE LD AO IS IMPROPER AND UNJUSTIFIED. THE LD CIT(A) IS ALSO NOT JUSTIFIED TO CONFIRM THE SAME, 2 ITA NO. 73/CTK/2016 ASSESSMENT YEAR :2012 - 2013 4. AT THE TIME OF HEARING, LD A.R. OF THE ASSESSEE SUBMITTED THAT HE IS NOT PRESSING THIS GROUND OF APPEAL AND ALSO MADE AN ENDORSEMENT TO THIS EFFECT TO THE GROUNDS OF APPEAL APPENDED TO FORM NO.36 OF THE APPEAL MEMO FILED BEFORE THE TRIBUNAL. HENCE, THIS GROUND IS DISMISSED AS NOT PRESSED. 5. I N GROUND NO.3 OF THE APPEAL, THE GRIEVANCE OF THE ASSESSEE IS THAT THE LD CIT(A) ERRED IN CONFIRMING THE ORDER OF THE ASSESSING OFFICER MAKING ADDITION OF RS. 12,74,544/ - ON ACCOUNT OF DISALLOWANCE OF LEAKAGE IN MS (PETROL) ACCOUNT AND HSD (DIESEL) ACCOUNT. 6. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE UNDISPUTED FACTS OF THE CASE ARE THAT THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS CLAIMED LEAKAGE ON HSD(DIESEL) TO THE TUNE OF 30,018 LITRES @ 0.55% AND PETROL TO THE TUNE OF 17,582 LITRES @1.13%. THE ASSESSING OFFICER OBSERVED THAT T HE COMPANY ALLOWS LEAKAGE ON EVAPORATION/HANDLING LOSS @ 0.75% ON PE TROL UPTO AVERAGE SALE OF 600 KL S AND @0.60% ON THE BALANCE SALE ABOVE 600 KLS (6,00,000 LITRES). SIMILARLY, LOSS IS ALLOWABLE @0.25% ON DIESEL UPTO AVERAGE SALE OF 600 KLS AND 0.20% ON THE BALANCE SALE ABOVE 600 KLS. HE OBSERVED THAT THE ASSESSEE HAD SOLD 15,52,619 LITRES OF PETROL AND 54,93,047 LITRE S OF DIESEL. ACCORDINGLY, THE ASSESSING OFFICER CALCULATED LEAKAGE ON PETROL AT 10,216 LITRES (4,500 + 5,716) AND DIESEL AT 11,286 LITRES (1 ,500 + 9,786). THEREFORE, THE ASSESSING OFFICER HELD THAT THE ASSESSEE HAD CLAIMED EXCESS LEAKAGE 7,366 LITRES OF 3 ITA NO. 73/CTK/2016 ASSESSMENT YEAR :2012 - 2013 PETROL (17,582 - 10,216) AND 18,732 LITRES OF DIES EL (30,018 - 11,286) WHICH CANNOT BE ALLOWED. THEREFORE, HE DISALLOWED THE EXCESS LEAKAGE OF PETRO L AND DIESEL AND MADE AN ADDITION OF RS.12,74,544/ - TO THE INCOME OF THE ASSESSEE. 7. ON APPEAL, LD CIT(A) CONFIRMED THE ACTION OF THE ASSESSING OFFICER ON THE GROUND THAT THE ASSESSING OFFICER HAS CALCULATED THE EXCESS LOSS ON THE BASIS OF CIRC ULAR ISSUED BY THE OIL COMPANY . 8. BEFORE ME, LD A.R. OF THE ASSESSEE HAS FILED A CHART SHOWING EVAPORATION LOSS ALLOWED IN THE PRECEDING ASSESSMENT YEARS TO THE ASSES SEE. ACCORDING TO THE SAID CHART, IN THE ASSESSMENT YEAR 2009 - 2010, EVAPORATION LOSS ON PETROL WAS ALLOWED AT 1% AND ON DIESEL AT 0.5%. IN THE ASSESSMENT YEAR 2010 - 2011, EVAPORATION LOSS ALLOWED ON PETROL WAS 0.98% AND ON DIESEL AT 0.5%. IN THE ASSESSME NT YEAR 2011 - 2012, EVAPORATION LOSS ON PETROL WAS ALLOWED AT 1% AND ON DIESEL AT 0.5%. HENCE, IT WAS THE SUBMISSION OF LD A.R. OF THE ASSESSEE THAT EVAPORATION LOSS ON PETROL CLAIMED BY THE ASSESSEE AT 1.13% AND ON DIESEL AT 0.55% COMPARES FAVOURABLE WIT H THE PAST ACCEPTED RESULTS OF THE ASSESSEE. HENCE, NO DISALLOWANCE IS CALLED FOR ON THIS ACCOUNT.. 9. ON THE OTHER HAND, LD D.R. RELIED ON THE ORDERS OF LOWER AUTHORITIES. 4 ITA NO. 73/CTK/2016 ASSESSMENT YEAR :2012 - 2013 10. I FIND THAT THE ASSESSING OFFICER ALLOWED EVAPORATION LOSS ON PETROL @ 0.75% O N AN AVERAGE OF 600 KLS AND @0.60% ON THE BALANCE SALE ABOVE 600 KLS (6,00,000 LITRES). SIMILARLY, THE ASSESSING OFFICER ALLOWED EVAPORATION LOSS @0.25% ON DIESEL UPTO AVERAGE SALE OF 600 KLS AND 0.20% ON THE BALANCE SALE ABOVE 600 KLS ON THE BASIS OF CIRCULAR ISSUED BY THE OIL COMPANY. THE CONTENTION OF LD A.R. OF THE ASSESSEE IS THAT THE SAID CIRCULAR ISSUED BY THE COMPANY IS FOR REIMBURSEMENT OF EVAPORATION LOSS TO THE ASSESSEE. IT IS THE CONTENTION OF THE LD A.R. THAT FROM THE PAS T ACCEPTED RESULTS OF THE ASSESSEE, IT CAN BE SEEN THAT EVAPORATION LOSS IN CASE OF PETROL HAS BEEN ACCEPTED AT 1% AND IN CASE OF DIESEL AT 0.5%. I FIND FORCE IN THE ARGUMENTS OF LD A.R. OF THE ASSESSEE THAT THE ASSESSEE HAS CLAIMED EVAPORATION LOSS AT 1. 13% AND DIESEL AT 0.55% IN THE YEAR UNDER APPEAL WHICH COMPARES FAVOURABLE WITH THE PAST ACCEPTED RESULTS OF THE ASSESSEE. I, THEREFORE, SET ASIDE THE ORDERS OF LOWER AUTHORITIES AND DELETE THE ADDITION OF RS.12,74,544/ - ON LEAKAGE IN MS (PETROL) ACCOUNT AND HSD (DIESEL) ACCOUNT. 11. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCE D IN THE OPEN COURT ON 10 /11 /2016 IN THE PRESENCE OF PARTIES. SD/ - ( N.S SAINI) A CCOUNTANT MEMBER CUTTACK; DATED 10 /11 /2016 5 ITA NO. 73/CTK/2016 ASSESSMENT YEAR :2012 - 2013 B.K.PARIDA, SPS COPY OF THE ORDER FORWARDED TO : BY ORDER, ASST.REGISTRAR, ITAT, CUTTACK 1. THE APPELLANT : ASHRAF PETROL STATION, KATHAMENTU SQUARE, ASKA ROAD, BERHAMPUR 2. THE RESPONDENT. DCIT, BERHAMPUR CIRCLE AMABPUA, BERHAMPUR 3. THE CIT(A) - 1, BHUBANESWAR 4. CIT , BHUBANESWAR. 5. DR, ITAT, CUTTACK 6. GUARD FILE. //TRUE COPY//