ACIT (OSD) 2(3), MUMBAI V. SYLVESTER FORWARDERS LTD, MUMBAI

ITA 7749/MUM/2010

• Counselvise Citation: 774919914 RSA 2010
• Duration Of Justice: 2 year(s) 10 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-09-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 12-09-2013
• Assessment Year: 2005-2006
• Appeal Filed On: 11-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: C SRINIVAS REDDY

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH E, MUMBAI BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER ITA NO.7749/MUM/2010 ASSESSMENT YEAR : 2005-06 DCIT - 2(3) ROOM NO.555 AAYAKAR BHAVAN MUMBAI. VS. M/ S. SYLVESTER FORWARDERS LTD. SYLVESTER BUILDING 20, SHAHID BHAGAT SING RD. FORT, MUMBAI-400 023. PAN NO.AACCS 2631 N (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI HIRO RAI REVENUE BY : SHRI C. SRINIV AS REDDY DATE OF HEARING : 12/09/2013 DATE OF PRONOUNCEMENT : 17 / 0 9 /2013 O R D E R PER B. RAMAKOTAIAH, AM: THIS IS A REVENUE APPEAL AGAINST THE ORDER OF LD. C IT(A) DATED 06.08.2010. REVENUE RAISED THE FOLLOWING GROUNDS: 1.THE ORDER OF THE CIT(A) IS OPPOSED TO LAW AND FAC TS OF THE CASE. 2 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE , AND IN LAW THE LD. CIT(A) ERRED IN HOLDING THAT THERE IS NO INCOME WHICH REMAINED TO BE ACCOUNTED FOR AND IT WAS ONLY A CASE OF DOUBLE D EDUCTION OF TDS OF CERTAIN SUMS. ITA NO.7749/M/10 A.Y.05-06 2 3 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE , AND IN LAW THE ID. CIT(A) ERRED IN DELETING THE ADDITION OF RS. 15 ,22,367/- BASED ON TDS CERTIFICATES. 4 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE , AND IN LAW THE LD. CIT(A) ERRED IN HOLDING THAT THE FOREIGN EXCHAN GE EARNINGS OF RS. 59,75,637/- ARE ACCOUNTED FOR WITHOUT APPRECIATING THAT RECEIPTS FROM REGGIANE CRANES & PLANTS WERE IN FACT NOT INCL UDED IN RECEIPTS DISCLOSED IN P & L ACCOUNT. 5 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) ERRED IN DELETING THE ADDITION OF RS. 58, 82,051/- BEING FOREIGN CURRENCY EARNING. 2. BRIEFLY STATED FACTS ARE THAT THE ASSESSEE IS A CUSTOM HOUSE AGENT AND IS IN THE BUSINESS OF EXPORT/IMPORT CONSULTANCY SERVICES. IT FILED RETURN OF INCOME OF RS.1,16,08,980/-. IN THE COURS E OF ASSESSMENT PROCEEDINGS, ASSESSING OFFICER ASKED FOR RECONCILIA TION OF SERVICE CHARGES WITH TDS CERTIFICATES. ON THE BASIS OF DIFFERENCE IN RECEIPTS SHOWN BY ASSESSEE AND TDS MADE BY M/S. NHAVA SHEWA INTERNATI ONAL CONTAINER TERMINAL P. LTD. (NSICTPL), AO ADDED AN AMOUNT OF RS.15,22,367/- TO THE TOTAL INCOME OF THE ASSESSEE. BEFORE THE LD. C IT(A), ASSESSEE RECONCILED THE AMOUNTS OFFERED IN RESPECTIVE YEARS AND ALSO THE FACT THAT TDS WAS DEDUCTED TWICE BY NSICTPL ON AN AMOUNT AT T HE TIME OF ADVANCE AS WELL AS LATER TIME WHEN ADJUSTED. IN S UPPORT, FILED LETTER FROM THE SAID CONCERN AND MADE TOTAL RECONCILIATION WHICH WAS EXTRACTED BY LD. CIT(A) IN PARA 4.2 TO 4.7. ULTIMATELY, HE DELETED THE ADDITION BY STATING AS UNDER: 4.8 I HAVE CONSIDERED THE FACTS OF THE ISSUE AS WE LL AS WRITTEN SUBMISSIONS MADE BY THE AR. A PERUSAL OF THE SUBM ISSIONS MADE BY THE AR INDICATES THAT THE TOTAL INCOME ACCRUING TO THE APPELLANT AS A RESULT OF THE AGREEMENT ENTERED INTO WITH NSIC T NAMELY A SUM OF RS.2,06,50,000/- HAS BEEN DULY ACCOUNTED FOR IN THE RETURNS OF INCOME BY THE APPELLANT IN THREE ASSESSMENT YEARS A S MENTIONED ABOVE. HENCE THERE IS NO INCOME WHICH REMAINED TO B E ACCOUNTED FOR. IT WAS ONLY A CASE OF DOUBLE DEDUCTION OF TDS IN RESPECT OF ITA NO.7749/M/10 A.Y.05-06 3 CERTAIN SUM AS DISCUSSED IN THE ARS SUBMISSIONS. H ENCE, THE ADDITION OF RS.15,22,367/- MADE BY THE AO BASED ON TDS CERTIFICATES IS DELETED. HOWEVER, THE AO IS DIRECTE D TO ALLOW CREDIT OF TDS ONLY ON THE BASIS OF THE MATCHING PRINCIPLE. HENCE, TDS SHOULD BE ALLOWED ONLY IN THE YEAR IN WHICH THE SUBJECT IN COME HAS BEEN ACCOUNTED FOR BY THE APPELLANT. THIS GROUND IS ALLO WED. 2.1 REVENUE RAISED GROUND NO. 2 & 3 ON THIS ISSUE. 3. ANOTHER ADDITION MADE BY THE AO IS THAT OF RS.58 ,82,051/- ON THE BASIS OF REPORTING OF FOREIGN EXCHANGE EARNINGS O F RS.59,75,637/- IN DIRECTORS REPORT. AO ASKED FOR RECONCILIATION OF THE AMOUNT WHICH ASSESSEE DID. HOWEVER, AO WAS OF THE OPINION THAT ONLY AN AMOUNT OF RS.75,961/- IN P&L ACCOUNT WAS ACCOUNTED BY ASSESSE E AND MADE AN ADDITION OF RS.58,82,051/-. IT WAS SUBMITTED BEFO RE LD. CIT(A) THAT THE FOREIGN EXCHANGE EARNINGS REPORTED IN DIRECTORS R EPORT COMPRISES OF AMOUNTS REPORTED IN VARIOUS HEADS LIKE SERVICE CHA RGES, WHARFAGE, CONSULTANCY SERVICES, CARTAGE ETC. AND MADE TOTAL R ECONCILIATION WITH AMOUNTS ACCOUNTED IN BOOKS OF ACCOUNT, SUPPORTED B Y RELEVANT LEDGER COPIES. THESE DETAILS WERE EXAMINED BY LD. CIT(A) AND EXTRACTED IN PARA 5.2 TO 5.7 AND FINALLY CONCLUDED AS UNDER: 6. I HAVE CONSIDERED THE FACTS OF THE ISSUE AS WEL L AS WRITTEN SUBMISSIONS MADE BY THE AR AND FIND MERIT IN THEM. THE ENTIRE FOREIGN EXCHANGE EARNINGS REPRODUCED BY THE AO IN P ARA 4 OF THE ORDER HAVE BEEN CHECKED AND WERE FOUND TO HAVE BEEN DULY REFLECTED IN THE ACCOUNTS OF THE APPELLANT AND TAKE N INTO CONSIDERATION WHILE DISCLOSING THE TAXABLE INCOME. ALL THE SAID AMOUNTS ERE DULY CREDITED IN EITHER OF THE ACCOUNT S WHICH ULTIMATELY GOT CREDITED IN THE P & L ACCOUNT FOR THE YEAR UNDE R CONSIDERATION. HENCE, LOOKING AT ALL THE FACTS OF THE CASE BROUGH T OUT BY THE AR, THE ADDITION MADE BY THE AO IS DELETED. THIS GROUND IS ALLOWED. 3.1 REVENUE IS AGGRIEVED AND RAISED GROUND NO.4 & 5 ON THE ISSUE. 4. WE HAVE HEARD LD. DR AND LD. COUNSEL AND PERUSED THE PAPER BOOK FILED. IN OUR OPINION THE AO IS NOT CORRECT I N MAKING ADDITIONS WITHOUT GIVING ANY OPPORTUNITY TO THE ASSESSEE. TH E ADDITION ARE MADE ITA NO.7749/M/10 A.Y.05-06 4 ON VARIOUS PRESUMPTIONS WITHOUT EXAMINING THE DETAI LS PLACED ON RECORD. LD. CIT(A) EXAMINED ALL THE ISSUES IN DETAIL AND GA VE HIS FINDINGS ON FACTUAL VERIFICATION. WE ALSO EXAMINED AND LD. COU NSEL EXPLAINED THE VARIOUS ACCOUNTS IN WHICH THE AMOUNTS WERE ACCOUNTE D FOR. WE DO NOT FIND ANY REASON TO INTERFERE WITH THE WELL REASONED ORDER OF THE LD. CIT(A), WHO TOOK PAINS IN RECONCILING AND ARRIVING AT CORRECT CONCLUSIONS. THERE IS NO MERIT IN GROUNDS RAISED BY THE REVENUE. 5. IN THE RESULT, REVENUE APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 17 TH SEPTEMBER, 2013. SD/- SD/- (SANJAY GARG ) JUDICIAL MEMBER (B. RAMAKOTAIAH ) ACCOUNTANT MEMBER MUMBAI, DATED: 17/09/2013. JV. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR BENCH TRUE COPY BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.