Sh. Mohd. Ayoub Khan, Poonch V. The Dy. Commissioner of Income Tax, Jammu

ITA 79/ASR/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 7820 (ITAT-AMRITSAR)
• Duration Of Justice: 2 year(s) 7 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-09-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 13-06-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 09-02-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: P N ARORA
• Keywords: Unexplained cash credit; Depreciation
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. T. S. KAPOOR, ACCOUNTANT MEMBER AND SH. N.K. CHOUDHRY, JUDICIAL MEMBER I.T.A NO. 79/(ASR)/2015 ASSESSMENT YEAR: 2010-11 PAN: AQQPK8314F SH. MOHD. AYOUB KHAN, S/O SH. JUMA KHAN, PROP. M/S PATHAM ENTERPRISES, VILL. POTHA, TEHSIL SURANKOTE, DISTT. POONCH (J. & K.) VS. DY. C. I. T., CIRCLE-2, JAMMU. (APPELLANT) (RESPONDENT) APPELLANT BY : SH. P. N. ARORA ( ADV.) RESPONDENT BY: SH. RAHUL DHAWAN (D. R.) DATE OF HEARING: 07.08.2017 DATE OF PRONOUNCEMENT: 11.09.201 7 ORDER PER T. S. KAPOOR (AM): THIS IS AN APPEAL FILED BY ASSESSEE AGAINST THE ORD ER OF LD. CIT(A), JAMMU DATED 25.11.2014 FOR ASST. YEAR: 2010-11. 2. THE GROUNDS OF APPEAL TAKEN BY ASSESSEE ARE REPR ODUCED BELOW: 1. THAT THE ASSESSMENT ORDER AS WELL AS THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) ARE BOTH AGAIN ST THE FACTS OF THE CASE & UNTENABLE IN LAW. 2. THAT NO REASONABLE OPPORTUNITY OF BEING WAS ALLO WED AND AS SUCH THE ORDER OF THE LD. CIT (APPEALS) THEREBY CONFIRMING THE ADDITION IS BAD IN LAW AND THE ADDITION CONFIRM ED BY THE LD. CIT(APPEALS) MAY BE DELETED. 3. THAT THE AUTHORITIES BELOW DID NOT APPRECIATE TH AT THE BOOKS OF ACCOUNTS ARE DULY MAINTAINED AND THE SAME SHOULD HAVE BEEN ACCEPTED AND REASONABLE OPPORTUNITY OF BEING H EARD SHOULD HAVE BEEN ALLOWED BEFORE MAKING THE ADDITION AND ITA NO. 79/(ASR)/2015 ASSESSMENT YEAR: 2010-11 2 THE LD. CIT (APPEALS) SHOULD HAVE DELETED THE ADDITION MADE BY THE AO. 4. THAT THE LD. CIT (APPEALS) WAS NOT JUSTIFIED IN CONFIRMING THE ADDITION OF RS. 19,50,000/- MADE BY THE AO ON A CCOUNT OF CASH CREDITS. THE LD. CIT (APPEALS) DID NOT APPR ECIATE THAT THESE TWO CREDITORS NAMELY SHRI ALI MARDAN HAV ING CREDIT BALANCE OF RS. 13,50,000/- AND M/S. G.M. RAJ , RAJOURI, HAVING CREDIT BALANCE OF RS. 6,00,000/- SH OULD HAVE BEEN ACCEPTED AS THESE CREDITORS WERE GENUINE, AND THE ORDER OF THE LD. CIT (APPEALS) THEREBY CONFIRMING T HE ADDITION MADE BY THE AO IS BAD IN LAW AND THE ADDITION MADE MAY BE DELETED. 5. THAT THE LD. CIT (APPEALS) HAS GROSSLY ERRED IN CONFIRMING THE DISALLOWANCE OF RS. 1,89,000/- ON ACCOUNT OF DEPREC IATION. THE DEPRECIATION AS CLAIMED SHOULD HAVE BEEN ALLOWE D IN TOTO. THE LD. CIT (APPEALS) HAS GROSSLY ERRED IN CO NFIRMING THE DISALLOWANCE OF RS. 1,89,000/- MADE BY THE AO. THE ASSESSEE IS CLEARLY ENTITLED FOR THE DEPRECIATION F OR THE WHOLE YEAR AND THE SAME SHOULD HAVE BEEN ALLOWED IN TOTO. AS SUCH THE DISALLOWANCE OF RS. 1,89,000/- MAY BE DELE TED. 6. AGAIN, THE LD. CIT (APPEALS) HAS GROSSLY ERRED I N CONFIRMING THE ADDITION OF RS. 9,41,444/- MADE BY THE AO ON AC COUNT OF CLAIM OF EXPENSES UNDER THE HEAD JCB_ EXPENSES. THE SE EXPENSES CLAIMED ARE INCIDENTAL TO THE BUSINESS OF THE ASSESSEE. THAT THE SUM/AMOUNT OF RS. 9,41.444/- AS CLAIMED SHOULD HAVE BEEN ALLOWED. 7. AGAIN, THE LD. CIT (APPEALS) HAS GROSSLY ERRED I N CONFIRMING THE DISALLOWANCE OF RS. 27,000/- ON ACCOUNT OF NON- DEDUCTION OF TDS ON PAYMENT MADE TO SHRI VIKA S CHOPRA ADVOCATE. THE AUTHORITIES BELOW DID NOT APPRECIATE THAT THIS AMOUNT OF RS. 27,000/- HAS ALREADY SUFFERED TAX IN THE HANDS OF SHRI VIKAS CHOPRA, ADVOCATE, WHO IS AN EXI STING ASSESSEE AND AS SUCH THE EXPENSES AS CLAIMED SHOULD HAVE BEEN ALLOWED, AS THESE EXPENSES ARE INCIDENTAL TO C ARRYING ON THE BUSINESS. AS SUCH THE AMOUNT PAID TO SHRI VI KAS CHOPRA, ADVOCATE AT RS. 27/000/- SHOULD HAVE BEEN A LLOWED AND THE SAME SHOULD NOT HAVE BEEN ADDED TO THE TOTA L INCOME. 8. ANY OTHER GROUND OF APPEAL AS MAY BE URGED AT TH E TIME OF HEARING OF THE APPEAL. 3. THE BRIEF FACTS AS NOTED IN THE ASSESSMENT ORDER ARE THAT ASSESSEE IS A CONTRACTOR WHO FILED HIS RETURN OF INCOME DECL ARING A NET PROFIT OF RS.16,01,557.66 AGAINST GROSS RECEIPTS OF RS.3,99,0 6,623/-. THE CASE OF ITA NO. 79/(ASR)/2015 ASSESSMENT YEAR: 2010-11 3 THE ASSESSEE WAS SELECTED FOR SCRUTINY. DURING ASSE SSMENT PROCEEDINGS, THE ASSESSING OFFICER MADE THE FOLLOWI NG ADDITIONS: (I) UNEXPLAINED CASH CREDITS RS.19,50,000/- (II) EXCESS CLAIM OF DEPRECIATION RS.1,89,000/- (III) INADMISSIBLE CLAIM OF EXPENSES OF JCB MACHINE S RS.9,41,444/- (IV) NON DEDUCTION OF TDS ON PAYMENT MADE TO SH. VIKAS CHOPRA RS.27,000/- AGGRIEVED WITH THE ADDITIONS THE ASSESSEE FILED APP EAL BEFORE LD. CIT(A), WHO UPHELD THE ADDITIONS MADE BY ASSESSING OFFICER BY HOLDING AS UNDER: GROUND NO. 3 & 6: IN THE ASSESSMENT ORDER THE AS SESSING OFFICER HAS MADE ADDITIONS ON ACCOUNT OF CASH CREDITS. REGA RDING CASH CREDIT OF RS. 19,50,000/- THE APPELLANT DESPITE REA SONABLE OPPORTUNITIES BY THE ASSESSING OFFICER, COULD NOT F URNISH THE REQUIRED DETAILS OF CASH CREDITS OF RS. 13,50,00 0/- AND RS. 6,00,000/- FROM M/S. ALI MARDAN TRADER, PAMPORE, SR INAGAR AND M/S. G.M. RAJ GUJJAR MANDI, RAJOURI RESPECTIVELY. T HE APPELLANT COULD NOT FURNISH CREDIT WORTHINESS AND GENUINENESS OF THE TRANSACTION. THUS, THE ASSESSING OFFICER ADDED THE AMOUNT U/S. 68 OF THE INCOME TAX ACT. IT IS THEREFORE INCORRECT TO SAY THAT OPPORTUNITY WAS NOT GRANTED BY THE AO. AT APPELLATE STAGE ALSO DESPITE, SEVERAL OPPORTUNIT IES GIVEN BY ME, THE APPELLANT COULD NOT LEAD ANY EVIDENCE OR ARGUME NTS TO CONTROVERT THE FINDING OF THE ASSESSING OFFICER, TH EREFORE, I DO NOT FIND ANY REASON TO INTERFERENCE WITH THE ADDITION M ADE. THIS GROUND OF APPEAL IS THUS DISMISSED. GROUND NO. 7: THE AO HAS OBSERVED THAT THE APPELLAN T HAS EXCESSIVELY CLAIMED THE DEPRECIATION ON JCB_ MACHIN E FOR RS. 1,89,000/- . THE JCB WAS PURCHASE IN THE MONTH OF M ARCH 2010 FOR RS. 20,70,000/- BUT THE CLAIM OF DEPRECIATION WAS M ADE FOR THE WHOLE YEAR AT RS.3,44,250/ - WHERE AS THE ENTITLEMENT WAS RS. L,55,250/-ONLY @ RATE OF 7.5% OF THE VALUE OF ASSET . I AGREE WITH THE FINDINGS AND COMPUTATION OF THE ASSESSING OFFICER. THE APPELLANT DESPITE, OPPORTUNITY COULD NOT FURNISH ANY EVIDENCE TO PROVE THE FINDINGS OF THE AO AS INCORRECT. THUS THE ADDITION IS UPHELD AND THIS GROUND OF APPEAL IS REJECTED. ITA NO. 79/(ASR)/2015 ASSESSMENT YEAR: 2010-11 4 GROUND NO. 8 & 9 : THE APPELLANT HAS BOOKED JCB EXP ENSES FOR RS. 9,41,444/- FOR THE PERIOD 27 TH AUGUST ,2009 TO 11 TH FEB. 2010 . THE ASSESSING OFFICER HAS HELD IN THE ORDER AS UNDER:- 'THE ASSESSEE WAS CONFRONTED ON THIS ISSUE AND IN H IS WRITTEN EXPLANATION FILED THROUGH SH. VIKAS CHOPRA, ADVOCAT E , IT WAS STATED THAT THOUGH THE DEPRECIATION HAS BEEN CL AIMED FOR THE FULL YEAR, THE FACT THAT ENTRY TAX RECEIPTS ( 2 NO. ) DATED 09.08.2009 WERE FOR THE JCB MACHINES ( 2 NO. ) HIRED FOR THE EXECUTION OF WORKS FROM SH. SURINDER SHARMA , NOIDA , UP. THOUGH THE ENTRY TAX ON THOSE 2 MACHINES WERE PAID BY THE ASSESSEE HENCE, THE JCB EXPENSES HAS SHOWN IN T HE BOOKS OF ACCOUNTS ARE JUSTIFIED . THE ASSESSEE HAS FILED COPY OF BANK CERTIFICATE SHOWING PAYMENT OF RS. 1,39,700/- IN FAVOUR OF SH. SURINDER SHARMA, PROP. KVC EARTH MOVERS, NEW DELHI AND PHOTOCOPY OF A CHEQUE DATED 28/08/2009 FOR RS. 1,00,000/- SHOWING PAYMENT IN FAVOUR OF SH. SURINDE R SHARMA. THIS EXPLANATION OF ASSESSEE IS NOT ACCEPTA BLE AS NO EVIDENCE OF TDS MADE ON THIS PAYMENT HAS BEEN PROVI DED BY THE ASSESSEE WHICH IS ALSO EVIDENT FROM THE TAX AUD IT REPORT OF THE C.A. WHICH SHOWS THE COLUMN 27 (A) AS BLANK ( NA ). ANOTHER NOTABLE FEATURE OF THIS ACCOUNT IS THAT THE ASSESSEE IS SHOWING EXPENSES LIKE PAYMENTS FOR DIESEL, SALAR Y AND REPAIR EXP ENSES FOR THIS JCB ALLEGEDLY TAKEN ON HIRE FROM SH. SURINDER SHARMA, PROP. KVC EARTH MOVERS NEW DELHI. THIS LOGIC APPEARS TO BE STRANGE AS IF SOME MACHINERY IS BEING USED ON HIRING BASIS, THE ENTIRE EXPENDITURE IS TO BE BORNE BY THE BY THE OWNER AND NOT BE THE USER. APART FROM AB OVE, THE ASSE SSEE ALSO FILED AN AFFIDAVIT STATING THEREIN THAT T HE EXCAVATOR MACHIN ES DID NOT BELONG TO HIM AND THESE WERE TAKEN ON HIRE FOR THE EXECU TION OF WORK CONTRACTS. IF FOR THE SAKE OF DISCUSSION, THE ARGUMENT OF AS SESSEE IS TAKEN AS CORRECT, THEN THERE 'WAS OBLIGATION ON HIS PART T O DEDUCT TDS ON HIRE CHARGES PAID TO THE OWNER AND ALSO HE WAS N OT REQUIRED TO PAY FOR THE RUNNING AND MAINTENANCE OF JCB MACHINES AS THESE DID NOT BELONG TO HIM AND HIS ONL Y OBLIGATION WAS TO PAY THE HIRE CHARGES TO THE OWNER . IF FOR ACADEMIC DISCUSSION, IT IS ASSUMED THAT THESE CHARG ES WERE PAID ON BEHALF OF OWNER THEN PROPER ACCOUNTING ENTR IES SHOULD HAVE BEEN PA SSED IN THE BOOKS OF ACCOUNTS. FROM THE ABOVE DISCUSSION, THE EXPENDITURE OF RS. 2,40,000/- INCURRED IN THE NAME OF SH. SURINDER SHARMA IS BEING DISALLO WED AS NO TDS HAS BEEN MADE ON THESE PAYMENTS. THE REMAINI NG EXPENDITURE RS. 7,01,444/- IS BEING DISALLO WED AS NOT INCIDENTAL TO THE BUSINESSOF 'THE ASSESSEE AND AL SO NOT INCURRED ON AN ASSET WHICH BELONGED TO HIM. THE ASS ESSEE HAS PAID RS. 27,000/- TO SH. VIKAS CHOPRA, ADVOCATE ON WHICH TAX HAS NOT BEEN DEDUCTED. THE SAME IS DISALL OWED U/S. 40 (A ) (I A )' . I FIND THAT THE APPELLANT DESPITE 7 OPPORTUNITIES S PREAD OVER FROM MARCH, 2014 TO NOV. 2014 COULD NOT PRODUCE ANY EVID ENCE BEFORE ITA NO. 79/(ASR)/2015 ASSESSMENT YEAR: 2010-11 5 ME TO CONTROVERT THE FINDINGS OF THE AO AND HENCE T HE ADDITION OF RS. 9,41,444/- IS SUSTAINED . THE NEXT ADDITION IS WITH REGARD TO NON DEDUCTION O F TDS ON PAYMENT TO SH. VIKAS CHOPRA, ADVOCATE FOR RS. 27,00 0/- . THE APPELLANT HAS NOT SUBSTANTIATED ITS CLAIM MADE IN T HE GROUND OF APPEAL BEFORE ME AND THEREFORE, THE ADDITION IS UPH ELD. 4. AGGRIEVED THE ASSESSEE IS IN APPEAL BEFORE US. 5. AT THE OUTSET, THE LD. AR SUBMITTED THAT THE AD DITIONS SUSTAINED BY LD. CIT(A) FOR CASH CREDITS WAS NOT JUSTIFIED, I N VIEW OF THE FACT THAT ASSESSEE HAD FILED CONFIRMATIONS FROM THE CREDITORS AND IN THIS RESPECT OUR ATTENTION WAS INVITED TO P.B. PAGE 12 AND 13 WH ERE THE CONFIRMATIONS FROM THE CREDITORS WAS PLACED. THE LD. AR FURTHER T OOK US TO P.B. PAGE 14 TO 17 WHERE THE LEDGER ACCOUNTS OF CREDITORS NAMELY M/S ALI MARDAN & G.M. RAJ RAJOURI CREDITORS WERE PLACED. 6. THE LD. AR ALSO TOOK US TO P.B. PAGE 19 TO 20 WH ERE THE COPY OF BANK ACCOUNT OF ASSESSEE SHOWING RECEIPTS OF RS.13, 50,000/- FROM ALI MARDAN WAS PLACED. THE LD. AR ALSO TOOK US TO P.B. PAGE 21 WHERE A COPY OF BANK ACCOUNT OF ASSESSEE SHOWING RECEIPT OF RS. 6 LACS FROM G. M. RAJ RAJOURI WAS PLACED. 7. THE LD. AR FURTHER SUBMITTED THAT ASSESSING OFFI CER HAD WRONGLY RESTRICTED THE DEPRECIATION TO 50% AS IN FACT, THE MACHINERY WAS PURCHASED ON 08.08.2009 BUT SINCE THE BANK CASE OF THE ASSESSEE WAS PENDING AT THE TIME OF DELIVERY, THE PAYMENT OF THE SAME WAS MADE IN THE MONTH OF MARCH, 2010 AND THAT IS WHY THE INVOICE IS DATED 05.03.2010. ITA NO. 79/(ASR)/2015 ASSESSMENT YEAR: 2010-11 6 THE LD. AR SUBMITTED THAT ASSESSEE HAD UTILIZED THI S MACHINERY FROM 08.08.2009; THEREFORE HE WAS ENTITLED FOR DEPRECIAT ION FOR FULL YEAR. AS REGARDS THE DISALLOWANCE OF RS.9,41,444/-, THE LD. AR SUBMITTED THAT ASSESSEE HAD HIRED JCB MACHINES AND HAD INCURRED EXPENSES ON THEM IN THE FORM OF SALARY, DIESEL EXPE NSES AND HIRE CHARGES OF JCB MACHINES. THE LD. AR IN THIS RESPECT TOOK US TO P.B. PAGE 6 WHERE COPIES OF ENTRY TAX PAID ON JCB MACHINES WHICH WAS TAKEN ON HIRE WERE PLACED. THE LD. AR ALSO TOOK US TO P.B. PAGE 25 WHE RE A COPY OF AN AFFIDAVIT FILED BY THE ASSESSEE WHEREIN HE HAS AFFI RMED THAT THE SAID MACHINES WERE TAKEN ON HIRE AND WERE NOT OWNED BY H IM. THEREFORE IT WAS ARGUED THAT THE LD. CIT(A) SHOULD HAVE ALLOWED THE EXPENSE AS THE SAME WERE INCURRED FOR THE PURPOSE OF BUSINESS. ARG UING UPON THE LAST ADDITION THE LD. AR SUBMITTED THAT THE AMOUNT OF RS . 27,000/- PAID TO VIKAS CHOPRA COMPRISED OF 2 AMOUNTS OF RS. 20,000/- WHICH WAS PAID AS PROFESSIONAL CHARGES AND RS.7,000/- AS REIMBURSEMEN T OF EXPENSES. THE LD. AR SUBMITTED THAT SINCE THE PROFESSIONAL FEE DI D NOT EXCEED RS.20,000/-, THE ASSESSEE WAS NOT LIABLE TO DEDUCT TDS. 8. THE LD. DR IN REPLY TO THE ARGUMENT OF THE LD. A R SUBMITTED THAT THE ASSESSEE WAS NOT ABLE TO PROVE THE CREDITWORTHI NESS AND GENUINENESS OF CREDIT BALANCES AMOUNTING TO RS.19,50,000/- AND MERELY BY STATING THAT THE ENTRIES WERE THROUGH BANKING CHANNELS, THE CREDITORS CANNOT BE ACCEPTED AS GENUINE. IT WAS FURTHER ARGUED THAT THE BANK ENTRIES DO NOT INDICATE THAT THE AMOUNTS WERE RECEIVED FROM THESE TWO CREDITORS. THE ITA NO. 79/(ASR)/2015 ASSESSMENT YEAR: 2010-11 7 LD. DR SUBMITTED THAT IN A NUMBER OF CASES IT HAS B EEN HELD THAT MERELY THE FACT, THE ENTRIES WERE MADE THROUGH BANK ING CHANNELS DOES NOT ABSOLVE THE ASSESSEE TO PROVE HIS ONUS U/S 68 O F THE ACT. RELIANCE IN THIS RESPECT WAS PLACED ON THE FOLLOWING CASE LAWS: 1. ASSTT. CIT VS. M/S GREENDIAM EXIM LTD. IN ITA N O. 1880/AHD/2011 (AHD. TRIBUNNAL.) 2. M/S BHARAT MOTOR PARCEL SERVICE VS. ASSTT. CIT I N ITA NO. 588/VIZAG/2013 (VIZAG TRIBUNAL) 3. COMMISSIONER OF INCOME TAX VS. VIR BHAN & SONS 2 73 ITR 0206 4. COMMISSIONER OF INCOME TAX VS. MEERA & CO. 161 I TR 0031 AS REGARDS THE CLAIM OF DEPRECIATION FOR FULL YEAR , THE LD. DR INVITED OUR ATTENTION TO THE ORDER OF LD. CIT(A) WH EREIN HE HAS OBSERVED THAT ASSESSEE HAD FILED A FORGED CERTIFICATE AS THE SUPPLIER OF THE JCB MACHINES THROUGH THIER CHARTERED ACCOUNTANT M/S R. C. GUPTA & COMPANY IN REPLY TO NOTICE U/S 133(6), HAD STATED T HAT THEY HAD NOT ISSUED ANY CERTIFICATE TO THE ABOVE PARTY. AS REGARDS THE CLAIM OF THE EXPENSES REGARDING JCB EXPENSES, THE LD. DR SUBMITTED THAT ASSESSEE WAS NOT ABLE TO PROV E THAT THE SAID EXPENSES WERE INCURRED FOR THE PURPOSE OF BUSINESS. AS REGARDS THE NON- DEDUCTION OF TDS, THE LD. DR RELIED ON THE ORDERS O F AUTHORITIES BELOW. 9. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE THOUGH THE MATERIAL PLACED ON RECORD. AS REGARDS THE FIRST ISSUE OF ADD ITION U/S 68 WE FIND THAT ASSESSEE WAS NOT ABLE TO PROVE IDENTITY, CREDI TWORTHINESS AND GENUINENESS OF THE PARTIES. THE ASSESSEE EVEN WAS N OT ABLE TO SUPPLY ITA NO. 79/(ASR)/2015 ASSESSMENT YEAR: 2010-11 8 PAN NOS. OF THESE CREDITORS. MERELY BECAUSE PARTIES HAD CONFIRMED THAT THEY OWE MONEYS TO THE ASSESSEE DOES NOT ABSOLVE TH E ASSESSEE FROM HIS ONUS OF PROVING THE AMOUNTS CREDITED IN THE BOOKS O F ACCOUNTS. THE ENTRIES IN THE BANK ACCOUNTS AS POINTED OUT BY LD. AR ALSO DO NOT INDICATE THAT THE AMOUNTS WERE RECEIVED FROM THESE TWO CREDITORS. THE ASSESSEE WAS NOT ABLE TO PROVE BEFORE LD. CIT(A) AL SO BEFORE US REGARDING THESE CASH CREDITS AND THEREFORE WE DO NOT HAVE ANY HESITATION TO DISMISS THIS GRIEVANCE OF ASSESSEE AND THEREFORE GROUND NO. 4 IS DISMISSED. AS REGARDS THE CLAIM OF ASSESSEE REGARDING DEPRECI ATION, WE FIND THAT ASSESSEE HAD FILED A CERTIFICATE ON THE LETTER HEAD OF JAMMU PATHANKOT EXCAVATORS THAT THE MACHINE WAS DELIVERED TO ASSESSEE ON 08.08.2009 WHEREAS ITS INVOICE WAS RAISED ON DATED 05.03.2010. HOWEVER ON AN ENQUIRY BY ASSESSING OFFICER BY CALLING INFOR MATION U/S 133(6), THE CHARTERED ACCOUNTANT OF M/S JAMMU PATHANKOT EXCAVAT ORS HAS REITERATED THAT THE MACHINE WAS SOLD TO THE ASSESSE E VIDE BILL DATED 05.03.2010 ONLY AND THEY HAD FURTHER AFFIRMED THAT HIS ASSESSEE M/S JAMMU PATHANKOT EXCAVATORS HAD NOT ISSUED ANY CERTI FICATE TO THE ASSESSEE, THEREFORE IN VIEW OF THESE FACTS AND CIRC UMSTANCES THE AUTHORITIES BELOW WERE JUSTIFIED IN RESTRICTING THE DEPRECIATION TO 50% AS THE MACHINERY WAS PURCHASED IN THE MONTH OF MARCH, 2010 AND THE CERTIFICATE FURNISHED BY ASSESSEE HAS BEEN FOUND TO BE BOGUS ON THE BASIS OF REPLY FROM THE SUPPLIER. IN VIEW OF THE GROUND NO. 5 IS ALSO DISMISSED. AS REGARDS THE CLAIM OF EXPENSES UNDER THE HEAD OF JCB EXPENSES, WE FIND THAT THESE EXPENSES CONSISTED OF PAYMENTS T HROUGH CHEQUES TO ITA NO. 79/(ASR)/2015 ASSESSMENT YEAR: 2010-11 9 SHRI SURINDER SHARMA TO THE EXTENT OF RS.2,40,000/- AND FURTHER THE NATURE OF EXPENSES BOOKED UNDER THIS ACT ARE SALARY AND DIESEL FOR THE ABOVE MACHINES. THE AUTHORITIES BELOW HAD MADE THIS ADDITION BY HOLDING THAT IN SUCH TYPE OF AGREEMENTS OF HIRE OF MACHINERY THE OWNER OF THE MACHINERY HAS TO SPEND MONEY ON DIESEL AND SALA RY TO DRIVERS. HOWEVER, WE ARE OF THE OPINION THAT THE TERMS OF AG REEMENT FOR HIRE OF A MACHINE CAN BE DIFFERENT FOR HIRING FROM DIFFERENT PERSONS AND ONLY BECAUSE OF THIS REASON, THE DISALLOWANCE CANNOT BE SUSTAINED. FURTHER WE FIND THAT ASSESSEE HAD PAID ENTRY TAX ON THESE MACH INES ON 09.08.2009, A PHOTOCOPY OF THE CERTIFICATE IS PLACED IN P.B. PA GE 6. THIS PAYMENT OF ENTRY TAX ON MACHINES PROVES THAT INDEED THESE MACH INES WERE RECEIVED BY THE ASSESSEE FOR ITS USE AND EVEN THE NAME OF TH E ASSESSEE AND VEHICLE NOS. OF THE JCBS IS ALSO MENTIONED ON THESE RECEIP TS. THEREFORE THE AUTHORITIES BELOW WERE NOT JUSTIFIED IN REJECTING T HE CLAIM OF THE ASSESSEE. IN VIEW OF THESE CIRCUMSTANCES WE DEEM IT APPROPRIA TE TO REMIT THE ISSUE BACK TO THE OFFICE OF THE ASSESSING OFFICER WHO SHO ULD EXAMINE THE ALLOWBILITY OF THESE EXPENSES, AFRESH AFTER GIVING A REASONABLE OPPORTUNITY TO THE ASSESSEE. IN VIEW OF THE ABOVE GROUND NO. 6 IS ALLOWED FOR ST ATISTICAL PURPOSES. AS REGARDS THE ADDITION ON ACCOUNT OF NON-DEDUCTIO N OF TAX ON PAYMENT OF RS.27,000/- TO MR. VIKAS CHOPRA, WE FIND THAT THE AMOUNT COMPRISES OF RS.20,000/-AND RS.7000/-. RS.20,000/- IS THE PROFESSIONAL FEE WHEREAS RS.7000/- REPRESENTED THE REIMBURSEMENT OF TRAVELING ITA NO. 79/(ASR)/2015 ASSESSMENT YEAR: 2010-11 10 EXPENSES. A COPY OF THE BILLS IS PLACED AT P.B. PAG E 26 AND 27. SINCE THE PROFESSIONAL FEE BILL DID NOT EXCEED RS. 20,000/-, THE ASSESSEE WAS NOT LIABLE TO DEDUCT TDS AND THEREFORE GROUND N O. 7 IS ALLOWED. 10. IN NUTSHELL, THE APPEAL OF THE ASSESSEE IS PART LY DISMISSED, PARTLY ALLOWED AND PARTLY ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED IN THE OPEN COURT ON 11.09.2017 SD/- SD/- (N. K. CHOUDHRY) (T. S. KAPOOR) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 11.09.2017. /GP/SR. PS . COPY OF THE ORDER FORWARDED TO: (1) THE ASSESSEE: (2) THE (3) THE CIT(A), (4) THE CIT, (5) THE SR DR, I.T.A.T., TRUE COPY BY ORDER