Das Traders, Kolkata V. C.I.T - XVII,kolkata, Kolkata

ITA 792/KOL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 87636 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 9 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2015
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 12-04-2013
• Court: TRIBUNAL
• Department Lawyers: RAVI JAIN
• Keywords: Revision of order; Assessment record
• Section: 40A(3); 143(3); 194C; 263; 63

Judgement Text

, C , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: KOLKATA ( ) BEFORE , /AND , ) [BEFORE SHRI MAHAVIR SINGH, JM & SHRI SHAMIM YAHYA , AM ] / I.T.A NO. 792 /KOL/201 3 / ASSESSMENT YEAR : 200 8 - 09 DAS TRADERS VS. COMMISSIONER OF INCOME - TAX - XVII , KOLKATA (PAN: AAEFD9648K) ( /APPELLANT ) ( / RESPONDENT ) DATE OF HEARING: 13 . 01 .201 5 DATE OF PRONOUNCEMENT: 29 . 01 .201 5 FOR THE APPELLANT: SHRI SUBHAS AGARWAL, ADVOCATE FOR THE RESPONDENT: SHRI RAVI JAIN, CIT, DR / ORDER PER SHRI MAHAVIR SINGH, JM : THIS APPEAL BY ASSESSEE S IS ARISING OUT OF REVISION ORDER OF CIT - XVII, KOLKATA IN M. NO. CIT - XVII/U.S,263/2012 - 13/774 - 776 DATED 1 2 .0 3 .201 3 . ASSESSMENT WAS FRAMED BY ITO, WARD - 51(1), KOLKATA U/S. 1 43(3) OF THE INCOME - TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT ) FOR ASSESSMENT YEAR 200 8 - 09 VIDE HIS ORDER DATED 2 7 . 1 2 .20 1 0 . 2. THE ONLY ISSUE IN THIS APPEAL OF ASSESSEE IS AGAINST THE REVISION ORDER PASSED BY C IT - XVII, KOLKATA REVISING THE ASSESSMENT FOR DISALLOWING TRANSPORTATION CHARGES BY INVOKING THE PROVISION OF SECTION 40A(3) OF THE ACT FOR NON - DEDUCTION OF TDS U/S. 194C OF THE ACT. FOR THIS, ASSESSEE HAS RAISED FOLLOWING THREE GROUNDS: 1. FOR THAT THE L D. CIT WAS NOT JUSTIFIED ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE IN INITIATING PROCEEDINGS U/S 263. 2. FOR THAT THE LD. CIT ERRED IN EXERCISING THE POWER OF REVISION FOR THE PURPOSE OF DIRECTING THE A.O. TO HOLD ANOTHER INVESTIGATION WHEN THE O RDER OF THE A.O. WAS NEITHER ERRONEOUS NOR PREJUDICIAL TO THE INTEREST OF THE REVENUE. 3. FOR THAT THE LD. CIT WAS NOT JUSTIFIED IN HOLDING THAT THE TRANSPORTATION CHARGES TO THE TUNE OF RS.18,73,049/ - HAD TO BE DISALLOWED U/S. 40(A)(IA) ON THE GROUND TH AT THE ASSESSEE DID NOT DEDUCT TAX ON THE SAME. 2 ITA NO.792/K/2013 DAS TRADERS AY 2008 - 09 3 . WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. BRIEFLY STATED FACTS ARE THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF TRADING IN SCR A P DURING THE YEAR UNDER CONSIDERATION. ORIGINAL ASSESSMENT WAS COMPLETED U/S. 143(3) OF THE ACT BY THE ITO, WARD - 51(1), KOLKATA VIDE HIS ORDER DATED 27/12/2010 AFTER GOING THROUGH THE CASH BOOKS, BANK BOOK, LEDGER, BANK PASS BOOK/BANK STATEMENT, COMPUTATI ON OF TOTAL INCOME, BALANCE SHEET, P&L ACCOUNT AND OTHER PAPERS AND DOCUMENTS CALLED FROM TIME TO TIME. SUBSEQUENTLY, CIT - XVII, KOLKATA ON PERUSAL OF THE ASSESSMENT RECORDS NOTICED THAT THE ASSESSEE HAS INCURRED EXPENSES OF RS.18,73,049/ - TOWARDS TRANSPOR TATION CHARGES BUT NO TDS WAS DEDUCTED U/S. 194C OF THE ACT. ACCORDING TO HIM, AS THE ASSESSEE HAS NOT DEDUCTED TDS U/S. 194C OF THE ACT, THE TRANSPORTATION CHARGES INCURRED BY THE ASSESSEE ARE TO BE DISALLOWED IN VIEW OF THE PROVISION OF SECTION 40(A)(IA ) OF THE ACT AND AO HAS NOT DISALLOWED THE SAME WHILE FRAMING ORIGINAL ASSESSMENT. BEFORE CIT(A), THE ASSESSEE CONTENDED THAT THE PAYMENT TO TRUCK OWNERS WAS MADE BY TRANSPORTERS ON BEHALF OF ASSESSEE AND EACH PAYMENT TO THE TRUCK OWNER WAS LESS THAN THE STIPULATED LIMIT OF RS.20,000/ - AS DIFFERENT TRUCKS WERE USED FOR THE TRANSPORTATION. THE ASSESSEE ALSO ARGUED THAT THERE IS NO CONTRACTUAL AGREEMENT MADE BY ASSESSEE WITH THE TRANSPORTERS FOR THIS SERVICE. IN VIEW OF THIS, LD. COUNSEL FOR THE ASSESSEE S TATED THAT THE ISSUE IS COVERED BY THE DECISION OF HON BLE CALCUTTA HIGH COURT IN THE CASE OF CIT VS. STUMM INDIA, ITA NO. 127 OF 2009 DATED 16.08.2010, WHEREIN IT IS REITERATED THAT THE DEPARTMENT HAS NOT BEEN ABLE TO BRING ANY MATERIAL ON RECORD TO SHOW THAT THE ASSESSEE MADE THE PAYMENT TO THE TRANSPORTERS IN PURSUANCE OF CONTRACT FOR CARRIAGE OF GOODS AND, THEREFORE, THE QUESTION OF DEDUCTION OF TAX AT SOURCE U/S. 194C DOES NOT ARISE. ON THE OTHER HAND, THE CIT, DR SHRI RAVI JAIN RELIED ON THE TRIBUNAL S DECISION OF THIS ITAT IN THE CASE OF ITO VS. MGB TRANSPORT, ITA NO.2280/K/2010 FOR AY 2007 - 08 DATED 15.03.2013. BUT LD. COUNSEL FOR THE STATED THAT THIS IS A HIGHLY DEBATABLE ISSUE AND NO DEBATABLE ISSUE CAN BE REVISITED BY REVISION ORDER PASSED U/S. 2 63 OF THE ACT. 4. WE FIND THAT HON BLE CALCUTTA HIGH COURT IN THE CASE OF STUMM INDIA, SUPRA HAS HELD AS UNDER: IT IS URGED BEFORE US THAT THE LEARNED TRIBUNAL OUGHT NOT TO HAVE ACCEPTED THE JUDGMENT AND ORDER OF THE CIT(APPEAL) WHO HAS QUASHED THE DI SALLOWANCE OF DEDUCTION OF RS.41,33,710/ - AND ON ACCOUNT OF TAX DEDUCTION AT SOURCE. THE 3 ITA NO.792/K/2013 DAS TRADERS AY 2008 - 09 LEARNED TRIBUNAL HAS RECORDED THE FACT THAT THE DEPARTMENT HAS NOT BEEN ABLE TO BRING ANY MATERIAL ON RECORD TO SHOW THAT THE ASSESSEE HAS MADE THE PAYMENT TO THE TRA NSPORTERS IN PURSUANCE OF CONTRACT FOR CARRIAGE OF GOODS OF THE ASSESSEE AND THE QUESTION OF DEDUCTION AT SOURCE UNDER SECTION 194C DOES NOT AND CANNOT ARISE. IN THE ABSENCE OF EVIDENCE OF PAYMENT MADE BY THE ASSESSEE TO THE TRANSPORTERS , THE ASSESSEE CAN NOT BE SADDLED WITH THE LIABILITY OF DEDUCTING TAX AT SOURCE. BEFORE US NO OTHER POINT HAS BEEN URGED NOT IT IS SAID THAT THE AFORESAID FACT FINDING IS TRUTHFUL WITHOUT ANY BASIS WHATSOEVER. WE ARE AWARE THAT THERE ARE DIVERGENT VIEWS ON THE ISSUE AND T HE ISSUE IS HIGHLY DEBATABLE. THE HON BLE SUPREME COURT IN THE CASE OF MALABAR INDUSTRIAL CO. LTD. VS. CIT (2000) 243 ITR 83 HELD THAT THERE CAN BE NO DOUBT THAT THE PROVISIONS OF SECTION 263(1) OF THE ACT CANNOT BE INVOKED TO CORRECT EACH AND EVERY TYPE OF MISTAKE OR ERROR COMMITTED BY THE AO BUT IT IS ONLY WHEN AN ORDER IS ERRONEOUS AS WELL AS PREJUDICIAL TO THE INTEREST OF REVENUE THAT THE SECTION WILL BE ATTRACTED . EVEN HON BLE SUPREME COURT IN THIS CASE HAS LAID DOWN THE PRINCIPLE THAT THE DEBATABLE ISSUES CANNOT BE THE SUBJECT MATTER OF REVISION U/S. 263 OF THE ACT. AS IS CLEAR FROM THE FACTS OF THE PRESENT CASE, THE ISSUE IS HIGHLY DEBATABLE , HENCE, NO REVISION IS POSSIBLE . ACCORDINGLY, WE QUASH THE REVISION ORDER PASSED U/S. 263 OF THE ACT BY CIT - X VII, KOLKATA. APPEAL OF ASSESSEE IS ALLOWED. 5 . IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED. 6 . ORDER IS PRONOUNCED IN THE OPEN COURT ON 2 9 . 0 1 . 2 0 1 5 . S D / - S D / - , , ( SHAMIM YAHYA ) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 2 9 T H JANUARY , 201 5 JD.(SR.P.S.) - COPY OF THE ORDER FORWARDED TO: 1 . / A PPELLANT DAS TRADERS, 28, ADARSH NAGAR, R. N. TAGORE R OAD, AGARPARA, KOLKATA - 700109 2 / RESPONDENT CIT - XVII, KOLKATA 3 . ( )/ THE CIT(A), KOLKATA 4. 5. / CIT KOLKATA / DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, / BY ORDER,