ASHWINI CONTAINER MOVERS P. LTD., NAVI MUMBAI V. PR. CIT -1, THANE

ITA 796/MUM/2021

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 2488 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-10-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2015-2016
• Appeal Filed On: 13-05-2021
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: KHUSHAL SHAH
• Keywords: Set aside
• Section: 263; 40(a)(ia); 20

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL , A BENCH MUMBAI BEFORE : SHRI M.BALAGANESH, A CCOUNTANT MEMBER & SHRI AMARJIT SINGH , JUDICIAL MEMBER ITA NO. 796 /MUM/ 20 21 ( ASSESSMENT YEAR : 2015 - 16 ) M/S. ASHWINI CONTAINER MOVERS PRIVATE. LTD., A - 4021, BIMA COMPLEX STEEL MARKET, KALAMBOLI, NAVI MUMBAI 410 218 VS. PCIT, THANE - 1 B WING, ASHAR IT PARK 6 TH FLOOR, ROAD NO.16Z WAGLE INDUSTRIAL ESTATE THANE (W) - 400 604 PAN/GIR NO. AAKCA4996L (APPELLANT ) .. (RESPONDENT ) ASSESSEE BY SHRI KHUSHA L SHAH REVENUE BY SHRI H.N. SINGH DATE OF HEARING 20/10 /2021 DATE OF PRONOUNCEMENT 28 / 10 /202 1 / O R D E R PER M. BALAGANESH (A.M) : THIS APPEAL IN ITA NO. 796/MUM/2021 FOR A.Y. 2015 - 16 PREFERRED BY THE ORDER AGAINST THE REVI SION ORDER OF THE LD. PRINCIP AL COMMISSIONER OF INCOME TAX THANE - 1 U/S. 263 OF THE ACT DATED 16/03/2021 FOR THE A.Y.2015 - 16. 2. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. WE FIND THAT ASSESSEE COMPANY IS A TRANSPORTER AN D ITA NO . 796/MUM/2021 M/S. ASHWINI CONTAINER MOVERS PVT. LTD., 2 HAD FILED ITS RETURN OF INCOME FOR THE A.Y.2015 - 16 ON 28/09/2015 DECLARING LOSS OF RS.43,44,140/ - . THE ASSESSMENT FOR THE A.Y.2015 - 16 WAS COMPLETED U/S.143(3) OF THE ACT ON 30/11/2017 DETERMINING TOTAL LOSS AT RS.41,44,140/ - AFTER MAKING ADHOC DISALLOWAN CE OF EXPENSES FOR RS.2,00,000/ - . IN THE SAID ASSESSMENT ORDER, THE LD. AO HAD MENTIONED THAT ASSESSEE HAD SHOWN NET PROFIT OF RS.23,76,457/ - AGAINST GROSS RECEIPTS OF RS.10,94,49,554/ - AND AFTER CONSIDERING THE VARIOUS ITEMS TO BE ALLOWED AND DISALLOWED A S PER THE ACT, THE ASSESSEE HAD DECLARED LOSS OF RS.43,44,140/ - IN THE RETURN OF INCOME. 2.1. IN PARA 3 OF THE ASSESSMENT ORDER, THE LD. AO HAD ALSO MENTIONED THAT VARIOUS EXPENSES DEBITED TO PROFIT AND LOSS ACCOUNT WERE SOUGHT TO BE EXAMINED BY HIM AND O N VERIFICATION OF THE SAME, HE FOUND THAT THERE WERE SOME EXPENSES WHICH WERE SUPPORTED ONLY BY SELF - MADE VOUCHERS AND HENCE, THE ADHOC DISALLOWANCE OF RS.2 LAKHS WAS MADE TOWARDS EXPENSES AND ASSESSMENT COMPLETED ACCORDINGLY BY THE LD. AO. THIS ASSESSMEN T WAS SOUGHT TO BE REVISED BY THE LD. PCIT ON THE FOLLOWING TWO GROUNDS: - A ) INTEREST PAID TO NON - BANKING FINANCE COMPANIES AMOUNTING TO RS.27,65,193/ - WITHOUT DEDUCTION OF TAX AT SOURCE. B ) HI RE CHARGES PAID TO VARIOUS TRANSPORTERS IN THE SUM OF RS.5,91,42,447 / - WITHOUT DEDUCTION OF TAX AT SOURCE. 2.2. THE LD. PCIT OBSERVED THAT SINCE THE AFORESAID EXPENSES WERE INCURRED BY THE ASSESSEE WITHOUT DEDUCTION OF TAX AT SOURCE, THE LD. AO OUGHT TO HAVE DISALLOWED 30% OF THE AFORESAID EXPENDITURE IN TERMS OF SECTION 40(A)(IA) OF THE ACT, FAILURE OF WHICH WOULD MAKE THE ORDER OF THE LD. AO ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. ITA NO . 796/MUM/2021 M/S. ASHWINI CONTAINER MOVERS PVT. LTD., 3 2.3. WE FIND THAT ASSESSEE HAD STATED THAT INTEREST IS PAID TO L & T FINANCE LIMITED, TATA CAPITAL LIMITED AND RELIANCE CAP ITAL LIMITED, ALL THREE BEING LISTED ENTITIES AND THAT THE CONCERNED LISTED ENTITIES HAD INDEED SHOWN THE CORRESPONDING INTEREST INCOME IN THEIR RETURNS OF INCOME AND PROMISED TO FILE A CERTIFICATE IN F ORM NO.26A FROM THEIR CONCERNED CHARTERED ACCOUNTANT, BUT DID NOT FILE THE SAME BEFORE THE LD. PCIT TILL THE COMPLETION OF SECTION 263 PROCEEDINGS. WITH REGARD TO HI RE CHARGES PAYMENT MADE TO VARIOUS TRANSPORT ER S, THE ASSESSEE PLEADED BEFORE THE LD. PCIT THAT SUFFICIENT ENQUIRIES WERE INDEED CARRIED OUT BY TH E LD. AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND ASSESSEE HAS ALSO PROVIDED THE ENTIRE NAMES AND ADDRESSES OF THE TRANSPORTERS TO WHOM HI RE CHARGES WERE PAID . THE ASSESSEE ALSO FURNISHED PAN OF THE TRANSPORTERS BEFORE THE LD. PCIT IN SEPARATE A NNEX URE - 1 WHICH IS STATED IN PAGE 405 OF THE PAPER BOOK FILED BEFORE US. IN THIS REGARD, WE FIND THAT THE LD. PCIT IN PARA 4 HAD CATEGORICALLY NOTICED THAT THOUGH PAN OF THE TRANSPORTERS WERE FURNISHED BEFORE HIM, THE SAME WAS NOT AVAILABLE FOR MAJORITY OF THE TRANSPORTERS. HENCE, THE REQUIREMENT IN TERMS OF SECTION 194C(6) OF THE ACT HAVE NOT BEEN COMPLIED WITH. THE LD. AR STATED THAT HE WILL SUBMIT ALL THE PAN BEFORE THE LD. AO IN THE SET ASIDE PROCEEDINGS. 2.4. HAVING HEARD BOTH THE SIDES, WE FIND THAT THE LD. PCIT HAD VALIDLY INVOKED REVISIONARY JURISDICTION U/S.263 OF THE ACT IN THE INSTANT CASE BY SETTING ASIDE THE ORDER OF THE LD. AO TO EXAMINE THE APPLICABILITY OF PROVISIONS OF SECTION 40(A)(IA) OF THE ACT QUA INTEREST PAYMENT MADE TO 3 N B FCS AND HI RE C HARGES PAID TO VARIOUS TRANSPORTERS ONLY . THE LD. AO IS DIRECTED TO EXAMINE ONLY THESE TWO ASPECTS IN THE SET ASIDE ASSESSMENT WHICH WOULD BE IN C OMPLIANCE TO DIRECTIONS ISSUED BY THE LD. PCIT U/S.263 OF THE ACT. ACCORDINGLY, THE GROUNDS RAISED BY THE ASSE SSEE ARE DISPOSED OF IN THE AFORESAID MANNER. ITA NO . 796/MUM/2021 M/S. ASHWINI CONTAINER MOVERS PVT. LTD., 4 3. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISSED SUBJECT TO ABOVEMENTIONED DIRECTIONS. ORDER PRONOUNCED ON 28 / 10 /202 1 BY WAY OF PROPER MENTIONING IN THE NOTICE BOARD. SD/ - ( AMARJIT SIN GH ) SD/ - (M.BALAGANESH) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED 28 / 10 / 2021 KARUNA , SR.PS COPY OF THE ORDER FORWARDED TO : BY ORDER, ( ASSTT. REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMB AI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//