K. Thomas Varghese, Piravam V. The ACIT, Aluva

ITA 83/COCH/2022

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 1369 (ITAT-COCHIN)
• Duration Of Justice: 4 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-06-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 24-02-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S.R. LOKANATHAN
• Keywords: Assessment record; TDS
• Section: 194A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN Before Shri George George K., Judicial Member and Shri Laxmi Prasad Sahu, Accountant Member ITA No. 83/Coch/2022 (Assessment Year: 2011-12) Shri K. Thomas Varghese Manakunnathu Piravom 686664 Vs. ACIT, Circle - 1 Aluva PAN – AASPV5029L Appellant Respondent Appellant by: Shri S.R. Lokanathan, CA Respondent by: Smt. J.M. Jamuna Devi, Sr. D.R. Date of Hearing: 27.06.2022 Date of Pronouncement: 30.06.2022 O R D E R Per: L.P. Sahu, A.M. This is an appeal filed by the assessee against the order of the learned CIT(A), NFAC, Delhi dated 07.01.2022 for AY 2011-12 on the following grounds: - “1. The orders of the learned Assessing Officer and the Commissioner of Income Tax (Appeals) are contrary to law, facts and circumstances of the case and hence not sustainable. 2. The learned Commissioner of Income Tax (Appeals) had wrongly upheld the conclusion of the Assessing Officer who had rejected the documentary evidences filed by the appellant which are a part of the assessment records and a copy of which was filed before the Commissioner of Income Tax (Appeals), Kochi at the time of filing of the appeal itself without giving an effective opportunity to submit further submissions so as to convince him of the facts in detail. 3. The learned Commissioner of Income Tax (Appeals) upheld the decisions and conclusions of the Assessing Officer without ascertaining the real facts of the case. ITA No. 83/Coch/2022 Shri K. Thomas Varghese 2 4. The assessing officer had not considered the documentary evidences produced before him to prove the genuineness of the expenses incurred and the first appellate authority had failed to even verify the assessment records and the evidences available in the file with the Assessing Officer. 5. The Commissioner of Income Tax (Appeals) had also not granted effective opportunity to the appellant to submit the documentary evidences before dismissing the appeal. 6. The learned Commissioner of Income Tax (Appeals) erred in dismissing the appeal in toto for the non- persecution of the appeal by the appellant. He should have considered the merits of the case and verified the assessment records before passing an ex-parte order. 7. The Commissioner of Income Tax (Appeals) had also failed to ensure proper service of the notice to the appellant for the hearing either through registered post or through the jurisdictional Assessing Officer before reaching at a conclusion that the appellant was not interested to prosecute the appeal. 8. The first appellate authority failed to appreciate the fact that the hire charges paid to M/s Tata Finance Ltd (Rs.3,35,797/-) is not liable for TDS under section 194A and not an item disallowable U/S 40(a)(i) of the Act. The appellant was denied an opportunity to furnish certificate in Form No. 26A as provided in the Act & Rules. 9. The first appellate authority had also not considered the fact that the rental charges is an inevitable expenditure for the retail shop for consumer goods and the documentary evidences were furnished before the Assessing Officer and available in the assessment records. Even when an ex- parte order is issued by the Commissioner of Income Tax (Appeals), he should have considered the documents and records available in the file and merits of the case. 10. The learned Commissioner of Income Tax (Appeals) had failed to appreciate that cost of packing materials amounting to Rs.29,360/- is an inevitable item of expenditure in running a margin free outlet. The Appellant was not given the effective opportunity to produce the supporting documents before him. 11. The Assessing Officer as well as the Commissioner of Income Tax (Appeals) had erred in concluding that the wages vouchers without signatures are fully disallowable. In the case of the contract workers, some wages may be paid out of regular working hours and obtaining the signature of each and every worker may not be practical. The aggregate wages paid was Rs. 5,20,080/- only which was absolutely reasonable considering the nature and volume of the activity ITA No. 83/Coch/2022 Shri K. Thomas Varghese 3 of the appellant. The Commissioner of Income Tax (Appeals) failed to examine the genuineness of the claim before dismissing the appeal. 12. Such other grounds that may be urged at the time of hearing. It is prayed that the appeal be allowed accepting the contentions of the appellant.” 2. The brief facts of the case are that that the assessee filed his return of income on 30.09.2011 declaring total income of Rs.8.08,550/-. The case was selected for scrutiny and statutory notices were sent to the assessee. During the course of assessment proceedings certain details were called for from the assessee and the assessee filed documents but as per the opinion of the AO the assessee was unable to produce the requisite details. Accordingly he made an addition as under and completed the assessment:- Total income returned Rs.8,08,550/- Addition as discussed in Para 3 above Rs.3,35,707/- Addition as discussed in Para 4 above Rs. 30,530/- Addition as discussed in Para 5 above Rs.1,50,000/- Addition as discussed in Para 6 above Rs. 29,360/- Addition as discussed in Para 7 above Rs.5,20,080/- Total income assessed Rs.18,74,307/- Aggrieved by the order of the AO the assessee filed appeal before the learned CIT(A). During the course of appellate proceedings by the CIT(A) sent notices to the assessee on the registered e-mail of the assessee but no response was received by the CIT(A). Therefore he dismissed the appeal of the assessee without considering the merits of the case. Aggrieved, assessee is in appeal before the Tribunal. 3. The learned A.R. submitted that the assessee has not received any notice for appearing before the CIT(A) and the CIT(A) has also not decided the issue on merits of the case. Accordingly he requested that the matter may be sent back to the file of the AO and he undertook that the assessee will produce necessary details in support of his claim to which the learned D.R. has no objection. 4. Considering the prayer of the assessee we restore the issue file of the AO and the assessee is directed to produce necessary documents/evidence ITA No. 83/Coch/2022 Shri K. Thomas Varghese 4 to substantiate his case. The assessee is also directed to update his correspondence details such as e-mail ID, mobile phone number, etc. so as to facilitate communication with the assessee. The assessee will not ask for unnecessary adjournments for the speedy disposal of the appeal. Needless to say that adequate opportunity of hearing should be provide to the assessee. 5. In the result, the appeal filed by the assessee is allowed for statistical purposes. Dictated and pronounced in the open Court on 30 th June, 2022. Sd/- Sd/- (George George K.) (Laxmi Prasad Sahu) Judicial Member Accountant Member Cochin, Dated: 30 th June, 2022 Copy to: 1. The Appellant 2. The Respondent 3. The CIT(A) -NFAC, Delhi 4. The CIT - 5. The DR, ITAT, Cochin 6. Guard File By Order //True Copy// Assistant Registrar ITAT, Cochin n.p.