DCIT 2(3), MUMBAI V. TRANS IMPEX P.LTD, MUMBAI

ITA 8316/MUM/2010

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 2900 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 10 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-10-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 18-09-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 01-12-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL E BE NCH, MUMBAI BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER / I .T.A. NO.8316/MUM/2010 ( / ASSESSMENT YEAR:2007-08 THE DCIT-2(3), AAYAKAR BHAVAN, MUMBAI-400 020 / VS. TRANS IMPEX PVT. LTD., 4 TH FLOOR, DARABSHAW HOUSE, S.V. MARG, BALLARD ESTATE, MUMBAI-400 001 ./ ./ PAN/GIR NO. : AAACT 5093P ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY: SHRI SURABHI SHARMA / RESPONDENT BY: SHRI NISHANT THAKKAR / DATE OF HEARING :05.10.2015 ! / DATE OF PRONOUNCEMENT :14.10.2015 '# / O R D E R PER N.K. BILLAIYA, AM: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-6, MUMBAI DATED 16.09.2010 PERTAINING TO ASSESSMENT YEAR 2007-08. 2. THE SOLE GRIEVANCE OF THE REVENUE IS THAT THE LD . CIT(A) ERRED IN DELETING THE ADDITION OF RS. 95,06,952/- HOLDING RS. 93,91,054/- AS REIMBURSEMENT BASED UPON THE REMAND REPORT. ITA. NO.8316/M/2010 2 3. THE ASSESSEE IS IN THE BUSINESS OF STEVEDORING & SHIPPING AGENT FOR ALL KINDS VESSELS. WHILE SCRUTINIZING THE RET URN OF INCOME, THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS CLAIM ED CREDIT FOR TAX DEDUCTED AT SOURCE ON THE SERVICE CHARGE AND COMMIS SION RECEIVED. ON PERUSING THE DETAILS FILED BY THE ASSESSEE, THE AO FOUND THAT THE ASSESSEE HAS SHOWN COMMISSION OF RS. 3,60,480/- AND PROFESSIONAL/TECHNICAL SERVICES AT RS. 1,11,74,94 5/-. ON FURTHER PERUSAL, THE DETAILS RELATING TO PROFESSIONAL FEES , THE AO FOUND THAT THE ASSESSEE HAS RECEIVED SERVICE CHARGES (AGENCY I NCOME) FROM M/S. WARNER INVESTMENT & LEASING CO. LTD. AGAINST SUPPL Y OF MANPOWER AMOUNTING TO RS. 16,67,993/-. THE AO WAS OF THE OP INION THAT THE ASSESSEE HAS RECEIVED PROFESSIONAL/TECHNICAL FEES F ROM M/S. WARNER INVESTMENT & LEASING CO. LTD AMOUNTING TO RS. 1,10, 86,200/- AND RS. 88,745/- FROM M/S. J.M. BAXI & CO. THE AO WAS OF T HE FIRM BELIEF THAT SINCE THE ASSESSEE HAS SHOWN THE SERVICE CHARGES RE CEIVED FROM M/S. WARNER INVESTMENT & LEASING CO. LTD., 16,67,993/- T HEREFORE THE ASSESSEE HAS NOT SHOWN THE INCOME OF RS. 94,18,207 /-. THE AO ADDED THIS DIFFERENCE TO THE TOTAL INCOME OF THE A SSESSEE. SIMILARLY, RS. 88,475/- RECEIVED FROM M/S. J.M. BAXI & CO WAS ALSO ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 4. AGGRIEVED BY THIS, THE ASSESSEE CARRIED THE MATT ER BEFORE THE LD. CIT(A). BEFORE THE LD. CIT(A)L, IT WAS STRONG LY CONTENDED THAT RS. 93,29,853/- IS NOTHING BUT REIMBURSEMENT OF EXPENSE S. IT WAS EXPLAINED THAT THE ASSESSEE WAS MAINTAINING ONE CRA NE AT NAVA SHEVA BELONGING TO M/S. WARNER INVESTMENTS FOR WHICH THE ASSESSEE WAS RECEIVED FIXED SERVICE CHARGES OF RS. 5,00,000/- FO R WHICH THE ASSESSEE EMPLOYED ENGINEERS, SPARES ETC., AND SERVI CED THE CRANE. THE ASSESSEE HAS INCURRED VARIOUS EXPENSES AND THES E EXPENSES WERE ITA. NO.8316/M/2010 3 REIMBURSED BY M/S. WARNER INVESTMENTS. INADVERTAN TLY, THE SAID COMPANY DEDUCTED TAX AT SOURCE WHICH WAS CLAIMED B Y THE ASSESSEE. 4.1. AFTER CONSIDERING THE FACTS AND THE SUBMISSION S, THE LD. CIT(A) WAS CONVINCED THAT THE EXPENSES ARE ACTUALLY REIMBU RSEMENT MADE BY M/S. WARNER INVESTMENTS. THE LD. CIT(A) FURTHER OBSERVED THAT SIMILAR TRANSACTIONS WERE THERE IN ASSESSMENT YEARS 2004-05, 2005- 06 AND 2006-07 AS THE FACTS OF THE CURRENT YEAR BEI NG SIMILAR TO THE FACTS OF THE EARLIER YEARS, THE EXPENSES HAVE TO BE ACCEPTED. THE LD. CIT(A) ACCORDINGLY DIRECTED THE AO TO DELETE THE A DDITION OF RS. 93,29,853/- AND IN SO FAR AS THE ADDITION OF RS. 88 ,745/- IS CONCERNED, THE AO IN HIS REMAND REPORT HAS ACCEPTED THAT THE S AME HAS BEEN OFFERED FOR TAXATION THEREFORE NO ADDITION IS TO BE MADE. 5. AGGRIEVED BY THIS, THE REVENUE IS BEFORE US. 6. THE LD. DEPARTMENTAL REPRESENTATIVE SUPPORTED TH E FINDINGS OF THE AO. 7. THE LD. COUNSEL FOR THE ASSESSEE REITERATED WHAT HAS BEEN STATED BEFORE THE LOWER AUTHORITIES. 8. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE ORDERS OF THE AUTHORITIES BELOW. THE ENTIRE DISPUTE REVOLVES ARO UND THE FACT THAT WHETHER RS. 93,29,852/- PERTAINS TO REIMBURSEMENT OF EXPENSES BY M/S. WARNER INVESTMENTS. WE FIND THAT THE LD. CIT( A) HAS APPRECIATED THE FACTS IN PROPER PERCEPTIVE. WE, AL SO FIND THAT THE LD. CIT(A) HAS ALSO CALLED FOR A REMAND REPORT FROM THE AO AND AFTER CONSIDERING THE FACTS IN TOTALITY, THE LD. CIT(A) D IRECTED THE AO TO ITA. NO.8316/M/2010 4 DELETE THE IMPUGNED ADDITION. WE, THEREFORE, DO NO T FIND ANY MERIT IN THE CASE OF THE REVENUE. 9. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S ACCORDINGLY DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 14 TH OCTOBER, 2015 SD/- SD/- (SANJAY GARG ) (N.K. BILLAIYA) $% ' /JUDICIAL MEMBER ' / ACCOUNTANT MEMBER & ' MUMBAI; (' DATED : 14 TH OCTOBER, 2015 . % . ./ RJ , SR. PS !' #' / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ) ( ) / THE CIT(A)- 4. ) / CIT 5. *+, %%-. , -.! , & ' / DR, ITAT, MUMBAI 6. ,/0 1 / GUARD FILE. $ / BY ORDER, * % //TRUE COPY// % / $& ' (DY./ASSTT. REGISTRAR) , & ' / ITAT, MUMBAI