ACIT Cir-2 Aurangabad., Aurangabad V. Late. Shri. Nirmal Madangopal Dhoot, L/H Smt. Shilpa Narmal Dhoot, Aurangabad

ITA 836/PUN/2012

• Counselvise Citation: 83624514 RSA 2012
• Duration Of Justice: 1 year(s) 2 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-07-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 27-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: Y K BHASKAR; M M VERMA
• Section: 40A(3); 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES A, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER AND SHRI G.S. PANNU, ACCOUNTANT MEMBER ITA NO.836/PN/2012 (ASSESSMENT YEAR: 2009-10) ASSTT. COMMISSIONER OF INCOME TAX CIRCLE 2, AURANGABAD . APPELLANT VS. LATE SHRI NIRMAL MADANGOPAL DHOOT THROUGH L/H SMT. SHILPA NIRMAL DHOOT, ANAND, STATION ROAD, PAGARIA COLONY, AURANGABAD. PAN : ABIPD6841K . RESPONDENT APPELLANT BY : MR. Y. K. BHASKAR & MS. M. M. VERMA RESPONDENT BY : MR. M. K. KULKARNI DATE OF HEARING : 17-07-2013 DATE OF PRONOUNCEMENT : 17-07-2013 ORDER PER G. S. PANNU, AM THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST AN ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS), AURANGABAD DA TED 23.02.2012 WHICH, IN TURN, HAS ARISEN FROM AN ORDER DATED 18.11.2011 PASSED BY THE ASSESSING OFFICER, UNDER SECTION 143(3) OF THE INCOME TAX ACT , 1961 (IN SHORT THE ACT), PERTAINING TO THE ASSESSMENT YEAR 2009-10. 2. IN THIS APPEAL, THE MAIN GROUND OF APPEAL RAISED BY THE REVENUE READS AS UNDER :- 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS), AURAN GABAD WAS CORRECT IN RELYING ON THE DECISION IN THE CASE OF SHRI RENUKES HWARA RICE MILLS VS. ITO (2005) 93 TTJ 912, ITAT, BANGALORE, ESPECIALLY WHEN THE FACTS ARE NOT SQUARELY APPLICABLE TO ASSESSEES CASE. ITA NO.836/PN/2012 LATE SHRI NIRMAL MADANGOPAL DHOOT A.Y. 2009-10 3. IN BRIEF, THE FACTS ARE THAT ASSESSEE IS AN INDI VIDUAL ENGAGED IN THE BUSINESSES OF LABOUR SUPPLY, INSURANCE AGENCY AND T RADING OF GARMENTS AS FRANCHISEE OF PROVOGUE AND LEE BRANDS AT AURANG ABAD AND NASHIK. IN THE COURSE OF ASSESSMENT PROCEEDINGS, ASSESSING OFFICER NOTICED THAT WHILE EFFECTING PURCHASES FROM PROVOGUE INDIA LTD., ASSES SEE HAD INCURRED EXPENDITURE FOR PURCHASES IN RESPECT OF WHICH PAYME NTS WERE MADE OTHERWISE BY AN ACCOUNT PAYEE CHEQUE OR BANK DRAFT I.E. IN CA SH EXCEEDING RS.20,000/- EACH. THE ASSESSING OFFICER OBSERVED THAT ASSESSEE HAD DEPOSITED CASH AT VARIOUS TIMES DURING THE YEAR TOTALING TO RS.59,82, 573/- DIRECTLY INTO THE BANK ACCOUNT OF PROVOGUE INDIA LTD.. THE AFORESAID HAS B EEN TREATED AS VIOLATION OF SECTION 40A(3) OF THE ACT AND ACCORDINGLY, A SUM OF RS.59,82,573/- WAS DISALLOWED BY INVOKING SECTION 40A(3) OF THE ACT. T HE CIT(A) HAS DELETED THE ADDITION FOLLOWING THE DECISION OF THE BANGALORE BE NCH OF THE TRIBUNAL IN THE CASE OF SHRI RENUKESHWARA RICE MILLS (SUPRA) AS ALS O HIS OWN DECISION IN THE CASE OF ASSESSEE FOR THE ASSESSMENT YEAR 2008-09 VI DE ORDER DATED 22.06.2011. AGAINST THE AFORESAID, REVENUE IS IN AP PEAL BEFORE US. 4. IN THE ABOVE BACKGROUND, AT THE TIME OF HEARING, IT WAS A COMMON POINT BETWEEN THE PARTIES THAT SIMILAR ISSUE IN THE ASSES SEES OWN CASE FOR ASSESSMENT YEAR 2008-09 WAS A SUBJECT MATTER OF A C ONSIDERATION OF THE TRIBUNAL VIDE ITA NO.1144/PN/2011 DATED 28.12.2012, WHEREIN THE ORDER OF THE CIT(A) WAS AFFIRMED AND REVENUES APPEAL WAS DI SMISSED. THE RELEVANT DISCUSSION IN THE ORDER OF THE TRIBUNAL DATED 28.12 .2012 (SUPRA) IS AS UNDER :- WE HAVE HEARD THE RIVAL SUBMISSIONS OF THE PARTIES AND PERUSED THE RECORD. IN THIS CASE, THE FACTS ARE NOT IN DISPUTE. THE ISSUE IN CONTROVERSY IS IN RESPECT OF PAYMENTS MADE TO ONE COMPANY FROM WHICH, THE ASSESSEE USED TO PURCHASE THE BRANDED ITEMS. AS NOTED BY THE LD. CIT (A), IT WAS AN ARRANGEMENT BETWEEN PROVOGUE INDIA LTD. AND ASSESSE E TO DIRECTLY DEPOSIT THE AMOUNT IN THE BANK A/C. OF THE SAID COMPANY. IT IS ALSO ADMITTED FACT THAT NOWHERE IT IS THE CASE OF THE A.O. THAT THE ASSESSE E HAS PAID CASH DIRECTLY TO PROVOGUE INDIA LTD.. IN FACT, IN THE IDENTICAL SITU ATION IN THE CASE OF SHRI RENUKESHWARA RICE MILLS VS. ITO, 93 TTJ 912 (BANGAL ORE), IT IS HELD THAT AS THE PAYMENTS HAVE DIRECTLY GONE TO THE ACCOUNT OF T HE PARTY NO DISALLOWANCE CAN BE MADE BY INVOKING PROVISIONS OF SECTION 40A(3 ). THE PURPOSE OF INTRODUCING HARSH PROVISION LIKE SECTION 40A(3) IS TO SEE THAT THE TRANSACTIONS ITA NO.836/PN/2012 LATE SHRI NIRMAL MADANGOPAL DHOOT A.Y. 2009-10 ARE IN THE MAIN STREAM OF THE ECONOMY OF THE NATION AND THERE SHOULD NOT BE SCOPE FOR AVOIDING THE LEGITIMATE TAX, NOWHERE IT I S THE CASE OF THE A.O. THAT THE TRANSACTIONS ARE NOT DISCLOSED BY EITHER OF THE PARTY. IN OUR OPINION, THE LD. CIT(A) HAS RIGHTLY DELETED THE ADDITION AND NO INTE RFERENCE IS CALLED FOR. IN THE RESULT, GROUND TAKEN BY THE REVENUE IS DISMISSED. 5. FOLLOWING THE AFORESAID PRECEDENT, WHICH IS REND ERED ON SIMILAR ISSUE IN ASSESSEES OWN CASE IN THE PRECEDING ASSESSMENT YEA R, WE HEREBY AFFIRM THE ORDER OF THE CIT(A) AND ACCORDINGLY, THE REVENUE HA S TO FAIL. 6. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON 17 TH JULY, 2013. SD/- SD/- (SHAILENDRA KUMAR YADAV) (G . S. PANNU) JUDICIAL MEMBER ACCOUNT ANT MEMBER PUNE, DATED: 17 TH JULY, 2013 SUJEET COPY OF THE ORDER IS FORWARDED TO : - 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A), AURANGABAD; 4) THE CIT, AURANGABAD; 5) THE DR, A BENCH, I.T.A.T., PUNE; 6) GUARD FILE. BY ORDER //TRUE COPY// SR. PRIVATE SECRETARY I.T.A.T., PUNE