Shriram D. Nahane, Pune V. Income-tax Officer,

ITA 959/PUN/2015

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 9405 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 7 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 11-01-2018
• Assessment Year: 2009-2010
• Appeal Filed On: 19-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 143(3)

Judgement Text

] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO.959/PUN/2015 / ASSESSMENT YEAR : 2009-10 SHRIRAM D. NAHANE, BHIGWAN, TALUKA INDAPUR, DIST. PUNE. PAN : AFRPN0975M. . / APPELLANT V/S INCOME TAX OFFICER, WARD 5(4), PUNE. . / RESPONDENT ASSESSEE BY : SHRI KISHORE PHADKE. REVENUE BY : SHRI AJAY MODI. / ORDER PER ANIL CHATURVEDI, AM : 1. THIS APPEAL FILED BY THE ASSESSEE IS EMANATING OUT OF THE ORDER OF COMMISSIONER OF INCOME TAX (A) 7, PUNE, DT.19.0 3.2015 FOR THE ASSESSMENT YEAR 2009-10. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON R ECORD ARE AS UNDER :- ASSESSEE IS AN INDIVIDUAL AND STATED TO BE ENGAGED IN THE BUSINESS OF TRANSPORTATION. ASSESSEE FILED HIS RETURN OF INC OME FOR A.Y. 2009-10 ON 19.08.2009 DECLARING TOTAL INCOME OF / DATE OF HEARING : 11.01.2018 / DATE OF PRONOUNCEMENT: 23.01.2018 2 RS.9,69,890/-. THE CASE WAS SELECTED FOR SCRUTINY AND TH EREAFTER ASSESSMENT WAS FRAMED U/S 143(3) R.W.S. 145(3) OF THE ACT VIDE ORDER DT.23.12.2011 AND THE TOTAL INCOME WAS DETERMINED AT RS.71,47,640/-. AGGRIEVED BY THE ORDER OF AO, ASSESSEE C ARRIED THE MATTER BEFORE LD. CIT(A), WHO VIDE ORDER DT.19.03.2015 (IN APPEAL NO.PN/CIT(A)-7/ITO WD-5(4), PN/944/2014-15) GRANTED PARTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY THE ORDER O F LD.CIT(A), ASSESSEE IS NOW IN APPEAL BEFORE US AND HAS RAISED THE FO LLOWING GROUNDS : 1. THE LEARNED CIT(A)-7, PUNE ERRED IN LAW AND ON FACTS IN SUSTAINING TOTAL ADDITION OF RS.38,36,994 (I.E . RS.37,75 , 000 + RS. 61 , 994) TO THE TAXABLE INCOME OF THE APPELLANT WITHOUT APPRECIATING THAT THE SAID REVENUE RELATES TO 2010-11 AND IS ALREADY ACCOUNTED FOR AND OFFERED TO TAX IN A.Y. 2010-11. 2. THE LEARNED CIT(A)-7, PUNE ERRED ON FACTS IN OBS ERVING THAT THE TRANSACTION DATE MENTIONED IN FORM 26AS AS REGARDS TDS INDICATES THAT THE SAID TRANSPORT REVENUE OF RS.37,75,000 REL ATES TO F . Y . 2008-09 (I.E. A.Y. 2009 - 10). IN FACT, THE DATE OF THE BOOKING OF TRANSPORT CHARGES AS PER THE CUSTOMER'S DECLARATION IS 16/6/2009, A DATE RELATING TO F.Y. 2009-10 (I.E. A.Y. 2010-11) . 3. THE LEARNED CIT(A)-7, PUNE ERRED IN LAW AND ON F ACTS IN UPHOLDING THE ADDITIONS OF RS . 38,36,994 AS SO MADE BY THE AO WITHOUT APPRECIATING THAT THE SAID PROCESS LEADS TO DOUBLE TAXATION. 4. ALTERNATIVELY & WITHOUT PREJUDICE, THE LEARNED CIT(A)-7, PUNE ERRED IN LAW AND ON FACTS IN NOT DIRECTING THE CONC ERNED AO TO DELETE THE REVENUE OF RS. 38,36,994 FROM APPELLANT'S REVEN UE AND PROFITS / TAXABLE INCOME, FOR A.Y. 2010-11 3. BEFORE US LD.A.R. SUBMITTED THAT THOUGH THE ASSESSEE HAS RAISED SEVERAL GROUNDS BUT ALL THE GROUNDS ARE INTER-CON NECTED AND ARE WITH RESPECT TO ADDITION MADE ON THE BASIS OF TRANSA CTIONS REPORTED IN FORM 26AS. 4. DURING THE COURSE OF ASSESSMENT PROCEEDINGS ON PERU SING THE DETAILS FURNISHED BY THE ASSESSEE, AO NOTICED THAT AS SESSEE HAD NOT DISCLOSED SOME OF THE RECEIPTS. THE ASSESSEE W AS ASKED TO 3 RECONCILE THE CONTRACT RECEIPTS WITH THE INFORMATION IN POS SESSION WITH THE DEPARTMENT. ASSESSEE INTER-ALIA SUBMITTED THAT THE CONTRACT RECEIPTS AMOUNTING TO RS.61,35,636/- WAS NOT DISCLOSED BECAUSE THE FORM NO.16A WAS NOT RECEIVED BY THE ASSE SSEE. IT WAS FURTHER SUBMITTED THAT THE RECEIPTS HAVE BEEN ACCO UNTED FOR IN A.Y. 2011-12. THE SUBMISSION OF THE ASSESSEE WAS NOT FOU ND ACCEPTABLE TO THE AO. AO WAS OF THE VIEW THAT SINCE TH E ASSESSEE WAS FOLLOWING THE MERCANTILE SYSTEM OF ACCOUNTING, HE OUGHT TO HAVE DISCLOSED THE RECEIPTS IN A.Y 2009-10 ITSELF. HE FURTHE R NOTED THAT SINCE THE ASSESSEE HAS FAILED TO ENTER THE RECEIPTS IN THE BOOKS, THE BOOK RESULTS CANNOT BE RELIED UPON. HE ACCO RDINGLY INVOKED THE PROVISIONS OF SEC.145(3) OF THE ACT. HE THEREA FTER CONSIDERED THE RECEIPTS OF RS.61,35,636/- AS AN UNDISCLOSE D INCOME OF THE ASSESSEE AND MADE ITS ADDITION. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE LD.CIT(A), WHO GRANTED PARTIAL RELIEF TO THE ASSESSEE BY OBSERVING AS UNDER : 3.4 DURING THE APPELLATE PROCEEDINGS THE APPELLANT HAS SUBMITTED THAT THE MAINTENANCE OF ACCOUNT HAD BEEN GIVEN TO S HRI K.J. BHISE, AN ACCOUNTANT 'SINCE 2007 AND HE IS B.COM THOUGH NO T A QUALIFIED ACCOUNTANT AND RELIED UPON THE EXPERTISE OF SHRI BH ISE FOR THE ACCOUNTING PURPOSE. THE ACCOUNTANT HAS ALSO MADE AN AFFIDAVIT AND ADMITTED HIS MISTAKE OF NOT RECONCILING THE INCOME AND TAX DEDUCTED AT SOURCE AS MENTIONED IN THE BOOKS OF ACCOUNT WITH AVAILABLE 26AS AVAILABLE AT INCOME-TAX SITE DUE TO WHICH THE INCOM E AND RELATED TAX NOT CONSIDERED WHILE COMPUTING THE INCOME. THE APPE LLANT HAS FURTHER STATED THAT OUT OF THE TOTAL AMOUNT OF RS.6 1,35,636/- INCOME TO THE EXTENT OF RS.38,36,994/ HAS BEEN ACCOUNTED AND DISCLOSED IN A.Y. 2010-11. WHICH INCLUDED THE TRANSPORT RECEI PTS FROM PUSPA BHASKAR OF RS.37,75,000/- AND COMMISSION OF RS.61,994/- FROM PACL INDIA LTD AND THE APPELLANT HAS FILED THE LEDG ER EXTRACT OF THE OF THE RESPECTIVE ACCOUNT THE APPELLANT HAS HOWEVER, ADMIT TED TO THE FACT THAT THE MERCANTILE SYSTEM OF ACCOUNTING HAD BEEN D EVIATED PRIMARILY DUE TO NON-RECEIPT OF FORM NO. 16A FROM T HE PARTIES. THE APPELLANT HAS THUS CONTENDED THAT EXCLUDING RS.38,3 6.994/- OUT OF RS.61,35,636/- THE BALANCE ADDITION OF RS.22,98,642 /- BE MADE DURING THE YEAR AND TO ALLOW THE CREDIT OF TDS OF RS.51,872/-. 3.5. I HAVE CONSIDERED THE SUBMISSION MADE BY THE APPELLANT AND PERUSED MATERIAL ON RECORD. THE ONLY ISSUE CONTESTE D RELATES TO THE POINT OF TAXATION OF INCOME OF RS.61,35,636/-. THE AO HAS ADDED 4 THE AFORESAID SUM ON ACCOUNT OF CONTRACT RECEIPTS W HICH HAS BEEN HELD TO HAVE NOT BEEN DISCLOSED. THE APPELLANT IS R UNNING TRANSPORT AND COMMISSION BUSINESS AND DURING THE YEAR IT IS F OUND TO HAVE NOT DISCLOSED THE CONTRACT RECEIPTS AMOUNTING TO RS .61,35,638/- AND THE BREAK-UP OF THE SAID RECEIPTS HAVE ALSO BEEN OU TLINED BY THE AO IN PARA 2.1 OF THE ORDER. THE APPELLANTS CONTENTIO N IN THIS REGARD WITH RESPECT TO THE NON DISCLOSURE OF RECEIPTS HAS BEEN FOR THE WANT OF FORM NO.16A FROM THE RESPECTIVE PARTIES. IN ANY CASE THE APPELLANT HAS ADMITTED TO THE FACT THAT OUT OF THE AFORESAID SUM OF RS.61,35,636/- A SUM OF RS.38,36,994/- TO HAVE BEEN ACCOUNTED AND DISCLOSED IN A.Y.2010-11 RELATING TO THE TRANSP ORT RECEIPTS FROM PUSPHA BHASKAR OF RS.37,75,000/- AND THE COMMISSION INCOME FROM PACL INDIA LTD OF RS.61,994/-. THE APPELLANT F OR THE REMAINING AMOUNT OF RS.22,98,642/- HAS ACCEPTED THAT THE SAID SUM IS LIABLE TO BE ADDED FOR THE YEAR UNDER CONSIDERATION. THE APPELLANT HAS ALSO AGREED AND ADMITTED THAT HE HAS DEVIATED THE MERCAN TILE SYSTEM OF ACCOUNTING IN RESPECT OF THE AFORESAID INCOME AND T HE SAME TO BE ATTRIBUTABLE TO NON-RECEIPT OF FORM NO 16A FROM THE PARTIES AND THE AMOUNTS HAVING BEEN RECEIVED IN THE SUBSEQUENT FINA NCIAL YEAR. THUS, THE ADDITION MADE BY THE AO TO THE EXTENT OF RS.22,98,642/- OUT OF THE TOTAL ADDITION OF RS.61,35,636/- IS LIAB LE TO BE UPHELD IN VIEW OF THE APPELLANT'S OWN ADMISSION. 3.6 SO FAR AS THE REMAINING AMOUNT OF RS.38,36,944 /- IS CONCERNED IT IS NOTICED THAT TDS ON THE AFORESAID AMOUNT HAS BEE N DEDUCTED IN RESPECT OF THE SAID AMOUNT DURING THE YEAR UNDER CON SIDERATION. THE APPELLANT HAS FILED THE COPIES OF THE PROFIT & LOSS ACCOUNT FOR THE A.Y.2010-11 ALONG WITH THE BREAK-UP OF TRANSPORT RE CEIPTS, BANK STATEMENT AND LEDGER EXTRACT OF THE PARTIES TO JUST IFY ITS CLAIM THAT THE SAID AMOUNT BAS BEEN RECEIVED IN F. Y.2009-10 R ELEVANT TO A.Y.2010-11. HOWEVER, THE APPELLANT HAS NOT BROUGHT ON RECORD ANY SUCH MATERIAL WHICH COULD JUSTIFY THE FACT THAT THE WORK RELATED TO THE AFORESAID RECEIPT HAD NOT BEEN CARRIED OUT IN F .Y. 2008-09 RELEVANT TO A.Y.2009-10 I.E. THE YEAR UNDER CONSIDE RATION. IT IS NOTABLE THAT THE TDS ON THE SAID AMOUNT HAS BEEN DE DUCTED DURING THE F.Y. 2008-09 I.E. THE YEAR UNDER CONSIDERATION AS IS EVIDENT FROM THE TDS-TRACES OF FORM NO. 26AS. THE APPELLANT FURT HER HAS NOT EXPLAINED THE NATURE OF TRANSACTION CARRIED OUT WIT H THE AFORESAID PERSONS NOR BROUGHT ON RECORD SUCH MATERIAL WHICH C OULD DISPROVE THE FACT THAT THE WORK RELATED TO THE TRANSACTION W AS NOT CARRIED OUT DURING THE YEAR UNDER CONSIDERATION SO THAT THE SAI D AMOUNT COULD BE TAXED IN THE SUCCEEDING YEAR. THE TRANSACTION DA TES AS MENTIONED IN FORM 26AS CLEARLY INDICATE THE RECEIPT ON WHICH TDS HAVE BEEN DEDUCTED TO HAVE BEEN RECEIVED IN F.Y.200 8-09 AND NOT 2009-10 AS CLAIMED BY THE APPELLANT THE APPELLANT H AS NOT FILED THE COPIES OF THE PROFIT & LOSS ACCOUNT AND BALANCE SH EET AND RELATED DOCUMENTS FOR THE YEAR UNDER CONSIDERATION SO AS TO PROVE ITS POINT. THE RECEIPT OF PAYMENT FROM PUSPA BHASKAR AND PACL MAY HAVE BEEN RECEIVED DURING THE NEXT FINANCIAL YEAR, HOWEV ER, THE APPELLANT HAS NOT BROUGHT ANY SUCH MATERIAL TO SHOW THAT THE SERVICES HAD ALSO BEEN RENDERED DURING THE NEXT FINANCIAL YEAR L EADING TO ITS DISCLOSURE IN THE RETURN OF INCOME FOR A.Y.2010-11 NOR SPECIFIED THE NATURE OF CONTRACT ENTERED INTO AND THE RESULTANT S ERVICES CARRIED OUT IN LIEU OF WHICH THE AFORESAID RECEIPT HAS BEEN REC EIVED. IN VIEW OF THE EXISTING FACTS AND CIRCUMSTANCES OF THE CASE TH E ADDITION MADE BY THE AO FOR THE REMAINING AMOUNT OF RS.38,36,944/ - IS ALSO LIABLE TO BE UPHELD AND THE CONTENTION RAISED BY THE APPEL LANT IN THIS REGARD FAILS. THUS, THE ENTIRE ADDITION OF RS.61,3 5,636/- ( 22,98,642 + 38,36,994) MADE BY THE AO DOES NOT REQU IRE ANY INTERFERENCE AND IS UPHELD. HOWEVER, THE CONTENTION RAISED BY THE APPELLANT OF ALLOWING CREDIT OF TDS APPEARS TO BE R EASONABLE AND 5 THE SAME NEEDS TO BE CONSIDERED IN VIEW OF THE TAX LIABILITY ARISING FOR THE YEAR. THE ASSESSING OFFICER NEEDS TO VERIFY THE AFORESAID FACTS AND ACCORDINGLY ALLOW CREDIT OF TAX DEDUCTED AS PER LAW. AGGRIEVED BY THE ORDER OF LD.CIT(A), ASSESSEE IS NOW IN APP EAL BEFORE US. 5. BEFORE US, LD.A.R. REITERATED THE SUBMISSIONS MADE BEFORE AO AND LD.CIT(A) AND FURTHER SUBMITTED THAT THE AMOUNT O F RS.38,36,994/- HAS ALREADY BEEN CONSIDERED AS INCOME OF T HE ASSESSEE IN A.Y. 2010-11 AND HAS ALSO BEEN OFFERED TO TAX IN A.Y. 2010-11. HE FURTHER SUBMITTED THAT THOUGH THE TDS WAS DEDUCTED BY PAYER IN A.Y 2009-10, ASSESSEE HAS NOT CLAIMED THE T DS IN AY. 2009-10 BUT IT HAS CLAIMED IN A.Y. 2010-11 AND IN SUPPORT OF HIS CONTENTION THAT THE AMOUNT WAS OFFERED TO TAX IN A.Y. 2 010-11, HE POINTED TO THE COPIES OF RETURN OF INCOME FOR A.Y. 2010-11 AND THE COMPUTATION OF INCOME FOR A.Y. 2010-11, WHICH ARE PLACED AT PAGES 25 TO 27 OF THE PAPER BOOK. HE ALSO POINTED TO THE LED GER EXTRACT OF TRANSPORT RECEIPTS AND THE LEDGER ACCOUNT OF THE PAR TIES AS APPEARING IN THE BOOKS OF THE ASSESSEE. HE THEREFORE S UBMITTED THAT THE ADDITION BE DELETED. WITHOUT PREJUDICE TO HIS AB OVE CONTENTION, HE SUBMITTED THAT IF THE SAME AMOUNT IS ADDE D IN A.Y. 2009-10 THEN SINCE ASSESSEE HAS ALREADY OFFERED THE IMP UGNED AMOUNT IN A.Y. 2010-11, IT WOULD AMOUNT TO DOUBLE TAXATION OF THE SAME INCOME. IN SUCH A SITUATION, THE AO BE DIRECTED TO DELETE THE REVENUE OF RS.38,36,994/- CONSIDERED BY THE ASSESSEE IN A.Y. 2010-11. LD.D.R. ON THE OTHER HAND, SUPPORTED THE ORDE R OF AO AND LD.CIT(A). 6 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT CASE IS WITH RESPECT TO ADDITION OF RS.38,36,994/-. IT IS ASSESSEES CONTENTION T HAT THE AFORESAID AMOUNT THOUGH HAS BEEN REFLECTED IN FORM 26AS BUT HAS BEEN RECEIVED BY THE ASSESSEE IN SUBSEQUENT YEAR I.E., IN A.Y. 2010-11, THE CREDIT OF THE TDS OF THE AFORESAID AMOUNT HA S ALSO BEEN CLAIMED IN A.Y. 2010-11 AND THE AMOUNT HAS BEEN REFL ECTED IN THE PROFIT AND LOSS ACCOUNT OF THE ASSESSEE IN A.Y. 201 0-11. THE AFORESAID SUBMISSION OF THE ASSESSEE HAS NOT BEEN CONTROVERTED BY REVENUE. IT IS ALSO A FACT THAT IF THE AMOUNT OF RS.38,36,994/- IS CONSIDERED AS INCOME OF THE ASSESSEE, IT WOULD AMOUNT TO DOUBLE TAXATION OF THE SAME AMOUNT. IN SUCH A SITUATION, WE ARE OF THE VIEW THAT NO ADDITION OF THE AMOU NT IS CALLED FOR IN THE YEAR UNDER CONSIDERATION MORE SO WHEN T HE SAME AMOUNT HAS BEEN OFFERED TO TAX BY THE ASSESSEE IN SUBS EQUENT ASSESSMENT YEARS AND THE TDS DEDUCTED ON SUCH AMOUN T HAS ALSO BEEN CLAIMED IN NEXT ASSESSMENT YEAR. WE THEREFORE DIRE CT ITS DELETION IN THE YEAR UNDER CONSIDERATION AND THUS, THE GROUNDS OF THE ASSESSEE ARE ALLOWED. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED ON 23 RD DAY OF JANUARY, 2018. SD/- SD/- ( SUSHMA CHOWLA ) ( ANIL CHATURVEDI ) / JUDICIAL MEMBER ! / ACCOUNTANT MEMBER PUNE; DATED : 23 RD JANUARY, 2018. YAMINI 7 '#$%&'&$ / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3 . 4. 5. 6. CIT(A)-7, PUNE. PRL.CIT-6, PUNE. '#$ %%&',) &', / DR, ITAT, A PUNE; $+,-/ GUARD FILE. / BY ORDER , T// ///TRUE TRUE COPY // TRUE COPY // ./0%1&2 / SR. PRIVATE SECRETARY ) &', / ITAT, PUNE.