ITO, Ludhiana V. M/s Devki Nandan & Sons, Ludhiana

ITA 966/CHANDI/2009

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 5325 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 7 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-07-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 05-09-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 08-12-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N K SAINI
• Assessee Lawyers: SUBHASH AGGARWAL
• Keywords: Tax effect
• Section: 143(3); 194C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES A CHANDIGARH BEFORE SHRI D.K.SRIVASTAVA, ACCOUNTANT MEMBER AND MS SUSHMA CHOWLA, JUDICIAL MEMBER ITA NO.966/CHD/2009 ASSESSMENT YEAR: 2005-06 THE ITO VS. M/S DEVKI NANDAN & SONS, WARD V(1), LUDHIANA LUDHIANA PAN NO. AAAFD9269J (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI N.K.SAINI RESPONDENT BY: SHRI SUBHASH AGGARWAL ORDER PER SUSHMA CHOWLA, JM THE APPEAL BY THE REV IS AGAINST THE ORDER OF CIT(A )-II, LUDHIANA DATED 14.7.2009 RELATING TO ASSESSMENT YEAR 2005-06 AGAINST THE ORDER PASSED UNDER SECTION 143(3) OF THE I.T. ACT, 1961. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- 1. THAT THE LEARNED CIT(A)-II HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS. 2,42,328/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF VIOLATION OF SECTION 40(A)(IA) READ WITH SECTION 194C OF THE INC OME TAX ACT, 1961. 2. BUT FOR TWO OR THREE PAYMENTS (SUBSEQUENTLY REIMBURSED BY HPCL), THE ENTIRE FREIGHT PAYMENT OF RS. 3,42,328/- HAS BEEN MADE BY ASSESSEE TO M/S TEMPO UNION SAHNEWAL (REGD), G.T. ROAD, SAHNEWAL (LUDHIANA) IN WHOLE FINANCIAL YEAR 2004-05. IT IS SUFFICIENT TO PROVE THAT ORAL AGREEMENT FOR SPECIFI C PERIOD EXISTED BETWEEN ASSESSEE AND THE TRANSPORTER S. ACCORDINGLY, RATIO OF JUDGMENT DELIVERED BY HON'BL E JURISDICTIONAL HIGH COURT IN THE CASE OF CIT (TDS), 2 CHANDIGARH VS. M/S UNITED RICE LAND LTD IS DISTINGUISHED VIS-A-VIS FACTS OF THE CASE AND HAND. 3. THE LD. COUNSEL OF THE ASSESSEE AT THE OUTSET PO INTED OUT THAT THE TAX EFFECT IN THE APPEAL IS LESS THAN THE PRESCRIBED LI MIT OF RS. 2 LAKHS/ . HOWEVER, LD. DR FOR THE REVENUE SUPPORTED THE ASSE SSMENT ORDER. 4. FROM THE PERUSAL OF RECORDS, IT IS OBSERVED THAT THE REVENUE EFFECT INVOLVED IN THIS APPEAL IS LESS THAN RS.2.00 LACS. THEREFORE, IN VIEW OF THE DECISIONS OF THE HONBLE MUMBAI HIGH COURT IN T HE CASE OF CIT VS. CAMCO COLOUR CO., (254 ITR 565), CIT VS. PITHWA ENG G. WORKS REPORTED IN 276 ITR 519 AND CIT VS. ZOEB Y. TOPIWALA (284 IT R 379), THE APPEAL IS NOT MAINTAINABLE. FURTHER, THE ISSUE WAS ALSO C ONSIDERED BY THE CBDT VIDE ITS CIRCULAR DATED 27.03.2000, WHEREIN IT REFL ECT THE POLICY DECISION TAKEN BY THE BOARD NOT TO RAISE QUESTIONS OF LAW WH ERE THE TAX EFFECT IS LESS THAN THE AMOUNT PRESCRIBED IN THE INSTRUCTIONS WITH A VIEW TO REDUCE LITIGATION BEFORE THE HIGH COURTS AND THE SUPREME C OURT. THEREFORE, THERE IS NO JUSTIFICATION TO PROCEED WITH THE APPEAL HAVI NG TAX EFFECT LESS THAN RS.2.00 LAKHS. 5. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 27 TH DAY OF JULY, 2011. SD/- SD/- (D.K.SRIVASTAVA) (SUSHMA CHOWLA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : JULY, 2011 RKK COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR 3 TRUE COPY BY ORDER ASSISTANT REGISTRAR, ITAT, CHANDIGARH