The ITO 1 (2), V. Shri Mahendra Kumar Agrawal, Dewas

ITA 98/IND/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 2944 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 1 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-05-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 03-05-2010
• Assessment Year: 2004-2005
• Appeal Filed On: 27-03-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: APARNA KARAN
• Assessee Lawyers: T N UNNI

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI V.K. GUPTA, ACCOUNTANT MEMBER ITA NO.98/IND/2009 A.Y. 2004-05 ITO, WARD-1(2), UJJAIN APPELLANT VS MAHENDRA KUMAR AGRAWAL, 23, TILAK MARG, KHATEGAON, DISTT. DEWAS (MP) (PAN ABNPA 3673 R) RESPONDENT APPELLANT BY : SMT. APARNA KARAN, SR. DR RESPONDENT BY : SHRI T.N. UNNI, CA O R D E R PER BENCH THIS APPEAL IS BY THE REVENUE AGAINST THE ORDER OF THE LEARNED CIT(A)-UJJAIN, DATED 2.12.2008 WHEREIN THE FIRST GR OUND RAISED IS THAT WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) IS CORRECT IN DELETING THE ADDITION OF RS.13,14,745/- MADE ON ACCOUNT OF UNDERSTATED EARTH WORK RECEIPTS, DETECTED DURING AS SESSMENT PROCEEDINGS. 2. DURING HEARING OF THIS APPEAL, THE ARGUMENTS ADV ANCED ON BEHALF OF THE REVENUE IS IN SUPPORT TO THE ASSESSMENT ORDE R WHEREAS THE LD. COUNSEL FOR THE ASSESSEE DEFENDED THE IMPUGNED ORDE R. WE HAVE HEARD 2 THE LD. REPRESENTATIVES FROM BOTH THE SIDES AND CON SIDERED THE ARGUMENTS ADVANCED BY THEM. 3. BRIEF FACTS ARE THAT THE ASSESSEE IS IN THE BUSI NESS OF CONTRACTORSHIP OF EARTH WORK OF ROADS, DECLARED TAX ABLE INCOME OF RS.17,71,110/-. DURING THE YEAR, THE GROSS RECEIPT OF THE ASSESSEE, AS PER P & L ACCOUNT, COMES TO RS.8,00,91,825/-, THE M AJOR PART OF WHICH IS CONSISTING OF EARTH WORK OF RECEIPTS AMOUNTING TO R S.7,79,66,940/-. AS PER TDS CERTIFICATE, THE TOTAL RECEIPTS FOR EARTH W ORK WERE RS.7,92,81,685/-, HOWEVER, THE SAME WERE DISCLOSED AT RS.7,79,66,940/- . THE ASSESSEE VIDE WRITTEN SUBMISSION DATED 16.10. 2006 CLAIMED THAT THERE IS NO DIFFERENCE IN THE AMOUNT OF RECEIPTS AN D WRONG ENTRIES WERE MADE DUE TO WHICH THE DIFFERENCE OF RS.13,14,745/- OCCURRED, WHICH WAS ADDED TO THE INCOME OF THE ASSESSEE. BEFORE THE LD. CIT(A), THE ASSESSEE ENCLOSED THE COPY OF THE FOLLOWING ACCOUNT S FOR VERIFICATION: I) EARTH WORK RECEIVED (N.N.SITE) ACCOUNT II) EARTH WORK RECEIVED (DEWAS) ACCOUNT III) M/S. ASHOKA BUILDCON LTD. IV) M/S. D.N. SUNADERMURTI V) M/S. HANSRAJ CHATURBHUJ JAIN BADI WE HAVE FOUND THAT THE ASSESSEE FURNISHED THE RECO NCILIATION BEFORE THE LD. FIRST APPELLATE AUTHORITY WHEREIN IT WAS FOUND THAT A GENUINE MISTAKE WAS DONE BY THE ASSESSEE WHICH WAS POINTED OUT TO THE 3 ASSESSING OFFICER ALSO AS THE NET PROFIT IS NOT EFF ECTED, CONSEQUENTLY, THERE IS NO INFIRMITY IN THE IMPUGNED ORDER. IT IS UPHELD. 4. THE NEXT GROUND RAISED IS WHETHER THE LD. CIT(A) IS CORRECT IN DELETING THE ADDITION OF DISALLOWANCE OF RS.1,42,82 6/- OUT OF DIESEL EXPENSES WITHOUT AFFORDING OPPORTUNITY, OF BEING HE ARD, TO THE ASSESSING OFFICER. THE CRUX OF ARGUMENTS ON BEHALF OF THE REV ENUE IS IN SUPPORT OF THE ASSESSMENT ORDER WHEREAS THE LD. COUNSEL FOR TH E ASSESSEE DEFENDED THE IMPUGNED ORDER. WE HAVE FOUND THAT THE ASSESSEE DEBITED A SUM OF RS.3,90,19,258/- AS MACHINERY RUNNING AND MAINTENANCE EXPENSES IN ITS P & L ACCOUNT AND FURTHER A SUM OF RS.4,12,994/- WAS SHOWN AS DIESEL ACCOUNT. THE ASSESSEE VIDE LETTER D ATED 24.11.2006 SUBMITTED ITS POSITION AS DETAILED AT PAGE 3 OF THE ASSESSMENT ORDER. THE ASSESSING OFFICER DOUBTED THE CLAIM OF DIESEL EXPEN SES AS A HUGE AMOUNT HAS ALREADY BEEN DEBITED ON ACCOUNT OF RUNNI NG AND MAINTENANCE OF MACHINERY AND VEHICLES. HOWEVER, THE RE IS A FINDING IN THE IMPUGNED ORDER THAT THE ASSESSEE HAS DEBITED ON LY THAT AMOUNT OF DIESEL WHICH WAS USED IN MACHINERY AND REMAINING AM OUNT WAS CREDITED IN P & L ACCOUNT. THE DIESEL ACCOUNT, WHICH WAS IN THE EXPENSES ACCOUNT, WAS DULY EXPLAINED. THE IMPUGNED AMOUNT IS THE DIFFERENCE ALLOCATED TO SHORTAGE, SPOILAGE AND EVAPORATION. TH E COPY OF THE DIESEL ACCOUNT WAS DULY FILED AS PER WHICH THE TOTAL PURCH ASE OF DIESEL AMOUNTED TO RS.2.66 CRORES, THEREFORE, THERE IS A P OSSIBILITY OF 4 EVAPORATION ETC. WHICH IS NOT UNUSUAL, CONSEQUENTLY , KEEPING IN VIEW THE PURCHASE OF HUGE QUANTITY OF DIESEL, SUCH AN ADDITI ON CANNOT BE SAID TO BE JUSTIFIED, CONSEQUENTLY, THERE IS NO INFIRMITY O N THE IMPUGNED ISSUE ALSO. FINALLY, APPEAL OF THE REVENUE IS HAVING NO MERIT, HENCE DISMISSED. 5. ORDER PRONOUNCED IN OPEN COURT ON 4TH MAY, 2010. SD SD (V.K. GUPTA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER MAY 4 TH , 2010 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, G UARD FILE !VYAS!