Sh. Sudhir Sood, Kangra V. ITO, Dharamashala

ITA 998/CHANDI/2009

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 8435 (ITAT-CHANDIGARH)
• Duration Of Justice: 11 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-10-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 12-08-2010
• Assessment Year: 2002-2003
• Appeal Filed On: 21-10-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JAI SHREE SHARMA
• Keywords: Depreciation; Diversion of income; Condonation of delay

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES B CHANDIGARH BEFORE SHRI G.S.PANNU, ACCOUNTANT MEMBER AND MS SUSHMA CHOWLA, JUDICIAL MEMBER ITA NO. 998 TO 1000/CHD/2009 ASSESSMENT YEARS: 2002-03 TO 2004-05 SHRI SUDHIR SOOD, VS. THE ITO, PROPRIETOR. SHIVAM PETRO DEALS, DHARAMSHALA KANGRA (H.P) PAN NO. ADNPS 7527G (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ASHWANI KUMAR RESPONDENT BY: SMT. JAISHREE SHARMA ORDER PER SUSHMA CHOWLA, JM THESE THREE APPEALS BY THE ASSESSEE ARE AGAINST TH E ORDER OF CIT(A), SHIMLA DATED 26.3.2009 RELATING TO ASSESSMENT YEARS 2002-03 TO 2004-05 AGAINST THE ORDER PASSED UNDER SECTION 143 (3) / 14 7 OF THE I.T. ACT. 2. THE ASSESSEE HAS RAISED THE FOLLOWING COMMON GRO UNDS OF APPEAL IN ALL THE APPEALS:- I) THAT THE ORDER OF CIT(A) IS AGAINST LAW AND FACTS O N THE FILE. II) THAT THE CIT(A) IS NOT JUSTIFIED IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER, WHO HAS MADE AN ADDITION OF RS. 9,44,242/- (ASSESSMENT YEAR 2002-03), RS. 3,01,110/ - (ASSESSMENT YEAR 2003-04) AND RS. 2,45,514/- (ASSES SMENT YEAR 2004-05) FOR RESPECTIVE ASSESSMENT YEARS ON A CCOUNT OF PAYMENT MADE BY THE ASSESSEE TO SHRI UDYA SOOD, WHO SE TRUCK WAS HIRED BY THE ASSESSEE FOR THE CARRIAGE OF DIES EL AND PETROL FOR HIS FILLING STATION. THE VEHICLE WAS HIR ED AS PER AGREEMENT SIGNED WITH INDIAN OIL CORPORATION. THE P AYMENTS WERE MADE THROUGH BOOKS OF ACCOUNT FROM TIME TO TIM E. NECESSARY EVIDENCE TO THIS EFFECT WAS PLACED ON REC ORD DURING 2 ASSESSMENT PROCEEDINGS AND BEFORE THE FIRST APPELLA TE AUTHORITY ALSO. . III) THE ORDER OF THE ASSESSING OFFICER DESERVES TO BE Q UASHED AS THE SAME IS NOT BASED ON FACTS, ILLEGAL AND BAD IN LAW. 3. ALL THESE APPEALS HAVING COMMON GROUNDS OF APPEA L WERE HEARD TOGETHER AND ARE BEING DISPOSED OFF BY THIS CONSOLI DATED ORDER FOR THE SAKE OF CONVENIENCE. 4. THE IDENTICAL ISSUE RAISED IN THE APPEALS FILED BY THE ASSESSEE ARE AGAINST THE ADDITIONS MADE ON ACCOUNT OF PAYMENTS RECEIVED AGAINST TRUCK HIRE CHARGES. 5. THE APPEALS IN ITA NOS. 998 TO 1000/CHD/2009 HAV E BEEN FILED BY THE ASSESSEE AFTER A DELAY OF 31 DAYS. THE ASSESS EE HAS MOVED AN APPLICATION FOR CONDONATION OF DELAY IN FURNISHING THE APPEALS BEFORE US BELATEDLY AFTER A DELAY OF 31 DAYS. THE AFFIDAVIT OF THE ASSESSEE IS ALSO FILED ON RECORD UNDER WHICH IT WAS EXPLAINED THAT B ECAUSE OF CERTAIN LEGAL PROBLEMS, THIS LICENSE WAS CANCELLED TWO YEARS AGO BY IOC AND THE PETROL PUMP WAS ASSIGNED TO SOME OTHER PERSON. THE ASSES SEE FURTHER CLAIMED THAT HIS ENTIRE MAIL WAS SENT TO THE OLD ADDRESS OF THE PETROL PUMP. SINCE THERE WAS NO BUSINESS, HE HAD NO FUNDS TO PAY THE TRIBUNAL FEE AND THE FILING OF THE APPEAL WAS FURTHER DELAYED. IN VIEW OF THE REASONS ADVANCED BY THE ASSESSEE, WE CONDONE THE DELAY OF 31 DAYS IN FILING THE APPEALS BELATEDLY AND PROCEED TO TAKE THE SAME ON RECORD. 6. THE FACTS IN ALL THE APPEALS BEFORE US ARE IDENT ICAL, HOWEVER,, A REFERENCE IS BEING MADE TO THE FACTS IN ITA NO.998/ CHANDI/2009 RELATING TO ASSESSMENT YEAR 2002-03 FOR ADJUDICATING THE ISS UE. THE BRIEF FACTS OF 3 THE CASE ARE THAT THE ASSESSEE WAS CARRYING ON THE BUSINESS OF RUNNING OF PETROL PUMP AT JAWALAMUKHI. THE RE-ASSESSMENT PROC EEDINGS WERE INITIATED U/S 147/148 OF THE ACT. THE ASSESSING OF FICER NOTED THE ASSESSEE TO BE IN RECEIPT OF TANKER FREIGHT RECEIPTS. FROM THE PERUSAL OF THE COPY OF TDS CERTIFICATES ISSUED BY IOC, AMBALA CANTT, ATTAC HED WITH THE RETURN OF INCOME, THE ASSESSING OFFICER NOTED THAT THE AMOUNT S PAID TO THE ASSESSEE THROUGH CHEQUES ON ACCOUNT OF TANKER FREIGHT RECEIP TS AMOUNTED TO RS.25,14,340/-. THE ASSESSING OFFICER ON THE EXAMI NATION OF BOOKS OF ACCOUNT FOUND THE ASSESSEE TO HAVE CREDITED RECEIPT S OF RS.15,70,098/- ONLY. THE ASSESSEE WAS SHOW CAUSED TO EXPLAIN WHY THE ENTIRE RECEIPTS SHOULD NOT BE ASSESSED IN HIS HANDS AS IT HAD CLAIM ED CREDIT OF ENTIRE TDS AS WELL EXPENSES OF RS.8,15,605/- UNDER THE HEAD TA NKER RUNNING EXPENSES, DEPRECIATION OF RS.2,33,123/- AND INTEREST ON BANK LOAN OF RS.4,85,982/- WAS ALSO DEBITED. THE EXPLANATION OF THE ASSESSEE WAS THAT THE TANKER OF HIS BROTHER WAS ATTACHED WITH THE IOC AS PER THEIR REQUIREMENT, BUT DUE TO SOME TECHNICAL DIFFICULTIES THE TDS CERTIFICATES OF FREIGHT RECEIPTS WERE ISSUED BY THE IOC IN THE NAME OF THE ASSESSEE. TH E ASSESSING OFFICER OBSERVED THAT THE ASSESSEE FAILED TO FURNISH ANY SU CH EVIDENCE FROM THE IOC AS TO UNDER WHAT CIRCUMSTANCES THE TANKER OF SH RI UDAY SOOD, HIS BROTHER HAS BEEN ATTACHED WITH IOC AND WHY THE TDS CERTIFICATE WAS NOT ISSUED IN THE NAME OF SHRI UDAY SOOD. THE ASSESSE E DURING THE COURSE OF ASSESSMENT PROCEEDINGS FILED THE LEDGER ACCOUNT APP EARING IN ITS BOOKS OF ACCOUNT REGARDING TANKER NO.HP 382530, WHICH IS IN THE NAME OF SHRI UDAY SOOD. AS PER THE ASSESSEE CHEQUES WERE ISSUE D TO SHRI UDAY SOOD AFTER APPORTIONING THE TOTAL RECEIPTS FROM THE IOC BETWEEN THE ASSESSEE AND UDAY SOOD. THE ASSESSEE ALSO EXPLAINED THAT TH E OIL HAD BEEN USED IN THE TANKER OF SHRI UDAY SOOD AND THE CHARGES FOR SU CH OIL WERE DEBITED TO HIS ACCOUNT AND ALSO THE CHARGES OF TYRES / TUBES BORNE BY THE ASSESSEE 4 WERE DEBITED TO THE ACCOUNT OF SHRI UDAY SOOD. TH E ASSESSING OFFICER OBSERVED THAT THE ASSESSEE HAD BORNE THE EXPENSES B UT HAS FAILED TO FILE ANY DETAIL OF ANY AGREEMENT BETWEEN THE ASSESSEE AN D SHRI UDAY SOOD OR BETWEEN UDAY AND IOC. THE ASSESSING OFFICER HELD THAT IN VIEW THE ASSESSEE CLAIMING EXPENDITURE OF RS.10,48,729/- PL US INTEREST, HE WAS BOUND TO DECLARE THE TOTAL RECEIPTS IN HIS HANDS AN D ALSO AS IT HAD CLAIMED THE CREDIT OF ENTIRE TDS IN ITS RETURNS, THE SAID R ECEIPTS SHOULD HAVE BEEN DECLARED BY THE ASSESSEE. THE PLEA OF THE ASSESSEE THAT SHRI UDAY SOOD HAD FILED ITS RETURN UNDER THE PROVISIONS OF SECTIO N 44AE OF THE ACT WAS NOT ACCEPTED BY THE ASSESSING OFFICER. THE ASSESSI NG OFFICER HELD THAT IN CASE THE SAID RECEIPTS WERE INCLUDED IN THE GROSS R ECEIPTS OF THE ASSESSEE TAX WOULD HAVE BEEN PAID BY THE ASSESSEE @ 30%. HO WEVER, NO TAX WAS PAID BY SHRI UDAY SOOD. THIS WAS HELD TO BE A CAS E OF DIVERSION OF RECEIPTS/INCOME AND THE RECEIPT OF RS.9,44,242/- W ERE INCLUDED AS INCOME OF THE ASSESSEE. THE CIT(A) UPHELD THE ORDER OF T HE ASSESSING OFFICER IN VIEW OF NO AGREEMENT BETWEEN THE PARTIES AND NO CON FIRMATION/BANK ACCOUNT OF UDAY SOOD BEING FILED TO PROVE THE RECEI PTS OF PAYMENT FROM THE ASSESSEE. FURTHER, IT WAS HELD BY THE CIT(A) MERE ENTRIES IN THE BOOKS OF ACCOUNT OF THE ASSESSEE DOES NOT PROVE THE PAYMENT MADE BY THE ASSESSEE AND THE SAME BEING NOT SUPPORTED BY CORROB ORATED EVIDENCE, THE ONUS PLACED UPON THE ASSESSEE HAS NOT BEEN DISCHARG ED. ACCORDINGLY, THE ADDITIONS MADE BY THE ASSESSING OFFICER WERE UPHELD . 7. THE LD. AR FOR THE ASSESSEE POINTED THAT NO EXPE NDITURE ON ACCOUNT OF DIESEL USED IN THE TANKER BELONGING TO SHRI UDAY SOOD WAS ACCOUNTED FOR IN THE PROFIT & LOSS ACCOUNT OF THE ASSESSEE. ONLY EXPENDITURE INCURRED ON THE TANKER OF THE ASSESSEE WAS ACCOUNTE D FOR AND CLAIMED AN EXPENDITURE. THE LD. AR FOR THE ASSESSEE POINTED OUT THAT THE ASSESSEE 5 HAD INCLUDED TANKER INCOME OF RS.15,70,098 AND THE TDS CREDIT WAS AVAILED BY THE ASSESSEE BY INCLUDING THE AMOUNT OF TDS IN ITS RETURN OF INCOME. THE LD. AR FOR THE ASSESSEE FURTHER POINTE D OUT THAT THE PROOF OF OWNERSHIP OF THE TANKER OF SHRI UDAY SOOD I.E HP 3 82530 WAS FILED BEFORE THE CIT(A). OUR ATTENTION WAS DRAWN TO THE ORDER OF THE CIT(A) WHEREIN ASSESSING OFFICER IN REMAND PROCEEDINGS VER IFIED THE STAND OF THE ASSESSEE THAT IT HAD NOT CLAIMED THE EXPENSES ON AC COUNT OF TANKER OWNED BY SHRI UDAY SOOD AND THE BOOKS OF ACCOUNT WERE PRO DUCED BEFORE THE ASSESSING OFFICER. THE ASSESSING OFFICER WAS ALSO ASKED TO VERIFY THE RETURN OF INCOME FILED BY SHRI UDAY SOOD U/S 44AE O F THE ACT. THE LD. DR FOR THE REVENUE POINTED THAT THE ENTIRE HIRE CHA RGES WERE PAID TO THE ASSESSEE BY THE IOC AND THE TDS CERTIFICATE WAS ALS O ISSUED IN THE NAME OF THE ASSESSEE. HOWEVER, THE ASSESSEE HAD NOT ACC OUNTED FOR SUCH RECEIPTS AND THE DIFFERENCE IN RECEIPTS NOT ACCOUNT ED FOR BY THE ASSESSEE WAS DIVERSION OF INCOME AND THE SAME ARE TO BE INCL UDED IN THE HANDS OF THE ASSESSEE. IN REJOINDER, THE LD. AR FOR THE ASS ESSEE CLARIFIED THAT IN ASSESSMENT PROCEEDINGS NO BOOKS OF ACCOUNT WERE PRO DUCED, HOWEVER, IN REMAND PROCEEDINGS BEFORE ASSESSING OFFICER, COMPLE TE BOOKS OF ACCOUNT WERE PRODUCED. THE LD. AR FOR THE ASSESSEE FURTHER CLAIMED THAT THE ENTIRE RECEIPTS COULD HAVE BEEN SHOWN IN THE HANDS OF THE ASSESSEE AND THE INCOME RELATING TO SHRI UDAY SOOD BE EXCLUDED. HIS FURTHER CONTENTION WAS THAT EVEN IF THERE WAS AN ACCOUNTING ERROR, THE RECEIPTS COULD NOT BE HELD OF THE ASSESSEE. 8. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ASSESSEE WAS CARRYING THE BUSINESS OF RUNNING OF PE TROL PUMP AT JWALAMUKHI. DURING THE YEAR, IN ADDITION, THE ASSE SSEE HAD SHOWN INCOME FROM TANKER HIRE CHARGES. THE CLAIM OF THE ASSESS EE WAS THAT IT HAD 6 ATTACHED TWO TANKERS TO IOC OUT OF WHICH ONE BELONG S TO HIS BROTHER SHRI UDAY SOOD. SEPARATE BILLS WERE RAISED FOR THE TWO TANKERS AND SEPARATE ACCOUNTS WERE APPEARING IN THE BOOKS OF ACCOUNT FOR BOTH THE TANKERS. THE ASSESSEE CLAIMS THAT THE FREIGHT RECEIVED FROM THE HIRED TANKER OF SHRI UDAY SOOD WAS CREDITED TO HIS ACCOUNT. THE BALANC E RECEIPTS WERE CREDITED TO THE ACCOUNT OF THE ASSESSEE AND WERE RE FLECTED AS HIS INCOME IN THE PROFIT & LOSS ACCOUNT. THE ASSESSEE CLAIMS TO HAVE FILED THE PROOF OF OWNERSHIP OF TANKER NO.HP 382530 BEFORE THE CIT(A) AS NOTED BY THE CIT(A) AT PAGE-3 OF THE APPELLATE ORDER. THE NEXT PLEA OF THE ASSESSEE WAS THAT THE EXPENDITURE CLAIMED IN THE PROFIT & LO SS ACCOUNT WAS IN RELATION TO THE TANKER OWNED BY THE ASSESSEE AND NO EXPENDITURE RELATING TO THE TANKER OWNED BY SHRI UDAY SOOD WAS CLAIMED B Y THE ASSESSEE. EVEN IF ANY EXPENDITURE WAS INCURRED ON BEHALF OF UDHAY SOOD, THE SAME WAS DEBITED TO HIS ACCOUNT. DURING THE APPELLATE PRO CEEDINGS, THE ASSESSING OFFICER WAS DIRECTED TO VERIFY THE FACTS REGARDING THE PAYMENT MADE BY THE ASSESSEE TO SHRI UDAY SOOD AND SUBMIT HIS REPORT. THE ASSESSEE PRODUCED THE BOOKS OF ACCOUNT FOR THE YEAR UNDER APPEAL BEFO RE THE ASSESSING OFFICER IN REMAND PROCEEDINGS AND THE ASSESSING OFF ICER VIDE LETTER DATED 23.3.2009, REPORTED AS UNDER :- IN CONTINUATION OF THE ABOVE NOTED LETTER IT IS SU BMITTED THAT ABOVE NOT ASSESSEE ALONGWITH HIS COUNSEL ATTENDED T HIS OFFICE ON 18.3.2009 AND PRODUCED HIS ACCOUNT BOOKS FROM TH E ASSESSMENT YEARS 2002-03, 2003-04 & 2004-05 BEFORE THE UNDERSIGNED. I HAVE PERSONALLY VERIFIED FROM THE L EDGERS OF THE ASSESSEE COPIES OF ACCOUNT FOR THE THREE YEARS IN RESPECT OF SHRI UDHAY SOOD AS APPEARING IN THE BOOKS OF ACC OUNT OF THE ASSESSEE SHRI SUDHIR SOOD. I HAVE ALSO TAKEN EX TRACTS OF ACCOUNTS OF SHRI UDHAY SOOD FOR THE THREE YEARS. C OPIES OF THE SAME ARE HEREBY SUBMITTED FOR YOUR KIND PERUSAL . THE ACCOUNTS OF SHRI UDAY SOOD AS APPEARING IN THE BOOK S OF ACCOUNT OF THE ASSESSEE FOR THE THREE ASSESSMENT YE ARS (SUPRA) TALLY WITH THOSE PRODUCED BY THE ASSESSEE D URING THE ASSESSMENT PROCEEDINGS. 7 IT IS FURTHER SUBMITTED THE COUNSEL OF THE ASSESSEE HAD STATED THAT SHRI UDAY SOOD OWNER OF THE TANK REG NO. HP-38 -2530, IS NOT MAINTAINING ACCOUNT BOOKS REGARDING HIS RECE IPTS FROM THE ASSESSEE FOR THE ABOVE NOTED A. YEARS SHRI UDHA Y SOOD IS FILING HIS RETURN U/S 44AE OF THE INCOME TAX ACT, 1 961. AS SUCH, HE IS NOT MAINTAINING HIS BOOKS OF ACCOUNT. HOWEVER, IT IS APPARENT THAT SHRI UDHAY SOOD IS GETTING BENE FIT FROM THE ASSESSEE WITH REGARDS TO RUNNING & MAINTENANCE OF HIS TANKER. SO HIS CLAIM TO COMPUTE HIS TAXABLE INCOME U/S 44AE, APPEALS TO BE ERRONEOUS UNDER THE CIRCUMSTANCES. 9. ASSESSING OFFICER VIDE LETTER DATED 25.3.2009 F URTHER SUBMITTED BEFORE CIT(A) AS UNDER : IT IS SUBMITTED THAT SHRI UDAY SOOD IS AN EXISTING INCOME TAX ASSESSEE HAVING PN-AANPS-7525-E. THE PERSON HA D FILED HIS INCOME TAX RETURN FOR ASSESSMENT YEARS 20 03-04 AND 2004-05 DECLARING HIS TOTAL INCOME AT RS. 54,570-/- AND RS. 55,890/- RESPECTIVELY. SHRI UDHAY SOOD HAS COMPUTED HIS INCOME U/S 44AE OF THE INCOME TAX ACT, 1961 ARISING ON ACCOUNT OF PLYING HIS TANKER BEARING REG NO. HP-38- 2530. THE ASSESSEE HAD NOT FILED HIS RETURN OF INCOME OF ASSESSMENT YEAR 2002-03 AS HIS INCOME DURING THE YEAR WAS BELO W TAXABLE LIMIT. PHOTOCOPIES OF THE RECEIPTS OF RETU RN FOR ASSESSMENT YEARS 2003-04 AND 2004-05 ARE SUBMITTED HEREWITH. IT IS ALSO SUBMITTED THAT UDAY SOOD HAS N OT MENTIONED IN HIS COMPUTATION THAT HIS INCOME IS ON ACCOUNT OF RECEIPTS FOR HIRE OF HIS TANKER WITH SHRI SUDHIR SOOD. 10. THE CIT(A) REJECTED THE CLAIM OF THE ASSESSEE IN THE ABSENCE OF AN AGREEMENT DEED BETWEEN THE ASSESSEE AND SHRI UDAY S OOD AND ALSO THE CONFIRMATION TO PROVE THE RECEIPT OF PAYMENT BY SHR I UDAY SOOD FROM THE ASSESSEE. IN THE FACTS AND CIRCUMSTANCES OF THE PR ESENT CASE, THE ASSESSEE WAS THE OWNER OF ONE TANKER AND THE PROOF OF THE OW NERSHIP OF THE OTHER TANKER BELONGING TO HIS BROTHER SHRI UDAY SOOD WAS FURNISHED ON RECORD, AS NOTED BY THE CIT(A). BOTH THE SAID TANKERS WER E ATTACHED WITH M/S IOC AND THE ASSESSEE HAS FURNISHED ON RECORD AN IND EMNITY BOND EXECUTED IN FAVOUR OF IOC IN WHICH HE UNDERTAKES THAT THE TA NKER NO. HP 382530, REGISTERED IN THE NAME OF SHRI UDAY SOOD WOULD BE A TTACHED TO HIS TRANSPORT COMPANY BY THE SAID REGISTERED OWNER AND THE SAME WOULD BE 8 UNDER HIS CONTROL AND SUPERVISION AND SHALL BE SUBJ ECTED TO THE SAME TERMS & CONDITIONS, WHICH WOULD BE APPLICABLE TO THE TANK ER OWNED BY HIS COMPANY. THE CIT(A) HAD DIRECTED THE ASSESSING OFF ICER TO VERIFY THE FACTS REGARDING THE PAYMENTS MADE BY THE ASSESSEE T O SHRI UDAY SOOD FROM THE BOOKS OF ACCOUNT OF THE ASSESSEE AND SUBMI T HIS REPORT. THE ASSESSING OFFICER HAD VERIFIED THE STAND OF THE ASS ESSEE AND REPORTED THAT THE ACCOUNTS OF SHRI UDAY SOOD AS APPEARING IN THE BOOKS OF ACCOUNT OF THE ASSESSEE FOR THE THREE ASSESSMENT YEARS TALLIED WITH THOSE PRODUCED BY THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS. TH E FACTUM OF SHRI UDAY SOOD FILING HIS RETURN OF INCOME U/S 44AE OF THE AC T WAS ALSO REPORTED BY THE ASSESSING OFFICER IN THE SAID REPORT FILED BEFO RE CIT(A) . THE ONLY OBJECTION OF THE ASSESSING OFFICER WAS THAT THE INC OME DECLARED BY SHRI UDAY SOOD ARISING ON ACCOUNT LYING OF HIS TANKER WA S BELOW TAXABLE LIMIT AND HE HAD NOT MENTIONED THE FACT OF RECEIPT OF HIR E OF HIS TANKER WITH THE ASSESSEE, IN HIS COMPUTATION OF INCOME. 11. IN THE TOTALITY OF FACTS AND CIRCUMSTANCES OF T HE CASE, WE FIND NO MERIT IN THE STAND OF THE AUTHORITIES BELOW IN VIEW OF THE VERIFICATION EXERCISE CARRIED BY THE ASSESSING OFFICER IN REMAND PROCEEDING VIS--VIS THE BOOKS OF ACCOUNT PRODUCED BY ASSESSEE. THE ST AND OF THE ASSESSEE THAT IT HAD MADE THE PAYMENTS TO SHRI UDAY SOOD AGA INST THE HIRING OF HIS TANKER WAS VERIFIED FROM THE LEDGER OF THE ASSESSEE AND NO DISCREPANCY WAS FOUND IN THE SAME BY THE ASSESSING OFFICER IN T HE REMAND PROCEEDINGS. THE INCOME FROM THE SAID HIRE CHARGES OF THE TANKER HAS BEEN DECLARED BY SHRI UDAY SOOD THOUGH UNDER THE PROVISI ONS OF SECTION 44AE OF THE ACT. THE EXPENDITURE ON RUNNING THE SAID TAN KERS IS ALSO DEBITED TO THE ACCOUNT OF UDAY SOOD. THE ASSESSEE HAD DECLAR ED THE RECEIPTS OF HIS TANKERS AND AFTER CLAMING THE EXPENDITURE THEREON, REFLECTED THE INCOME IN 9 HIS HANDS. THOUGH THE COMPANY IOC HAS ISSUED TDS CE RTIFICATE IN RESPECT OF PAYMENTS DUE TO ASSESSEE AND UDAY SOOD, BUT THE RECEIPTS RELATABLE TO UDAY SOOD ARE TO BE EXCLUDED. IN THE PRESENT SET OF FACTS AND CIRCUMSTANCES, THE INCOME RELATING TO THE TANKER O WNED BY SHRI UDAY SOOD IS NOT INCLUDIBLE IN THE HANDS OF THE ASSESSEE AND WE DIRECT THE ASSESSING OFFICER TO EXCLUDE THE SAME. ACCORDINGLY , WE SET ASIDE THE ORDER OF CIT(A) AND DIRECT THE ASSESSING OFFICER TO DELETE THE ADDITION OF RS.9,44,242/- RELATING TO ASSESSMENT YEAR 2002-03. AS THE FACTS IN ASSESSMENT YEARS 2003-04 & 2004-05 ARE IDENTICAL TO THE FACTS IN ASSESSMENT YEAR 2002-03, FOLLOWING OUR ORDER, WE D IRECT THE ASSESSING OFFICER TO DELETE THE ADDITION OF RS.3,01,110/- IN ASSESSMENT YEAR 2003-04 AND RS.2,45,514/- IN ASSESSMENT YEAR 2004-05. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE ALLOWED. 12. IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 19 TH DAY OF OCTOBER, 2010. SD/- SD/- (G.S.PANNU) (SUSHMA CHOWLA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 19 TH OCTOBER, 2010 RKK COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR