The ACIT, Central Circle-1, Surat V. Shree Ambay Handling and Transport Pvt.Ltd., Kolkatta

ITSSA 58/AHD/2013

• Counselvise Citation: [2013] 121 COUNSELVISE.COM (IT) 9399 (ITAT-AHMEDABAD)
• Duration Of Justice: 7 month(s) 11 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 13-09-2013
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 14-08-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 01-02-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: D S KALYAN SHRI MEHUL R SHAH
• Keywords: Additional evidence

Judgement Text

, , , , , , , , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD . , !' # $ $ $ $ % &', # BEFORE SHRI A.MOHAN ALANKAMONY,ACCOUNTANT MEMBER AND SHRI KUL BHARAT, JUDICIAL MEMBER APPEAL(S) BY APPELLANT VS. RESPONDENT SL. NO(S). IT(SS)A NO(S) ASSESSMENT YEAR(S) APPELLANT (S) RESPONDENT(S) 1. 58/AHD/2013 2008-09 THE ASST.CIT CENTRAL CIRCLE-1, SURAT (REVENUE) SHREE AMBAY HANDLING AND TRANSPORT PVT.LTD. 191, RAVINDRA SARAI, 1 ST FLOOR, KOLKATTA WEST BENGAL PAN:AAICS6562Q (ASSESSEE) 2. 59/AHD/2013 2009-10 -DO- -DO- 3. 60/AHD/2013 2010-11 -DO- -DO- 4. 105/AHD/2013 2008-09 ASSESSEE REVENUE 5. 106/AHD/2013 2009-10 ASSESSEE REVENUE 6. 107/AHD/2013 2010-11 ASSESSEE REVENUE REVENUE BY : SHRI D.S. KALYAN, CIT-DR ASSESSEE BY : SHRI MEHUL R.SHAH, AR %$( ) '' / DATE OF HEARING : 14/08/2013 *+ ) '' / DATE OF PRONOUNCEMENT : 13/9/2013 !, / O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER : OUT OF THIS BUNCH OF 6 APPEALS, THERE ARE THREE A PPEALS FILED BY THE REVENUE IN RESPECT OF AYS 2008-09, 2009-10 & 2010-11 AND REMA INING THREE APPEALS ARE FILED BY THE ASSESSEE FOR AYS 2008-09, 2009-10 & 2010-11 AND ALL THESE APPEALS ARE DIRECTED AGAINST A COMBINED ORDER OF LD.CIT(APPEALS )-II AHMEDABAD (CIT(A) FOR SHORT) DATED 21/11/2012. SINCE COMMON ISSUES ARE INVOLVE D, ALL THESE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY WAY OF THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. IT(SS)A NOS.58 TO 60 /AHD/2013 (BY REVENUE) AND IT(SS)A NOS.105 TO 107/AHD/2013(BY ASSESSEE) THE ASST.CIT VS. SHREE AMBAY HANDLING AND TRANSPORT P.LTD. ASST.YEARS 2008-09, 2009-10 & 2010-11 - 2 - 2. FIRST, WE TAKE UP THE REVENUES APPEAL, I.E. IT( SS)A NO.58/AHD/2013 FOR AY 2008-09 AS A LEAD CASE. THE REVENUE HAS RAISED FOL LOWING GROUNDS OF APPEAL: 1) THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN ADMI TTING ADDITIONAL EVIDENCES WITHOUT GIVING THE AO AN OPPORTUNITY TO O FFER HIS COMMENTS IN CONTRAVENTION OF PROVISIONS OF RULE 46A OF THE I.T. RULES AS SUCH EVIDENCES WERE NOT SUBMITTED BEFORE THE AO DURING A SSESSMENT PROCEEDINGS. 2) THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELE TING ADDITION OF RS.31,66,650/- (FOR AY 2009-10 RS.54,38,907/- & FOR AY 2010-11 RS.66,37,729/-) OUT OF TOTAL ADDITION OF RS.49,98,2 55/- ((FOR AY 2009-10 RS.78,92,357/- & FOR AY 2010-11 RS.89,89,241/-) MAD E ON ACCOUNT OF DISALLOWANCE OF NON-GENUINE EXPENSES CLAIMED AS VE HICLE RUNNING EXPENSES, EVEN THOUGH THE ASSESSEE HAS TOTALLY FAI LED TO DISCHARGE THE ONUS BY FURNISHING EVIDENCES TO PROVE THAT SUCH EXP ENDITURE WAS GENUINE. 3) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE A.O. 4) IT IS THEREFORE, PRAYED THAT THE ORDER OF THE LD.CI T(A) BE SET ASIDE THAT OF THE AO BE RESTORED TO THE ABOVE EXTENT. 2. FOR AY 2008-09, BRIEFLY STATED FACTS ARE THAT A SEARCH ACTION U/S.132 OF THE IT ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) WA S CARRIED OUT AT THE BUSINESS AS WELL AS RESIDENTIAL PREMISES OF PIRAMAL GROUP OF CASES O N 11/02/2010. SUBSEQUENTLY, A NOTICE U/S.153A OF THE ACT WAS ISSUED TO THE ASSESS EE AND IN RESPONSE THEREOF THE ASSESSEE FILED HIS RETURN OF INCOME OF ` 2,41,830/-. THE ASSESSING OFFICER (AO) FRAMED ASSESSMENT U/S.143(3) R.W.S.153A OF THE IT A CT, 1961 VIDE ORDER DATED 15/12/2011. THE AO WHILE FRAMING THE ASSESSMENT, M ADE SOLITARY ADDITION OF RS.49,98,255/- IN RESPECT OF DISALLOWANCE OF VEHICL E RUNNING EXPENDITURE. THE ASSESSEE CARRIED THE MATTER BEFORE THE LD.CIT(A), W HO AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, DELETED THIS ADDITION TO THE EXTENT OF RS.31,66,650/- AND BALANCE WAS CONFIRMED TO THE TUNE OF RS.18,31,605/ - . IT(SS)A NOS.58 TO 60 /AHD/2013 (BY REVENUE) AND IT(SS)A NOS.105 TO 107/AHD/2013(BY ASSESSEE) THE ASST.CIT VS. SHREE AMBAY HANDLING AND TRANSPORT P.LTD. ASST.YEARS 2008-09, 2009-10 & 2010-11 - 3 - 3. FIRST GROUND OF APPEAL OF THE REVENUE IS AGAINST IN ADMITTING ADDITIONAL EVIDENCES WITHOUT GIVING THE AO AN OPPORTUNITY TO O FFER HIS COMMENTS IN CONTRAVENTION OF PROVISIONS OF RULE 46A OF THE I.T. RULES, 1962 AND GROUND NO.2 IS AGAINST THE DELETION OF VEHICLE RUNNING EXPENDITURE . BOTH THE GROUNDS ARE INTER- CONNECTED, THEREFORE THE SAME ARE BEING DISPOSED OF TOGETHER FOR THE SAKE OF CONVENIENCE. THE CIT-DR SHRI D.S.KALYAN VEHEMENT LY ARGUED THAT THE LD.CIT(A) DECIDED THIS ISSUE WITHOUT SEEKING ANY COMMENT FROM THE AO AND ADMITTED THE ADDITIONAL EVIDENCES. HE DREW OUR ATTENTION TOWA RDS PARAGRAPH NO.4 OF THE ORDER OF THE LD.CIT(A). ON THE CONTRARY, LD.COUNSEL FOR THE ASSESSEE SHRI MEHUL R.SHAH SUBMITTED THAT THE DETAILS WERE ALSO AVAILABLE BEFO RE THE AO. THEREFORE, IT WAS NOT THE CASE OF ADMITTING ADDITIONAL EVIDENCES. HE SUB MITTED THAT IN REPLY TO SHOW-CAUSE NOTICE DATED 09/11/2011, A REPLY WAS SUBMITTED BY T HE ASSESSEE ON 30/11/2011, WHEREIN THE EXPLANATION OF THE EXPENDITURE WAS GIVE N BUT AO DID NOT CONSIDER THE SAME. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELO W. THE LD.CIT(A) IN PARAGRAPH NO.4 OF HIS ORDER HAS OBSERVED AS UNDER:- 4. DURING THE COURSE OF APPELLATE HEARING, APPELL ANT HAS SUBMITTED A BREAK- UP OF EXPENDITURE INCURRED ON EACH TRIP WHICH INCLU DES DATE OF TRANSPORTATION, NAME OF THE CITY FROM WHICH GOODS WERE TRANSPORTED AND ITS DESTINATION, WEIGHT OF GOODS LOADED IN TRUCKS, KILOMETERS, DAYS REQUIRED FOR TRANSPORTATION, STANDARD DIESEL EXPENSES FOOD EXPENSE OF DRIVER, TO LL EXPENSES AND OTHER VEHICLE MAINTENANCE EXPENDITURE INCURRED ON SUCH TR IPS FOR ASSESSMENT YEARS 2008-09, 2009-10 AND 2010-11. IT WAS ALSO STATED B Y AR THAT AS OWN VEHICLES USED IN TRANSPORTATION IN A.Y. 2009-10 AND 2010-11 WERE MORE THAN USE OF OWN VEHICLE IN A.Y. 2008-09, VEHICLE RUNNING EXPEND ITURE IN A.Y. 2009-10 AND 2010-11 IS HIGHER IN COMPARISON OF A.Y. 2008-09. 4.1. FURTHER, LD.CIT(A) IN PARAGRAPH NO.5 (AT PAGE 10) OF HIS ORDER HAS OBSERVED AS UNDER:- IT(SS)A NOS.58 TO 60 /AHD/2013 (BY REVENUE) AND IT(SS)A NOS.105 TO 107/AHD/2013(BY ASSESSEE) THE ASST.CIT VS. SHREE AMBAY HANDLING AND TRANSPORT P.LTD. ASST.YEARS 2008-09, 2009-10 & 2010-11 - 4 - ON CAREFUL CONSIDERATION OF ENTIRE DETAILS, THE APPELLANT HAS SUBMITTED THE BREAK-UP OF ADVANCE PAYMENTS MADE TO DRIVERS ON THE BASIS OF STANDARD PRE-DETERMINED AMOUNTS AND VEHICLE RUNNING EXPENSE S DEBITED IN PROFIT & LOSS ACCOUNT AS UNDER:- PARTICULARS A.Y.2008-09 A.Y. 2009-10 A.Y.2010-11 RE MARKS DIESEL 51,90,400 97,71,708 1,00,55,090 AVERAGE CONSUMPTION OF DIESEL FOR 1 KM IS COMPUTED AND AFTER CONSIDERING DIESEL RATE DURING RELEVANT PERIOD, STANDARD DIESEL REQUIREMENT IS COMPUTED. FOOD 2,25,450 4,78,625 4,80,200 RS.150 PER DAY PER PERSON IS CONSIDERED TOLL 13,78,500 17,44,000 17,41,000 DEPENDING UPON DESTINATION STANDARD TOLL IS WORKED OUT OTHERS 4,63,500 8,46,000 5,54,000 SAME AS ABOVE SUB-TOTAL(A) 72,57,850 1,28,40,333 1,28,30,290 ADD: EXTRA ADVANCE TO GO FROM UNLOADING POINT TO RETURN LOADING POINT 11,57,293 10,20,583 8,08,497 SUB-TOTAL(B) 84,15,143 1,38,60,916 1,36,38,787 LESS: DIESEL PURCHASED SEPARATELY DEBITED IN PROFIT & LOSS ACCOUNT(C) 34,16,888 59,68,559 46,59,546 DIESEL PRE- FILLED IN TRUCK AND PAID THROUGH CHEQUE IS SEPARATELY IT(SS)A NOS.58 TO 60 /AHD/2013 (BY REVENUE) AND IT(SS)A NOS.105 TO 107/AHD/2013(BY ASSESSEE) THE ASST.CIT VS. SHREE AMBAY HANDLING AND TRANSPORT P.LTD. ASST.YEARS 2008-09, 2009-10 & 2010-11 - 5 - DEBITED VEHICLE RUNNING EXPENSES (B- C). THIS AMOUNT IS DISALLOWED BY ASSESSING OFFICER 49,98,255 78,92,357 89,89,241 4.2. IT IS ALSO OBSERVED BY THE LD.CIT(A) THAT FROM THE COPY OF TRADING AND PROFIT AND LOSS ACCOUNT FILED WITH THE RETURN OF INCOME AN D PRODUCED DURING THE APPELLATE PROCEEDINGS, IT IS CLEAR THAT DIRECT EXPENSES DEBIT ED AS PER SCHEDULE-J INCLUDE FREIGHT PAYMENT, DIESEL PURCHASE, REPAIRS AND MAINTENANCE E XPENSES, TYRE PURCHASE AND VEHICLE RUNNING EXPENSES. IT ALSO CONFIRMS THAT T OLL CHARGES, FOOD CHARGES TO DRIVER AND KHALASIS AND OTHER MISCELLANEOUS EXPENDITURE AR E NOT DEBITED SEPARATELY UNDER THE HEARD DIRECT EXPENSES, BUT ARE INCLUDED IN THE DI FFERENTIAL AMOUNT DEBITED UNDER THE HEARD VEHICLE RUNNING EXPENSES AND EXTRA ADVANCE TO GO FROM UNLOADING POINT TO RETURN LOADING POINT. WE FIND THAT THE UNDISPUTED FACT REMAINS THAT NO REMAND REPORT ON THE DETAILS FURNISHED BY THE ASSESSEE DURING THE APPELLATE PROCEEDINGS BEFORE LD.CIT(A) WAS SOUGHT. LD.CIT(A) HAS DECIDED THE IS SUE OF DISALLOWANCE OF VEHICLE RUNNING EXPENSES ON THE BASIS OF THE DETAILS SUBMIT TED BY THE ASSESSEE. IN OUR CONSIDERED VIEW, THIS WAS NOT JUSTIFIED AS THE AO W AS NOT GIVEN OPPORTUNITY TO MAKE SUBMISSIONS QUA DETAILS SUBMITTED BY THE ASSESSEE. THEREFORE, THIS ISSUE IS REMITTED BACK TO THE FILE OF LD.CIT(A) TO DECIDE IT AFRESH. THE LD.CIT(A) IS HEREBY DIRECTED TO DECIDE THE ISSUE OF DISALLOWANCE OF VEHICLE RUNNIN G EXPENSES, AFTER GIVING REASONABLE OPPORTUNITY OF HEARING TO BOTH THE PARTI ES. HENCE, THE GROUND NOS.1 AND 2 OF THE REVENUES APPEAL ARE ALLOWED FOR STATISTICAL PURPOSES. 5. GROUND NOS.3 & 4 OF REVENUES APPEAL ARE GENERAL IN NATURE WHICH REQUIRE NO INDEPENDENT ADJUDICATION. 6. IN THE RESULT, REVENUES APPEAL FOR AY 2008-09 I S ALLOWED FOR STATISTICAL PURPOSES ONLY. IT(SS)A NOS.58 TO 60 /AHD/2013 (BY REVENUE) AND IT(SS)A NOS.105 TO 107/AHD/2013(BY ASSESSEE) THE ASST.CIT VS. SHREE AMBAY HANDLING AND TRANSPORT P.LTD. ASST.YEARS 2008-09, 2009-10 & 2010-11 - 6 - 7. NOW, WE TAKE UP REMAINING TWO APPEALS OF REVENUE , I.E. IT(SS)A NOS.59 & 60/AHD/2013 FOR AYS 2009-10 & 2010-11 RESPECTIVELY. 8. SINCE THE FACTS AND CIRCUMSTANCES ARE SIMILAR TO THE FACTS AND CIRCUMSTANCES IN REVENUES APPEAL IN ASSESSEES OWN CASE IN IT(SS)A NO.58/AHD/2013 FOR AY 2008- 09(SUPRA), FOLLOWING THE SAME REASONING, WE HEREBY REMIT THIS ISSUE ALSO BACK TO THE FILE OF CIT(A) FOR BOTH THE YEARS. AS A RESULT, R EVENUES APPEALS FOR AYS 2009-10 & 2010-11 BOTH ARE ALLOWED BUT FOR STATISTICAL PURPOS ES. 9. NOW, WE TAKE UP THE ASSESSEES APPEALS, I.E. I T(SS)A NOS.105, 106 & 107/AHD/2013 FOR AYS 2008-09, 2009-10 & 2010-11. T HE ASSESSEE HAS RAISED THE FOLLOWING COMMON GROUNDS OF APPEAL. 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE AS WELL AS LAW ON THE SUBJECT, THE LEARNED COMMISSIONER OF INCOME-TAX(APP EALS) HAS ERRED IN PARTLY CONFIRMING THE ACTION OF ASSESSING OFFICER I N MAKING DISALLOWANCE OF VEHICLE RUNNING EXPENSE BY SUSTAINING THE DISALLOWA NCE TO THE EXTENT OF RS.18,31,605/- (FOR AY 2009-10 RS.24,53,450/- & FOR AY 2010-11 RS.23,51,512/- ) AS AGAINST THE DISALLOWANCE OF RS .49,98,255/- (FOR AY 2009-10 RS.78,92,357/- & FOR AY 2010-11 RS.89,89 ,241/- )MADE BY ASSESSING OFFICER. 2. IT IS THEREFORE PRAYED THAT THE ABOVE ADDITION MADE BY ASSESSING OFFICER AND CONFIRMED BY COMMISSIONER OF INCOME-TAX (APPEAL S) MAY PLEASE BE DELETED. 10. THE ONLY ISSUE IN THIS APPEAL IS AGAINST THE D ISALLOWANCE OF VEHICLE RUNNING EXPENSES. THE REVENUE HAS ALSO CHALLENGED DELETION OF DISALLOWANCE OF VEHICLE RUNNING EXPENSES IN THREE ASSESSMENT YEARS, I.E. A YS 2008-09, 2009-10 & 2010-11 BY WAY OF IT(SS)A NOS.58 TO 60/AHD/2013(SUPRA). IN THESE APPEALS, WE HAVE RESTORED THE ISSUE BACK TO THE FILE OF THE LD.CIT(A) FOR FRE SH DECISION. SINCE THE FACTS ARE IDENTICAL AND THERE IS NO CHANGE IN THE FACTS AND C IRCUMSTANCES POINTED OUT BY BOTH THE IT(SS)A NOS.58 TO 60 /AHD/2013 (BY REVENUE) AND IT(SS)A NOS.105 TO 107/AHD/2013(BY ASSESSEE) THE ASST.CIT VS. SHREE AMBAY HANDLING AND TRANSPORT P.LTD. ASST.YEARS 2008-09, 2009-10 & 2010-11 - 7 - SIDES, THEREFORE FOLLOWING OUR DECISION RENDERED IN REVENUES APPEALS(SUPRA), THIS GROUND OF ASSESSEES APPEALS IS ALSO ALLOWED FOR STATISTICAL PURPOSES. 11. IN THE COMBINED RESULT, REVENUES APPEALS AND ASS ESSEES APPEALS ARE ALLOWED BUT FOR STATISTICAL PURPOSES ONLY. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE SD/- SD/- (. ) (% &') !' # # ( A. MOHAN ALANKAMONY ) ( KUL BHARAT ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 13 / 9 /2013 0.., $.../ T.C. NAIR, SR. PS !, ) 1'2 3!2+' !, ) 1'2 3!2+' !, ) 1'2 3!2+' !, ) 1'2 3!2+'/ COPY OF THE ORDER FORWARDED TO : 1. 45 / THE APPELLANT 2. 1645 / THE RESPONDENT. 3. ' %7 / CONCERNED CIT 4. %7() / THE CIT(A)-II, AHMEDABAD 5. 2$&8 1' , , / DR, ITAT, AHMEDABAD 6. 89 :( / GUARD FILE. !,% !,% !,% !,% / BY ORDER, 62' 1' //TRUE COPY// ; ;; ;/ // / < < < < (DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 02/09/2013(DICTATION-PAD 1 1 PAGES ATTACHED AT THE END OF THIS FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 03/09/2013 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 5. DATE ON WHICH FAIR ORDER PLACED BEFORE OTHER MEMBER 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.13.9.13 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 13.9.13 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER