M/s Janki Sons, Jalandhar V. Assistant Commissioner of Income Tax, range - ii, Jalandhar

MA 47/ASR/2017

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 6522 (ITAT-AMRITSAR)
• Duration Of Justice: 1 year(s) 1 month(s) 25 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 29-05-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 16-03-2018
• Assessment Year: 2011-2012
• Appeal Filed On: 03-04-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJEEV GUBGOTRA LD
• Assessee Lawyers: SANDEEP VIJH L D

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR BEFORE SH. SANJAY ARORA, ACCOUNTANT MEMBER AND SH. N.K.CHOUDHRY, JUDICIAL MEMBER M.A NO.47(ASR)/2017 ARISING OUT OF ITA NO.550(ASR)/2016 ASSESSMENT YEAR:2011- 12 M/S JANKI SONS, G.T. ROAD, JALANDHAR PAN:AAEFJ8527H VS. ASST. CIT RANGE-II, JALANDHAR (APPELLANT) (RESPONDENT) APPELLANT BY: SH. SANDEEP VIJH (LD.CA) RESPONDENT BY: SH. RAJEEV GUBGOTRA (LD. DR) DATE OF HEARING: 16.03.2018 DATE OF PRONOUNCEMENT: 29.05.2018 ORDER PER N.K.CHOUDHRY, JM: THE ASSESSEE HAS PREFERRED THE INSTANT MISCELLANEOUS APPLICATION AND SUBMITTED AS UNDER: RESPECTED SIR, THE APPEAL FILED BY THE ASSESSEE FOR THE ABOVE MEN TIONED ASSESSMENT YEAR WAS DISPOSED THROUGH CONSOLIDATED O RDER DATED 21/1/2016 IN ITA NO.550(ASR)/2016 AS WELL AS ITA NO. 340(ASR)/2016 FOR THE ASSESSMENT YEAR 2010-11 AND 2 011-12 RESPECTIVELY. WHILE DISPOSING OFF THE APPEAL IN ITA NO. 550(ASR)/2016 FOR THE ASSESSMENT YEAR 2011-12, THOU GH DISALLOWANCE OUT OF SAME EXPENSE WAS BEING DISPUTED IN GROUND NO. 1 FOR BOTH THE ASSESSMENT YEARS, THE FACTS AS B ROUGHT OUT IN THE WRITTEN SUBMISSION AT PAGE NO. 1, THE SECOND PA RA AT PAGE NO.- 2 OF THE SUBMISSION THERE WAS NO DISCREPANCY I N THE MAINTENANCE OF VOUCHERS FOR FORWARDING & DELIVERY E XPENSES, AS THAT EXISTED IN THE ASSESSMENT YEAR 2010-11 AS C ONSEQUENTLY M.A.NO.47/ASR/2017(A.Y. 2011-12) (ARISING OUT OF ITA NO.550(ASR)/2016) M/S. J ANKI SONS, JALANDHAR VS. ACIT 2 NO DISALLOWANCE WAS CALLED FOR HAS NOT BEEN CONSIDE RED. ALSO THE COMPARATIVE CHART OF THE EXPENSE WHICH SHOWS TH AT THE EXPENSE IS SUBSTANTIALLY LOWER THAN THAT OF THE EAR LIER YEARS REMAINED UNNOTICED. SINCE A COMMON ORDER FOR TWO YE ARS HAS BEEN PASSED, THIS ESSENTIAL FACT POSSIBLY ESCAPED A TTENTION. IN VIEW OF THE ABOVE, IT IS HUMBLY PRAYED THAT THE ORDER FOR THE ASSESSMENT YEAR 2011-12 MAY PLEASE BE RECAL LED AND DECIDED AFRESH. 2. THE LD. DR DID NOT RAISE ANY OBJECTION AGAINST THE GRIEVANCES OF THE ASSESSEE. 3. WE HAVE PERUSED THE CONSOLIDATED ORDER DATED 21 ST FEB. 2017, WHICH PERTAINS TO THE ASST. YEARS: 2010-11 & 2011 -12. IN ITA NO. 550(ASR)/ 2016 RELEVANT TO ASST. YEAR: 2011-12 , THE ASSESSEE HAD CHALLENGED THE ORDER DATED 29.08.2016 PASSED BY THE LD. CIT(A)-2, JALANDHAR. VIDE GROUND NO.1 IN IT A NO.550(ASR)/2016, THE ASSESSEE AVERRED THAT CIT(A) HAS ER RED IN CONFIRMING ESTIMATED DISALLOWANCE OF RS.2,00,000/- FROM OUT OF FORWARDING AND DELIVERY EXPENSES AS AGAINST THE SUM OF RS.4,16,515/- DISALLOWED BY THE ASSESSING OFFICER @ 20% O F THE SAID EXPENSE. THE SUBMISSIONS MADE ON THE ISSUE HAVE NOT BEEN PROPERLY APPRECIATED. THE CO-ORDINATE BENCH AT AMRITSA R VIDE CONSOLIDATED ORDER DATED 21 ST FEB.2017, IN PARA NO.9 OF THE ORDER, AFFIRMED THE ORDER OF THE LD. CIT(A) ON RESTR ICTION OF THE DISALLOWANCE TO THE TUNE OF RS.2,00,000/- BY HOLDING T HAT THE LD. CIT(A) HAS ALREADY ALLOWED RELIEF TO THE ASSESSEE TO TH E EXTENT OF RS.2,16,515/- WHICH IS MORE THAN 10% OF THE TOTAL EXP ENSES AND THE RELIEF IS IN ACCORDANCE WITH THE EARLIER TRIBUNAL O RDER DATED 18.10.2016. HOWEVER, THE ASSESSEE BY THE AFORESAID M.A.NO.47/ASR/2017(A.Y. 2011-12) (ARISING OUT OF ITA NO.550(ASR)/2016) M/S. J ANKI SONS, JALANDHAR VS. ACIT 3 MISCELLANEOUS APPLICATION RAISED THE ISSUE THAT THERE WAS N O DISCREPANCY IN THE MAINTENANCE OF THE VOUCHERS FOR FORWAR DING AND DELIVERY EXPENSES, AS THAT EXISTED IN THE ASST. YEAR: 2010- 11 AND CONSEQUENTLY NO DISALLOWANCE WAS CALLED FOR. WE HAVE GONE THROUGH WITH THE FACTS AND CIRCUMSTANCES OF THE CASE AND ORDERS PASSED BY THE AUTHORITIES BELOW. IN T HE ASSESSMENT ORDER PASSED BY THE AUTHORITIES BELOW VIDE PAR A NO.3.1, IT IS OBSERVED BY THE ASSESSING OFFICER THAT TH E ASSESSEES AR MADE SUBMISSIONS WHICH HAVE DULY BEEN CONSIDERED AND THE VOUCHERS WERE EXAMINED AND LOOKING T O THE ENTIRETY OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND A LSO DULY CONSIDERING THE ASSESSEES SUBMISSION, FURTHER TAKING INTO CONSIDERATION PAST HISTORY OF THE CASE, THE DISALLOWANCE @ 20% OF THE TOTAL EXPENSES WHICH WORKED OUT OF RS.4,16,515 / - AS REASONABLE. THE LD. CIT(A) VIDE PARA NO.4.5 WHILE GOING THROUG H THE SUBMISSIONS AND MATERIAL BROUGHT ON RECORD INCLUDING JUDI CIAL CITATIONS OBSERVED THAT THE PRIMARY GROUND TAKEN BY TH E AO WAS THAT COMPLETE SUPPORTING VOUCHERS FOR THE EXPENSES CLAIM ED UNDER THIS HEAD COULD NOT BE PRODUCED IN THE COURSE OF EXAMINATION OF BOOKS OF ACCOUNTS. FURTHER, THE AO HAD P LACED HIS RELIANCE ON THE ORDERS PASSED FOR THE PRECEDING YEAR S WHEREIN SIMILAR DISALLOWANCES HAVE BEEN MADE. HOWEVER, AFTER CONSIDERING THE SUBMISSIONS WITH REGARD TO THE RATIO OF EXPENSES, THE LD. CIT(A) FOUND FORCE IN THE CONTENTIONS OF THE APPELLANT/ASSESSEE AS THE EXPENSES CLAIMED UNDER THIS HEAD IN M.A.NO.47/ASR/2017(A.Y. 2011-12) (ARISING OUT OF ITA NO.550(ASR)/2016) M/S. J ANKI SONS, JALANDHAR VS. ACIT 4 PROPORTION TO SALES HAVE DECLINED IN THIS YEAR, AS COMPA RED TO THE PRECEDING YEARS. HOWEVER, AS REGARDS NON-PRODUCTION O F SUPPORTING VOUCHERS BEFORE THE AO FOR THE EXPENSES CLAIME D, THE APPELLANT HAD JUSTIFIED THE SAME ON THE GROUND THAT THE SUPPORTING VOUCHERS/EXPENSES COULD NOT BE OBTAINED FORM THE SMALL VENDORS. THEREFORE, CONSIDERING ALL THESE FACTORS, THE LD. CIT(A) HOLD THAT IT WOULD BE FAIR AND JUSTIFIED TO RESTRICT THE ADDITION TO RS.2,00,000/- OUT OF TOTAL ADDITION OF R S.4,16,515/- MADE BY THE AO UNDER THIS HEAD. ON APPEAL, THE CO-ORDINATE BENCH AT AMRITSAR CONFIRMED THE AFORESAID DISALLOWANCE WHICH IS UNDER CHALLENGE IN TH E INSTANT MISCELLANEOUS APPLICATION. CONSIDERING THE FACTS AN D DISALLOWANCE MADE IN THE ASSESSMENT ORDER AS WELL AS ORDER PASSED BY THE LD. CIT(A), IT DOES NOT REFLECT THAT ANY SPECIFIC OBJECTION HAS EVER BEEN RAISED BY THE ASSESSING OFFICER WHI LE DEALING WITH FORWARDING AND DELIVERY EXPENSES BUT IT SEEMS THAT INADVERTENTLY THE LD. CIT(A) OBSERVED THAT COMPLETE SU PPORTING VOUCHERS FOR THE EXPENSES CLAIMED UNDER THIS HEAD COULD NO T BE PRODUCED IN THE COURSE OF EXAMINATION OF BOOKS OF ACCOUNT S. IN OUR CONSIDERED VIEW THE CO-ORDINATE BENCH INADVERTENTLY ESCAPED TO DECIDE THE GROUND NO.1 SPECIFI CALLY WITH REGARD TO THE ASSESSMENT YEAR 2011-12, THEREFORE, IN T HE INTEREST OF JUSTICE THE ORDER UNDER CHALLENGE TO THE EX TENT OF DECIDING GROUND NO.1 OF ITA NO.550(ASR)/2016 RELEVANT TO THE ASST. YEAR:2011-12 IS REQUIRES TO BE RECALL. HENCE, THE OR DER M.A.NO.47/ASR/2017(A.Y. 2011-12) (ARISING OUT OF ITA NO.550(ASR)/2016) M/S. J ANKI SONS, JALANDHAR VS. ACIT 5 UNDER CHALLENGE TO THE EXTENT AS STATED ABOVE FOR DECISI ON AFRESH, STANDS RECALLED. THE REGISTRY IS DIRECTED TO FIX T HE APPEAL ACCORDING TO ITS TURN. 4. IN THE RESULT, THE MISCELLANEOUS APPLICATION FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 29.05.2018. SD/- SD/- (SANJAY ARORA) (N.K.CHOUDHRY) ACCOUNTANT MEMBER JUDICI AL MEMBER DATED: 29.05.2018 /PK/ PS. COPY OF THE ORDER FORWARDED TO: (1) M/S JANKI SONS, JALANDHAR (2) THE ACIT, RANGE-II, JALANDHAR (3) THE CIT(A)-II, JALANDHAR (4) THE CIT CONCENRED (5) THE SR DR, I.T.A.T., AMRITSAR TRUE COPY BY ORDER