MANGI LAL MOHTA,SRI BIJAYNAGAR V. ITO WARD, SURATGARH

ITA 39/JODH/2025

AI Insights

The case involves Sh. Mangi Lal Mohta, who appealed against the order of the Learned CIT(A) which dismissed his appeal and sustained the intimation issued by the Central Processing Centre under section 143(1) of the Income Tax Act, 1961 for the assessment year 2023-24. The primary contention was whether the appellant, operating as a commission agent and trader, should include income from sales made as a commission agent in his turnover. The appellant argued that his role as a commission agent should not affect his trading turnover, supported by a document from the Agricultural Produce Market Committee and a previous decision in a similar case. However, the department contended that the appellant was not authorized to operate as a commission agent under the relevant market rules, and the necessary segregation of income from different sources was not adequately demonstrated. The Tribunal found that the material presented required further verification and discussion, leading to the decision to remit the matter back to the Assessing Officer.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 707232 (ITAT-JODHPUR)
• Duration Of Justice: 5 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-07-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2023-2024
• Appeal Filed On: 13-01-2025
• Other Referred Cases: ITA No. 82/Jodh/2024 Pravin Kumar Nagpal vs. ITO
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: KARNI DAN
• Assessee Lawyers: VEDANT GUPTA
• Keywords: Set aside; Opportunity of being heard; TDS; Competent authority

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH, JODHPUR. BEFORE: Dr. M. L. MEENA, ACCOUNTANT MEMBER AND SHRI NARINDER KUMAR, JUDICIAL MEMBER ITA No. 39/Jodh/2025 Assessment Year: 2023-24 Sh. Mangi Lal Mohta Shop No. 38, New Dhan Mandi, Sri Bijaynagar. [PAN: ABUPM1687J] Vs. The ITO, Ward, Suratgarh. Udaipur. (Appellant) (Respondent) Appellant by : Shri Vedant Gupta, C.A. Respondent by: Shri Karni Dan, Addl. CIT (Sr. DR) Date of Hearing: 01/07/2025 Date of Pronouncement: 07 /07/2025 ORDER PER: NARINDER KUMAR, JUDICIAL MEMBER On 13.12.2024, vide order u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”), Learned CIT(A) dismissed the appeal filed by the assessee-appellant and thereby sustained intimation dated 23.01.2024 u/s 143(1) of the Act issued by Central Processing Centre, Income Tax Department, relating to the assessment year 2023-24. ITA No.39/Jodh/2025 Mangli Lal Mohta vs. ITO. 2 2. Learned CIT(A) dismissed the appeal, while observing in the manner as under:- “4.5 In the case under consideration, as illustrated in the preceding paragraph, the trade debtors is not confined to the unrealised commission and therefore, it is established that the Appellant is a trader and not a broker/commission agent as claimed. Further, it is also observed that if the Appellant were truly a commission agent, the buyer of goods would have deducted TDS invoking the provisions of S. 194J and not 194Q, which again strengthens that the goods have been purchased by such persons from the Appellant. Therefore, when it is established beyond doubt that the transactions undertaken by the Appellant during the year is in the nature of trade and not in the nature of a commission agent/broker, the adjustment made by the CPC invoking the provisions of rule 37BA is found to be in order and hence upheld.” 3. Arguments heard. File perused. Contentions 4. Ld. AR for the appellant has submitted that the appellant operates as a commission agent ( Kachha Arhatia), but at the same time, indulges in purchase and sale of agricultural commodities. Ld. AR has tried to explain that income from the sales which are made with the assistance of the assessee, operating as a commission agent, is not to be included in the turnover of the assessee, and as such, the impugned order passed by Learned CIT(A) deserves to be set aside. ITA No.39/Jodh/2025 Mangli Lal Mohta vs. ITO. 3 In support of his contention, Ld. AR has relied on document dated 29.03.1997 issued by the Secretary, Agricultural Produce Market Committee, Sri Vijay Nagar, Rajasthan. He has also relied on decision in ITA No. 82/Jodh/2024 Pravin Kumar Nagpal vs. ITO, decided on 02.09.2024, relating to the assessment year 2022-23, while submitting that present case is covered by the said decision, and as such, present appeal also deserves allowed. 5. On the other hand, Ld. DR for the department has submitted that document dated 29.03.1997 depicts that the assessee was permitted trade in agricultural produces, subject to terms and conditions as provided under Rules 69/72 of Rajasthan Agricultural Produce Market Rules, 1963, and also to operate as joint trader, and as such, it cannot be said that the assessee was permitted to operate as commission agent for the purposes of agriculture produce in the market area of Sri Vijaynagar. Ld. DR also pointed out that from the ITR submitted by the assessee for the Assessment year 2023-24, it cannot be gathered as to how many transactions were dealt with by the assessee as a commission agent, so as to decipher or segregate his income by way of commission for having assisted farmers in sale of ITA No.39/Jodh/2025 Mangli Lal Mohta vs. ITO. 4 the agriculture produce, as a commission agent. Accordingly, Ld. DR has urged that for the reasons recorded by Learned CIT(A) , present appeal deserves to be dismissed. 6. On perusal of photo copy of documents dated 29.03.1997, it transpires that the same pertains to M/s Pawan Kumar Bhikham Chand. In the course of arguments, Ld. AR for the appellant has submitted, on query by the Bench, that the proprietorship concern under the said name is being run by the assessee, where he indulges in sale/purchase of agriculture produce, and also acts as a commission agent. However, from this very document, it cannot be made out that the assessee is a proprietor of M/s Pawan Kumar Bhikhamchand is a partnership concern. 7. As is further available from said document dated 29.03.1997, permission was granted for trade in agriculture produce as (Joint) trader. Words “Ka” category commission agent/ “Kha” category commission agent were struck of by the office of Secretary, Rajasthan Agriculture Produce Market Committee. 8. In the course of arguments, Ld. AR for the appellant has submitted that the document dated 29.03.1997 does not contain true facts. ITA No.39/Jodh/2025 Mangli Lal Mohta vs. ITO. 5 Had it been so, the assessee would have got issued fresh permission after getting error, if any, rectified from the said office. But, admittedly, no such step was taken by the assessee. So, said document, as it is, does not come to the aid of the appellant to establish that he had permission from the competent authority to act as a commission agent under the abovesaid Market rules. 9. As regards income from sales by the appellant as a trader and by way of commission, as a commission agent, from the statement of TDS submitted by the assessee and copy of ITR as well as computations, details of transactions made by the assessee as a commission agent, during the said year cannot be gathered or segregated. Ld. AR for the appellant submits that all requisite documents could not be submitted by the assessee before CPC and that while disposing of the appeal, Ld. CIT(A) did not discuss the material submitted by the assessee. 10. As noticed above, intimation was issued by CPC u/s 143(1) of the Act, and the same was challenged by way of appeal, before Learned CIT(A). In the given facts and circumstances of the case, when the material relied on by the appellant required verification and discussion for effective adjudication of the issue involved, but no step was taken by Learned CIT(A) in this regard by way of ITA No.39/Jodh/2025 Mangli Lal Mohta vs. ITO. 6 remand report or otherwise, we deem it a fit case to remit the matter to the Assessing Officer for decision afresh, by adjudicating all the relevant issues, and while providing an opportunity of being heard to the assessee. Result 11. As a result, in view of the above discussion, this appeal is disposed of for statistical purpose and matter is remitted to the Assessing Officer for decision afresh, by adjudicating all the relevant issues, and while providing an opportunity of being heard to the assessee. Judicial Member having joined and presided over through virtual mode from Jaipur Benches, order needs pronouncement under Rule 34(4) of the Income Tax (Appellate Tribunal) Rules, 1963 by placing the details on the notice board. File be consigned to the record room after the needful is done by the office. Sd/- Sd/- (Dr. M. L. Meena ) (Narinder Kumar ) Accountant Member Judicial Member Date: 07 /07/2025 *Santosh Copy of the order forwarded to: (1) The Appellant: (2) The Respondent: (3) The CIT(Appeals) (4) The CIT concerned ITA No.39/Jodh/2025 Mangli Lal Mohta vs. ITO. 7 (5) The Sr. DR, I.T.A.T By Order Asstt. Registrar. "