M/s. Universal Embroidery, CHENNAI v. ITO, CHENNAI

ITA 1524/CHNY/2010 | 2007-2008
Pronouncement Date: 11-01-2011 | Result: Allowed

Appeal Details

RSA Number 152421714 RSA 2010
Assessee PAN AABFU0671N
Bench Chennai
Appeal Number ITA 1524/CHNY/2010
Duration Of Justice 3 month(s) 25 day(s)
Appellant M/s. Universal Embroidery, CHENNAI
Respondent ITO, CHENNAI
Appeal Type Income Tax Appeal
Pronouncement Date 11-01-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted B
Tribunal Order Date 11-01-2011
Date Of Final Hearing 11-01-2011
Next Hearing Date 11-01-2011
Assessment Year 2007-2008
Appeal Filed On 16-09-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL BENCH B CHENNAI (BEFORE DR. O.K. NARAYANAN VICE PRESIDENT AND SHRI HARI OM MARATHA JUDICIAL MEMBER) ..... I.T.A. NO. 1524/MDS/2010 ASSESSMENT YEAR : 2007-08 M/S UNIVERSAL EMBROIDERY NEW NO.14 OLD NO.11/2 VALLUVAN STREET OLD WASHERMENPET CHENNAI - 600 021. PAN : AABFU0671N (APPELLANT) V. THE INCOME TAX OFFICER BUSINESS WARD VII(3) CHENNAI - 600 034. (RESPONDENT) APPELLANT BY: SHRI LAKSHMICHAND NAHATA RESPONDENT BY: SHR I P.B. SEKARAN O R D E R PER HARI OM MARATHA JUDICIAL MEMBER : THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-IX CH ENNAI DATED 5.7.2010 AND PERTAINS TO ASSESSMENT YEAR 2007-08. 2. THE ASSESSEE IN THIS CASE IS A FIRM WHICH IS D OING EMBROIDERY WORK USING COMPUTERIZED MACHINES. THE ASSESSEE-FIR M FILED ITS RETURN OF INCOME FOR ASSESSMENT YEAR 2007-08 ADMITT ING A TOTAL INCOME OF ` 6 70 550/- ON 31.10.2007. THE A.O. WHILE MAKING R EGULAR I.T.A. NO. 1524/MDS/10 2 ASSESSMENT MADE AN ADDITION OF ` 22 24 810/- UNDER VARIOUS HEADS AS UNDER:- (1) BILLS ARE NOT AVAILABLE FOR LABOUR CHARGE OUT ` 4 10 582 (2) ON VERIFICATION OF VOUCHERS/BILLS DIFFERENCE IN PURCHASES A/C ` 2 26 479 (3) ON VERIFICATION OF VOUCHERS/BILLS DIFFERENCE IN SALES A/C ` 8 924 (4) RECEIPT NOT AVAILABLE FOR ESI PREMIUM ` 679 (5) TELEPHONE EXPENSES CLAIMED IN P&L ` 47 753/- BUT CHEQUES NOT AVAILABLE FOR ` 23 043 (6) SALARY DIFFERENCE (VERIFIED THE ATTENDANCE REGISTER PRODUCED BY THE ASSESSEE) THERE IS DISCRIPANCIES ` 28 281 (7) BILLS NOT AVAILABLE FOR BHARATH AIR TEL ` 2 022 (8) TDS ON LABOUR CHARGES OUT NOT DEDUCTED. AS PER PROVISIONS OF SECTION 40(A)(IA) NOT ALLOWABLE. ` 15 24 800 ` 22 24 810 3. AGAINST THESE ADDITIONS THE ASSESSEE FILED APPE AL BEFORE THE CIT(APPEALS) WHO ALSO DISMISSED THE GROUNDS RAISED BEFORE HIM. 4. WE HAVE HEARD RIVAL SUBMISSIONS AND HAVE CAREFUL LY PERUSED THE ENTIRE RECORDS AVAILABLE BEFORE US. THE ABOVE DISALLOWANCES ARE RESULT OF NON PRODUCTION OF VOUCHERS/BILLS. BUT T HE CASE OF THE ASSESSEE IS THAT THE ITO DID NOT VERIFY ANY BILLS A ND NEVER GAVE ANY OPPORTUNITY TO THE ASSESSEE TO PRODUCE THE SAME. S UCH EXPENSES ARE TO THE TUNE OF ` 6 70 550/-. AN ADDITION OF ` 15 24 800/- IS THE RESULT OF NON PRODUCTION OF TDS ON LABOUR CHARGES A S PER SECTION 40(A)(IA) OF THE ACT. THE CASE OF THE ASSESSEE IS THAT SECTION 194C HAS NO APPLICATION TO THE FACTS OF THIS CASE AND SE CTION 40(A)(IA) IS NOT I.T.A. NO. 1524/MDS/10 3 INVOCABLE. THE MAIN REASON FOR THIS PLEA IS STATED TO BE THE FACT THAT THE EMBROIDERY WORK HAS BEEN GOT DONE BY THE ASSESS EE FROM OUTSIDE EMBROIDERS BUT UNDER HIS OWN CONTROL AND SUPERVISIO N AND IT IS NOT A CASE OF SUB-CONTRACT AS HAS BEEN HELD BY THE A.O. AFTER GOING THROUGH THE ORDER APPEALED AGAINST WE FIND THAT TH IS IS A NON- SPEAKING ORDER. THEREFORE WE SET ASIDE THE ORDER OF THE LD. CIT(APPEALS) AND IN THE INTEREST OF JUSTICE RESTOR E BACK THE ENTIRE ISSUES TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION THAT HE SHALL MAKE AN ASSESSMENT ORDER DE NOVO AFTER HEARING THE ASSESSEE. 5. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT AFTER CONCLUSION OF HEARING ON THE ELEVENTH DAY OF JANUARY 2011. SD/- SD/- (DR. O.K. NARAYANAN) (HAR I OM MARATHA) VICE PRESIDENT JUDICIAL MEMBER CHENNAI DATED THE 11 TH JANUARY 2011. KRI . COPY FORWARDED TO: (1) APPELLANT (2) RESPONDENT (3) CIT(A)-IX CHENNAI-34 (4) CIT-VII CHENNAI-34. (5) D.R. (6) GUARD FILE