Shri Ashraf I.Kherani, Daman v. The Income tax Officer,Vapi Ward-4,, Daman

ITA 2650/AHD/2008 | 2005-2006
Pronouncement Date: 08-10-2010 | Result: Allowed

Appeal Details

RSA Number 265020514 RSA 2008
Assessee PAN ACPPK1871L
Bench Ahmedabad
Appeal Number ITA 2650/AHD/2008
Duration Of Justice 2 year(s) 2 month(s) 15 day(s)
Appellant Shri Ashraf I.Kherani, Daman
Respondent The Income tax Officer,Vapi Ward-4,, Daman
Appeal Type Income Tax Appeal
Pronouncement Date 08-10-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted C
Tribunal Order Date 08-10-2010
Date Of Final Hearing 07-10-2010
Next Hearing Date 07-10-2010
Assessment Year 2005-2006
Appeal Filed On 23-07-2008
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH C AHMEDABAD BEFORE SHRI MAHAVIR SINGH JUDICIAL MEMBER AND SHRI A.N.PHAUJA ACCOUNTANT MEMBER ITA NO.2650/AHD/2008 ASSESSMENT YEAR:2005-06 DATE OF HEARING:7.10.10 DRAFTED:7.1010 ASHIF I KHERANI F-2 2 ND FLOOR ALFALA COMPLEX MADRESS STREET KHARIWAD DAMAN PAN NO.ACPPK1871L V/S. INCOME TAX OFFICER VAPI WARD-4 DAMAN (APPELLANT) .. (RESPONDENT) APPELLANT BY :- SHRI J.P. SHAH SR-AR RESPONDENT BY:- SHRI K.M. MISHRA SR-DR O R D E R PER MAHAVIR SINGH JUDICIAL MEMBER:- THIS APPEAL BY THE ASSESSEE IS ARISING OUT OF THE ORDER OF COMMISSIONER OF INCOME-TAX(APPEALS)-VALSAD IN APPEAL NO.CIT(A)/V LS/149/07-08 DATED 11- 03-2008. THE ASSESSMENT WAS FRAMED BY THE ITO VAPI WARD-4 DAMAN U/S.143(3) OF THE INCOME-TAX ACT 1961 (HEREINAFTER REFERRED TO AS THE ACT) VIDE HIS ORDER DATED 16-11-2007 FOR THE ASSESSMENT YEAR 2005-06. 2. THE FIRST TWO INTER-CONNECTED ISSUE IN THIS APPE AL OF ASSESSEE IS AGAINST THE ORDER OF CIT(A) CONFIRMING THE ADDITION OF UNEX PLAINED CASH CREDIT U/S.68 OF THE ACT. FOR THIS ASSESSEE HAS RAISED THE GROUND NO.1 AND 5 :- 1. THE ADDITION OF RS.1184500.00/- MADE UNDER SECT ION 68 AS UNEXPLAINED CASH CREDITS IS WITHOUT CONSIDERATION O F THE EXPLANATIONS ITA 2650/AHD/2008 A.Y.2 005-06 ASHIF I KHERANI V. ITO VAPI WD-4 DAMAN PAGE 2 AND OTHER DOCUMENTS PLACED ON RECORD BY THE ASSESSE E. THUS THE SAID ADDITION MAY KINDLY BE DELETED. 5. THE ADDITION OF RS 3447976.00/- MADE UNDER SECTI ON 68 AS UNEXPLAINED CASH CREDIT IS ARBITRARY AND WHIMSICAL AS ONLY A CASH CREDIT OF RS.35000.00/- HAS BEEN MADE IN THE CAPITAL ACCOU NT DURING THE PREVIOUS YEAR UNDER CONSIDERATION. THUS THE SAID A DDITION MAY KINDLY BE DELETED. 3. AT THE OUTSET IT IS NOTICED FROM THE ASSESSMENT ORDER IN RESPECT ADDITION OF ADDITION OF RS.11 84 500/- THAT THIS ADDITION IS ARISING OUT OF THE DIFFERENCE IN TWO SET OFF ACCOUNTS PREPARED BY ASSESSEE. IN THE F IRST SET OFF ACCOUNTS THE FOLLOWING ARE THE CREDITORS:- 1. YASH TRADERS RS.3 56 000 (I) AMINA I. KHERANI RS. 15 000 (II) ASLAM I. KHERANI RS. 18 000 (III) AZIZ K BANDUKIYA RS. 15 000 (IV) GAFURBHAI N GAGARI RS. 11 000 (V) GULAM MOHD. NAGARI RS. 15 000 (VI) HAMIDA I KHERANI RS. 12 000 (VII) HUSSAIN I GOGARI RS. 20 000 (VIII) KHERUNBEN K DHANANI RS. 22 000 (IX) NAZEEM M BANDUKIA RS. 11 000 (XI) RASIDA I KHERANI RS. 16 000 (XI) USMAN PAPER MILLS PVT. LTD. RS.5 73 000 (XII) YUSUF M MAKE RS.1 00 000 THE ASSESSEE IN RESPECT OF YASH TRADERS HAD FILED C ONFIRMATION BUT IN RESPECT OF THE OTHER NOTHING WAS FILED. SUBSEQUENTLY ASSES SEE REVISED THE RETURN OF INCOME AND FILED REVISED BALANCE-SHEET WHEREBY THE ASSESSEE HAS NOT DECLARED THE CASH CREDITORS. 4. BEFORE US LD. SR-COUNSEL FOR THE ASSESSEE SHRI J.P. SHAH FILED COPY OF PROFIT AND LOSS ACCOUNT AND PROPRIETOR CAPITAL ACCO UNT BUT HAS NOT FILED ITA 2650/AHD/2008 A.Y.2 005-06 ASHIF I KHERANI V. ITO VAPI WD-4 DAMAN PAGE 3 COMPLETE SET OF ACCOUNTS I.E. REVISED ACCOUNTS AND ALSO NOT FILED COPY OF ORIGINAL SET OFF ACCOUNTS. AFTER GOING THROUGH THE ASSESSMENT ORDER THE ORDER OF CIT(A) AND ARGUMENTS OF BOTH THE SIDES WE FIND THAT NEITHER THE ASSESSING OFFICER NOR THE CIT(A) HAS GIVEN COMPARATIVE ACCOUN TS AND WHETHER THE ASSESSEE HAS A PLAUSIBLE EXPLANATION IN RESPECT TO THE EXISTENCE OF CASH CREDITS. IN THE ABSENCE OF THESE THINGS AS THE LD . COUNSEL FOR ASSESSEE EVEN DURING THE COURSE OF HEARING COULD NOT FILE THESE S ET OF ACCOUNTS WE AT THIS STAGE CANNOT DECIDE THE INTER-CONNECTED ISSUES IN ABSENCE OF DOCUMENTARY EVIDENCES AND NON-AVAILABILITY OF FACTS IN THE ORDE RS OF LOWER AUTHORITIES. AS THESE INTERCONNECTED ISSUES REQUIRE RECONSIDERATION WE SET ASIDE THESE INTER- CONNECTED ISSUES TO THE FILE OF ASSESSING OFFICER T O RECONSIDER IN ENTERITY AFTER COMPARING BOTH THE ACCOUNTS AND ON THE BASIS OF EVI DENCE WHETHER REALLY THERE ARE CASH CREDITS OR NOT AND IN CASE THESE ARE GENUINE CASH CREDITORS THEN AO WILL DELETE THE ADDITION. THE AO WILL PROVI DE REASONABLE OPPORTUNITY OF BEING HEARD TO ASSESSEE AND WILL DECIDE THE INTER-C ONNECTED ISSUE. THIS INTER- CONNECTED ISSUE OF THE ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 5. THE NEXT ISSUE IN THIS APPEAL OF ASSESSEE IS AGA INST THE ORDER OF CIT(A) IN CONFIRMING THE DISALLOWANCE OF EXPENDITURE ON CA RTING CHARGES BY INVOKING THE PROVISIONS OF SECTION 40(A)(IA) R.W.S. 194 C OF THE ACT. FOR THIS ASSESSEE HAS RAISED THE FOLLOWING GROUND NOS.2-4 :- 2. THE ADDITION OF RS.1251000.00/- UNDER SECTION 4 0(A)(I) READ WITH SECTION 194C FOR NON DEDUCTION OF TDS ON CARTING CH ARGES IS ULTRA VIRES SECTION 40(A)(IA) READ WITH SECTION 194C.NO. CARTIN G CHARGES HAVE BEEN PAID TO A NON RESIDENT NON CORPORATE ASSESSEE OR TO A FOREIGN COMPANY. THUS THE SAID ADDITION MAY KINDLY BE DELETED. 3. THE ADDITION OF RS.1251000.00/- MADE UNDER SECTI ON 40(A)(I)(IA) READ WITH SECTION194C IS ULTRA VIRES SECTION 40(A)(I)(IA ) READ WITH SECTION194C BECAUSE FOR THE ASSESSMENT YEAR 2005-20 06 AN INDIVIDUAL ASSESSEE WAS SUNDER NO LEGAL OBLIGATION TO DEDUCT TAX AT SOURCE ON CONTRACTUAL PAYMENTS UNLESS THEY ARE MADE TO A SUB CONTRACTOR. THUS THE SAID ADDITION MAY KINDLY BE D ELETED. 4. THE ADDITION OF RS.1251000.00/- MADE UNDER SECTI ON 40(A)(I)(IA) READ WITH SECTION 194C IS ULTRA VIRES SECTION 40(A)(IA) BECAUSE THE THE LATTER ITA 2650/AHD/2008 A.Y.2 005-06 ASHIF I KHERANI V. ITO VAPI WD-4 DAMAN PAGE 4 SECTION DEALS WITH ONLY THE AMOUNT PAYABLE AND NO T THE AMOUNT PAID. THUS THE SAID ADDITION MAY KINDLY BE DELETED. 6. WE FIND FROM THE ASSESSMENT ORDER AND THE ORDER OF CIT(A) THAT THERE IS NO DETAILS WHETHER THERE IS AGREEMENT BETWEEN THES E PARTIES FOR PAYMENT OF HIRE OF TRUCKS AND PAYMENT OF CARTING CHARGES BY AS SESSEE. WE FIND FROM THE ORDERS OF THE LOWER AUTHORITIES THAT NO DETAILS ARE DISCUSSED IN RESPECT OF THESE EXPENSES. THE ASSESSEE HAS CITED A FEW CASE LAWS OF TRIBUNAL (I) DCIT V. SATISH AGGARWAL & CO. (2001) 122 ITD 35 (ASR) (II) JAIPAUR VIDYUT VITRAN NIGAM LTD. V. DCIT (2009) 123 TTJ 888 (JP) AND (III ) K. SRINIVAS NAIDU V. ACIT (2010) 131 TTJ 17 (HYD). AS THE FACTS ARE NOT AVA ILABLE ON THE ORDERS OF LOWER AUTHORITIES WE SET ASIDE THIS ISSUE TO THE F ILE OF ASSESSING OFFICER AND DIRECTING HIM TO RECONSIDERATION THE CASE AS THE ON THE BASIS FACTS. ACCORDINGLY THIS ISSUE IS SET ASIDE TO THE FILE OF ASSESSING OFFICER TO BE DECIDED AFTER PROVIDING REASONABLE OPPORTUNITY OF B EING HEARD TO ASSESSEE. 7. IN THE RESULT ASSESSEES APPEAL IS ALLOWED FOR STA TISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 08/10 /2010 SD/- SD/- (A.N.PHAUJA) (MAHAVIR SINGH) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) AHMEDABAD DATED : 08/10/2010 *DKP COPY OF THE ORDER FORWARDED TO :- 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT(APPEALS)-VALSAD 4. THE CIT CONCERNS. 5. THE DR ITAT AHMEDABAD 6. GUARD FILE. BY ORDER /TRUE COPY/ DEPUTY / ASSTT.REGISTRAR ITAT AHMEDABAD