Shri Shankarlal Chachan, Ahmedabad v. The Income tax Officer,Ward-11(4),, Ahmedabad

ITA 2770/AHD/2011 | 2008-2009
Pronouncement Date: 30-03-2012 | Result: Allowed

Appeal Details

RSA Number 277020514 RSA 2011
Assessee PAN ABVPC2016Q
Bench Ahmedabad
Appeal Number ITA 2770/AHD/2011
Duration Of Justice 4 month(s) 22 day(s)
Appellant Shri Shankarlal Chachan, Ahmedabad
Respondent The Income tax Officer,Ward-11(4),, Ahmedabad
Appeal Type Income Tax Appeal
Pronouncement Date 30-03-2012
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 30-03-2012
Date Of Final Hearing 22-03-2012
Next Hearing Date 22-03-2012
Assessment Year 2008-2009
Appeal Filed On 08-11-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH AHMEDABAD (BEFORE SHRI G. C. GUPTA VP AND SHRI A. MOHAN ALAN KAMONY AM) ITA NO.2770/AHD/2011: A. Y.: 2008-09 SHANKARLAK CHACHAN PROP. M/S. OMSHANTI TEXTILE MILLS 95 HIRABHAI MARKET D. B. ROAD KANKARIA AHMEDABAD 380 022 PA NO. ABVPC 2016 Q VS THE INCOME TAX OFFICER WARD - 11(4) AHMEDABAD (APPELLANT) (RESPONDENT) APPELLANT BY SHRI KISHOR GOYAL AR RESPONDENT BY SHRI JAMES KURIAN SR. DR DATE OF HEARING: 22-03-2012 DATE OF PRONOUNCEMENT:30-03-2012 O R D E R PER A. MOHAN ALANKAMONY: THIS APPEAL IS FILED BY THE ASSESSEE AGGRIEVED BY THE ORDER OF THE LEARNED CIT( A)-XVI AHMEDABAD DATED 23-08-2011 FOR ASSESSMENT YEAR 2008-09 IN AP PEAL NO. CAT(A)/XVI/ITO/WD.11(4)/436/2010-11. 2. THE ASSESSEE HAS RAISED SEVERAL GROUNDS IN IT GR OUNDS OF APPEAL IN AN ELABORATE MANNER WHICH IS AGAINST ITAT RULE 8. ON EXAMINING THE GROUNDS FRAMED BY THE ASSESSEE IN THE APPEAL IT EMERGES THAT THE CRUX OF THE ISSUE IS WITH REGARD TO THE ADDITION MA DE BY THE AO U/S 40(A) (IA) OF THE IT ACT ON ACCOUNT OF (I) NON-DEDUCTION OF TDS FOR JOB CHARGES AMOUNTING TO RS.6 26 617/- AND (II) NON-DEDUCTION O F TDS FOR INTEREST PAYMENT AMOUNTING TO RS.2 28 183/-. ITA NO.2770/AHD/2011 (AY 2008-09): SHANKARLAL CHACH AN VS ITO W-11(4) AHMEDABAD 2 3. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSE SSEE IS AN INDIVIDUAL TRADING IN CLOTHS FILED ITS RETURN OF INCOME ON 2-2 -2009 DECLARING TOTAL INCOME OF RS.2 04 480/-. SUBSEQUENT TO THE PROCESSI NG OF RETURN U/S 143(1) OF THE ACT THE CASE WAS TAKEN UP FOR SCRUTI NY AND ASSESSMENT WAS COMPLETED U/S 143(3) OF THE IT ACT ON 20.12.201 0. DURING THE COURSE OF ASSESSMENT PROCEEDINGS IT WAS NOTED BY TH E LEARNED AO THAT THE ASSESSEE HAD PAID RS.6 26 617/- TOWARDS JOB WOR K FOR TEXTILE PROCESSING AND RS.2 81 183/- TOWARDS INTEREST WHERE IN TDS WAS NOT DEDUCTED AND THEREFORE THE LEARNED AO MADE THE AD DITION OF THE SAME U/S 40(A) (IA) OF THE ACT. 4. WHEN THE MATTER CROPPED UP BEFORE THE LEARNED CI T(A) THE LEARNED CIT(A) UPHELD THE ORDER OF THE LEARNED AO A ND OBSERVED AS UNDER: (I) WITH RESPECT TO THE NOTING OF THE LEARNED AO TH AT THE LEARNED COUNSEL OF THE ASSESSEE DURING THE COURSE OF ASSES SMENT PROCEEDINGS AGREED FOR THE DISALLOWANCE U/S 40(A) ( IA) OF THE ACT FOR PAYMENT OF JOB WORK AND INTEREST PAYMENT THE L EARNED CIT(A) HELD THAT (PARA 2.2) IT IS AN ADMITTED FACT THAT NO TDS WAS MADE FROM THE PAYMENT OF JOB CHARGES AND INTEREST. WHEN THE ONE CONTENTION OF THE ASSESSING OFFICER IS RIGHT H OW CAN THE SECOND CONTENTION CAN BE SAID TO BE WRONG AND HOW T HE THEN C. A. CAN NOW PRETEND THAT HE HAS SIGNED THE ORDER SHEET ENTRY WITHOUT NOTICING WHAT WAS WRITTEN IN IT. THIS IS DEFINITELY AN AFTER THOUGHT AND THE SAME IS REJECTED. THEREFOR E THE CONTENTION OF THE LD. COUNSEL THAT THE ADDITION WAS NOT AGREED ADDITION IS REJECTED. ITA NO.2770/AHD/2011 (AY 2008-09): SHANKARLAL CHACH AN VS ITO W-11(4) AHMEDABAD 3 (II) WITH RESPECT TO NON-DEDUCTION OF TDS FOR PAYME NT MADE FOR RS.6 26 617/- FOR JOB WORK THE LEARNED CIT(A) HELD THAT (PARA 2.3) THUS THE JOB WORK WAS DONE UNDER THE CONTRAC T. IT IS NOT NECESSARY THAT THE AGREEMENT SHOULD BE IN WRITING. THE CONTRACT CAN BE VERBAL ALSO. SINCE THE PAYMENTS WE RE MADE FOR CERTAIN WORK AS PER THE DIRECTION OF THE ASSESS EE THE ASSESSEE WAS REQUIRED TO DEDUCT TAX U/S. 194C OF TH E ACT AS THE PAYMENTS WERE IN THE NATURE OF ANY WORK AND AMO UNTS TO PAYMENTS FOR A CONTRACT. SINCE THE ASSESSEE HAD NOT DEDUCTED TAX AS PER THE PROVISION OF SECTION 194C O F THE ACT THE SAME ARE DISALLOWABLE U/S. 40(A) (IA) OF THE AC T. THE ASSESSING OFFICER HAS THUS RIGHTLY DISALLOWED THE J OB CHARGES OF RS.6 26 617/- U/S. 40(A) (IA) OF THE ACT. (III) WITH RESPECT TO ADDITION MADE FOR NON-DEDUCTI ON OF TDS FOR INTEREST PAYMENT MADE FOR RS.2 28 183/- THE LEARNE D CIT(A) HELD THAT (PARA 2.4) IN RESPECT OF OTHER PAYMENTS OF INTERE ST IT WAS SUBMITTED THAT THE ASSESSEE HAD NOT DEDUCTED TAX BE CAUSE THE PAYEES HAD GIVEN FORM NO.15G. I HAVE GONE THROU GH THE ASSESSMENT ORDER AND NOTICED THAT NOWHERE THE COUNS EL OF THE APPELLANT CLAIMED BEFORE THE ASSESSING OFFICER AND SUBMITTED THAT FORM NO.15G WERE OBTAINED AND ON ACC OUNT OF THAT NO TDS WAS MADE. THIS IS AN AFTERTHOUGHT AND T HE EVIDENCE HAS BEEN CREATED AFTER PASSING THE ASSESSM ENT ORDER. SINCE THESE EVIDENCES WERE NOT BEFORE THE AS SESSING OFFICER THEREFORE THE SAME CANNOT BE ADMITTED AT A PPELLATE STAGE AS THE SAME WERE IN CONTRAVENTION TO RULE 46A OF THE IT RULES. THE DISALLOWANCE SO MADE IS HEREBY CONFIRMED . ITA NO.2770/AHD/2011 (AY 2008-09): SHANKARLAL CHACH AN VS ITO W-11(4) AHMEDABAD 4 5. THE LEARNED AR VEHEMENTLY ARGUED BEFORE US THAT THE ASSESSEES COUNSEL DID NOT AGREE FOR THE ADDITION EITHER BEFOR E THE LEARNED AO OR BEFORE THE LEARNED CIT(A). IT WAS SUBMITTED THAT TH E ASSESSEE IS IN POSSESSION OF ALL THE DOCUMENTS TO ESTABLISH THAT H E DOES NOT DESERVE FOR SUCH ADDITION MADE BY THE LEARNED AO WHICH WAS FURTHER SUSTAINED BY THE LEARNED CIT(A). THE LEARNED AO HUMBLY PRAYED THAT AN OPPORTUNITY MAY BE PROVIDED TO APPEAR BEFORE THE LE ARNED AO ONCE AGAIN IN ORDER TO PRODUCE ALL THE RELEVANT RECORDS TO JUSTIFY HIS CLAIM SINCE THE ASSESSMENT WAS MADE HASTILY. THE LEARNED DR VEHEMENTLY OPPOSED TO THE SUBMISSION OF THE ASSESSEE AND PRAYE D THAT THE ADDITIONS MAY BE SUSTAINED. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. FROM THE FACTS OF THE CASE IT IS APPARENT THAT THE WHOLE ADDITION MADE IS BASED ON THE STRINGENT PROVI SION OF SECTION 40(A) (IA) OF THE ACT. FURTHER THE ASSESSEE CLAIMS THAT HE HAS SUFFICIENT MATERIAL TO ESTABLISH THAT THE PROVISIONS OF TDS AR E NOT APPLICABLE TO HIM. FURTHER HE HAS ALSO CLAIMED THAT HE HAS NOT CONCED ED FOR DEFAULT BEFORE THE LEARNED AO. LOOKING AT THE FACTS AND CIRCUMSTAN CES OF THE CASE AND THE STRINGENT PROVISIONS OF SECTION 40(A) (IA) AND SINCE AS IT APPEARS THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS SUFFICI ENT OPPORTUNITY WAS NOT PROVIDED BY THE LD.AO TO THE ASSESSEE IN ORDER TO PRODUCE ALL THE MATERIALS IN HIS POSSESSION TO ESTABLISH HIS CLAIM WE ARE OF THE OPINION THAT THE CASE REQUIRES TO BE REMITTED BACK TO THE F ILE OF LD.AO SO AS TO ENABLE THE ASSESSEE TO MAKE PROPER REPRESENTATION. ACCORDINGLY IN THE INTEREST OF JUSTICE WE HEREBY REMIT THE CASE BACK T O THE FILE OF THE LEARNED AO FOR DE NOVO CONSIDERATION WITH DIRECTION TO THE ASSESSEE TO PROMPTLY PRODUCE ALL RELEVANT DOCUMENTS BEFORE THE REVENUE W ITHOUT SEEKING UNNECESSARY ADJOURNMENTS FOR THE SEEDY DISPOSAL OF THE CASE. ITA NO.2770/AHD/2011 (AY 2008-09): SHANKARLAL CHACH AN VS ITO W-11(4) AHMEDABAD 5 7. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 30 TH DAY OF MARCH 2012 SD/- SD/- (G. C. GUPTA) VICE PRESIDENT (A. MOHAN ALANKAMONY) ACCOUNTANT MEMBER LAKSHMIKANT DEKA/ LAKSHMIKANT DEKA/ LAKSHMIKANT DEKA/ LAKSHMIKANT DEKA/- -- - COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) CONCERNED 5. THE DR ITAT AHMEDABAD 6. GUARD FILE BY ORDER DY. REGISTRAR ITAT AHMEDABAD