M/S. ANAND TEXTILES,PATHANKOT vs. INCOME TAX OFFICER WARD- 4 (1), AMRITSAR

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ITA 674/ASR/2019Status: DisposedITAT Amritsar19 December 2019AY 2008-093 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The tribunal dismissed the ground against the ex-parte order due to repeated adjournments by the assessee. However, it allowed the deletion of disallowance on fabrication charges, stating no further addition is needed if books are rejected. The addition for non-deduction of TDS was upheld as it's a statutory disallowance.

What were the facts?

The assessee's appeal was against the CIT(Appeals) order. The assessee sought adjournments multiple times, leading to an ex-parte order. The appeal also concerned disallowances on fabrication charges and non-deduction of TDS on clearing and forwarding charges.

What were the issues?

Whether an ex-parte order by CIT(Appeals) is valid when the assessee seeks adjournments. Whether disallowances are permissible when books of account are rejected, and if statutory disallowances for TDS non-deduction are independent of book rejection.

Which sections of the Income-tax Act were involved?

Section 145(3),Section 40(a)(ia),Section 194C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, AMRITSAR BENCH, AMRITSAR

Before: SH. N. K. CHOUDHRY & SH. O. P. MEENA

For Respondent: Smt. Raman Damathia (DR)
Hearing: 17.12.2019Pronounced: 19.12.2019

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR BEFORE SH. N. K. CHOUDHRY, JUDICIAL MEMBER AND SH. O. P. MEENA ACCOUNTANT MEMBER I.T.A. No. 674/Asr/2019 Assessment Year: 2008-09

M/s Anand Textiles, vs. Income Tax Officer, Tung Pai, Batala Road, Ward 4(1), Amritsar, Amritsar Punjab [PAN: AAGFA 1009B] (Appellant) (Respondent)

Appellant by : Sh. Parveen Jain (Adv.) Respondent by: Smt. Raman Damathia (DR) Date of Hearing: 17.12.2019 Date of Pronouncement: 19.12.2019

ORDER Per O. P. Meena, AM: This appeal filed by the Assessee is directed against the order of learned Commissioner of Income Tax (Appeals)-2, Amritsar dated 30.08.2019 for the Assessment Year 2008-09.

2.

Ground no. 1 is general in nature and does not require our adjudication.

3.

Ground no. 2 is against the passing ex-parte order by CIT(Appeal).

4.

We have heard the rival submissions and find that the Ld. CIT(Appeal) has fixed hearing on 02.07.2012, 23.12.2013, 10.11.2017, 23.10.2015, 20.01.2017 and 14.08.2019. However, the counsel of the assessee has sought adjournment on various dates and no details were filed, therefore the order passed by the

2 ITA No. 674/Asr/2019 (AY 2008-09) M/s Anand Textiles v. ITO CIT(appeal) on merits. We do not find any infirmity in the order of CIT(Appeal), accordingly this ground of appeal is dismissed.

5.

Ground no. 3 is against the confirmation of disallowance of Rs.3,24,775/- being 10% of fabrication charges.

6.

The counsel submitted that the books of account were rejected u/s 145(3) of the Act. Hence, where the books of account are rejected and GP rate is applied, then no other addition is required to be made.

7.

Per contra the Ld. DR relied on the orders of lower authorities.

8.

We have heard the rival submissions and find that hence the books of account are rejected then no other addition is required to be made, therefore above disallowance of Rs.3,24,775/- made by the AO on account of fabrication expenses is accordingly deleted.

9.

Ground no. 4 is against the confirmation of addition of Rs.5,03,743/- made on account of non deduction of TDS on clearing and forwarding charges.

10.

The AO noted that the assessee has made payment of Rs.5,03,743/- on account of clearing and forwarding charges on which tax was not deducted as per provisions of section 194C of the Act. Hence, the expenses were disallowed u/s 40(a)(ia) of the Act.

11.

Being aggrieved the assessee filed this appeal before this tribunal. The Ld. counsel submitted that when the books of account are rejected then no other disallowances are called for.

12.

Per contra the Ld. Sr. DR submitted that the disallowances were made u/s 40(a)(ia) of the Act which are statutory disallowances, hence same are not related

3 ITA No. 674/Asr/2019 (AY 2008-09) M/s Anand Textiles v. ITO to rejection of books of account, hence the CIT(Appeal) has rightly confirmed the same.

13.

We have heard the rival submissions and perused the material available on record. We find that the disallowances were made on account of non deduction of TDS u/s 194C of the Act which are statutory disallowances, hence the same are not governed by the rejection of books of account. Hence, same are required to be disallowed statutorily, therefore this ground of appeal of the assessee is dismissed.

14.

In the result, the appeal of the assessee is partly allowed.

Order pronounced in the open court on December 19, 2019

Sd/- Sd/- (N. K. Choudhry) (O. P. Meena) Judicial Member Accountant Member Date: 19.12.2019 /GP/Sr. Ps. Copy of the order forwarded to: (1) The Appellant: (2) The Respondent: (3) The CIT(Appeals), (4) The CIT concerned (5) The Sr. DR, I.T.A.T.

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