SHRI VIJAY PRASAD,WEST SINGHBHUM vs. PR. CIT, PATNA

1 ITA No.130/Ran/2016

IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI BENCH, RANCHI

BEFORE SHRI N.S.SAINI, ACCOUNTANT MEMBER & SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA No.130/Ran/2016 A.Y. : 2012-2013 Sri Vijay Prasad, vs The Principal CIT, 161, Thana No.745, Central, Patna Balijhoran, Nowamundi, West Singhbum-711102 PAN No. : AILPP 0228 L Respondent (Appellant) .

Assessee by : Shri S.K.Poddar & Devesh Poddar, Adv. Revenue by :Shri D.K.Sutariya, CIT(A), JSR Date of Hearing : 22.05.2018 Date of Pronouncement : 25.05.2018 O R D E R Per Pavan Kumar Gadale, JM: This is an appeal filed by the assessee against the order of

CIT(Central), Patna, dated 04.03.2016, for the assessment year 2012-

2013.

the order passed by the CIT u/s.263 of the Act.

electronically on 11.09.2012 declaring total income at Rs.14,32,834/-. The

case was selected for scrutiny under CASS. The AO completed the

assessment u/s.143(3) of the Act, dated 28.03.2014 determining total

2 ITA No.130/Ran/2016 income at Rs.15,43,400/- and made addition of Rs.1,10,569/- as 5% of the

total expenditure on account of repair and maintenance.

called for the records of the assessment proceedings and after

examination the CIT found the order passed by the AO is erroneous and

prejudicial to the interest of Revenue, therefore, show cause notice was

issued to the assessee under the provisions of section 263 of the Act and

the CIT found that the AO had not examined/investigated the various

expenses claimed in the profit and loss account and also the AO has not

examined the applicability of section 40(a)(ia) of the Act on payment of

transportation/hire charges. Therefore, the CIT held that the order passed

by the AO is erroneous and prejudicial to the interest of Revenue and

directed the AO to do denovo assessment and passed order u/s.263 of the

Act dated 04.03.2016.

CIT u/s.263 of the Act is bad in law and does not satisfy the twin condition,

since the expenditure debited by the assessee as transportation/hire

charges in the profit and loss accounts against which the payment were

made to transporter has also shown their income in their income tax return,

therefore assessment order cannot be considered as erroneous and

prayed for allowing the appeal.

3 ITA No.130/Ran/2016 7. We have heard rival submissions and perused the material on

record. Prima facie the ld. AR’s contention is that the AO has made

enquiries and based on material information assessment was completed.

The CIT observed that the assessee is in the business of

transportation/hiring of vehicles and has debited substantial amount in the

profit and loss account under the head transportation /hire charges,

therefore, the CIT observed that failure on the part of AO to apply section

40(a)(ia) of the Act has made the assessment order both erroneous and

prejudicial to the interest of revenue. Before us the ld. AR could not

controvert the finding of the CIT that the order passed by the AO is

erroneous and prejudicial to the interest of Revenue. We are in agreement

with the order passed by the CIT. Our view is supported with relying on the

decision of Hon’ble Supreme Court in the case of DENIEL MERCHANTS

P. LTD. & ANR. Vs. ITO, SLP(C) No(s). 23976/2017, dated 29.11.2017,

wherein the Hon’ble Apex Court has held as under :- “Delay condoned. In all these cases, we find that the Commissioner of Income Tax had passed an order under Section 263 of the Income Tax Act, 1961 with the observations that the Assessing Officer did not make any proper inquiry while making the assessment and accepting the explanation of the assessee(s) insofar as receipt of share application money is concerned. On that basis the Commissioner of Income Tax had, after setting aside the order of the Assessing Officer, simply directed the Assessing Officer to carry thorough and detailed inquiry. It is this order which is upheld by the High Court. We see no reason to interfere with the order of the High Court. The Special Leave Petitions are dismissed. Pending application(s), if any, stands disposed of accordingly.”

4 ITA No.130/Ran/2016 8. We considering the facts and circumstances of the case and relying

on the decision of Hon’ble Supreme Court, found that the CIT has dealt on

the disputed issue and considered the judicial decision and passed a

reasoned order. Accordingly, we are not inclined to interfere with the order

of the CIT and we upheld the same and dismissed the ground of appeal of

the assessee.

Order pronounced in the open court on 25/05 /2018

Sd/- Sd/- (N.S.SAINI) (PAVAN KUMAR GADALE) ACCOUNTANT MEMBER JUDICIAL MEMBER Ranchi, Dated 25/05/2018 Prakash Kumar Mishra , Sr. Ps Copy of the Order forwarded to : 1. The Appellant – 2. The Respondent – 3. The CIT(A) concerned 4. CIT , concerned 5. DR, ITAT, Ranchi 6. Guard file. BY ORDER, //True Copy// SR.PS, ITAT, RANCHI