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Income Tax Appellate Tribunal, DELHI BENCH: ‘A’ NEW DELHI
Before: SHRI G. D. AGRAWAL & SMT SUCHITRA KAMBLE
ORDER PER SUCHITRA KAMBLE, JM
This appeal is filed by the Revenue against the order dated 21/10/2013 passed by CIT(A), Rohtak and the cross objection is filed by the assessee.
The grounds of appeal are as follows:- (ITA NO.03/Del/2014)
“1. On the facts and in the circumstances of the case, the ld has erred in law and facts in deleting the addition of Rs.1,81,578/- made by the A.O as the assessee failed to give any reliable and sustainable evidence in support of various expenses viz. travelling and conveyance, loading & unloading and freight & cartages expenses claimed by the assessee as discussed in detail by the A.O while framing the assessment.
2. On the facts and in the circumstances of the case, the ld has erred in law and facts in deleting the addition of Rs.49,03,790/- out of total addition amounting to Rs.51,35,739/- made on account of contra entries claimed but not proved by the assessee; the ld erroneously considered the remand report submitted by the A.O during the 1st round of appellate proceedings, whereas the instant order of the ld CIT(A) pertains to the case set aside by the Hon’ble ITAT in dated 21/4/2011 to the file of the A.O for fresh adjudication.
The grounds of appeal
are as follows:- (C.O NO.37/Del/2016) “1. That initiation of proceedings u/s 147 of the Act and completion of assessment u/s 147/143(3) of the Act without satisfying the statutory provisions contained in the Act is without jurisdiction and therefore deserves o be quashed as such.
2. That furthermore in any case addition made of Rs.51,35,739/- in the impugned order of assessment framed u/s 147/143(3) of the Act is beyond the scope of assessment and is excess of jurisdiction and therefore untanable.
4. The original assessment u/s 143(3) of the Income tax Act, 1961 was completed on 21/12/2009. An assessed income of Rs.7,96,73,660/- as against the return income of Rs.3,43,270/-.
The addition of Rs.7,93,40,390/- was deleted by the CIT(A)’s Rohtak except for disallowing Rs.70,020/-, on account of advertisement expenses. The ITAT on the Department’s appeal before it vide order dated 21/04/2013 set aside the addition of Rs.51,45,739/- to the file of the Assessing Officer and rejected the other grounds of appeal. Prior to the order of the ITAT it was found that income amounting to Rs.1,81,578/- had escaped assessment within the meaning of Section 147 read with Section 148 of the Income-tax Act, and therefore, after duly recording the reasons and obtaining the necessary approval notice u/s 148 was issued on 20th March 2011. This amount related to expenditure on freight, loading/unloading and travelling on behalf of the consigner to the reimbursed.
5. The Assessing Officer while passing the fresh order has observed that no documentary evidence has been furnished either by the assessee or by M/s Luminous Power Technologies Pvt. Ltd. that the particulars given in regard to contra entries are correct. Therefore, the assessee could not verify the genuineness of the contra entries with the documentary evidence in the form of any bills/invoices/cheques etc and made addition of Rs.51,35,739/-, the assessee filed appeal before the CIT(A). The CIT(A) held that the assessee has submitted copies of their expenses on account of travelling and conveyance, loading/unloading and freight and cartages before the CIT(A). A copy of agreement with M/s Luminous Power Technologies Pvt. Ltd. was also filed before the Assessing Officer as well as before the CIT(A). The Assessing Officer in his order has not proved that the said amounts were not reimbursed by M/s Luminous Power Technologies Pvt. Ltd. Thus, the assessee’s appeal was allowed on this ground. The CIT(A) further held that (extracts of para 3 & 4 of the CIT(A)’s order):-
“(5) ……The entries amounting to Rs.408157/- and Rs.3,509/- have effect on the account of the assessee. In his present claim assessee specifies that “the entries relate to the commission and others which were being credited to our account and simultaneously reversed because company had issued cheques for the same. The cheques have already been accounted for in our accounts in various heads.” This version of the assessee has also been examined and it is found that the M/s Luminous Power Technologies Pvt. Ltd said in its certification dated 26/4/2010 that Rs.4,08,157/- belongs to the commission while the assessee in its submission and its annexure dated 6/5/2010 stated that the entries amounting to Rs.4,08,157/- relates to interest on security at Rs.55,487/- (9.5.2006); commission received Rs.43,917/-; reimbursement of expenses Rs.46,527/- ; salary to Rs.3,500/- ‘reimbursement of expenses Rs.82,518/-; commission and brokerage Rs.82,518/- (29.06.2006); and Rs.93,8=690/- (01.08.2006). The version of the assessee has been examined and it is seen that the entries of commission amounting to Rs.82,518/- (including RDS) and Rs.93,690/- (including TDS) have been found to be genuine”. The A.O has also stated that a balance of Rs.231949/- has been certified by M/s Luminous Power Technologies Pvt. Ltd as commission entries while this has not been stated to be so in the books of the assessee.
I have considered the A.O’s remand report as well as the assessee’s submissions and reply to the remand report. The assessee has not been able to prove that the sum of Rs.2,31,949/- was anything what commission entries. Therefore, this amount of Rs.2,31,949/- out of an addition of Rs.51,35,739/- stands confirmed. This ground of appeal is partly allowed.”
The Ld. DR relied on the order of the Assessing Officer held that the assessee could not made any attempt to produce the document before the Assessing Officer. Hence, CIT(A) was not correct in allowing the appeal of the assessee.
The Ld. AR submitted that in the remand report itself expenses were admitted by the Assessing Officer to the extent of 4,08,157/-. Thus, making addition of Rs.51,35,739/- was not correct on part of the Assessing Officer. The CIT(A) has taken proper cognizance of the same. The assessee produced all these documents related to various expenses vide travelling and conveyance loading/unloading and freight and cartages expenses.
We have heard both the parties and perused the material available on record. The Assessee produced all the relevant documents before the Assessing Officer. The CIT(A) has correctly dealt the issue. In fact, in the remand report itself the expenses incurred clearly stated out to Rs.4,08,157/- and CIT(A) has given a clear finding by disallowing Rs.2,31,949/- to that extent. There is no requirement for interfering the well reasoned order of the CIT(A).
In result, appeal is dismissed. C.O of the assessee is disposed off.
The order is pronounced in the open court 19th of September, 2016.