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Income Tax Appellate Tribunal, KOLKATA BENCH “C” KOLKATA
Before: Shri N.V.Vasudevan & Shri Waseem Ahmed
आदेश /O R D E R
PER Waseem Ahmed, Accountant Member:-
This appeal is preferred by Revenue against the order of Commissioner of Income Tax (Appeals)-XXXII, Kolkata in appeal No.235/XXXII/10-11/Cir- 51/Kol dated 22.07.2013 for the assessment year 2008-09 and same is being disposed of along with the Cross Objection (CO) filed by assessee being CO No.141/Kol/2013. Assessment was framed by DCIT, Circle-51, Kolkata u/s
ITA No.2442 & CO 141/Kol/2013 A.Y. 2008-09 ACIT Cir-51 Kol. vs. M/s Maa Engineering Page 2 147/143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) vide his order dated 31.12.2010. First we take up Revenue’s appeal in ITA No.2442/Kol/2013. 2. Revenue has raised per its appeal as under:- “1) On the facts & circumstances of the case, whether, Ld. CIT(A) was justified in deleting the addition made by the AO us 40(a)(ia) on labour charges for non deduction of TDS u/s. 194C by relying on the submission given by the assessee before him without providing any opportunity the AO as required under the provisions of Rule 46A of IT Rules, 1962. 2) On the facts & circumstances of the case, whether, Ld. CIT(A) was justified in deleting the addition made by the AO on salary by relying on submission given by the assessee before him without providing any opportunity the AO a required under the provisions of Rule 46A of IT Rules, 1962.”
Sri S.M.Surana, Ld. Authorized Representative appeared on behalf of assessee and Shri Rajat Kumar Kureel, Ld. Departmental Representative appeared on behalf of Revenue. 3. First issue raised by Revenue in this appeal is that Ld. CIT(A) erred in deleting the addition made by Assessing Officer u/s. 40(a)(ia) of the Act on account of labour charges for non-deduction of Tax Deducted at Source (TDS for short) u/s 194C of the Act on account of accepting the fresh evidence following the provision of Rule 46A of the Income Tax Rules, 1962 (the Rule for short).
Brief facts as having brought on record is that assessee, partnership firm, engaged in the construction business has filed its return on 15.10.2008 declaring total income of ₹7,22,740/-. Thereafter notice was issued u/s. 148 of the Act for filing fresh return of income tax. In compliance with the notice, assessee submitted that returned filed on 15.10.2008 should be treated as filed u/s. 148 of the Act. The assessee for the year under consideration has claimed wage expense for an amount of ₹60,99,600/-. The AO during the course of assessment proceedings, observed that such expenses are liable for TDS u/s. 194C of the Act but assessee has defaulted in deducting the TDS
ITA No.2442 & CO 141/Kol/2013 A.Y. 2008-09 ACIT Cir-51 Kol. vs. M/s Maa Engineering Page 3 on the aforesaid amount. Accordingly, AO has disallowed the aforesaid expense u/s. 40(a)(ia) of the Act and added to the total income of assessee.
Aggrieved, assessee preferred an appeal before Ld. CIT(A) who deleted the addition after considering the submission of assessee.
Being aggrieved by this order of Ld. CIT(A) Revenue is in appeal before us. 6. Before us Ld.DR submitted that Ld. CIT(A) has granted relief to assessee on the basis of fresh evidence produced before him i.e. wages register. The fresh evidences were admitted without taking remand report from the AO in terms of provision of rule 46A of Income Tax Rules 1962 and he left the issue to the discretionary of the Bench. In rebuttal, Ld. AR submitted that no fresh evidence were submitted during the appellate stage and he relied on the order of Ld. CIT(A).
We have heard the rival contentions and perused the materials available on record. At the outset we find that AO in his assessment order has accepted that wage register which was produced for the purpose of verification. From the own recording by AO about the details submitted in support of wage expenses, we do not find the relief was granted by Ld. CIT(A) on the basis of fresh evidence and the relevant portion of assessment order is reproduced below for the sake of clarification:- “It is seen from the wages register that the payment was made to each labourer after putting signature. The AR for the assessee claimed that they are regular labourer on daily payment basis employed by the assessee and no contractor involved in this respect.”
As such we find that no fresh evidence was submitted while appellate stage and accordingly, there is no violation of Rule 46A of IT Rules. In this view of the matter, we do not find any reason to interfere in the order of Ld. CIT(A). We uphold accordingly. This ground of Revenue is dismissed.
ITA No.2442 & CO 141/Kol/2013 A.Y. 2008-09 ACIT Cir-51 Kol. vs. M/s Maa Engineering Page 4 8. Coming to next issue raised by Revenue is that Ld. CIT(A) erred in deleting the addition made by AO on account of salary expense on the basis of fresh evidence which were admitted in contravention of the provision of Rule 46A of the IT Rules.
At the outset, it was observed that AO has disallowed the entire salary expense for an amount of ₹10,25,475/- on the ground that no documentary evidence in support of such salary expense was produced at the time of assessment proceedings for the purpose of verification. However, Ld. CIT(A) deleted the addition made by AO by putting reliance on the comparative statement for the payment of salary submitted by assessee. This comparative statement is comprised of salary for the several years and therefore, the disallowance made by AO was deleted by him. From the observation of Ld. CIT(A), we do not find that any fresh evidence was submitted at the appellate stage. We find that no new fresh evidence was produced before Ld. CIT(A). In view of above, we are inclined not to interfere in the order of Ld. CIT(A). Hence, we uphold the same. This ground of Revenue’s appeal is dismissed. Coming to assessee’s CO No.141/Kol/2013 10. In this CO, the assessee has challenged the reassessment proceedings under section 147 of the Act. However we have adjudicated the Revenue appeal in favour of the assessee. Therefore we are inclined not adjudicate the issue raised in the CO of the assessee. Accordingly we hold the CO raised by the assessee as infructuous and the same is accordingly dismissed. 11. In the result, appeal of Revenue is dismissed and that of assessee’s CO is also dismissed as infructuous. Order pronounced in the open court 12/08/2016
Sd/- Sd/- (�या�यक सद�य) (लेखा सद�य) (N.V.Vasudevan) (Waseem Ahmed) (Judicial Member) (Accountant Member) Kolkata,
ITA No.2442 & CO 141/Kol/2013 A.Y. 2008-09 ACIT Cir-51 Kol. vs. M/s Maa Engineering Page 5 *Dkp �दनांकः- 12/08/2016 कोलकाता । आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. राज�व /Revenue -ACIT, Circle-51 Block-DS-2&3, Manicktala Civic Centre, Uttarapana Complex, Kolkata-700 054 2. आवेदक /Assessee -M/s Maaa Engineering, 37, B.T.Rd., Suckchr, 24-Pgn(N), Pin-700115 3. संबं�धत आयकर आयु�त / Concerned CIT Kolkata 4. आयकर आयु�त- अपील / CIT (A) Kolkata 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, कोलकाता / DR, ITAT, Kolkata 6. गाड� फाइल / Guard file. By order/आदेश से, /True Copy/ उप/सहायक पंजीकार आयकर अपील�य अ�धकरण, कोलकाता ।