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Income Tax Appellate Tribunal, KOLKATA ‘C’ BENCH, KOLKATA
Before: Shri P.M. Jagtap & Shri S.S. Viswanethra Ravi
Per Shri P.M. Jagtap :- This appeal is preferred by the Revenue against the order of the ld. Commissioner of Income Tax-(Appeals), Durgapur dated 19.02.2013 for the assessment year 2008-09, whereby he deleted the disallowance of Rs.30,00,000/- made by the Assessing Officer on account of Truck hire charges.
The assessee in the present case is an individual, who is engaged in the business of transportation and handling work under the name and style of his two proprietary concerns M/s. Sree Durga Roadways’ and M/s. Shree Balaji Roadways’. The return of income for the year under consideration was filed by him on 30.09.2008 declaring total income of ./2013 Assessment year: 2008-2009 Page 2 of 5 Rs.11,73,490/-. In the said return, expenditure on account of Truck hire charges paid was claimed by the assessee to the extent of Rs.17.29 crores and Rs.2.77 crores in case of his two proprietary concerns M/s. Shree Durga Roadways’ and M/s. Shree Balaji Roadways’ respectively. During the course of assessment proceedings, the claim of the assessee for the said expenditure was examined by the Assessing Officer and on such examination, he found the following shortcomings:- “(1) The self-made debit vouchers produced in support of truck hire charges are mostly not amenable to any verification as postal addresses were not provided. As such veracity of the expenses incurred under this head cannot be verified.
(2) No truck owner-wise party ledger was maintained by the assessee. Payments for truck hire charges were made through self-made debit vouchers. Only date-wise payment sheets were maintained by the assessee.
(3) All payments for truck hire charges were made by cash.
(4) In bank statements it is found that money was withdrawn from bank on different dates for making payment to truck owners”.
On the basis of the above shortcomings noticed by him, the Assessing Officer held that the expenditure incurred by the assessee on payment of truck hire charges was not fully verifiable and a disallowance of Rs.30,00,000/- out of the said expenditure was made by him on account of non-verifiable element in the assessment completed under section 143(3) vide an order dated 27.12.2010.
Against the order passed by the Assessing Officer under section 143(3), an appeal was preferred by the assessee before the ld. CIT(Appeals) and after considering the submission made by the assessee and perusing the relevant material on record, the ld. CIT(Appeals) deleted the disallowance made by the Assessing Officer out of truck hire charges paid for the following reasons given in his impugned order:- ./2013 Assessment year: 2008-2009 Page 3 of 5
“It is seen from the assessment order that the issue of submission of Forms 15-I & 15-J have not been doubted by the A.O. Copies of these forms submitted before me show the addresses of the owners. Under the circumstances, I do not see what prevented the A.O. from making his enquiries based on the material on record. I do not see it to be the AO’s case that the enquiries made by him have thrown doubts on the appellant’s contention. Neither have the books of accounts submitted before him drawn on any adverse comments from the A.O. Under the circumstances, I fail to see the rationale for an estimated disallowance on this issue. No basis for the quantum of estimated disallowances made by the AO is available on record. Under the circumstances, I am unable to ag4ree with the AO’s decision. Furthermore, on similar facts, the Hon’ble ITAT, Kolkata, is seen to have deleted similar disallowances in the case of M/s. Ashoka Transports [ITA No. 1265/KOL/2009] by their order dated 20.11.2009. Respectfully following the said decision, the disallowances made are directed to be deleted and this ground of appeal is allowed”.
Aggrieved by the order of the ld. CIT(Appeals), the Revenue has preferred this appeal before the Tribunal.
We have heard the arguments of both the sides and also perused the relevant material available on record. As found by the ld. CIT(Appeals) on the basis of relevant record, the information as regards the names and addresses of the truck owners to whom truck hire charges were paid by the assessee was already available before the Assessing Officer in the Forms 15-I and 15-J furnished by the assessee. No enquiry whatsoever was made by the Assessing Officer with the concerned truck owners to find out the genuineness of the hire charges claimed to be paid by the assessee. Even no specific or material defects were pointed out by the Assessing Officer in the vouchers maintained by the assessee in support of his claim for truck hire charges except that the said vouchers were self-made vouchers and the truck hire charges were paid by the assessee in cash. Keeping in view the nature of the business of the assessee, there was nothing unusual in making the payment of truck hire charges in cash through self-made vouchers so as to doubt the genuineness of the ./2013 Assessment year: 2008-2009 Page 4 of 5 expenditure incurred by the assessee on truck hire charges. Moreover, as rightly held by the ld. CIT(Appeals), the ad hoc disallowance of Rs.30,00,000/- made by the Assessing Officer was without any basis. In the case of Ranjit Singh Prem Singh Ahuja –vs.- DCIT (ITA No. 961/PN/2014 dated 24.06.2015), a similar issue had come up for consideration before the Pune Bench of this Tribunal and the disallowance of 2% of transport expenses made by the Assessing Officer by raising trivial objection was held to be not sustainable by the Tribunal on the ground that no material discrepancy whatsoever had been pointed out by the Assessing Officer in the books of account and other record maintained by the assessee in support of its claim for transport expenses. Keeping in view the decision of the Coordinate Bench of this Tribunal in the case of Ranjit Singh Prem Singh Ahuja (supra) and having regard to all the facts of the case, we are of the view that the ad hoc disallowance of Rs.30,00,000/- made by the Assessing Officer out of truck hire charges was not sustainable and the ld. CIT(Appeals) is fully justified in deleting the same. In that view of the matter, we uphold the impugned order of the ld. CIT(Appeals) giving relief to the assessee on this issue and dismiss this appeal filed by the Revenue.