ACIT, NEW DELHI vs. M/S. AGRICULTURAL PRODUCE MARKETING COMMITTEE, NEW DELHI

BEFORE SHRI P. K. BANSAL, ACCOUNTANT MEMBER Assessment year: 2004-05 ACIT, Circle 26(1), Vs. Agricultural Produce New Delhi Marketing Committee, C/o Chetram Wholesale Fruit Vegitable Market, Keshopur, New Delhi GIR/PAN:AAATA7774K (Appellant) (Respondent) Appellant by: Shri P. Sam Kanunjna, Sr. DR Respondent by: Shri Para Chaudhary, Adv. Date of hearing : 10.11.2015 Date of pronouncement : 10.11.2015 ORDER This appeal has been filed by the Revenue against the order of Ld. CIT(A) by taking the following effective grounds of appeal:- “On the facts and in the circumstances of the case and in law, the CIT(A) has erred in – 1) Deleting the disallowance of Rs.35,70,025/- made by AO on account of property tax paid by the assessee. 2) Allowing the payment of Rs.17,48,412/- to the DAMB as statutory payment which was disallowed by the A.O. 3) Deleting the addition of Rs.1,82,384/- made by ÄO on account of income from undisclosed sources.”

2. Ground No.1 relates to the deletion of disallowance made by the AO in respect of Rs.3,570,025/-, payment of property tax to MCD and the ground rent to DDA.

3. After hearing rival submissions and going through the orders of tax authorities below, I noted that the AO had disallowed deduction in respect of rent as well as ground rent paid by the assessee to MCD and DDA as according to him, the assessee did not own the property. It is undisputed fact that the property is in the name of Delhi Agricultural Marketing Board which is a supervisory authority and constitutes the committee for carrying out the functions as provided under the Delhi Agricultural Produce Marketing Regulation Act 1998. The assessee submitted the certificate before Ld. CIT(A) that the ground rent and property tax was to be paid by the assessee. The assessee has paid the ground rent and property tax directly to MCD and DDA in the earlier year also and similar type of disallowance was deleted by Ld. CIT(A) and the Department has accepted the decision of Ld. CIT(A). In view of this fact, in my opinion, no interference is called for in the order of Ld. CIT(A) in deleting the disallowance. Therefore, ground No.1 stands dismissed. 4. Ground No.2 relates to the deletion of disallowance for a sum of Rs.17,48,612/- to DAMB disallowed by the A.O. The issue involved in this appeal is duly covered in favour of the assessee by the decision of ITAT, New Delhi Benches ‘SMC-2’Bench, in the case of APMC Vs DCIT in I.T.A. 892/Del/2007 in which the Tribunal has taken the view that the contribution to be made to DAMB is a statutory payment and is directly connected with the business of marketing committee. No contrary decision was brought to my knowledge in view of this fact. I do not find any infirmity or illegality in the order of Ld. CIT(A) in deleting the said disallowance and the order of Ld. CIT(A) is confirmed on this ground. 5. Ground No.3 relates to the deletion of disallowance of Rs.1,82,384/-. After hearing the rival submissions, I noted that the A.O. has made the addition on the basis of trade credit of Rs,.1,82,384/- in the books of accounts with Delhi State Cooperative Bank and the said credit was not incorporated by the assessee in his books of accounts. When the matter went before Ld. CIT(A), Ld. CIT(A) verified the same and given the finding on the basis of submissions made by the assessee and verified that the said credit was duly incorporated in the books of accounts of the assessee. Ld. CIT(A) on the basis of documents submitted by the assessee, deleted the addition.

6. Ld. D.R. before me even though vehemently relied upon the order of A.O. but could not adduce any evidence to the contrary. Ld. CIT(A) given the finding of fact after verifying the documents submitted by the assessee. I, therefore, do not find any illegality in the order of Ld. CIT(A). I confirm the order ofld.cia on this ground.