Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, “ B” BENCH, KOLKATA
Before: Shri M. Balaganesh
This appeal of the assessee arises out of the order of the Learned CIT(A)-15, Kolkata in Appeal No. 38/CIT(A)-15/14-15/Cir-50/Kol dated 13-01-2015 for the Asst Year 2008-09 against the order of assessment framed by the Learned AO u/s. 143(3) of the Income Tax Act, 1961 (hereinafter referred to as the ‘Act’).
The only issue to be decided in this appeal of the assessee is as to whether the disallowance u/s. 40(a)(ia) of the Act could be made in the sum of Rs.1,43,74,884/- in the facts and circumstances of the case.
4. The brief facts of this issue are that the assessee is an individual engaged in job work of jewellery ornaments. The return of income for the assessment year 2008-09 was filed on 26-09-2008 declaring taxable income at Rs.13,79,973/-. The assessment was completed u/s. 143(3) of the Acton 31-12-2010. Later, the assessment was sought to be reopened u/s. 147 of the Act for the purpose of making of disallowance u/s. 40(a)(ia) of the Act. The re-assessment was completed on 10-03-2014, wherein a sum of Rs.1,43,74,884/- was disallowed u/s. 40(a)(ia) towards labour charges paid by the assessee to various Karigars for non compliance of TDS provisions in terms of section 194C of the Act. On 1st appeal, before the ld. CIT(A), the ld.AR sought to explain that the labour payments are made to two types to following people :- a. Own Smiths : That is the labour directly employed by the assessee only, and b. Flying Smiths: The labour hired on periodic basis depending on the work load.
4.1 The ld. A/R claimed that for the payment towards Own Smith totaling to Rs.16,19,420/- and Flying Smiths of Rs. 1,27,55,464/- the provisions of section 194C of the Act were inapplicable to the assessee. The assessee sought to file a list of 735 names and addresses with job work reference date and amount paid to the Flying Smiths in computerized form. The ld. CIT(A) observed that the assessee cannot explain the premises where the labour used to work on the gold ornaments and SP. No.01/Kol/2016 2 Jagadish Das-B-AM whether any security was taken from them. He also observed in his order that in the said list of 735 persons there were many names that were repeated. The mode of payment was also not explained by the assessee. According to the ld. CIT(A) the assessee could not produce any evidence that the gold was given to the flying smith and taken up from them for job work. No books of account evidencing the same was produced. He also observed in his order that the entire list being the additional evidences were filed before him for the first time in terms of section 46A of the I.T Rules. Thus, he refused to admit the same. The ld. CIT(A) has held that the assessee has got the ornament work done only through contractors and sub-contractors and no TDS was effected by the assessee in terms of provisions of section 194C of the Act. Accordingly, he upheld the order of the ld.AO in making addition being non deduction of TDS u/s. 40(a)(ia) of the Act. Aggrieved, the assessee is in appeal before us on the following grounds :- 1. That the order of the Hon'ble CIT (A) is bad in law as there was no reasonable opportunity provided by the Hon'ble CIT considering the facts of the case.
2. That the order of the CIT (A) and the Assessment is bad in law as the Hon'ble CIT made it Flagrantly violating the principle of natural justice.
3. That the CIT (A) was not correct in confirming the order of addition of Rs. 1,43,74,884/- passed by Ld. DCIT due to non-deduction of TDS u/s 40(a)(ia) without considering the facts and figure placed by the appellant.
That the appellant begs the liberty to further modify, alter, withdraw or add any new grounds of appeal on or before the final hearing.
4.2 The ld.AR argued that the entire list of various karigars for the job works were given. The assessee got ornaments from them for job work done and duly filed the same before the ld. CIT(A). It was also stated that no payment was made in excess of Rs. 20,000/- to any party. He also argued that no finding was given by the ld. CIT(A) with regard to this fact that payment exceeding Rs. 20,000/- was not made by the assessee. However, he fairly conceded that since the details were not available before
SP. No.01/Kol/2016 3 Jagadish Das-B-AM the ld.AO for examination, he prayed before us for set aside the issue to the file of the ld.AO to examine the entire list of various karigars and payments made thereon for the job work done by them. In response to this, the ld. Sr.DR fairly conceded for setting aside the issue to the file of the ld.AO.
We have heard the rival submissions and perused the material available on record. In the facts and circumstances of the case, we deem it fit and appropriate, in the interest of justice and fair play, to set aside the issue to the file of the AO to decide the same afresh in accordance with the law after affording reasonable opportunity of being heard to the assessee for verification of various documents as submitted by the assessee. Accordingly, the grounds raised by the assessee are allowed for statistical purpose.
In the result, the appeal of the assessee is allowed for statistical purpose and stay petition filed by the assessee is dismissed as in fructuous. THIS ORDER IS PRONOUNCED IN OPEN COURT ON 05-02- 2016
Sd/- Sd/- ( Mahavir Singh, Judicial Member ) (M. Balaganesh, Accountant Member) Date:
Date 05-02-2016
Copy of the order forwarded to:- 1.. The Appellant: Shri Jagadish Das 203 R.N Tagore Road, Kol-77. 2 The Respondent- The DCIT, Cir-50, Manicktala Civic Centre, Uttarapan, Shopping Complex, DS-II 2nd Fl., Ultadanga, Kol-54. 3 /The CIT, 4.The CIT(A)
SP. No.01/Kol/2016 4 Jagadish Das-B-AM