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Income Tax Appellate Tribunal, “E” BENCH, MUMBAI
Before: SHRI N.K. BILLAIYA & SHRI SANJAY GARG
आदेश / O R D E R
PER N.K. BILLAIYA, AM:
This appeal by the Revenue is directed against the order of the Ld. CIT(A)-6, Mumbai dated 16.09.2010 pertaining to Assessment year 2007-08.
The sole grievance of the Revenue is that the Ld. CIT(A) erred in deleting the addition of Rs. 95,06,952/- holding Rs. 93,91,054/- as reimbursement based upon the remand report.
The assessee is in the business of Stevedoring & shipping agent for all kinds vessels. While scrutinizing the return of income, the Assessing Officer found that the assessee has claimed credit for tax deducted at source on the service charge and commission received. On perusing the details filed by the assessee, the AO found that the assessee has shown commission of Rs. 3,60,480/- and professional/technical services at Rs. 1,11,74,945/-. On further perusal, the details relating to professional fees , the AO found that the assessee has received service charges (agency income) from M/s. Warner Investment & Leasing Co. Ltd. against supply of manpower amounting to Rs. 16,67,993/-. The AO was of the opinion that the assessee has received professional/technical fees from M/s. Warner Investment & Leasing Co. Ltd amounting to Rs. 1,10,86,200/- and Rs. 88,745/- from M/s. J.M. Baxi & Co. The AO was of the firm belief that since the assessee has shown the service charges received from M/s. Warner Investment & Leasing Co. Ltd., 16,67,993/- therefore the assessee has not shown the income of Rs. 94,18,207/-. The AO added this difference to the total income of the assessee. Similarly, Rs. 88,475/- received from M/s. J.M. Baxi & Co was also added to the total income of the assessee.
Aggrieved by this, the assessee carried the matter before the Ld. CIT(A). Before the Ld. CIT(A)l, it was strongly contended that Rs. 93,29,853/- is nothing but reimbursement of expenses. It was explained that the assessee was maintaining one Crane at Nava Sheva belonging to M/s. Warner Investments for which the assessee was received fixed service charges of Rs. 5,00,000/- for which the assessee employed engineers, spares etc., and serviced the crane. The assessee has incurred various expenses and these expenses were reimbursed by M/s. Warner Investments. Inadvertantly, the said company deducted tax at source which was claimed by the assessee.
4.1. After considering the facts and the submissions, the Ld. CIT(A) was convinced that the expenses are actually reimbursement made by M/s. Warner Investments. The Ld. CIT(A) further observed that similar transactions were there in assessment years 2004-05, 2005- 06 and 2006-07 as the facts of the current year being similar to the facts of the earlier years, the expenses have to be accepted. The Ld. CIT(A) accordingly directed the AO to delete the addition of Rs. 93,29,853/- and in so far as the addition of Rs. 88,745/- is concerned, the AO in his remand report has accepted that the same has been offered for taxation therefore no addition is to be made.
Aggrieved by this, the Revenue is before us.
The Ld. Departmental Representative supported the findings of the AO.
The Ld. Counsel for the assessee reiterated what has been stated before the lower authorities.
We have given a thoughtful consideration to the orders of the authorities below. The entire dispute revolves around the fact that whether Rs. 93,29,852/- pertains to reimbursement of expenses by M/s. Warner Investments. We find that the Ld. CIT(A) has appreciated the facts in proper perceptive. We, also find that the Ld. CIT(A) has also called for a remand report from the AO and after considering the facts in totality, the Ld. CIT(A) directed the AO to delete the impugned addition. We, therefore, do not find any merit in the case of the Revenue.
In the result, the appeal filed by the Revenue is accordingly dismissed.
Order pronounced in the open court on 14th October, 2015