ACIT, Sonepat v. M/s Atlas Cycle Haryana Ltd., Sonepat

ITA 243/DEL/2009 | 2005-2006
Pronouncement Date: 26-02-2010 | Result: Partly Allowed

Appeal Details

RSA Number 24320114 RSA 2009
Bench Delhi
Appeal Number ITA 243/DEL/2009
Duration Of Justice 1 year(s) 1 month(s) 5 day(s)
Appellant ACIT, Sonepat
Respondent M/s Atlas Cycle Haryana Ltd., Sonepat
Appeal Type Income Tax Appeal
Pronouncement Date 26-02-2010
Appeal Filed By Department
Order Result Partly Allowed
Bench Allotted A
Tribunal Order Date 26-02-2010
Date Of Final Hearing 22-02-2010
Next Hearing Date 22-02-2010
Assessment Year 2005-2006
Appeal Filed On 21-01-2009
Judgment Text
I.T.A. NO243 /DEL/09 1/7 IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH A NEW DELHI) BEFORE SHRI R.P. TOLANI JUDICIAL MEMBER AND SHRI A.K. GARODIA ACCOUNTANT MEMBER I.T.A. NO.243 /DEL/2009 ASSESSMENT YEAR : 2005-06 ACIT M/S ATLAS CYCLES (HARYANA) LTD. CIRCLE SONEPAT. V. ATLAS ROAD SONEPAT. SONEPAT. (APPELLANT) (RESPONDENT) APPELLANT BY : MS. PRATIMAKAUSHIK SR. DR. RESPONDENT BY : SHRI BHARAT BERIWAL ADVOCATE. ORDER PER A.K. GARODIA AM: THIS IS REVENUE'S APPEAL DIRECTED AGAINST THE ORDER OF LD CIT(A) ROHTAK DATED 11.11.2008 FOR ASSESSMENT YEAR 2005-06. 2. THE GROUNDS RAISED BY THE REVENUE READ AS UNDER: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE CIT(A) HAS ERRED IN THE LAW AND FACTS IN DELETING THE ADDITION OF RS .3 00 000/- ON ACCOUNT OF BUILDING REPAIR FOR WHICH NO SUPPORTING VOUCHER S WERE PRODUCED BY THE ASSESSEE. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE CIT(A) HAS ERRED IN THE LAW AND FACTS IN DELETING THE ADDITION OF RS .2 00 000/- ON ACCOUNT OF REFRESHMENT OUTSIDE FOR WHICH NO SUPPORTING VOU CHERS WERE PRODUCED BY THE ASSESSEE. . I.T.A. NO.243/DEL/09 2/7 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE CIT(A) HAS ERRED IN THE LAW AND FACTS IN DELETING THE ADDITION OF RS .1 00 000/- ON ACCOUNT OF BUSINESS P0RESENT EXPENSES FOR WHICH COMPLETE S UPPORTING VOUCHERS WERE NOT PRODUCED BY THE ASSESSEE. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE CIT(A) HAS ERRED IN THE LAW AND FACTS IN DELETING THE ADDITION OF RS .38688/- ON ACCOUNT OF WINE AND BEER EXPENSES FOR WHICH JUSTIFICATION OF THESE EXPENSES FOR BUSINESS USE WAS NOT FURNISHED THE ASSESSEE. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE CIT(A) HAS ERRED IN THE LAW AND FACTS IN DELETING THE ADDITION OF RS .2 00 000/- ON ACCOUNT OF MISC. EXPENSES FOR WHICH COMPLETE SUPPORTING V OUCHERS WERE NOT PRODUCED BY THE ASSESSEE. 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE CIT(A) HAS ERRED IN THE LAW AND FACTS IN DELETING THE ADDITION OF RS .1 00 000/- ON ACCOUNT OF SUBSCRIPTION TO CLUB FOR WHICH COMPLETE SUPPORT ING VOUCHERS WERE NOT PRODUCED BY THE ASSESSEE. 7. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE CIT(A) HAS ERRED IN THE LAW AND FACTS IN DELETING THE ADDITION OF RS .3 00 000/- ON ACCOUNT OF TRAVELING EXPENSES FOR WHICH COMPLETE SUPPORTI NG VOUCHERS WERE NOT PRODUCED BY THE ASSESSEE. 8. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE CIT(A) HAS ERRED IN THE LAW PROMOTION FOR WHICH COMPLETE SUPPORTIN G VOUCHERS WERE NOT PRODUCED BY THE ASSESSEE. . I.T.A. NO.243/DEL/09 3/7 9. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE CIT(A) HAS ERRED IN THE LAW AND FACTS IN DELETING THE ADDITION OF RS .1 00 000/- ON ACCOUNT OF POSTAGE TELEPHONE PRINTING AND STATIONERY EXPENS ES FOR WHICH COMPLETE SUPPORTING VOUCHERS WERE NOT PRODUCED BY T HE ASSESSEE. 10. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE THE CIT(A) HAS ERRED IN THE LAW AND FACTS IN DELETING THE ADDITION OF RS .3 00 000/- ON ACCOUNT OF FOREIGN TOUR EXPENSES FOR WHICH COMPLETE SUPPOR TING VOUCHERS WERE NOT PRODUCED BY THE ASSESSEE. 11. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE THE CIT(A) HAS ERRED IN THE LAW AND FACTS IN DELETING THE ADDITION OF RS .2 00 000/- ON ACCOUNT OF DISALLOWANCE OF OTHER REPAIRS FOR WHICH COMPLET E SUPPORTING VOUCHERS WERE NOT PRODUCED BY THE ASSESSEE. 12. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE THE CIT(A) HAS ERRED IN THE LAW AND FACTS IN DELETING THE ADDITION OF RS .1 00 000/- ON ACCOUNT OF WORKERS WELFARE EXPENSES FOR WHICH COMPLETE SU PPORTING VOUCHERS WERE NOT PRODUCED BY THE ASSESSEE. 13. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE THE CIT(A) HAS ERRED IN THE LAW AND FACTS IN DELETING THE ADDITION MADE ON ACCOUNT OF ATE DEPOSIT OF EMPLOYEES CONTRIBUTION OF ESI AND EPF A MOUNTING TO RS.834534/- WHICH IS CONTRARY TO SECTION 36(1)(VA) READ WITH SECTION 2(24)(XI) OF THE I.T. ACT. . 3. IT WAS SUBMITTED BY THE LD DR OF THE REVENUE THA T EXCEPT GROUND NO.13 REGARDING DELETION OF ADDITION MADE ON ACCOUNT OF L ATE DEPOSIT OF EMPLOYEES CONTRIBUTION TO ESI AND EPF AND IN ALL OTHER GROUND S IT IS THE GRIEVANCE OF THE ASSESSING OFFICER THAT SUPPORTING VOUCHERS WERE NOT PRODUCED BY THE ASSESSEE . I.T.A. NO.243/DEL/09 4/7 BEFORE THE ASSESSING OFFICER. IT WAS ALSO SUBMITTED THAT ALTHOUGH IT IS THE CLAIM OF THE ASSESSEE AS PER CHART SUBMITTED BY LD AR OF THE ASSESSEE THAT ALL ISSUES IN THE PRESENT YEAR ARE COVERED BY THE TRIBUNAL ORDERS IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2000-01 BUT SINCE THIS ASPECT WAS NOT THERE IN EARLIER YEARS IN THE INTEREST OF JUSTICE ALL THESE ISSUES SHOULD BE RESTORED BACK TO THE FILE OF THE ASSESSING OFFICER FOR A FRESH DECISION AND THE ASSE SSEE MAY BE DIR5ECTED TO FURNISH AND PRODUCE NECESSARY EVIDENCES BEFORE THE ASSESSING OFFICER. 4. AS AGAINST THIS IT WAS SUBMITTED BY THE LD AR O F THE ASSESSEE THAT ALL THESE ISSUES IN THE PRESENT APPEAL ARE COVERED BY T HE TRIBUNAL ORDERS IN ASSESSEES OWN CASE IN VARIOUS EARLIER YEARS AND CO PIES OF THESE TRIBUNAL DECISIONS ARE AVAILABLE IN PAPER BOOK. OUR ATTENTIO N WAS DRAWN TO THE TRIBUNAL ORDER FOR ASSESSMENT YEAR 2000-01 IN REVENUES APPE AL AS PER I.T.A. 4346/DEL/2003 DATED 25..8.2006 AND IN PARTICULAR OU R ATTENTION WAS DRAWN TO PARA NO.7 OF THIS TRIBUNAL ORDER WHEREIN IT IS NOTED BY THE TRIBUNAL THAT THE ASSESSING OFFICER MADE THE DISALLOWANCE ON THE GROUND THAT TH E EXPENSES WERE NOT PROPERLY VOUCHED. IT WAS SUBMITTED THAT IT GOES TO SHOW THAT THIS ASPECT WAS ALSO CONSIDERED BY THE TRIBUNAL IN EARLIER YEARS AND HEN CE THE ISSUES ARE SQUARELY COVERED IN FAVOUR OF THE ASSESSEE. 5. REGARDING GROUND NO.13 OF THE REVENUE REGARDING DELETION OF ADDITION MADE BY THE LD CIT(A) ON ACCOUNT OF LATE DEPOSIT OF EMPLOYEES CONTRIBUTION TO ESI AND EPF. IT WAS SUBMITTED THAT THIS ISSUE IS AL SO COVERED IN FAVOUR OF THE ASSESSEE BY THE JUDGMENT OF HON'BLE DELHI HIGH COUR T RENDERED IN THE CASE OF P.M. ELECTRONICS AND ALSO IN THE CASE OF CIT V. DHA RMENDER SHARMA AS REPORTED IN 213 CTR 609 (DEL.). 6. WE HAVE HEARD THE RIVAL S UBMISSIONS AND HAVE GONE THROUGH THE MATERIAL AVAILABLE ON RECORD AND THE TR IBUNAL JUDGMENTS CITED BY THE LD AR OF THE ASSESSEE WHICH ARE AVAILABLE IN PAPER BOOK. WE FIND THAT FIRST JUDGMENT IS IN ASSESSMENT YEAR 2003-04 WHEREIN THE TRIBUNAL HAS DECIDED THE ISSUE REGARDING DELETION OF VARIOUS DISALLOWANCES O N THE BASIS OF TRIBUNAL DECISION IN ASSESSMENT YEAR 2000-01 AS PER I.T.A. NO.43436/DEL/.2003 AND IN . I.T.A. NO.243/DEL/09 5/7 I.T.A. NO. 42316/DEL/2003. WHEN WE EXAMINE THIS TR IBUNAL DECISION IN ASSESSMENT YEAR 2000-01 IN I.T.A. NO.4216/DEL/2003 WE FIND THAT IT IS NOTED BY THE TRIBUNAL IN PARA NO.4 OF THIS TRIBUNAL DECISION THAT THE ASSESSING OFFICER OR THE LD CIT(A) HAS NOT REFERRED TO ANY BIOLL OR VOUC HER WHICH REPRESENT EXPENDITURE NOT INCURRED IN THE COURSE OF BUSINESS. THIS OBSERVATION OF THE TRIBUNAL GOES TO SHOW THAT THESE VOUCHERS WERE AVAI LABLE BEFORE THE AUTHORITIES BELOW AND IN SPITE OF THIS THE AUTHORITIES BELOW H AVE NOT REFERRED TO ANY BILL OR VOUCHER WHICH REPRESENT EXPENDITURE NOT INCURRED IN THE COURSE OF BUSINESS AND HENCE ON THIS ASPECT THAT BILLS AND VOUCHERS WERE N OT PRODUCED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER THIS TRIBUNAL DECISIO N OF ASSESSMENT YEAR 2000-01 DOES NOT SUPPORT THE CASE OF THE ASSESSEE. REGARDIN G TRIBUNAL ORDER IN REVENUES APPEAL FOR ASSESSMENT YEAR 2000-01 AS PER I.T.A. NO. 4336/.DEL/2003 WE FIND THAT THE GROUND NO.3 OF THE REVENUE IN THAT YEAR WAS REGARDING DELETION OF ADDITION OF RS.1.5 LAKHS MADE BY THE ASSESSING OFFI CER ON ACCOUNT OF BUILDING REPAIRS EXPENSES WITHOUT ANY COGENT REASON. THIS GO ES TO SHOW THATIN THAT YEAR IT WAS NOT THE GRIEVANCE OF THE REVENUE BEFORE THE TRIBUNAL THAT VOUCHERS WERE NOT PRODUCED BY THE ASSESSEE BEFORE THE ASSESSING O FFICER. IT IS ALSO OBSERVED BY THE TRIBUNAL THAT THE ASSESSING OFFICER HAS MADE THE DISALLOWANCE ON THE GROUND THAT THE EXPENSES WERE NOT PROPERLY VOUCHED. THIS OBSERVATION OF THE TRIBUNAL ALSO DOES NOT SUGGEST THAT THE VOUCHERS WE RE NOT PRODUCED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER IN THAT YEAR. THE OBJECTION OF THE ASSESSING OFFICER WAS NOT THAT VOUCHERS WERE NOT PR ODUCED BEFORE HIM HBUT THE OBJECTION OF THE ASSESSING OFFICER WAS THAT THE EXP ENSES ARE NOT PROPERLY VOUCHED WHICH MEANS THAT THE ASSESSING OFFICER MAY HAVE NOTICED CERTAIN DEFICIENCIES IN THE VOUCHERS. HENCE THE TRIBUNAL O RDER IN THE REVENUES APPEAL ALSO DOES NOT SUPPORT THE CASE OF THE ASSESSEE ON T HIS ASPECT. THAT EVEN IF THE BILLS AND VOUCHERS ARE NOT PRODUCED BEFORE THE ASSE SSING OFFICER THE ISSUE SHOULD BE DECIDED ONE WAY OR THE OTHER. IN ASSESSME NT YEAR 2003-04 THE GROUNDS OF THE REVENUE ARE THAT BILLS OR VOUCHERS W ERE NOT PRODUCED BEFORE THE ASSESSING OFFICER BUT THERE IS FINDING GIVEN BY THE TRIBUNAL IN THAT YEAR AS TO WHETHER THIS ALLEGATION OF THE REVENUE IS CORRECT O R NOT AND THE ISSUE IN THAT YEAR . I.T.A. NO.243/DEL/09 6/7 WAS DECIDED ON THE BASIS OF EARLIER TRIBUNAL DECISI ONS. IN THE PRESENT YEAR THE LD DR HAS POINTED OUT BEFORE US THAT IN THE ASSESSMENT ORDER A SPECIFIC FINDING IS GIVEN BY THE ASSESSING OFFICER THAT THE ASSESSEE HA S NOT PRODUCED ANY SUPPORTING BILLS OR VOUCHERS ETC. IN THIS REGARD HE DRAWN OUR ATTENTION TO PARA NO.3 OF THE ASSESSMENT ORDER AND IN THE STATEMENT O F FACTS OR GROUNDS OF APPEAL BEFORE LD CIT(A) THE ASSESSEE HAS NOWHERE DISPUTED THIS OBSERVATION OF THE ASSESSING OFFICER IN THE ASSESSMENT ORDER THAT THE ASSESSEE HAS NOT PRODUCED ANY BILLS OR VOUCHERS BEFORE HIM. THERE IS NO FINDI NG OF LD CIT(A) ALSO REGARDING THIS OBSERVATION OF THE ASSESSING OFFICER THAT BILL S AND VOUCHERS WERE NOT PRODUCED BEFORE HIM IS NOT CORRECT. LD CIT(A) HAS D ECIDED THESE ISSUES ON THE BASIS THAT THE ASSESSING OFFICER HAS NOT POINTED OU T EVEN A SINGLE ITEM OF EXPENDITURE WHICH HAS NOT BEEN VOUCHED AND SUPPORTE D BY RELEVANT BILLS AND VOUCHERS. THIS OBSERVATION OF THE LD CIT(A) IS NOT PROPER BECAUSE WHEN THE ASSESSING OFFICER SAYS IN THE ASSESSMENT ORDER THAT THE ASSESSEE DID NOT PRDUCE ANY SUPPORTING BILLS AND VOUCHERS ETC. IT IS NOT P OSSIBLE FOR THE ASSESSING OFFICER TO PIN-POINT ANY SPECIFIC ITEM OF EXPENSES WHICH IS NOT SUPPORTED BY THE RELEVANT BILLS AND VOUCHERS. SINCE THE FACTS IN THE PRESENT YEAR ARE DIFFERENT WE FEEL THAT EARLIER TRIBUNAL ORDERS CANNOT BE FOLLOWED BESIDES THE ISSUE IS BEFORE US BECAUSE IN THE PRESENT YEAR LD DR OF THE REVENUE WAS ABLE TO SATISFY US THAT IN THE PRESENT YEAR BILLS AND VOUCHERS WERE NOTN PRODUCED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER. WE THEREFORE SET ASIDE THE ORD ER OF THE LD CIT(A) ON ALL THE ISSUES EXCEPT REGARDING DELETION OF ADDITION MADE B Y THE ASSESSING OFFICER ON ACCOUNT OF LATE DEPOSIT OF EMPLOYEES CONTRIBUTION TO ESI & EPF AND RESTORE ALL THESE MATTERS BACK TO THE FILE OF THE ASSESSING OFF ICER FOR A FRESH DECISION. THE ASSESSEE HAS TO PRODUCE RELEVANT BILLS AND VOUCHERS FOR ALL THESE EXPENSES AND THEREAFTER THE ASSESSING OFFICER SHOULD DECIDE THES E ISSUES AFTER PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE . 7. REGARDING GROUND NO.13 OF THE REVENUE I.E. REGAR DING DELETION OF ADDITION MADE ON ACCOUNT OF LATE DEPOSIT OF EMPLOYEES CONTR IBUTION TO ESI AND EPF AMOUNTING TO RS.8 34 534/- WE FIND THAT AS PER THE DETAILS OF THESE DEPOSITS . I.T.A. NO.243/DEL/09 7/7 AVAILABLE ON APGES 3-04 OF ASSESSMENT ORDER LAST D EPOSIT WAS MADE ON 22.2.2005 WHICH IS WITHIN THE ACCOUNTING YEAR ITSEL F AND HENCE ADMITTEDLY THESE DEPOSITS WERE BEFORE THE DUE DATE OF FILING OF RETU RN OF INCOME BY THE ASSESSEE AND HENCE AS PER TWO JUDGMENTS OF HON'BLE DELHI HIG H COURT CITED BY THE LD AR OF THE ASSESSEE NO INTERFERENCE IS CALLED FOR IN T HE ORDER OF LD CIT(A) ON THIS ISSUE. GROUND NO.13 OF THE REVENUE STANDS REJECTED WHEREAS REMAINING GROUNDS ARE ALLOWED FOR STATISTICAL PURPOSES. 8. IN THE RESULT THE APPEAL OF THE REVENUE IS PART LY ALLOWED FOR STATISTICAL PURPOSES. 9. ORDER PRONOUNCED IN THE OPEN COURT ON 26TH FEB RUARY 2010. SD/- SD/- (R.P. TOLANI) (A.K. GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER DT. 26.2.2010. HMS COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT (A)- NEW DELHI. 5. THE DR ITAT LOKNAYAK BHAWAN KHAN MARKET NEW DELHI. TRUE COPY. BY ORDER (ITAT NEW DELHI).