Dipti Trading Co., Mumbai vs Department Of Income Tax

आयकर अपील सं./I.T.A. No. 3375/Mum/2013 ( नधारण वष / Assessment Year: 2009-10) Dy. CIT-Circle 23(2), Dipti Trading Co. Building C-10, 2nd Floor, 227, Udyog Shetra Indl. Estate बनाम/ Room No. 207, Pratyaksha Kar Bhavan, Mulund Goregaon Link Road, Bandra Kurla Complex, Bandra (E), Vs. Mulund (W), Mumbai-400 080 Mumbai-400 051 थायी ले खा सं . /जीआइआर सं . / PAN/GIR No. AAAFD 0597 K (अपीलाथ /Appellant) : ( यथ / Respondent)

अपीलाथ क ओर से / Appellant by : Shri Love Kumar यथ क ओर से/Respondent by : Shri Mehul Shah

सनु वाई क तार ख / : 05.03.2015 Date of Hearing घोषणा क तार ख / : 25.03.2015 Date of Pronouncement

आदे श / O R D E R

Per Sanjay Garg, Judicial Member :

The present appeal has been preferred by the Revenue against the order of the Commissioner of Income Tax (Appeals) ('CIT(A)' for short) dated 18.02.2013. T Revenue has agitated the action of the ld. CIT(A) in deleting the addition Rs.17,83,862/- made by the Assessing Officer (A.O.) on account of non-reconciliation the payments to two parties.

2. The brief facts of the case are that during the assessment proceedings, the A noted that the assessee inter alia had debited freight charges of Rs.1,88,55,603/-. In or to carry out cross-verification, requisitions u/s.133(6) of the Income Tax Act, 1961 ( 2 ITA No. 3375 /Mum/2013 (A.Y. 2 009- Dy. CIT vs. Dipti Trading

Act' hereinafter) were issued to eleven parties. No reply in response was received fr the two parties namely M/s. Namakkal Roadlines and M/s. Shiv Shivani Transport. W the matter was discussed with the assessee, the assessee's representative expressed inability stating that it was beyond the control of the assessee to produce the said par who were located at far off places. Vide letter dated 23.12.2011, the assessee reques the A.O. to issue summons u/s.131 of the Act to the said two parties who had responded to the notices u/s.133(6) of the Act. The A.O., however, observed that assessment was going to get time barred and that it was not possible and practicable issue summons to the said parties. He, further, observed that the said parties w assessee's witnesses and the burden was upon the assessee to produce them. therefore, treated the payments made to the above said parties totaling to Rs.17,83,86 as non-genuine and added back the same in the income of the assessee.

3. In first appeal before the ld. CIT(A), the assessee filed application for additio evidence in respect of freight charges paid to the said two parties. The ld. CIT remanded the said evidence to the A.O. for his report. The A.O. in the remand rep reported about the transactions/evidences submitted in relation to Shiv Shivani Transp He, however, did not give any comment in relation to M/s. Namakkal Roadlines. The CIT(A) after going through the remand report and considering the objections of assessee to the said remand report made the following observations:

'4.4 The appellant has relied upon ledger account of these two parties as they appear in his books while pressing the point that all the payments have been made by cheques against the bills issued by these parties, copies of which were already provided as additional evidence. I have gone through these bills as well as ledger account of these two parties. The A.O. has in the remand report though doubted that the transactions with the parties cannot be held genuine or beyond doubt, however he chose not to make any enquiry to ascertain the facts. Further, this fact has also not been negated by the A.O. that payments have been made to these two parties by cheques and TDS also were deducted in case of Namakkal Roadlines against their bills. Merely doubting genuineness of transactions cannot be taken against the appellant in absence of finding to that effect. In view of this disallowance made in case of these two parties by A.O. are not sustainable. This view is supported by decision given by Hon'ble Gujarat High Court in the case of 3 ITA No. 3375 /Mum/2013 (A.Y. 2 009- Dy. CIT vs. Dipti Trading

Commissioner of Income tax vs. Ranchhod Jivabhai Nakhava [2012] 21 taxmann.com 159 (Guj.), already cited by the appellant. Accordingly additions made of Rs.17,83,862/- by way of disallowances of freight charges paid to these two parties are deleted herewith. Ground no. 3 is allowed.'

4. A perusal of the above findings of the ld. CIT(A) reveals that all the necess evidences such as ledger account of the said two parties, the evidence of making payment through banking channel, the copy of invoice and further that the TDS was d deducted in case of Namakkal Roadlines, etc., were duly produced by the assessee. T A.O. instead of verifying the same through proper enquiries, has just given his opin doubting the genuineness of the transaction. The ld. CIT(A) considering the s evidences deleted the additions made by the A.O. observing that the A.O. has not gi any finding that the said transactions were not genuine.

5. We find further that the assessee not only during the assessment proceedings requested the A.O. to summon the above said parties, but had also given the necess evidences which he was supposed to furnish and thereafter the burden was upon the A to make proper enquiries and contradict the said evidences. The A.O. has not done said exercise either during the assessment proceedings, or during the rem proceedings.

Under such circumstances, we do not find any infirmity in the order of the CIT(A) in deleting the impugned additions while relying upon the evidence by assessee in this respect. The order of the ld. CIT(A) is, therefore, upheld.

6. In the result, the appeal of the Revenue is hereby dismissed.

प रणामतः राज व क अपील खा रज क जाती है ।

Order pronounced in the open court on March 25, 2015

Sd/- Sd/-

(B. R. Baskaran) (Sanjay Garg) लेखा सद य / Accountant Member या यक सद य / Judicial Member मुंबई Mumbai; दनांक Dated : 25.03.2015 4 ITA No. 3375 /Mum/2013 (A.Y. 2 009- Dy. CIT vs. Dipti Trading

व. न.स./Roshani, Sr. PS

आदे श क त ल प अ े षत/Copy of the Order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent 3. आयकर आयु त(अपील) / The CIT(A) 4. आयकर आयु त / CIT - concerned 5. वभागीय त न ध, आयकर अपील य अ धकरण, मंब ु ई / DR, ITAT, Mumbai 6. गाड फाईल / Guard File आदे शानुसार/ BY ORDER,

उप/सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपील य अ धकरण, मुंबई / ITAT, Mum