Income Tax Appellate Tribunal - Delhi
Shri Rakesh Kumar Jain, New Delhi vs Acit, New Delhi on 5 October, 2017
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH "F", NEW DELHI
BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBER
AND
MS. SUCHITRA KAMBLE, JUDICIAL MEMBER
ITA No.4559/Del/2016
Assessment Year : 2012-13
Rakesh Kumar Jain, ACIT, Circle- 62(1),
Prop. R. K. Construction New Delhi.
Company,
B-27, Second Floor, B- Block, Vs.
Radhey Puri, Krishna Nagar,
New Delhi.
PAN : AALPJ7673H
(Appellant) (Respondent)
Assessee by : Shri Piyush Kaushik, Adv.
Department by : Shri Atiq Ahmad, Sr.DR
Date of hearing : 05-10-2017
Date of pronouncement : 05-10-2017
ORDER
PER R. K. PANDA, AM :
This appeal filed by the assessee is directed against the order dated 24.06.2016 of CIT(A)-20, New Delhi relating to assessment year 2012-13.
2. Facts of the case, in brief, are that the assessee is an individual and is the proprietor of M/s R.K. Construction Company. He filed his return of income on 25.09.2012 declaring total income of Rs.1,19,25,130/-. During the course of assessment proceedings, the Assessing Officer observed that no TDS has been deducted on the shuttering charges amounting to Rs.12,12,615/- and hiring 2 ITA No.4559/Del/2016 charges amounting to Rs.36,53,480/- debited in Profit & Loss Account. The Assessing Officer, therefore, asked the assessee to explain as to why the above amount should not be disallowed in view of the provisions of section 40(a)(ia) of the I.T. Act. In absence of any satisfactory explanation by the assessee, the Assessing Officer invoking the provisions of section 40(a)(ia) disallowed an amount of Rs.48,66,095/-.
3. Before the CIT(A), it was submitted that assessee had shown all the ledger accounts and documentary evidences regarding the shuttering expenses and hiring charges and genuineness of the same has not been disputed. It was explained that all the amounts were paid in cash to different parties and was not falling under the ambit of TDS provisions due to smallness of the amounts. Therefore, the payments made to the parties are not eligible for TDS deduction. It was reiterated that these are small payments made to various parties in cash on which TDS provisions are not applicable. The provisions of section 194C was brought to the notice of the CIT(A) and it was submitted that no TDS is to be made where such sum is credited to the account of or paid to the contractor in the course of business of plying, hiring or leasing of goods carriages if the PAN is furnished by the contractor. It was accordingly submitted that the TDS on the payment of Rs.7,54,558/- made to M/s Ramesh Transport Company by 3 ITA No.4559/Del/2016 the assessee does not fall within the ambit of section 194C and not eligible for TDS deduction.
4. However, the CIT(A) was not satisfied with the explanation given by the assessee and upheld the disallowance made by the Assessing Officer.
5. Aggrieved with such order of the CIT(A), the assessee is in appeal before the Tribunal on the following grounds of appeal :-
"1. That the order of the Ld. Assessing Officer is bad in law and wrong on facts.
2. That the Ld. Assessing Officer wrongly disallowed Rs.48,66,095/- in shuttering expenses and hire charges due to non-deduction of TDS as it was not applicable.
3. The Ld. CIT(Appeals) erred in confirming the above addition of Rs.48,66,095/-.
4. That the Appellant prays to add/alter/amend any one or all of the grounds of appeal on or before the hearing of appeal."
6. Ld. counsel for the assessee at the outset filed the ledger account and party-wise details of shuttering expenses, copy of which is placed at page 3 to 4 of the Paper Book and submitted that none of the payment is exceeding Rs.20,000/- per day and, therefore, the provisions of section 40(a)(ia) are not applicable. Similarly, referring to page 6 to 17 of the Paper Book, he submitted that none of the payment on account of hiring charges is exceeding Rs.20,000/- so as to invoke the provisions of section 40(a)(ia). He submitted that the lower authorities have not appreciated the facts properly and, therefore, the 4 ITA No.4559/Del/2016 disallowance made by the Assessing Officer which has been sustained by the CIT(A) should be deleted.
7. Ld. DR on the other hand heavily relied on the order of the CIT(A). He submitted that the assessee has not given cogent reasons for non-applicability of the provisions of section 40(a)(ia). Therefore, the order of the CIT(A) should be upheld.
8. We have considered the rival arguments made by both the sides, perused the orders of the Assessing Officer and the CIT(A) and Paper Book filed on behalf of the assessee. A perusal of the ledger accounts and party-wise details in respect of shuttering expenses and hiring charges to Transporters shows that the assessee has made cash payments on various dates to different parties not exceeding Rs.20,000/- per day. Although, ld. counsel for the assessee drew the attention of the Bench to such ledger account it appears from the submission made before the Assessing Officer and the CIT(A) that no such specific argument was taken before them and it was only submitted that these are small payments made to various parties in cash on which TDS provisions are not applicable. Considering the totality of facts of the case and in the interest of justice, we deem it proper to restore the issue to the file of the Assessing Officer with a direction to adjudicate the issue afresh and in accordance with law after giving due opportunity of being heard to the assessee. We hold and direct 5 ITA No.4559/Del/2016 accordingly. The grounds raised by the assessee are accordingly allowed for statistical purposes.
9. In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open Court at the time of hearing itself i.e. on this 05th day of October, 2017.
Sd/- Sd/-
(SUCHITRA KAMBLE) (R. K. PANDA)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Dated: 05-10-2017.
Sujeet
Copy of order to: -
1) The Appellant
2) The Respondent
3) The CIT
4) The CIT(A)
5) The DR, I.T.A.T., New Delhi
By Order
//True Copy//
Assistant Registrar
ITAT, New Delhi