ITA NO. 3/DEL/2014 & C.O 37/DEL/2016 IN INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: NEW DELHI BEFORE SHRI G. D. AGRAWAL, VICE PRESIDENT AND SMT SUCHITRA KAMBLE, JUDICIAL MEMBER I.T.A .No.-03/DEL/2014 (ASSESSMENT YEAR 2007-08) ITO vs Alok Singla Ward-3 H. NO. 1132, Sector, 14 Sonepat Sonepat AZHPS3355E (APPELLANT) (RESPONDENT) C.O .No.-37/DEL/2016 (ASSESSMENT YEAR 2007-08) Alok Singla vs ITO H. NO. 1132, Sector, 14 Ward-3 Sonepat Sonepat AZHPS3355E (APPELLANT) (RESPONDENT) Appellant by Sh. S. K. Jain, Sr. DR Respondent by Sh. Gautam Jain, Adv. Sh. Piyush Kumar Kamal. Adv Date of Hearing 08.08.2016 Date of Pronouncement 19.09.2016 ORDER PER SUCHITRA KAMBLE, JM This appeal is filed by Revenue against order dated 21/10/2013 passed by CIT(A), Rohtak and cross objection is filed by assessee. 2 ITA NO. 3/DEL/2014 & C.O 37/DEL/2016 2. grounds of appeal are as follows:- (ITA NO.03/Del/2014) 1. On facts and in circumstances of case, ld has erred in law and facts in deleting addition of Rs.1,81,578/- made by A.O as assessee failed to give any reliable and sustainable evidence in support of various expenses viz. travelling and conveyance, loading & unloading and freight & cartages expenses claimed by assessee as discussed in detail by A.O while framing assessment. 2. On facts and in circumstances of case, ld has erred in law and facts in deleting addition of Rs.49,03,790/- out of total addition amounting to Rs.51,35,739/- made on account of contra entries claimed but not proved by assessee; ld erroneously considered remand report submitted by A.O during 1st round of appellate proceedings, whereas instant order of ld CIT(A) pertains to case set aside by Hon ble ITAT in ITA NO. 3544/Del/2010 dated 21/4/2011 to file of A.O for fresh adjudication. 3. grounds of appeal are as follows:- (C.O NO.37/Del/2016) 1. That initiation of proceedings u/s 147 of Act and completion of assessment u/s 147/143(3) of Act without satisfying statutory provisions contained in Act is without jurisdiction and therefore deserves o be quashed as such. 2. That furthermore in any case addition made of Rs.51,35,739/- in impugned order of assessment framed u/s 147/143(3) of Act is beyond scope of assessment and is excess of jurisdiction and therefore untanable. 4. original assessment u/s 143(3) of Income tax Act, 1961 was completed on 21/12/2009. assessed income of Rs.7,96,73,660/- as against return income of Rs.3,43,270/-. 3 ITA NO. 3/DEL/2014 & C.O 37/DEL/2016 addition of Rs.7,93,40,390/- was deleted by CIT(A) s Rohtak except for disallowing Rs.70,020/-, on account of advertisement expenses. ITAT on Department s appeal before it vide order dated 21/04/2013 set aside addition of Rs.51,45,739/- to file of Assessing Officer and rejected other grounds of appeal. Prior to order of ITAT it was found that income amounting to Rs.1,81,578/- had escaped assessment within meaning of Section 147 read with Section 148 of Income-tax Act, and therefore, after duly recording reasons and obtaining necessary approval notice u/s 148 was issued on 20th March 2011. This amount related to expenditure on freight, loading/unloading and travelling on behalf of consigner to reimbursed. 5. Assessing Officer while passing fresh order has observed that no documentary evidence has been furnished either by assessee or by M/s Luminous Power Technologies Pvt. Ltd. that particulars given in regard to contra entries are correct. Therefore, assessee could not verify genuineness of contra entries with documentary evidence in form of any bills/invoices/cheques etc and made addition of Rs.51,35,739/-, assessee filed appeal before CIT(A). CIT(A) held that assessee has submitted copies of their expenses on account of travelling and conveyance, loading/unloading and freight and cartages before CIT(A). copy of agreement with M/s Luminous Power Technologies Pvt. Ltd. was also filed before Assessing Officer as well as before CIT(A). Assessing Officer 4 ITA NO. 3/DEL/2014 & C.O 37/DEL/2016 in his order has not proved that said amounts were not reimbursed by M/s Luminous Power Technologies Pvt. Ltd. Thus, assessee s appeal was allowed on this ground. CIT(A) further held that (extracts of para 3 & 4 of CIT(A) s order):- (5) entries amounting to Rs.408157/- and Rs.3,509/- have effect on account of assessee. In his present claim assessee specifies that entries relate to commission and others which were being credited to our account and simultaneously reversed because company had issued cheques for same. cheques have already been accounted for in our accounts in various heads. This version of assessee has also been examined and it is found that M/s Luminous Power Technologies Pvt. Ltd said in its certification dated 26/4/2010 that Rs.4,08,157/- belongs to commission while assessee in its submission and its annexure dated 6/5/2010 stated that entries amounting to Rs.4,08,157/- relates to interest on security at Rs.55,487/- (9.5.2006); commission received Rs.43,917/-; reimbursement of expenses Rs.46,527/- ; salary to Rs.3,500/- reimbursement of expenses Rs.82,518/-; commission and brokerage Rs.82,518/- (29.06.2006); and Rs.93,8=690/- (01.08.2006). version of assessee has been examined and it is seen that entries of commission amounting to Rs.82,518/- (including RDS) and Rs.93,690/- (including TDS) have been found to be genuine . A.O has also stated that balance of Rs.231949/- has been certified by M/s Luminous Power Technologies Pvt. Ltd as commission entries while this has not been stated to be so in books of assessee. 4. I have considered A.O s remand report as well as assessee s submissions and reply to remand report. assessee has not been able to prove that sum of Rs.2,31,949/- was anything what commission entries. Therefore, this amount of Rs.2,31,949/- out of addition of Rs.51,35,739/- stands confirmed. This ground of appeal is partly allowed. 5 ITA NO. 3/DEL/2014 & C.O 37/DEL/2016 6. Ld. DR relied on order of Assessing Officer held that assessee could not made any attempt to produce document before Assessing Officer. Hence, CIT(A) was not correct in allowing appeal of assessee. 7. Ld. AR submitted that in remand report itself expenses were admitted by Assessing Officer to extent of 4,08,157/-. Thus, making addition of Rs.51,35,739/- was not correct on part of Assessing Officer. CIT(A) has taken proper cognizance of same. assessee produced all these documents related to various expenses vide travelling and conveyance loading/unloading and freight and cartages expenses. 8. We have heard both parties and perused material available on record. Assessee produced all relevant documents before Assessing Officer. CIT(A) has correctly dealt issue. In fact, in remand report itself expenses incurred clearly stated out to Rs.4,08,157/- and CIT(A) has given clear finding by disallowing Rs.2,31,949/- to that extent. There is no requirement for interfering well reasoned order of CIT(A). 9. In result, appeal is dismissed. C.O of assessee is disposed off. order is pronounced in open court 19th of September, 2016. Sd/- Sd/- (G. D. AGRAWAL) (SUCHITRA KAMBLE) VICE PRESIDENT JUDICIAL MEMBER 6 ITA NO. 3/DEL/2014 & C.O 37/DEL/2016 Dated: 19/09/2016 R. Naheed Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI Date 1. Draft dictated on 08.07.2016 PS 2. Draft placed before author 08.08.2016 PS 3. Draft proposed & placed before .2016 JM/AM second member 4. Draft discussed/approved by JM/AM Second Member. 5. Approved Draft comes to .09.2016 PS/PS Sr.PS/PS 6. Kept for pronouncement on PS 7. File sent to Bench Clerk 19.09.2016 PS 8. Date on which file goes to AR 9. Date on which file goes to Head Clerk. 10. Date of dispatch of Order. ITO, Ward-3, Sonepat v. Alok Singla