Ita/362/2010 Of The Commissioner Of Income Tax v. Shri A Balarama Reddy

1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU ON THE 14 DAY OF NOVEMBER, 2018 BEFORE THE HON'’BLE MR. JUSTICE RAVI MALIMATH AND| THE HON’BLE MR. JUSTICE K.NATARAJAN INCOME TAX APPEAL No.367 of 2010 BEI|WEEN 1.THE DEPUTY COMMISSIONER INCOME TAX, CIRCLE - 1) DAVANAGERE 2).THE INCOME - TAX OFFICER|WARD - 1, CHITRADURGA ..» APPELLANTS ©WARD - 1, CHITRADURGA ..» APPELLANTS © (BY SRI: K.V.ARAVIND, ADVOCATE) AND SRI.A. BALARAMA REDDY CLASS I CONTRACTOR SRUJANA NILAYA, S.R.LAYOUT CHITRADURGA ... RESPONDENT| (BY SRIYUTHS A SHANKAR AND M.LAVA, ADVOCATES). THIS|INCOME|TAXAPPEAL|[ISFILED|UNDER|SECTION 260-A OF INCOME TAX ACT, 1961 ARISING OUT|OF|ORDERDATED20.05.2010|PASSED|IN|ITANO.746/Bang/2009, FOR THE ASSESSMENT YEAR 2006- 2007, PRAYING TO I)FORMULATE THE SUBSTANTIAL)QUESTIONS OF LAW STATED THEREIN, ID)ALLOW THE)APPEAL AND SET ASIDE THE ORDER PASSED BY THE ITAT,BENGALURU IN ITA NO.746/Bang/2009 DATED 20.05.2010CONFIRMING.THE|ORDER.OF|THE|APPELLAIECOMMISSIONER AND CONFIRM THE ORDER PASSED BY.THE INCOME TAX OFFICER, WARD - 1, CHITRADURGA, IN|THE INTEREST OF JUSTICE AND EQUITY. AK AK THIS INCOME TAX APPEAL COMING ON FORHEARING THIS DAY, RAVI MALIMATH. J., DELIVERED THE.FOLLOWING: JUDGMENT Tne Assessee herein is the very Assessee as inIncome Tax Appeal No.361 of 2010 which pertains to theassessment year 2005-06. The present appeal is for tneassessment year 2006-07. 2. Income Tax Appeal No.361 of 2010 was disposed| off today on three substantial questions of law. Since the.substantial questions of law involved are one and the same.in both appeals, this appeal is admitted on the following:three substantial questions of law as was considered in.Income Tax Appeal No.361 of 2010. — 1. Whether the finding of the AppellateAuthorities that a sum of Rs.1,94,21,443/-.snown as trade creditors should be accepted asthe same had peen reflected in the accounts|ana tne name, adaress ana_ confirmatoryletters were produced witnout examining thecreait wortniness is perverse, arbitrary andbaseless and therefore unsustainable? 2Whether the Appellate Autnoritieswere correct in holding that a sum _ oRs.1,94,00,885/-Waspaymentsmade.tolabourers as wages and therefore the samewas not payment to sub-contractor/contractoru/s.194CoftheActandconsequentlyprovisions of section 40(a)(ia) of the Act wasnot applicable? 5,Whether the Appellate Autnoritieswere correct in granting relief to the assesseeby recording different reasons which were notSupported by any material and _ thereforrecordedadPervVversfindingwitnout appreciating that even wages paid will be liableto tax at source? 4 The learned counsels would submit that thisappeal can be disposed of based on the findings and theanswers recorded in Income Tax Appeal No.361 of 2010. 5. In view of the submissions made, the firstsubstantial question of law is hneld in favour of theAssessee and against the Revenue and the second and.third substantial questions of law are answered, byfollowing the judgment of this Court dated 25.05.2011.passed in Income Tax Appeal No.363 of 2010, against the)Revenue and in favour of the Assessee. The appeal is accordingly disposed off. | Sd/- Sd/-. JUDGE JUDGE TS|