The Commissioner Of Income Tax ,Rohtak v. Anil Kumar Arya

In the High Court for the States of Punjab and Haryana at Chandigarh… ITA No.508 of 2007 Date of decision:4.4.2008 The Commissioner of Income Tax ,Rohtak Appellant Versus Anil Kumar Arya .. Respondent Coram: Hon’ble Mr.Justice Satish Kumar MittalHon'ble Mr.Justice Rakesh Kumar Garg Present:Mr.Yogesh Putney, Advocatefor the Revenue/appellant. Rakesh Kumar Garg,J 1.The Revenue has filed the present Appeal under Section260A of the Income Tax Act, 1961(for short ‘the Act’) against theorder dated 31.1.2007 passed by the Income Tax AppellateTribunal, Delhi Bench(I), Delhi (for short ‘the Tribunal’), in ITANo.122/DEL/2005 for the assessment year 2001-02 raising thefollowing proposed substantial questions of law: - “1)Whether on the facts and in the circumstances of thecase , the Hon'ble ITAT has erred in law and on facts inupholding the order of CIT(A) in deleting the addition ofRs.37,09,580/- computed on the basis of applying 8 %profit from contract receipts of 28 trucks because thecase of the assessee falls outside the ambit of section44AE as the amendments at any time during theprevious year in section 44AE is effective from 1.4.2004.The assessee case is related to A.Y. 2001-02, hence clause at any time during the year in section 44AE is notapplicable in the case of the assessee in the relevantassessment year i.e., A.Y.2001-02 ? 2) Whether on the facts and in the circumstances of thecase , the Hon'ble ITAT has erred in law in upholding the order of learned CIT(A) deleting the addition ofRs.6,62,425/- on account of income of 5 trucks on thesame basis which were owned by the assessee but notused in the tender of M/s Satpriya & Sons during theyear under consideration ? 3)Whether on the facts and in the circumstances of thecase , the Tribunal has erred in law in not adjudicatingthe ground of appeal of the revenue in respect of additiondeleted by the CIT(A) at Rs.4,00,000/- on account ofrepair and renovation of flat and Rs.13,95,000/- onaccount of unexplained investment in shares? 4)Whether on the facts and in the circumstances of thecase , the Tribunal has erred in law ignoring the factsthat the TDS of the receipts on form No.16A from these28 trucks were claimed by the assessee in his return ofincome and the refund was claimed by him and has beenreceived by the assessee on all these 28 trucks ? 5)Whether on the facts and in the circumstances of thecase , the Tribunal has erred in law in not taking intoaccount the provision of section 199 of the Income TaxAct which stipulate that any deduction made in accordance with section 194 C of the Act and paid to theCentral Govt. shall be treated as a payment of tax onbehalf of the person from whose income the deductionwas made and credit shall be given to him on productionof certificate u/s 203 of Income Tax Act on theassessment made under this Act for the A.Y. for suchincome is assessable provided that where the income isassessable to any other person the credit shall be givento such other persons in such circumstances as may beprescribed.?” The assessee is a transport contractor and is engaged inthe business of supplying oil tankers on hire to various oil companies.The return of income in this case was filed by the assessee on25.9.2001 declaring total income of Rs.1,96,590/-. The said returnwas processed under Section 143(1)(a) of the Act. Later on the casewas selected for scrutiny. The assessee was issued notice underSection 143(2) of the Act. The assessee is a transport contractor and is engaged inthe business of supplying oil tankers on hire to various oil companies.The return of income in this case was filed by the assessee on25.9.2001 declaring total income of Rs.1,96,590/-. The said returnwas processed under Section 143(1)(a) of the Act. Later on the casewas selected for scrutiny. The assessee was issued notice underSection 143(2) of the Act. Reply was filed by the assessee. No books of accountare stated to have been maintained by him on the plea that his caseis covered under the provisions of Section 44 AE of the Act. TheAssessing Officer reached the conclusion that provisions of Section44 AE are not applicable in the case of the assessee and theassessee was required to maintain regular books of account and getthese audited as per Section 44 AA and 44 AB of the Act. TheAssessing Officer estimated the total income of the assessee on thebasis of gross receipts earned by him by applying a net profit of 8 % and made additions vide his order dated 27.2.2004. Aggrieved against this order, the assessee filed anappeal before the Commissioner of Income Tax(Appeals), Rohtak(for short 'the CIT(A)'). The CIT (A), Rohtak vide his order dated28.10.2004 partly allowed the appeal and held that at no point oftime, the assessee owned more than 9 trucks during the accountingyear of appeal and directed the assessment of the income frombusiness of trucks to be made at Rs.1,96,000/- as returned plusRs.24000/-. Not satisfied with the order of the CIT(A), Rohtak, therevenue filed the present appeal challenging the said order beforethe Tribunal. The main argument of the revenue before the Tribunalwas that the assessee had failed to produce the books of account orthe registration certificates of various tankers/trucks to verify as towhether or not the assessee was owning more than 10 trucks so asto verify the applicability of Section 44 AE of the Act. The Tribunalfound that the dispute is essentially factual in nature and as per thecomputation of income filed by the assessee, the total number oftankers owned by the assessee does not exceed 10 at any timeduring the previous year relevant to the assessment year underconsideration and there is no material brought on record by theRevenue to controvert the said finding and therefore, the provisionsof Section 44 AE have been rightly held to be applicable to theassessee. We have heard Mr.Yogesh Putney, Advocate learnedcounsel for the Revenue and perused the record. The Tribunal has ITA No.508 of 2007 given a pure finding of fact to the effect that total number of trucksowned by the assessee does not exceed 10 at any point of timeduring the assessment year under consideration and there is nomaterial brought on record by the Revenue to controvert the saidfactual finding. Section 44 AE is a special provision for computing theprofits and gains from the business of plying, hiring for lease ofgoods carriages. It provides that income from plying, hiring, leasinggoods carriages shall be computed at Rs.2,000/- per month for everyvehicle owned by an assessee. The provisions of Section 44 AE ofthe Act are applicable to only those assessees who do not own morethan ten goods carriage. Since the Tribunal has found as a fact that the totalnumber of tankers owned by the assessee does not exceed 10 atany point of time during the relevant period. The provisions ofSection 44 AE of the Act are applicable in the case of the assesseeand therefore, the provisions of Section 44 AE have been rightlyapplicable to the case of the assessee. No other point has beenargued by the learned counsel for the Revenue. In view of the finding of fact, we find no infirmity in theorder of the Tribunal. No substantial questions of law arises from theorder of the Tribunal. Thus, the appeal filed by the Revenue beingdevoid of any merit is hereby dismissed. (RAKESH KUMAR GARG) JUDGE (SATISH KUMAR MITTAL) JUDGE