IN THE INCOME TAX APPELLATE TRIBUNAL: "A" BENCH: CHANDIGARH
BEFORE SHRI H L KARWA, HON'BLE VICE PRESIDENT AND
SHRI D K SRIVASTAVA, HON'BLE ACCOUNTANT MEMBER
ITA No. 959/Chd/2010
Assessment Year 2004-05
The Truck Operators Union v. I.T.O. Barnala
Sehna - Bhadaur
Appellant By : Shri Sudhir Sehgal
Respondent By: Shri Jyoti Kumari
Date of hearing: 21.11.2011
Date of pronouncement: 25.11.2011
D K Srivastava: The appeal filed by the assessee is directed against the order passed by the ld. CIT(A) on 14.8.2008, on the following grounds: "1 That the ld. CIT(A) has erred in upholding the addition of Rs. 19,20,000/- made by the AO on account of difference in gross receipts as per books of account and TDS certificates.
2. That the ld. CIT(A) has also erred in upholding addition of Rs. 28,20,508/- being the difference in total receipts as gathered by the AO from the banks, the total receipts credited in the bank are to the tune of Rs. 3,94,52,802/- but the same as shown in TDS certificates are Rs. 3,66,32,394/-.
3. That addition in the aforesaid paras has been made against the facts and circumstances of the case and by not considering our submissions properly.
4. That the ld. CIT(A) has erred in not considering that no reasonable opportunity was afforded to hear the case properly.
5. That the ld. CIT(A) otherwise has also erred to consider that if at all addition was to be made, it was for the profit earned after giving credit for expenses made and not of gross receipts/income.
6. That the ld. CIT(A) has also erred to consider that the assessee has maintained regular books of account and the same was audited by the Chartered Accountant.
7. That the Appellant craves leave to add or amend the grounds of appeal before the appeal is finally heard or disposed off."
2. At the time of hearing, the ld. counsel for the assessee submitted that ground Nos. 3, 6 and 7 were general in nature and therefore do not require any adjudication. They are therefore not being adjudicated.
3. Apropos ground No. 5, it was submitted that the issue raised in ground No. 5 is linked with ground Nos. 1 and 2 and therefore ground No. 5 would not require independent adjudication.
4. The issue raised in ground No. 4 was not pressed at the time of hearing. It is therefore dismissed as not pressed.
5. We are now left with only two grounds i.e. ground No. 1 and 2 by which the assessee has challenged addition of Rs. 19,20,000/- made by the AO on account of difference in gross receipts as per books of account and TDS certificates and further addition of Rs. 28,20,508/- made by the AO on account of difference in total receipts credited in the banks and shown in the TDS certificates.
6. The assessee is an Association of Persons (AOP) located at Sehna - Bhadaur, Distt Barnala consisting of truck operators who have joined voluntarily to form an Association to avoid competition amongst themselves and to promote their business through a facilitator, i.e., the assessee-union. The assessee filed its return of income on 22.12.2004 returning total income at Rs. 56,069/- against which assessment u/s 143(3) of the Income-tax Act was completed on 22.12.2006 assessing the total income at Rs. 48,18,900/- after making the impugned additions. On appeal, the ld. CIT(A) has confirmed the impugned additions made by the AO.
7. Aggrieved by the order passed by the ld. CIT(A), the assessee is now in appeal before this Tribunal. In support of appeal, it was submitted that the assessee-union is acting as a mere facilitator for its members. It was further submitted that the assessee-union received certain contracts from the agencies for transportation of their goods pursuant to which it utilized the trucks of its members for transportation. It was pointed out that the receipts collected from the agencies were simply passed on to the members operating the trucks after deducting commission out of such receipts. It was submitted that the members, being truck owners, were entitled not only to receipts but also to meet entire expenses on the operation of their trucks. According to the ld. counsel for the assessee, the assessee was entitled merely to collect commission.
8. In reply, the ld. DR supported the orders passed by the ld. CIT(A).
9. We have heard both the parties and carefully considered their submissions. It is claimed by the assessee that it entered into contracts with various agencies for transportation of their goods. It is also claimed that the trucks of the members of the union were utilized for this purposes. It is further submitted that the members of the union were not only entitled to the receipts collected by the assessee on their behalf from the agencies for which the goods were transported but also obliged to meet the entire expenditure on the operation of their trucks. It is also the case of the assessee that it is entitled to retain a part of the receipts as commission, which is nominal. It is submitted that the assessee was neither entitled to retain the receipts nor liable to meet the expenses relating to the operations of the trucks of its members and therefore neither the receipts nor the expenses of the trucks, could be considered in the hands of the assessee.
10. Perusal of the order passed by the ld. CIT(A) shows that he aforesaid submissions made by the assessee have not been considered. It is therefore considered appropriate to vacate the order of the ld. CIT(A) in this behalf and restore the matter to his file for fresh decision in conformity with law. Reasonable opportunity of hearing shall be given to both the parties. We order accordingly.
11. Appeal filed by the assessee is treated as allowed for statistical purposes.
Order pronounced on 25.11.2011
(H L KARWA) (D K SRIVASTAVA)
VICE PRESIDENT ACCOUNANT MEMBER
1. The Appellant, The Truck Operators Union
2. The Respondent, I.T.O
3. The CIT, Patiala
4. The CIT(A), Patiala
5. The D.R, Income-tax Department, Chandigarh
Assistant Registrar, ITAT, Chandigarh
ITA No. 959/Chandi/2010
The Truck Operators Union V. I.T.O .