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M/s. SGSIL Geophysical Services Pvt. Ltd., Pvt. Ltd.), CSC, C / 9, Vasant Kunj, New Delhi. Vs. ACIT, Range 10, New Delhi.
October, 31st 2014
               (DELHI BENCH `G' : NEW DELHI)


                         ITA No.2757/Del./2013
                       (Assessment Year : 2007-08)

M/s. SGSIL Geophysical Services Pvt. Ltd., vs.        ACIT, Range 10,
(Formerly known as M/s. Scintrex                      New Delhi.
 Geophysical Services (India) Pvt. Ltd.),
CSC, C / 9, Vasant Kunj,
New Delhi.

       (PAN : AAHCS2860A)

       (Appellant)                                    (Respondent)

          Assessee by : Shri Krishnamohan K. Menon, Advocate
              Revenue by : Shri B.R.R. Kumar, Senior DR



       This appeal filed by the assessee emanates from the order of the CIT

(Appeals)-X, New Delhi dated 16.01.2013 for the Assessment Year 2007-08.

2.     The assessee is a private limited company engaged in the business of

different types of geophysical services, such as, geological surveys like

gravimeter, magnetic, resistivity and borehole logging and perforation. During

the year, the assessee has provided borehole logging services for Coal and Coal

Bed Methane and served various customers like Essar Oil Limited, Great

Eastern Engergy Corporation Ltd., Parson Overseas Pvt. Ltd. and Reliance
                                       2                  ITA No.2757/Del/2013

Industries Ltd. The assessee has debited rent for the premises at various project

sites like Jalore in Rajasthan, Shadol in Madhya Pradesh and Asansol in West

Bengal. The Assessing Officer disallowed the payment of rent of Rs.1,42,400/-

on the basis that no rent agreement was produced. The CIT (A) has confirmed

the addition and now the assessee is in appeal before us by taking the following

grounds :-

     "1.      That on the facts and circumstances of the case and in law,
     the order of the Ld. Commissioner of Income Tax *(Appeals)
     [hereinafter referred to as CITA'] is incorrect, illegal, against the
     statutory provisions and liable to be set aside.
     2.       That on the facts and circumstances of the case and in law,
     the CITA erred in confirming the action of the Ld. Assessing
     Officer [hereinafter referred to as `AO'] in treating the amount of
     Rs.1,42,400/- paid towards rent for business purposes as an
     impermissible claim for deduction on the sole premise that there
     was no rent agreement, even though there were other documents.

     3.      That the order appealed against is contrary to the facts, law
     and principles of nature justice.

3.     Grounds No.1 & 3 are general in nature and do not require any


4.     The only substantial ground is Ground No.2 in which the addition of

Rs.1,42,400/- has been challenged.

5.     We have heard both the sides on the issue. Although admittedly there

was no rent agreement, however, the assessee submitted various receipts signed

by the house owners and the amount was petty. The receipts for the rent have
                                         3                   ITA No.2757/Del/2013

been taken by the assessee after affixation of revenue stamp on the receipt.

Due to the nature of the work conducted by the assessee in various small towns

and places and that too for a short period, we find that it will not be practical to

enter into a rent agreement in such places and since the assessee has produced

the receipts for the payment and that too of a very petty amount in comparison

to the total turnover of the assessee, we find that the assessee deserves the relief

and no addition on this count is called for. Therefore, we direct to delete the


6.      In the result, the appeal of the assessee stands allowed.

     Order pronounced in open court on this 22nd day of October, 2014.

              Sd/-                                     sd/-
        (GEORGE GEORGE K.)                          (B.C. MEENA)
         JUDICIAL MEMBER                        ACCOUNTANT MEMBER

Dated the 22nd day of October, 2014

Copy forwarded to:
     4.CIT(A)-X, New Delhi.
     5.CIT(ITAT), New Delhi.                                            AR/ITAT
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