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
IN THE INCOME TAX APPELLATE TRIBUNAL
(DELHI BENCH `G' : NEW DELHI)
BEFORE SHRI GEORGE GEORGE K., JUDICIAL MEMBER
SHRI B.C. MEENA, ACCOUNTANT MEMBER
(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,
(PAN : AAHCS2860A)
Assessee by : Shri Krishnamohan K. Menon, Advocate
Revenue by : Shri B.R.R. Kumar, Senior DR
PER B.C. MEENA, ACCOUNTANT MEMBER :
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
"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.
(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