Munshi Ram Sharma, Prop., Rashtriya Transport Corp., 5810, Gali No.8, Block No.4, Dev Nagar, Karol Bagh, New Delhi. Vs. ACIT, Circle-33(1), New Delhi.
June, 19th 2015
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH : SMC : NEW DELHI
BEFORE SHRI R.S. SYAL, ACCOUNTANT MEMBER
Assessment Year : 2002-03
Munshi Ram Sharma, Vs. ACIT,
Prop., Rashtriya Transport Corp., Circle-33(1),
5810, Gali No.8, New Delhi.
Block No.4, Dev Nagar,
PAN : AATPS4846D
Appellant by : Shri A.K. Jain, CA
Respondent by: Shri Neehar Ranjan Pandey, Addl.CIT
Date of Hearing : 17.06.2015
Date of Pronouncement : 18.06.2015
This appeal by the assessee is directed against the order passed by the
CIT(A) on 26.12.2013 in relation to the Assessment Year 2002-03.
2. The first ground is against the confirmation of addition of
Rs.8,74,439/- made by the AO.
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3. Briefly stated, the facts are that the original assessment in this case
was completed under 143(3) on 24.3.2005 in which total income was
determined at Rs.10,60,920/-. The major addition to the total income was
of Rs.8,74,439/- towards difference of the balance in the books of the
assessee and M/s Metro Tyres Ltd., from whom the assessee was earning
freight charges. The assessee went in appeal against the original
assessment order and the Tribunal restored the matter to the CIT(A) for
reconsideration. The CIT(A) vide his order dated 15.11.2007 deleted this
addition, against which the Revenue approached the Tribunal. The
Tribunal, vide its order dated 17.7.2009, in second round, restored the
matter to the file of AO for deciding this issue afresh and directing the
assessee to file reconciliation statement duly supported by relevant
vouchers, bank statement and documentary evidence explaining the reasons
for the difference. In the instant third round of proceedings, the assessee
submitted before the AO that the accounting entries for all the transactions
were duly reflected in the books of the assessee for assessment year 2001-
02 and 2002-03. The difference of Rs.8,74,429/- was stated to be not on
account of any wrong accounting entries made in these years, but, of earlier
period. It was further stated that the original difference stood at
ITA No.619/Del/2014 3
Rs.9,29,250/- as on 31.3.2000 which stood reduced to Rs.8,74,429/- as on
31.3.2002. The AO noticed from the copy of account received from M/s
Metro Tyres that they paid Rs.35,37,337/-, whereas the assessee had shown
to have received only a sum of Rs.26,62,908/-. In the absence of the
assessee furnishing any satisfactory explanation, the AO made an addition
to the tune of Rs.8.74 lac. The assessee contended before the ld. CIT(A)
that his accountant made a wrong entry and the amount of Rs.8,74,439/-
was actually introduced as capital in cash which was received by him on
family settlement in the period relevant to assessment year 2000-01, but,
the Accountant wrongly credited the account of M/s Metro Tyres instead of
the capital account of the assessee. The assessee did not dispute about the
closing balance of Rs.35.37 lac which was receivable from this party. The
ld. CIT(A) upheld the view taken by the AO.
4. Having heard the rival submissions and having perused the relevant
material available on record, it is noticed that it is the third round of the
proceedings before the Tribunal. Admittedly, there is a difference of
Rs.8.74 lac. Whereas the assessee had shown to have received a sum of
Rs.26.62 lac from M/s Metro Tyres Ltd., on the other hand, this company is
ITA No.619/Del/2014 4
confirming to have paid Rs.37.37 lac to the assessee towards freight.
Despite the Tribunal allowing sufficient opportunity, the assessee
miserably failed to prove his case before the authorities. It was contended
that the said sum of Rs.8.74 lac was actually his capital contribution which
was inadvertently taken to the account of M/s Metro Tyres by the
Accountant instead of the capital account. On being called upon by me to
demonstrate this mistake with reference to the copy of account of M/s
Metro Tyres, the ld. AR failed to point out any such wrong posting of entry
to the account of M/s Metro Tyres instead of the capital account. In my
considered opinion, the assessee has not given any tenable explanation in
support of the difference in the amount received by the assessee from M/s
Metro Tyres towards the freight charges. It is further an admitted fact that
the amount outstanding at Rs.37.37 lac at the end of the year in the case of
Metro Tyres Ltd., was received by the assessee in the subsequent year. As
such, I am of the considered opinion that the ld. CIT(A) was justified in
sustaining the addition. This ground is not allowed.
5. The only other ground is against the charging of interest of
Rs.29,024/- u/s 234D of the Act. The ld. AR contended that interest u/s
234D ought not to have been charged.
ITA No.619/Del/2014 5
6. I do not find any reason to disturb the view taken by the ld. CIT(A).
Explanation 2 inserted to section 234D by the Finance Act, 2012 with
retrospective effect from 1.6.2003 provides that the provisions of this
section was also apply to an assessment year commencing before the first
day of June, 2003 if the proceedings in respect of such assessment year is
completed after the said date. Since the assessment proceedings in this case
were completed after the 1st June, 2003, I hold that the interest is rightly
7. In the result, the appeal is dismissed.
The decision was pronounced in the open court on 18th June, 2015.
Dated: 18th June, 2015.
Copy forwarded to
Dy. Registrar, ITAT, New Delhi