TMI Blog2013 (11) TMI 178X X X X Extracts X X X X X X X X Extracts X X X X ..... t these are payments by assessee towards sub-contract for the work executed for Kandla Port Trust" unquote - This aspect requires an indepth adjudication on the basis of the agreements executed between the parties and the constitution of this AOP on the basis of which the alleged amount was transferred in the hands of the members - Restored back to the file of ld.CIT(A) for de novo adjudication. - ITA No.1753/Ahd/ 2010 - - - Dated:- 8-2-2013 - Shri Mukul Kumar Shrawat And Shri Anil Chaturvedi,JJ. For the Appellant : Shri D. K. Singh, Sr. D. R. For the Respondent : Shri S. N. Saporkar, A. R. ORDER Per : Anil Chaturvedi, Accountant Member This is assessee's appeal against the order of ld. CIT(A), Valsad dated 24.02.2010. 2. The facts, as culled out from the order of the assessment are as under:- The assessee is an A.O.P. engaged in the business of civil construction. During the relevant assessment year the A.O.P. had undertaken work of Kandla Port Trust. A.O. observed that there are two members of A.O.P. having the determinate share in the receipts as under:- Name of the Member Share (i) M/s Detibh Engineers(I) Pvt. Ltd. 97. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s upheld and the ground of appeal raised by the appellant dismissed. The relevant paragraph of the order of the ld. CIT(A) Valsad for A.Y. 2005-06 is as under:- "Considering the rival contentions, I found the contentions raised by the AR of the appellant is more of a convenience than legal interpretation. Since, the law is amended in respect of the provisions of section 40a(ia) of the Act, he has conveniently shifted his arguments in respect of the applicability of the provisions of section 40a(ia) of the Act and taken a plea that invocation of the provisions of section 40a(ia) and estimation of income made by the AO is not in accordance with the law. Though he has referred to the accounting standard (AS7), I found no force in the said arguments. It is surprising to note that in the additional grounds of appeal, he has confirmed that the payment was made to the sub-contractors. I found AO has rightly picked up the issue of payment to sub-contractors and invoked the provisions of section 40a(ia), so that he could estimate the income of the appellant. Since, the AOP appellant is a joint venture, the phrase of word itself suggests that it is an association of two or more persons to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his predecessor's decision in appellant's own case for the preceding Assessment Year 2005-06, without assigning any reason therefor and without going into merits of the facts of the appellant placed before him during the course of appellate proceedings. 5. That ld. CIT(A) while upholding the estimated income of Rs.5,86,670/- as estimated by the ld. A.O. in the hands of the appellant, further erred on ignoring the fact that the captioned estimated income of Rs.5,86,670/- is being taxed twice over in as much as, that the income arising out of the entire Contract Receipt sub-contracted to the members of the AOP, is already offered to tax by them in their respective individual assessments." 5. The only effective ground is with regard to addition of Rs.5,86,669/-. 5. At the outset, ld. A.R. submitted that on identical facts for A.Y. 2005- 06 Hon'ble Tribunal in ITA No.4046/Ahd/2008 had remitted the matter to the file of CIT(A) for denovo adjudication. He, therefore, submitted that since the facts in the year under appeal are identical to that of A.Y. 2005-06, similar direction may be issued and the order be passed accordingly. 6. Ld. D.R., on the other hand, relied on the order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sdictional High Court Ahmedabad in Tax Appeal No.706 of 2011 vide an order dated 18/07/2011 in the case of CIT vs. M/s. J. K. Construction Co. has held as under:- "From the record, it emerges that for payment to contractor, the assessee had made deduction as required under law from time to time and in particular latest by 31.3.2005. This is clear from chart supplied by the assessee before CIT (Appeals) which would establish that deduction in case of several contractors were made on 31.3.2005. All such amounts were deposited with the Government on or around 28.5.2005. In background of above undisputed facts, tribunal was of the opinion that by virtue of amended provisions of Section40(a)(ia) of the Income Tax Act, 1961, assessee has not breached the requirement of deduction and depositing of TDS. Section 40(a)(ia) of the Act as amended with effect from 1.4.2005 read as under: "(ia) any interest, commission, or brokerage, (rent, royalty) fees for professional services or fees for technical services payable to a resident, or amounts payable to a contractor or sub-contractor, being resident, for carrying out ay work (including supply of labour for carrying out any work), on which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AOP on the basis of which the alleged amount was transferred in the hands of the members. On account of these reasons, both the issues raised before us vide above referred five grounds are restored back to the file of ld.CIT(A) for de novo adjudication in the light of the directions made hereinabove. Grounds may be treated as allowed only for statistical purposes. 7. In the result, the appeal of the Assessee is allowed but for statistical purposes. " 8. It is an undisputed fact that the facts of the case in the year under appeal are identical to that of A.Y. 2005-06. For A.Y. 2005-06, the coordinate Bench has held that the nature of payment by assessee to its member needs examination in light of the agreements entered by the parties. Since the issue in the year is similar to that of A.Y. 2005-06, we respectfully following the order of the coordinate Bench for A.Y. 2005-06remit the matter to the file of CIT(A) for denovo adjudication in the light of the directions contained in the order for A.Y. 2005-06 which would also apply to the present appeal. CIT(A) will decide the issue after givingreasonable opportunity of hearing to assessee. 9. In the result, the appeal of the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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