TMI Blog2014 (5) TMI 930X X X X Extracts X X X X X X X X Extracts X X X X ..... ecuting the contract – the order of the CIT(A) is set aside – Decided in favour of Assessee. Deletion made u/s 68 of the Act – Held that:- The AO has not properly appreciated the facts relevant to the transaction - M/s. Achiever Trading Pvt. Ltd is the supplier to the assessee and they have commercial transactions - assessee gives advances to the supplier of material - The amounts appearing in the bank accounts of the assessee as per the Achiever Trading Pvt. Ltd as a source in the said advances given by the assessee, the same is not reviews by the Revenue - it is not proper to doubt the identity and genuineness of the transactions – there was no error in the order of the CIT(A) – Decided against Revenue. - I.T.A. No.4996/M/2012 and I.T.A. No.4997/M/2012, I.T.A. No.5447/M/2012 - - - Dated:- 9-4-2014 - SHRI D. KARUNAKARA RAO, AND SHRI AMIT SHUKLA, JJ. For the Appellant : Shri Rakesh Joshi For the Respondent: Shri Girija Dayal, DR ORDER Per: D Karunakara Rao: There are 3 appeals under consideration involving two assessment years. Out of three appeals, there are cross appeals for the AY 2009-2010. In assessee's appeals, grounds are identical for both ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee has acted in the nature of subcontractor. 3. During the proceedings before the first appellate proceedings, assessee made various submissions and relied on the decision of the Tribunal in the case of ITO vs. UAN Raju Construction (48 SOT 178) for the proposition that the assessee, being a constituent of JV, is entitled to deduction when the work was actually awarded by the JV but it was also executed by the constituents of the JV. Para 8.1 to 9.2 of the impugned order are relevant in this regard. The CIT (A) has extracted the paras from the said order of the Tribunal which discussed elaborately the meaning of the Joint Venture relying on the judgment of the Hon'ble Supreme Court in the case of Faxir Chand Gulati vs. Uppal Agencies (P) Ltd [2008] 10 SCC 345. It was mentioned that as per the interpretation of the joint venture, arrangement is unique and understanding of the constituents in JV is important to decide the issue. He accordingly summed up by stating that the assessee is the main executor of the product. Assessee claimed the deduction in respect of the income earned by him out of the contract entered into by the JV with NHAI. In these circumstances, assessee i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the assessee and it was entirely executed by the assessee company. Taking the substance of the transaction, the assessee are entitled to all the profits in respect of the contract executed by them, hence the assessee would certainly be entitled to deduction under the provisions of 8OlA as they have fulfilled all the other conditions. This view gets strength from decision in the case of ITAT, Indore Bench, in case of Ayush Ajay Constructions Ltd. (supra). Thus, while giving effect to the opinion of Third Member u/s.255(4) of the Act, we take view in conformity with order of jurisdictional High Court in case of ABG Heavy Industries Ltd. (supra) available at this time though contrary to the opinion expressed by the Third Member. So in view of above discussion, following the ratio of jurisdictional High Court in case of ABG Heavy Industries Ltd. (supra), the Assessing Officer is directed to allow deduction u/s.80IA(4) of the Act to the assessee with regard to the projects in question for both the years. The matter is disposed off accordingly. 7. In the above case, the assessee is found eligible even after considering the deviations from the original agreement. Here the substan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee's books of account shows the transfer of certain amounts on 6.6.2008, 31.10.2008 and 15.12.2008. The bank account of the assessee reflects the same. AO is of the mistaken opinion that the said accounts constitute loans received by the assessee from M/s. Achiever Trading Pvt. Ltd. AO came to the conclusion that M/s. Achiever Trading Pvt Ltd is not a genuine party and for this he relied on the report of the Inspector's report dated 19.2.2010 collected during the post search proceedings. Mentioning that the assessee failed to prove the identity as well as the genuineness of the creditor, AO invoked the provisions of section 68 and made the addition of Rs. 2,27,80,000/-. Matter travelled to the first appellate authority. 12. During the proceedings before the first appellate authority, assessee demonstrated the genuineness of M/s. Achiever Trading Pvt. Ltd and mentioned that it is a regular business transaction with the Achiever Trading Pvt. Ltd., in matters of purchases. He also substantiated the fact that the amounts received are not the loans but these are the returns of the unutilized trade advances returned by the Achiever Trading Pvt. Ltd. In that case, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Receipt 70,00,000 1,37,20,000 15/12/2008 Receipt 1,00,00,000 37,20,000 12.1 The appellant submitted that from the above chart it was very clear that at no point of time the appellant had taken any loan and whatever amount received from the party was against advance given. The appellant stated the contention of the A.O. that all the purchases from the party was treated as bogus was also not correct. The appellant submitted that AO has treated purchases only of Rs. 2,60,79,598.80 as bogus as against total purchases of Rs. 4,48,46,960.80. This was because wherever the AO did not find supporting document against the purchases only to that extent it was treated as bogus and not the whole amount. Therefore, the appellant stated that it is not the case that all the transaction with the appellant was treated as bogus and the action of the A.O. cannot be upheld. The appellant stated that when the A.O. has accepted part of the transaction as genuine transaction, it means existence genuinity of the party cannot be denied. Therefore the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X
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