TMI Blog2013 (8) TMI 973X X X X Extracts X X X X X X X X Extracts X X X X ..... there is no infirmity in the order of the ld.CIT(A). Since the finding of the Assessing Officer is based merely on conjectures and surmises that there was no sufficient diesel/petrol as provided by the dealer, we do not understand that how can AO determine that how much petrol was supplied to the assessee by the dealer without making any enquiry from the dealer. Therefore, this ground of the Revenue is hereby rejected. - I.T.A. No.201/Ahd/2013, I.T.A. No.202/Ahd/2013 - - - Dated:- 14-8-2013 - SHRI A.MOHAN ALANKAMONY,ACCOUNTANT MEMBER And SHRI KUL BHARAT, JUDICIAL MEMBER For the Appellant : Shri O.P. Batheja, Sr.D.R. For the Respondent : Shri M.G.Patel, A.R. ORDER PER SHRI KUL BHARAT, JUDICIAL MEMBER : These two appeals by the Revenue in the case of same assessee are directed against the separate orders of the ld.CIT(A)-VIII, Ahmedabad [ CIT(A) for short] both dated 25/10/2012 for AYs 2008-09 and 2009-10. Since the grounds raised in both the appeals are same and identical, therefore both were heard together and are being disposed of by a consolidated order for the sake of convenience. 3. First, we take up the Revenue s appeal, i.e. ITA No.201/Ahd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fit that he can out of his trading transactions. He submitted that the Hon ble Apex Court has also held that avoidance of tax liability by so arranging commercial affairs that charge of tax is distributed is not prohibited. A Taxpayer may resort to a device to divert the income before it accrues or arises to him. Effectiveness of the device depends not upon considerations of morality, but on the operation of the Income-tax Act. Legislative injunction in taxing statues may not, except on peril of penalty, be violated, but it may lawfully be circumvented. He submitted that the Hon ble Delhi High Court in the case of United Exports Vs. CIT (330 ITR 549) held that the trade discount is not an expenditure therefore there is no applicability of section 40A(2)(b) of the Income Tax Act. He also relied on the decision of Hon ble Bombay High Court rendered in the case of CIT vs. Indo Saudi Services (Travel) P.Ltd. reported at (2009) 310 ITR 306 (Bom). In support of his contention that the sister-concern was also assessed to tax and no disallowance was to be made u/s.40A(2)(b) of the Act in respect of payment made to the relatives and sister-concern where there was no attempt to evade tax. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the AO cannot be vindicated. Therefore the same addition cannot be sustained. The AO is directed to delete the addition made on turnover discount. 5. From the above, it is evident that the ld.CIT(A) has given a finding on fact that there is no loss to the Revenue and M/s. Bharat Pesticides Industries Pvt.Ltd., i.e. sister-concern of the assessee is assessable on the same rate of tax (Maximum rate for companies) as the assessee-company. This finding on the fact is not controverted by the ld.Sr.DR. 6. Undisputed fact are that the AO has made addition on the basis that additional turnover discount passed on to the related party M/s.Bharat Pesticides Industries Pvt.Ltd. is not found reasonable and has disallowed an expenditure in the hands of the assessee being reasonable and excessive. However, the AO has not specifically mentioned the provisions of section 40A(2)(b) but such disallowance to be made u/s.40A(2)(b) of the Act. The Hon ble Apex Court in the case of CIT vs. A.Raman and Co. has held that the law does not oblige a trader to make the maximum profit that he can out of his trading transactions. Avoidance of tax liability by so arranging commercial affairs that ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompany to the assessee company and the scheme had been specially made to ensure undue benefit to the related party. 2) The Ld.CIT(A) has erred in law and on facts in deleting the disallowance of ₹ 82,425/- on account of depreciation on car purchased on 31.03.2009, i.e. on the last day of the Previous Year without appreciating the fact that no supporting evidence was given to substantiate his claim that the car was used for his business purpose. 3) On the facts and in the circumstances of the case the Ld.CIT(A) ought to have upheld the order of the Assessing Officer. 4) It is, therefore, prayed that the order of the Ld.CIT(A) may be set aside and that of the Assessing Officer may be restored to the above extent. 10.1. The first ground is against the deletion of turnover discount of ₹ 42,41,128/- given to its associate-company. The identical ground was raised by the Revenue in the AY 2008-09 bay way of ITA No.201/Ahd/2013(supra). Since the facts are identical and there is no changes in the facts and circumstances pointed out by the ld.Sr.DR, therefore following our decision rendered in ITA No.201/Ahd/2013(supra), this ground of Revenue s appeal is rejected. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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