9911796707
TMI Blog2009 (12) TMI 583X X X X Extracts X X X X X X X X Extracts X X X X ..... xcluded for the purpose of section 44AA and 44AB as per the provisions of section 44AE(5) of the Act. - ITA Nos. 616 & 633/PN/08 - - - Dated:- 31-12-2009 - ORDER Per: D Karunakara Rao, AM These two appeals filed by the assessees are against the orders of the CIT(A), Aurangabad dated, 21.02.2008. In view of the connectivity of the issues in these two appeals, they were clubbed together and adjudicated by this consolidated order for the sake of convenience. The appeal-wise adjudication is given in the following paragraphs. First we take up the appeal by Anil Ramgopal Mali - HUF. ITA No. 633/PN/08 A. Y. 2006-07 Anil Ramgopal Mali HUF 2. The grounds raised in this appeal are as under: 1. The learned Assessing Officer erred in levying the Penalty U/s.2716 for non compliance of Section 44AB of the Income Tax Act, 1961. 2. The learned Assessing Officer erred in levying the Penalty U/s 271B without taking into consideration the Section 44A (5) of the Income Tax Act, 1961. 3. The learned Assessing Officer erred in levying the Penalty U/S.271B which is not reasonable, correct and justified by not taking into consideration of facts and circumstances and the cumula ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rson engaged in the business of operating any truck taken on hire is not covered under the provision of this section and the assessee being the owner as well as hirer of the truck cannot be brought under the precincts of section 44 AE of the Act. CIT(A) is of the opinion that the assessee, who is engaged with the composite business employing both own as well as the hired vehicles from others, is outside the ambit of 44AE. C1T(A) also of the opinion that no scheme is provided in the Act like in the case of an omitted section 44AC of the Act for bifurcation of composite income. Intention of the legislature is not to cover the assessees who are engaged in the composite business u/s 44AE of the Act. Thus, the CIT(A) confirmed the penalty levied by the AO. 5. Aggrieved with the above, assessee filed an appeal before us. During the proceedings, the Ld. counsel summed up grounds by stating that the core issue for adjudication before the Tribunal revolves around the interpretation and applicability of the provisions of section 44AE(5) of the Act to the assessee's facts. Further, Ld counsel mentioned that the CIT(A) is entirely silent on the applicability of sub-section 5 of section 44AE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the provisions of section 44AE etc. The limited dispute is only with regard to the applicability of section 44AE to the assessee who has composite business receipts i.e. business using own vehicles and the vehicles of the others on hire, in general and the subsection (5) in particular. 8. The case of the revenue is that the provisions of section 44AE is not applicable to the assessee, which has both the turnover on own goods carriages as well as goods carriages outsourced by the assessee as these are special provisions meant for assesses low business turnover. As per the revenue, provisions of Section 44AE come into operation only when the assessee exclusively engaged in the business of plying, hiring or leasing goods carriages and nothing else. Per contra, as per the assessee, in view of the provisions of section 44AE(5) read with the contents of the Circular No.684 of 1994 dtd. 10.06.1994, the provisions of section 44AE are not applicable only when the assessee has no vehicles and has vehicles exceeding ten. Considering the above rival positions, we find it is necessary to examine the statutory provisions and material available before us for adjudicating the dispute. First, we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able to the business mentioned in sub-section referred above for the purpose of section 44AA 44AB of the Act. In other words, the provisions of section 44AB are not applicable in so far as they relate to the business referred to in sub-section (1) and in computing the monetary limits under those sections, the gross receipts or, as the case may be, the income from the said business shall be excluded. 10. Next we take up the analysis of the contents of the circulars relied on by the assessee. Paragraphs 32, 32.3 and 32.5 of the Circular No.684 of 1994 dated 10.06.1994 are relevant and they are reproduced. 32. A new 44AE has been inserted in the IT Act with a view to providing the method of estimating income from the business of plying, hiring or leasing trucks owned by a taxpayer. The scheme applies to persons owning not more than ten trucks. It is not applicable to the persons who do not own any truck but operate trucks taken on hire. The income from each truck being a heavy goods vehicle, will be estimated at R$. for every month or part of a month during which the truck is owned by the assessee. The income from each truck, other than a heavy goods vehicle, will be estimated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . (Supra) reads that 'Assessee carrying on the business of transportation using both own trucks as well as trucks belonging to others, only the receipts from the plying of own trucks are to be considered for determining turnover and the receipts from assessee's own trucks being less than Rs. 40 lakhs, there was no contravention of 5A4AB and penalty under section 271B was not leviable.' Prima facie, in our opinion, as seen above, the issue is entirely different in the instant case and the issue about the exclusion of receipts relatable to the own goods carriage. Further, the perusal of the judgment of the Punjab Haryana High Court in the case Anil Kumar Arya, (Supra), we find that the conclusion of the said judgment is reads that Tribunal having found a fact that total number of tankers owned by the assessee did not exceed 10 at any point of time during the relevant previous year, section 44AE was rightly applied to the case of assessee and no substantial question of law arises/ Therefore, on facts this proposition is irrelevant to the facts of the instant case where the revenue held that the assessee is not entitled to the benefits of section 44AE as the assessee have multiple bu ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
