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TMI Blog2018 (7) TMI 1168X X X X Extracts X X X X X X X X Extracts X X X X ..... - - - Dated:- 13-7-2018 - Shri Aby. T. Varkey, JM And Shri M.Balaganesh, AM For The Appellant : Shri R.N. Ram, Advocate For The Respondent : Shri Sallong Yaden, Addl. CIT, Sr. DR ORDER Per M.Balaganesh, AM 1. This appeal by the Assessee arises out of the order of the Learned Commissioner of Income Tax(Appeals)-Asansol [in short the ld CIT(A)] in Appeal No. 162/CIT(A)/Asl/W-1(3)/Asl/13-14 dated 22.02.2016 against the order passed by the ITO, Ward-1(3), Asansol [ in short the ld AO] under section 143(3) of the Income Tax Act, 1961 (in short the Act ) dated 31.12.2012 for the Assessment Year 2010-11. 2. At the outset, we find that there is a delay in filing the appeal by the assessee by 26 days. We have gone through the reasons adduced in the condonation petition and the same are found convincing. Accordingly, we are inclined to condone the delay of 26 days in filing the appeal before us and admit the appeal for adjudication. 3. The first issue to be decided in the appeal of the assessee is as to whether the ld CITA was justified in deleting the disallowance made u/s 40A(3) of the Act in the facts and circumstances of the case. 4. The brie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... derstanding of the facts :- In exercise of the power conferred by section 85 and section 86 of the Bengal Excise Act, 1909 (Ben. Act V of 1909) and in supersession of the rules published with this Department Notification No. 122-EX/O/1R-1/2000 dated 23.2.2000, as subsequently amended, the Governor is pleased hereby to make the following rules regulating the issue and removal of country spirit on payment of duty in labelled and capsuled bottles from country spirit bottling plants and in bulk from warehouses by the licensed wholesale vendors of the same for the purpose of selling country spirit by wholesale:- Rules 1. Short Title and commencement.-(1) These rules may be called the West Bengal Excise (Supply of Country Spirit on Payment of Duty) Rules, 2005. (2) These rules shall come into force from 19th October, 2005. 2. Definitions.-(1) In these rules, unless there is anything repugnant in the subject or context- ( i) Commissioner means the Excise Commissioner; ( ii) requisition means the requisition submitted by the authorized representative of licensed wholesale vendor of country spirit in Form II appended to these rules; ( iii) r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er-in-Charge of the warehouse, a demand for issue of country spirit in Form I appended to these rules in duplicate. The duplicate copy shall be kept in the custody of the Excise Officer-in-Charge for his official record. ( 2) No retail vendor of country spirit shall deposit duty direct into the local treasury for issue of country spirit to be taken by him from the warehouse concerned. Duty, cost price, bottling charge, if there be any, at the prescribed rate and other imposition, as may be prescribed by law, shall be paid by the retail vendor to the credit of the wholesale licensee concerned. ( 3) The authorized representative of the wholesale licensee shall realize the necessary amount of duty, cost price and bottling charge, if there be any, at the prescribed rate and such other imposition, as may be prescribed by law, from the retail vendor to whom country spirit is to be issued from the concerned warehouse. The authorized representative as above shall then submit requisition in duplicate in Form II appended to these rules to the Excise Officer-in-Charge of the warehouse separately for each of the retail vendors to whom country spirit is to be issued on the day. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... depositing the cash in their bank account. Moreover, the regulations of the West Bengal Government pursuant to notification from its Excise Department dated 29.8.2005 also mandates the payment to be made by way of direct deposit into the bank account of the wholesale licensee. This fact is also not disputed by the revenue. 9. We find that this tribunal had in the case relied upon by the ld AR supra had elaborately dealt with the impugned issue with specific reference to the West Bengal Excise Rules and Bengal Excise Act, case laws on the impugned issue and ultimately held as below:- 21. We find that M/s Asansol Bottling Packaging Co. Pvt Ltd is a bottling plant cum warehouse under Rule 2(vii) of The West Bengal Excise Rules 2005 with privilege granted u/s 22 of The Bengal Excise Act, 1909. At this juncture, it would be relevant to go into the definition of warehouse as provided under the State Excise Rules 2005 as below:- Warehouse , under Rule 2(vii) of the W.B.Excise Rules 2005 , means the warehouse for supply of country spirit to retail vendors, established at convenient places by the Commissioner at the expense of the State Government, or at the expense ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exclusive privilege is granted. ( 2) No grantee of any privilege under sub-section (1) shall exercise the same unless or until he has received a license in that behalf from the Collector or the Excise Commissioner. Hence it could be safely concluded that M/s Asansol Bottling Packaging Co. Pvt Ltd (Bottling Plant) is a warehouse within the meaning of Rule 2(vii) of the Excise Rules 2005 and said warehouse is a State Government establishment, established and controlled by the Excise Commissioner . It would be relevant to reproduce Rule 6DD(b) of the IT Rules at this juncture :- ( b) where the payment is made to the Government and, under the rules framed by it, such payment is required to be made in legal tender. In the instant case, the assessee (retail vendor) had made cash payments for purchase of country spirit by depositing cash directly into the bank account of M/s ABPL as per Rule 6(2) of the Excise Rules 2005 , it has to be construed as payment made to the State Government authority and accordingly falls under the exception provided in Rule 6DD(b) of the IT Rules. 22. It is not in dispute that M/s Asansol Bottling Packaging Co. Pvt Ltd have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd to another cash payment to the tune of ₹ 3,48,392/- made to M/s United Spirits Ltd towards purchase of beer, as fairly conceded by the ld AR , the same is in violation of section 40A(3) of the Act and hence the ground raised in this regard is dismissed. 5. Respectfully following the aforesaid decision of this tribunal, we hold that there could be no disallowance u/s 40A(3) of the Act in the facts and circumstances of the case and accordingly we direct the ld AO to delete the same. We also find that this issue is recently decided in favour of the assessee by the Hon ble Jurisdictional High Court in the case of CIT vs Sri Ritwik Kumar Bera in ITAT 103 of 2014 GA 2127 of 2014 dated 11.6.2018 and in the case of CIT vs Alk Kumar Das in ITAT 117 of 2014 GA 2274 of 2014 dated 11.6.2018. Accordingly the grounds raised by the assessee are allowed. 6. The next issue to be decided in this appeal is as to whether the ld CITA was justified in upholding the addition made in the sum of ₹ 81,809/- towards difference in purchases and profit added thereon in the facts and circumstances of the case. 6.1. We find that this addition was made by the ld AO based on the informati ..... X X X X Extracts X X X X X X X X Extracts X X X X
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