Decided on May 09,2014



ANIL CHATURVEDI,AM. - (1.) THIS appeal is filed by the Assessee against the order of CIT(A) -IV, Baroda dated 12.09.2011 for A.Y. 2006 -07.
(2.) THE relevant facts as culled out from the material on record are as under.
(3.) ASSESSEE is an individual stated to be engaged in the business of plying of trucks in the name and style of Saibaba Transport. Assessee filed his return of income for AY 2006 -07 on 27.11.2006 declaring total income of Rs 3,18,567/ -. During the course of assessment proceedings AO noticed that Assessee was doing contract work for Hindustan Coca Cola Braveries Ltd and had received payment of Rs 80.64 lacs which exceeded the monetary limit prescribed u/s 44AB of the Act and therefore the Assessee should have got his accounts audited for the previous year 1.4.2005 to 31.3.2006 before the specified date and furnished the audit report. Since the assessee had failed to comply with the provisions of s. 44AB, the AO was of the view that Assessee has committed default so as to attract penalty u/s 271B of the Act. The submission of the Assessee that he was a commission agent and the commission earned by him was less than the monetary limit prescribed u/s 44AB for the audit was not found acceptable to the AO. He thereafter vide order dated 30.12.2010 levied penalty @ 1/2% of the turnover (amounting to Rs 40,324/). Aggrieved by the order of AO, Assessee carried the matter before CIT(A). CIT(A) vide order dated 12.9.2011 confirmed the order of AO by holding as under: - 2.3 But entire above submission of the A.R is not acceptable in view of the facts involved in the case of appellant. In the case of appellant form No. 16A dated 18.4.2006 has been issued by Assistant Manager, Finance of Hindustan Coca Cola. On perusal of such form 16A it is seen that amounts of TDS of Rs 1,80,671/ - have been made by this company on the payments made to the appellant on different dates. The total payments of Rs. 80,64,855/ - have been credited to the bank account of the appellant. The TDS have been made by the above company in the capacity of contractor and obviously the appellant is contractee assessee. Again on perusal of receipt & payments account in the case of appellant for the year under consideration, it is further seen that amount of Rs. 80,64,855/ - as paid by the above company is credited in the account of appellant and out of such amount as credited, payments have been to various persons on account of purchases of diesels. Further, the appellant has made payments as commission to truck owners and truck drivers from his accounts. Out of above amounts of Rs. 80,64,855/ -, the payments have also been made by the appellant on account of short broken expenses. Thus the entire above receipts of Rs. 80,64,855/ - and various expenditures incurred out of such receipts are accounted for in the books of accounts of the appellant for the year under consideration. Though, the appellant has also shown its commission of Rs. 5,98,436/ - in the payment side of above account, but this aspect does not affect the merits of the case. The very fact is that the appellant is getting the above entire receipts credited in its bank account and books of account and incurring various expenses out of the same. These facts show that appellant is just not acting as an agent on behalf of the above company and getting only its commission part in lieu of services rendered by it and remaining amounts are directly paid to truck owners by the above company. The entire state of affairs show that appellant has got credited above receipt of Rs. 80,64,255/ - as contracteeassessee and has met out various expenses at its own. Thus instead of acting merely as commission agent, the appellant is managing affairs of business of transportation at its own and therefore, it can be said that he is liable to get his books of accounts audited in terms of provisions of Section 44AB of the Act. The turnover/ receipts in the case of appellant is exceeding the monetary limit as prescribed under the provisions of section 44AB of the Act. In view of these facts, I am of the view, that A. O has correctly levied penalty of Rs. 40,324/ -u/s.271B of the Act, in the, case of the appellant and, therefore, the same is confirmed.;

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