TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
When case Id is present, search is done only for this
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>Carriage contractor cannot be treated as owner of bitumen under Section 69A of Income Tax Act</h1> <h3>M/s. D.N. SINGH Versus COMMISSIONER OF INCOME TAX, CENTRAL, PATNA AND ANOTHER</h3> M/s. D.N. SINGH Versus COMMISSIONER OF INCOME TAX, CENTRAL, PATNA AND ANOTHER - [2023] 454 ITR 595 (SC) Issues Involved:1. Whether the appellant could be treated as the owner of the bitumen.2. Whether bitumen could be treated as other valuable articles under Section 69A of the Income Tax Act, 1961.3. Whether the ITAT erred in passing contradictory orders for the assessment years 1995-1996 and 1996-1997.4. How the value of the bitumen is to be ascertained.Summary:I. Ownership of Bitumen:The appellant, a carrier, was entrusted with bitumen for delivery to the Road Construction Department of Bihar. The court held that a carrier, being a bailee, does not become the owner of the goods. The possession of the bitumen by the appellant, if not delivered, would be wrongful and contrary to the terms of the contract and law. The court emphasized that recognizing the appellant as the owner would involve negating the actual owner's rights and would be akin to recognizing a thief as the owner, which is legally untenable.II. Bitumen as a Valuable Article:The court examined whether bitumen could be classified as 'other valuable articles' under Section 69A. It was concluded that bitumen, being a residual product from petroleum refining, does not fit within the category of valuable articles like money, bullion, or jewellery. The principle of ejusdem generis and noscitur a sociis were applied, indicating that 'other valuable articles' should be items of high value and marketability, which bitumen is not.III. Contradictory Orders by ITAT:The court noted that the ITAT had passed contradictory orders for the assessment years 1995-1996 and 1996-1997. However, it focused on the substantive issues of ownership and classification of bitumen rather than resolving the procedural inconsistencies.IV. Valuation of Bitumen:The court did not delve deeply into the valuation issue, as it concluded that bitumen does not qualify as a valuable article under Section 69A. The assessment order had valued bitumen at Rs. 4999.58 per metric ton, but this valuation became irrelevant due to the court's findings on the primary issues.Conclusion:The appeals were allowed, and the impugned judgment was set aside. The court restored the order by the Commissioner Appeals, deleting the addition made on the basis of the alleged short delivery of bitumen. The court held that bitumen is not a valuable article under Section 69A, and the appellant, as a carrier, could not be treated as the owner of the bitumen.
TaxTMI 