Buhler (India) Pvt. Ltd. V. The Deputy Commissioner of Income-Tax, Circle-11(2) Bangalore

ITA/614/2013

AI Insights

The case involves Buhler (India) Pvt. Ltd., the appellant, contesting orders from the Income Tax Appellate Tribunal (ITAT) which confirmed additions made by the Assessing Authority to their declared income for the assessment year 2007-08. The Tribunal had dismissed the appellant's appeal and a subsequent miscellaneous petition without adequately considering the documents and invoices provided, which were part of the record. The High Court of Karnataka found that the Tribunal's dismissal was based on an oversight of these crucial documents and thus set aside the Tribunal's orders, remanding the case for a fresh hearing.

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 794130 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 19-08-2014
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: K V ARAVIND
• Assessee Lawyers: NAGESHWAR RAO
• Keywords: Assessment Year; Commission expenditure; Income Tax; Miscellaneous petition; Scrutiny
• Section: 143(3); 143(1); 260A

Judgement Text

" 1 IN THE HIGH COURT OF KARNATAKA, BANGALORE DATED THIS THE 19TH DAY OF AUGUST 2014 PRESENT THE HON’BLE MR. JUSTICE N.KUMAR AND THE HON’BLE MRS.JUSTICE RATHNAKALA INCOME TAX APPEAL NO.614 OF 2013 C/W INCOME TAX APPEAL NO.616 OF 2013 BETWEEN : BUHLER (INDIA) PVT. LTD. (A PRIVATE CO. LTD. BY SHARES, INCORPORATED UNDER THE COMPANIES ACT, 1956) HAVING ITS OFFICES AT NO.13D, KIADB INDUSTRIAL AREA ATTIBELE, BANGALORE-562 107 REP. HEREIN BY ITS MANAGING DIRECTOR, MR.DIPAK MANE ... COMMON APPELLANT (BY SRI.NAGESHWAR RAO, ADV.) AND : THE DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE-11(2) BANGALORE – 560 001 ... COMMON RESPONDENT (BY SRI.K.V.ARAVIND, ADV.) --- ITA.614/2014 is filed under Section 260A of I.T.Act, 1961 arising out of Order dated 22.2.2013 in ITA 2 No.434/Bang/2012 for the assessment year 2007-08 praying to formulate the substantial questions of law stated therein and set aside the appellate order dated 22.2.2013 passed by the ITAT, Bangalore in appeal proceedings No.ITA.434/Bang/2012 and quash any proceedings instituted pursuant to the directions issued thereunder. ITA.616/2013 is filed under Section 260A of I.T.Act, 1961 arising out of Order dated 2.8.2013 in M.P.65/Bang/2013 in ITA No.434/Bang/2012 for the assessment year 2007-08 praying to formulate the substantial questions of law stated therein and set aside the appellate order dated 2.8.2013 passed by the ITAT ‘C’ Bench, Bangalore in M.P.65/Bang/2013 in ITA No.434/Bang/2012 and quash any proceedings instituted pursuant to the directions issued thereunder These appeals coming on for Admission this day, N.KUMAR J., delivered the following: JUDGMENT Both these appeals are preferred by the assessee against the original order and the order passed against the miscellaneous petition refusing to review the original order. Therefore, they are taken up for consideration together and disposed of by this common order. 2. The assessee is a Company engaged in the manufacture, trading, servicing and maintenance of food processing machines. They have filed the returns declaring the income of `15,31,55,764/-. The returns was 3 processed under Section 143(1) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’, for short). Later, it was taken up for scrutiny. An order came to be passed under Section 143(3) of the Act determining the income of the assessee at `17,24,34,920/- making certain additions. Aggrieved by the said order, the assessee preferred an appeal. The Appellate Authority passed an order on 30.12.2011 partly allowing the appeal and dismissing on certain other aspects. Against the said order, the assessee preferred an appeal to the Tribunal. The Tribunal dismissed the appeal by its order dated 22.2.2013 confirming the order passed by the Appellate Authority and confirming the additions made by the Assessing Authority. The reason given was that the commission expenditure was not an ascertained liability and no evidence has been brought on record for disallowance. Therefore, the assessee filed a miscellaneous application enclosing the copy of the invoice raised to the extent of `1,14,00,000/- showing the commission for the assessment year 2008-09 and they also produced documents. Without looking into the said documents, the 4 miscellaneous petition also came to be dismissed. That is how, the assessee is before this Court challenging both the orders. Along with the appeal memos, they have produced invoice and other documents. The said documents are not looked into by the Tribunal. They are the documents which are produced by the assessee before the Appellate Commissioner. The said documents were part of the record. Therefore, the findings recorded by the Tribunal that the assessee has not produced any evidence to substantiate his claim, is ex facie illegal. Therefore, the order cannot be sustained. It is appropriate to remand the matters back to the Tribunal to enable them to hear the appeals afresh in the light of the documents which are available on record and which will be pointed out by the appellant in the course of arguments. They also shall take into account the judgments to be relied on by both the parties and then pass appropriate orders. Hence, we pass the following: ORDER Both the appeals are allowed. Impugned orders are set aside. The entire matter is remitted back to the 5 Tribunal for fresh consideration and in accordance with law, without in any way being influenced by any of the observations made by this Court in this order. Sd/- JUDGE Sd/- JUDGE RV "