Inter State Security Agency, Kolkata V. ACIT, CIR-40, KOLKATA, Kolkata

CO 50/KOL/2015

• Counselvise Citation: [2017] 123 COUNSELVISE.COM (IT) 3268 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 4 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 17-11-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 12-11-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ARINDAM BHATTACHARJEE
• Assessee Lawyers: CROSS OBJECTOR SHRI SWA

Judgement Text

1 ITA NO.1156/KOL/2015 & CO NO.50/KOL/2015 INTER STATE SECURITY AGENCY, AY 2011-12 , D , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH: KOL KATA () BEFORE . , /AND . . , ) [BEFORE SHRI J. SUDHAKAR REDDY, AM & SHRI A. T. VA RKEY, JM] I.T.A. NO. 1156/KOL/2015 ASSESSMENT YEAR: 2011-12 ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE-40, KOLKATA VS. INTER STATE SECURITY AGENCY (PAN:AAAFI8660G) APPELLANT RESPONDENT & C.O. NO.50/KOL/2015 IN I.T.A. NO. 1156/KOL/2015 ASSESSMENT YEAR: 2011-12 INTER STATE SECURITY AGENCY VS. ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE-40, KOLKATA CROSS OBJECTOR RESPONDENT DATE OF HEARING 25.09.2017 DATE OF PRONOUNCEMENT 17.11.2017 FOR THE REVENUE SHRI ARINDAM BHATTACHARJEE, ADDL. C IT FOR THE ASSESSEE/CROSS OBJECTOR SHRI SWAPAN KR. ROY, ADVOCATE ORDER PER SHRI A.T.VARKEY, JM THE APPEAL FILED BY THE REVENUE AND THE CROSS OBJEC TION FILED BY THE ASSESSEE ARE AGAINST THE ORDER OF LD. CIT(A)-12, KOLKATA DATED 2 9.07.2015 FOR AY 2010-12. SINCE THE APPEAL AND THE CROSS OBJECTION HAVE ARISEN OUT OF T HE COMMON ORDER OF THE LD. CIT(A), WE DISPOSE OF BOTH THE APPEAL AS WELL AS THE CROSS OBJ ECTION BY THIS CONSOLIDATED ORDER. 2. THE SOLE ISSUE INVOLVED IN THIS APPEAL OF REVENU E IS AGAINST THE ACTION OF THE LD. CIT(A) IN DELETING THE ADDITION OF RS.38,92,581/- O N ACCOUNT OF BONUS PAYMENTS. 2 ITA NO.1156/KOL/2015 & CO NO.50/KOL/2015 INTER STATE SECURITY AGENCY, AY 2011-12 3. BRIEFLY STATED FACTS ARE THAT THE ASSESSEE IS RU NNING A SECURITY GUARD AGENCY. DURING THE E-FILING RETURN, THE ASSESSEE SHOWED PAYMENT OF SALARY OF RS.6,66,02,828/-. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSEE ON BEING ASKED BY THE AO, FILED DETAILS SHOWING PAYMENT OF SALARY OF RS.6,24,85,308/- AND PAYMENT O F BONUS OF RS.38,92,581/- SEPARATELY. ASSESSEE ALSO PRODUCED SALARY AND BONUS SHEETS BEFO RE THE AO FOR VERIFICATION. HOWEVER, THE AO ALLOWED SALARY TO THE TUNE OF RS.6,22,50,369 /-, (DISALLOWING A SUM OF RS.2,34,939/-) BUT DISALLOWED THE ENTIRE BONUS PAYMENTS AND ADDED THE SAME TO THE TOTAL INCOME OF THE ASSESSEE DUE TO NON PRODUCTION OF ANY AUTHENTIC DOC UMENTS AS PER THE AO. ON APPEAL, THE LD. CIT(A) DIRECTED THE AO TO ALLOW BONUS PAYMENTS OF RS.38,92,581/- BY OBSERVING AS UNDER: I HAVE DULY CONSIDERED THE SUBMISSION OF THE APPE LLANT AND THE DETAILS FILED . THE APPELLANT IS A SECURITY GUARD AGENCY. IN THE E-RETURN, IT SHOWE D PAYMENT OF SALARY OF RS.6,66,02,828/-. DURING THE ASSESSMENT PROCEEDINGS, THE APPELLANT FI LED DETAILS SHOWING PAYMENTS OF SALARY OF RS.6,24,85,308/- AND PAYMENTS OF BONUS OF RS.38,92, 581/- SEPARATELY. THE APPELLANT ALSO PRODUCED THE SALARY AND BONUS SHEETS BEFORE THE AO FOR VERIFICATION. HOWEVER, AO ALLOWED SALARY TO THE TUNE OF RS.6,22,50,369/- (DISALLOWING A SUM OF RS.2,34,939/-) BUT DISALLOWED ENTIRE BONUS PAYMENTS IGNORING THE BONUS REGISTER A ND WITHOUT ASSIGNING ANY REASON WHATSOEVER. THE LD. AR OF THE APPELLANT HAS FILED COPY OF SAMPLE BONUS SHEETS SHOWING BONUS WAS PAID TO THE SAME PERSONS TO WHOM SALARY WAS PAI D. HE ALSO PRODUCED EVIDENCES THAT TAX WAS DEDUCTED AT SOURCE AS AND WHERE REQUIRED AGAINS T SUCH BONUS PAYMENTS. HAVING EXAMINING THE DOCUMENTS PRODUCED, THE CONTENTION OF THE APPELLANT IS FOUND CORRECT. SINCE THE AO ACCEPTED THE PAYMENTS OF SALARY, HE OUGHT TO HAV E ACCEPTED BONUS PAYMENTS ALSO PAID TO THE SAME EMPLOYEES. JUST BECAUSE BONUS COLUMN IS K EPT NIL IN THE E-RETURN, AO CANNOT DISALLOW BONUS PAYMENTS, WHEN SUPPORTED EVIDENCE WE RE PRODUCED BEFORE HIM. THE AO IS, THEREFORE, DIRECTED TO ALLOW BONUS PAYMENTS OF RS.3 9,92,581/-. AGGRIEVED BY THE AFORESAID ORDER, THE REVENUE IS IN APPEAL BEFORE US. 4. WE HAVE HEARD RIVAL SUBMISSIONS, GONE THROUGH TH E FACTS AND CIRCUMSTANCES OF THE CASE AND ALSO CAREFULLY PERUSED THE ORDER OF THE LD . CIT(A). WE NOTE THAT WE FIND NO INFIRMITY IN THE ORDER OF THE LD. CIT(A) IN DELETIN G THE ADDITION ON ACCOUNT OF BONUS PAYMENTS AS THE CLAIM OF THE ASSESSEE WAS SUPPORTED BY THE BONUS SHEETS AND REGISTER. MOREOVER, WE NOTE THAT AO ALLOWED THE SALARY EXPEND ITURE CLAIMED BY THE ASSESSEE TO THE TUNE OF RS.6,22,50,369/- (DISALLOWED ONLY RS.2,34,9 39/-) AND WHEN THE FACT THAT VERY SAME EMPLOYEES RECEIVED THE SALARY AND BONUS WHICH WAS S UPPORTED BY BONUS REGISTER AND TDS WAS DEDUCTED AT SOURCE AS PER LAW, SO THE BONUS EXP ENDITURE HAS TO BE ALLOWED AND LD. CIT(A) HAS RIGHTLY ALLOWED IT. WE ALSO NOTE THAT T HE LD. DR COULD NOT CONTROVERT THE ABOVE FINDING OF THE LD. CIT(A) BY PRODUCING ANY MATERIAL TO UPSET THE DECISION OF LD CIT(A). 3 ITA NO.1156/KOL/2015 & CO NO.50/KOL/2015 INTER STATE SECURITY AGENCY, AY 2011-12 HENCE, WE DECLINE TO INTERFERE IN THE ORDER OF THE LD. CIT(A) AND THE SAME IS HEREBY UPHELD. APPEAL OF REVENUE IS DISMISSED. 5. THE CROSS OBJECTION OF ASSESSEE IS IN SUPPORT OF THE ORDER OF THE LD. CIT(A) AND HENCE, THE SAME IS DISMISSED AS INFRUCTUOUS. 6. IN THE RESULT, APPEAL OF REVENUE IS DISMISSED A ND CROSS OBJECTION OF ASSESSEE IS ALSO DISMISSED BEING INFRUCTUOUS. ORDER IS PRONOUNCED IN THE OPEN COURT ON 17TH N OVEMBER, 2017 SD/- SD/- (J. SUDHAKAR REDDY) (ABY. T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBE R DATED :17TH NOVEMBER, 2017 JD.(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1 . APPELLANT ACIT, CIRCLE-40, KOLKATA. 2 RESPONDENT INTER STATE SECURITY AGENCY, 16, GARPA R ROAD, KOLKATA-700 009. 3 . THE CIT(A), KOLKATA 4. 5. CIT , KOLKATA DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, SR. PVT. SECRETARY