Indiana Textiles Mill, Howrah V. ACIT, Circle - 44, Kolkata [Formerly ITO, Ward - 43(4)], Kolkata

ITA 1121/KOL/2018

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 1248 (ITAT-KOLKATA)
• Duration Of Justice: 6 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-11-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 23-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAURAV KUMAR
• Keywords: Bad and doubtful debts

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH : KOLKATA [BEFORE HONBLE SHRI J.SUDHAKAR REDDY, AM] I.T.A NO. 1121/KOL/20 18 ASSESSMENT YEAR : 2012-1 3 INDIANA TEXTILES MILL VS- ACIT, CIRCLE-44, K OLKATA [PAN: AAAFI 6173 Q] (APPELLANT) (RESPONDENT) FOR THE APPELLANT : SHRI SUBASH AGARWAL, ADV OCATE FOR THE REVENUE : SHRI SAURAV KUMAR, ADDL. CIT SR. DR DATE OF HEARING : 01.11.2018 DATE OF PRONOUNCEMENT : 28.11.2018 ORDER THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED A GAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-14, KOLKATA DA TED 16.01.2018 FOR THE ASSESSMENT YEAR 2012-13, PASSED U/S 250 OF THE INCO ME TAX ACT, 1961 (IN SHORT THE ACT). THERE IS A DELAY OF 82 DAYS IN FILING OF THE APPEAL. AFTER PERUSING THE PETITION FOR CONDONATION, I AM CONVINCED THAT THE ASSESSEE WAS P REVENTED BY SUFFICIENT CAUSE FROM FILING THIS APPEAL. HENCE I CONDONE THE DELAY AND A DMIT THE APPEAL. 2. THE ASSESSEE IS A COMPANY AND IS IN THE BUSINES S OF MANUFACTURING AND DEALING IN HOSIERY GOODS. THE ISSUES THAT ARISES FROM MY CONSI DERATION IN THIS REGARD ARE, THE DISALLOWANCE OF BAD DEBTS AND AD HOC DISALLOWANCE O F VARIOUS EXPENDITURES. 3. AFTER HEARING RIVAL SUBMISSIONS AND ON A CAREFU L CONSIDERATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE, A PERUSAL OF PAPERS ON R ECORD AND ORDERS OF THE LOWER AUTHORITIES BELOW, AS WELL AS CASE LAW CITED, I HOL D AS FOLLOWS. 2 ITA NO.1121/KOL/2018 INDIANA TEXTILES MILL A.YR .2012-13 2 4. THE BAD DEBTS OF RS. 2,55,289/- HAS TO BE ALLOWE D AS DEDUCTION AS IT IS NOT DISPUTED THAT THE ASSESSEE HAS WRITTEN OFF THE SAME IN ITS B OOKS OF ACCOUNTS. THESE ISSUES COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF HONBL E SUPREME COURT IN THE CASE OF TRF REPORTED IN 323 ITR 397 (SC). ACCORDINGLY, GROUND N O. 2 RAISED BY THE ASSESSEE IS ALLOWED. 5. GROUND NOS. 3, 4, 5 AND 6 ARE IN THE ISSUES OF A D HOC DISALLOWANCE OF TRAVELLING EXPENSES, TELEPHONE AND CONVEYANCE EXPENSES, GENERA L EXPENSES AND MOTOR CAR EXPENSES. THE ASSESSING OFFICER DISALLOWED 20% OF THESE EXPENSES, ON THE GROUND THAT THEY MAY HAVE BEEN SOME PERSONAL USE. THE LEARNED C OUNSEL FOR THE ASSESSEE RELIED ON THE DECISION OF HONBLE GUJRAT HIGH COURT FOR THE PROPOSITION THAT THERE CANNOT BE ANY PERSONAL EXPENDITURE IN THE CASE OF LIMITED COMPANY REGISTERED UNDER THE COMPANYS ACT. EVEN OTHERWISE IT WAS SUBMITTED THAT THE ASSES SING OFFICER HAS, IN AN AD HOC MANNER, RESTRICTED THE CLAIM OF THE ASSESSEE. I AGR EE WITH THE CONTENTIONS OF THE ASSESSEE THAT COMPANY CANNOT BE SAID TO HAVE INCURRED EXPE NSES OF PERSONAL NATURE. AS THE DISALLOWANCE HAS BEEN MADE ON THE GROUND THAT PART OF THE EXPENDITURE INCURRED IS OF A PERSONAL NATURE, I DELETE THE DISALLOWANCE AND ALLO W THIS GROUND OF THE ASSESSEE. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE COURT ON 28.11.2018 SD/- [ J.SUDHAKAR REDDY] ACCOUNTANT MEMBER DATED : 28.11.2018 SB, SR. PS 3 ITA NO.1121/KOL/2018 INDIANA TEXTILES MILL A.YR .2012-13 3 COPY OF THE ORDER FORWARDED TO: 1. INDIANA TEXTILES MILL, 493B, G.T.ROAD, SHIBPUR, BENGAL JUTE MILL COMPLEX, HOWRAH-711102 2. ACIT, CIRCLE-44/KOL (FORMERLY ITO, WARD-43(4), K OLKATA), 3, GOVERNMENT PLACE (WEST), KOLKATA-700001. 3..C.I.T.(A)- , KOLKATA 4. C.I.T.- KOLKATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT , KOLKATA BENCHES