Calcutta Oil & Produce Syndicate, Kolkata V. ACIT, Cir-37, Kolkata, Kolkata

ITA 1331/KOL/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 78425 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 10 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-07-2014
• Appeal Filed By: Assessee
• Bench Allotted: A
• Next Hearing Date: 09-10-2013
• Assessment Year: 2003-2004
• Appeal Filed On: 14-09-2012
• Court: TRIBUNAL
• Assessee Lawyers: J K BRAHMA; S P BAGARDA
• Section: 37(1)

Judgement Text

, A , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH: KOL KATA () BEFORE , /AND , ! ) [BEFORE SHRI MAHAVIR SINGH, JM & SHRI SHAMIM YAHYA, AM] ' / I.T.A NO.1331/KOL/2012 #$ %&/ ASSESSMENT YEAR: 2003-04 CALCUTTA OIL & PRODUCE SYNDICATE VS. ACIT, CIRCLE 37/KOLKATA, 9, RABINDRA SARANI, KOLKATA 700 073 PODDAR COURT , 18, RABINDRA SARANI, (PAN: AABFC 8043 N) 8 TH FLOOR, KOLKATA 700 001 (() /APPELLANT ) (*+()/ RESPONDENT ) DATE OF HEARING: 15.07.2014 DATE OF PRONOUNCEMENT: 17.07.2014 FOR THE APPELLANT: SHRI S.P.BAGARDA, AR AND SHRI J.K. BRAHMA, AR FOR THE RESPONDENT: SHRI SANJAY MUKHERJEE, JCIT, SR. DR / ORDER PER SHRI MAHAVIR SINGH, JM : THIS APPEAL BY ASSESSEE IS ARISING OUT OF ORDER OF CIT(APPEALS)-XXIV, KOLKATA IN APPEAL NO. 853/CIT(A)-XXIV/C037/10-11 DATED 19.07.2 012. ASSESSMENT WAS FRAMED BY ACIT, CIRCLE-37, KOLKATA U/S. 143(3)/147/143(1) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR ASSESSMENT YEAR 2003- 04 VIDE HIS ORDER DATED 30.12.2010. 2. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE STAT ED THAT HE IS NOT PRESSING THE FOLLOWING GROUND NO.1 AND 2. LD. COUNSEL FOR THE ASSESSEE FAI RLY STATED THAT HE HAS INSTRUCTION FROM THE ASSESSEE NOT TO PRESS THESE ISSUES. ON QUERY FROM T HE BENCH, LD. SR-DR FAIRLY STATED THAT HE HAS NO OBJECTION IN OPPOSING THE PLEA OF THE ASSESS EE. IN SUCH CIRCUMSTANCES, WE PERMIT TO WITHDRAW THE GROUNDS. HENCE, THE SAME ARE DISMISSE D AS WITHDRAWN. 3. THE ONLY ISSUE REMAINS FOR ADJUDICATION IS AGAIN ST THE ORDER OF CIT(A) CONFIRMING THE ADDITION OF RS.50,000/- BEING EXPENSES INCURRED ON ACCOUNT OF COPRA COMMISSION BUSINESS.. FOR THIS, ASSESSEE HAS RAISED FOLLOWING GROUND NO.3:- (3) THAT ON THE FACTS AND IN THE CIRCUMSTANCES, TH E C.I./T.(A) ERRED IN CONFIRMING AN ADDITION OF RS.50,000/- OUT OF RS.1,25,121/- REPRES ENTING ACTUAL EXPENSES INCURRED BY 2 ITA NO. 1331/K/2012 CALCUTTA OIL & PRODUCE SYNDICATE AY 2003-04 THE REPRESENTATIVE AT CALICUT RELATING TO THE COPRA COMMISSION BUSINESS OF THE APPELLANT WHO PAID PARTLY BY CHEQUES AND DEMAND DRAFTS TO THE REPRESENTATIVE. 4. WE HAVE HEARD RIVAL CONTENTIONS AND GONE THROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE. WE FIND FROM THE ASSESSMENT ORDER THAT THE AS SESSING OFFICER HAS MADE DISALLOWANCE OF RS.1,21,121/- BEING EXPENSES CLAIMED ON ACCOUNT OF COMMISSION INCOME. THE AO DISALLOWED BY OBSERVING AS UNDER:- IN RELATION TO REST OF THE EXPENDITURES RELATED TO EARNING COMMISSION THE ASSESSEE SUBMITS THAT SINCE COPRA IS AN AGRICULTURAL PRODUC T AND OIL CONTAINS VARIES A LOT THEREFORE THE ASSESSEE NEEDS ITS REPRESENTATIVE TO SEND ALL THESE PLACES TO KNOW ABOUT THE QUALITY OF COBRA. BUT SOME EXPENDITURES LIKE LIC PREMIUM ON LIFE OF ASIT BHATTACHARJEE 2016/- IS COMPLETELY NOT RELATED EXPENDITURE TO EARN COMMISSI ON INCOME FROM M/S SHALIMAR CHEMICAL WORKS LTD. AND THE FOLLOWING EXPENDITURES ARE ALREADY DEBITED BY THE ASSESSEE IN THE P&L ACCOUNT UNDER SAME HEADS, MOBILE PHONE EXPENSES 19,357/- TELEPHONE CHARGES 14,299/- THEREFORE THE REMAINING AMOUNT 1,25,121/- (3,65,121 2,40,000) IS DISALLOWED U/ 37 PAS THERE IS NO BUSINESS NEXUS WITH CLAIMED EXPENDI TURE. PENALTY PROCEEDING IS SEPARATELY INITIATED U/S 271(1). AGGRIEVED, ASSESSEE PREFERRED APPEAL BEFORE CIT(A) WHO RESTRICTED ADDITION AT RS.50,000/- BY OBSERVING AS UNDER:- 4.2 I HAVE CAREFULLY CONSIDERED THE ABOVE OBSERVAT ION OF THE ASSESSING OFFICER. DU9RING THE COURSE OF APPEAL, THE LD. A/R HAS FILED A PAPER BOOK CONTAINING VARIOUS DETAILS. HOWE4VER, HE HAS FAILED TO FURNISH ANY EXPLANATION AS TO WHY THE REMAINING AMOUNT OF RS.1,25,121/- SHOULD BE ALLOWED AS EXPENDITURE U/S 37(1) OF THE INCOME-TAX ACT, 1961. CONSIDERING THE NATURE AND VOLUME OF THE BUSINESS, THE AO IS DIRECTED TO RESTRICT THE DISALLOWANCE U/S. 37(1) TO RS.50,000/- IN PLACE OF RS.1,25,121/-. THUS, THE APPELLANT GETS A RELIEF OF RS.75,121/-. THIS GROUND OF APPEAL IS P ARTLY ALLOWED. WE FIND FROM THE RECORDS OF THE ASSESSEE I.E., PAGE G.112A OF ASSESSEES PAPER BOOK, WHEREIN COMPLETE DETAILS OF COMMISSION INCOME RECEIVED AND COMMISSION EXPENSES PAID ARE FILED. WE FIND THAT ASSESSEE HAS CLAIMED TELEPHONE CHARGES AN D MOBILE CHARGES ON ACCOUNT OF ACTUAL BASIS AND THERE IS NO DOUBLE DEDUCTION AS CLAIMED BY THE REVENUE. IN TERM OF THE ABOVE, WE DELETE THE BALANCE ADDITION EXCEPT THE LIC PREMIUM PAID BY ASS ESSEE ON ACCOUNT OF LIC PREMIUM ON THE 3 ITA NO. 1331/K/2012 CALCUTTA OIL & PRODUCE SYNDICATE AY 2003-04 LIFE OF ASIT BHATTACHARJEE AMOUNTING TO RS.2016/-. IN TERM OF THE ABOVE, WE ALLOW THE APPEAL OF ASSESSEE BY RESTRICTING THE ADDITION AT RS. 2,016/ - ONLY. 5. IN THE RESULT, ASSESSEES APPEAL IS PARTLY ALLOW ED. 6. ORDER IS PRONOUNCED IN THE OPEN COURT ON 17.07.2 014. SD/- SD/- , ! , (SHAMIM YAHYA ) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 17 TH JULY, 2014 ,- #./ 0 DKP*P.S. 1 *2 3 2%4- COPY OF THE ORDER FORWARDED TO: 1 . () / APPELLANT CALCUTTA OIL & PRODUCE SYNDICATE, 9, RABINDRA SARANI, KOLKATA-700 073 2 *+() / RESPONDENT ACIT, CIRCLE 37, PODDAR COURT, 18, RA BINDRA SARANI 8 TH FLOOR, KOLKATA-1 3 . # ( )/ THE CIT(A), KOLKATA 4. 5. # / CIT KOLKATA 2:; *# / DR, KOLKATA BENCHES, KOLKATA +2 */ TRUE COPY, #