M/s Benara Bearing & Postons Ltd., Kanpur V. Dy. Commissioner of Income Tax, Kanpur

ITA 156/LKW/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 0562 (ITAT-LUCKNOW)
• Duration Of Justice: 1 year(s) 8 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-12-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 28-03-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R K VISHWAKARMA
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A , LUCKNOW BEFORE SHRI. T.S. KAPOOR, ACCOUNTANT MEMBER AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER ITA NO. 156/LKW/2016 ASSESSMENT YEAR: 2008 - 09 M/S BENARA BEARING & PISTONS LTD. C/O 24/4, T HE MALL KANPUR V. DCIT CENTRAL CIRCLE - 1 KANPUR T AN /PAN : AABCB7583 (APP ELL ANT) (RESPONDENT) APPELLANT BY: SHRI ASHISH JAISWAL, ADVOCATE RESPONDENT BY: SHRI R. K. VISHWAKARMA, D.R. DATE OF HEARING: 12 12 201 7 DATE OF PRONOUNCEMENT: 13 12 201 7 O R D E R PER P ARTHA SARATHI CHAUDHURY, J.M : THIS APPEAL PREFERRED BY THE ASSESSEE EMANATES FROM THE ORDER OF THE LD. CIT(A) - IV, KANPUR DATED 28/1/2016. 2 . THOUGH THE ASSESSEE HAS RAISED MULTIPLE GROUNDS OF APPEAL, FIRST GROUND IS THAT THE LD. CIT(A) HAS ERRED IN NOT FOLLOWING THE DIRECTION OF THE TRIBUNAL. 3 . THE BRIEF FACTS AS APPEARING IN THE ORDER OF THE LD. CIT(A) ARE AS UNDER: - IN THIS CASE, ORIGINAL APPEAL WAS FILED ON 17.01.2011 AGAINST ORDER U/S 143(3) OF THE ACT DATED 28.12.2010 WITH THE FOLLOWING GROUNDS OF APPEAL; [ ITA NO.156/LKW/201 ] 2 1. BECAUSE ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED A. O. HAS ERRED IN ADDITION OF RS. 7,30,913/ - 2. BECAUSE ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED A. O. HAS ERRED IN OF RS. 1,24,907/ - BEING LIC GRATUITY PAID . 3. BECAUSE ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED A.O. HAS ERRED DISALLOWANCE U/S 40 (IA) AT RS. 11,93,668/ - 4. BECAUSE ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED A. O. HAS ERRED DISALLOWANCE OUT OF TELEPHONE EXPENSES AT RS. 82,473/ - . 5. BECAUSE ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED A.O. HAS ERRED DISALLOWANCE OUT OF SALES PROMOTION EXPENSES AT RS. 50, OOO/ - . 6. BECAUSE ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED A.O. HAS ERRED IN PASSING THE ORDER U/S 143(3), WHICH IS BOTH ON LAW AND FACTS. 7. BECAUSE ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE RELIEF, IF ANY, BY THE AUTHORITY, MAY BE GRANTED. 1.1 THE SAID APPEAL WAS PARTLY ALLOWED BY MY LD. PREDECESSOR CIT(A) - I, KANPUR VIDE HIS ORD ER DATED 01.04.2011. MY LD PREDECESSOR HAS ALLOWED GR. NO. 1,2,3,4 & 6. AGGRIEVED WITH THE AFORESAID ORDER, THE DEPARTMENT WENT IN APPEAL BEFORE HON'BLE ITAT WITH THE FOLLOWING GROUNDS OF APPEAL; 1. LD. CIT(A) - I, KANPUR HAS ERRED IN LAW AND FACTS IN ALLO WING THE RELIEF ON ACCOUNT OF BONUS OF RS. 7,30,913/ - NOT PAID, RS. 1,24,901/ - LIC GRATUITY NOT PAID AND RS. 11,93,668/ - DISALLOWANCES U/S 40(A) OF INCOME TAX ACT, 1961 WHICH WERE NEVER DISALLOWED BY THE A.O. MOREOVER, THE FACT THAT THESE DISALLOWANCES WER E STATUTORY IN NATURE AND ASSESSEE COMPANY ITSELF HAD INCLUDED THE SAME IN ITS TOTAL INCOME AND PAID TAX THEREON. [ ITA NO.156/LKW/201 ] 3 2. THE CIT(A) HAS ERRED IN LAW AS HE DID NOT HAVE JURISDICTION ON AN ISSUE WHICH WAS NOT DISPUTED BY THE ASSESSEE BEFORE THE A.O., AS HE HAD HIMSELF ADDED THAT INCOME IN THE COMPUTATION AND PAID TAX THEREON. 3. LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.11,70,365/ - MADE U/S 36(L)(VA) READ WITH SECTION 2(24)(X) OF I. T. ACT, 1961 ON ACCOUNT DELAYED QUOTING THE PR OVISION OF SECTION 43B(B) APPLIED IN RESPECT OF EMPLOYERS CONTRIBUTION. 4. LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN ALLOWING ABOVE RELIEF ON THE BASIS OF FINDINGS GIVEN BY HON'BLE HIGH COURT IN THE CASE OF CIT VS SABARI ENTERPRISES 213 CTR 269 (KAR) WI THOUT CONSIDERING THE DISTINGUISHABLE FACTS AND CIRCUMSTANCES OF INSTANT CASE. 5. LD.CIT(A) HAS ERRED IN LAW AND FACTS IN ALLOWING THE RELIEF OF RS.50,000/ - OUT OF SALES PROMOTION EXPENSES DESPITE THE FACT THAT SOME EXPENSES WERE FOUND TO BE INCURRED IN $ CASH. 6. THAT THE ORDER OF THE LD. CIT(A) DESERVES TO BE VACATED AND THE ASSESSMENT ORDER PASSED BY THE A. O. BE RESTORED. 2. THE HON'BLE ITAT VIDE ITS ORDER IN ITA NO. 394/LKW/11 DATED 05.07.2012 HAS ALLOWED THE APPEAL OF THE DEPARTMENT AND HAS RESTOR ED BACK THE ISSUES, RAISED IN GROUND NO. 1 AND 5 ABOVE, FOR FRESH ADJUDICATION, TO THE FILE OF THE UNDERSIGNED. 4 . WITH REGARD TO GROUND NO.1 OF THE GROUNDS OF APPEAL, WE FIND THAT THE CO - ORDINATE ITAT BENCH HAS HELD AS FOLLOWS: - 'THE ASSESSEE HAS NEVER RAIS ED ANY GROUND IN RESPECT OF ELIGIBILITY OF SUCH CLAIMS AT THE LEVEL OF ASS ESSING OFFICER AS WELL AS THE CI T(A). THE FINDING OF LEARNED C1T(A) ARE CONTAINED IN PARA 8 OF THE APPELLATE ORDER DATED 01.04.2011 WHEREBY THE LD. CIT(A) HAS DELETED THE ADDITION, W HICH WERE NEVER MADE BY THE ASSESSING OFFICER, THEREFORE, THE FINDING OF LD. CIT(A) ARE FACTUALLY AND [ ITA NO.156/LKW/201 ] 4 LEGALLY INCORRECT. THE ASSESSEE RAISED FACTUALLY INCORRECT GROUNDS OF APPEAL AND (HE CIT(A), ACCORDINGLY RECORDED FINDINGS ADJUDICATING THE SAME.' 5 . AFTER C ONSIDERING THIS ORDER OF THE TRIBUNAL, THE LD. CIT(A) HAS HELD AS FOLLOWS: - IT MAY BE SEEN THAT HON'BLE ITAT WHILE SATING ASIDE THE GROUND HAS OBSERVED SPECIFICALLY THAT THE ASSESSEE RAISED FACTUALLY INCORRECT GROUND OF APPEAL BEFORE CIT(A) I.E. BEFORE MY LD. PREDECESSOR. FURTHER, SINCE NO ADDITION HAS BEEN MADE BY AO ON THIS ISSUE, THIS GROUND DOES NOT STAND. THEREFORE, AFTER HEARING THE LD. A.R. OF THE APPELLANT THIS GROUND IS DISMISSED. 6 . AT THE TIME OF HEARING BEFORE US, THE LD. A.R. OF THE ASSESSEE PRA YED THAT THE ORDER OF THE LD. CIT(A) MAY BE SET ASIDE AND RESTORED TO THE FILE OF THE ASSESSING OFFICER, TO WHICH THE LD. D.R. DID NOT MAKE ANY OBJECTION. 7 . WE HAVE PERUSED THE CASE RECORD AND AT THE REQUEST OF THE LD. A.R. OF THE ASSESSEE, WE SET ASIDE THE ORDER OF THE LD. CIT(A) AND RESTORE THE MATTER TO THE FILE OF THE ASSESSING OFFICER FOR FRESH ADJUDICATION AFTER AFFORDING REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. 8 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 13 /12/ 201 7 . SD/ - SD/ - [ T.S. KAPOOR ] [PARTHA SARATHI CHAUDHURY ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 13 TH DECEMBER , 2017 JJ: 1212 [ ITA NO.156/LKW/201 ] 5 COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR ASSISTANT REGISTRAR