Eastern Division Project Engineers Co-operative Society Ltd., Asansol V. A.C.I.T.., Cir-1, Asansol,

ITA 1601/KOL/2008

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 54477 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 11 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-08-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 07-04-2011
• Assessment Year: 2001-2002
• Appeal Filed On: 14-08-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RANADHIR GUPTA
• Assessee Lawyers: U DASGUPTA
• Section: 143(3); 37

Judgement Text

, SMC ( ) , IN THE INCOME TAX APPELLATE TRIBUNAL SMC (B) BENC H: KOLKATA () BEFORE , ) [BEFORE HONBLE SRI MAHAVIR SINGH, JM] / I.T.A NO. 1601/KOL/2008 ! '# ! '# ! '# ! '#/ // / ASSESSMENT YEAR: 2001-02 EASTERN DIVISION PROJECT ENGINEERS VS. ASSISTAN T COMMISSIONER OF INCOME-TAX, CO-OPERATIVE SOCIETY LTD. CIRCLE-1, ASANSOL (PAN-AABFE 5920 G) (%& /APPELLANT ) ('(%&/ RESPONDENT ) FOR THE APPELLANT: SHRI U. DASGUPTA FOR THE RESPONDENT: SHRI RANADHIR GUPTA, SR.DR )* / ORDER THIS APPEAL BY ASSESSEE IS ARISING OUT OF ORDER OF CIT(A), ASANSOL IN APPEAL NO.219/CIT(A)/ASL/CIRCLE-1/2006-07 DATED 30.04.2008 . ASSESSMENT WAS FRAMED BY ACIT, CIRCLE-1, ASANSOL U/S 143(3) R.W.S. 250 OF THE INCOME-TAX ACT, 1961 ( HEREINAFTER REFERRED TO AS THE ACT) VIDE HIS ORDER DATED 29.12.2006. 2. THE SOLE ISSUE IN THIS APPEAL OF THE ASSESSEE IS AGAINST THE ORDER OF CIT(A) CONFIRMING THE ACTION OF ASSESSING OFFICER IN NOT ALLOWING REM UNERATIONS PAID TO MEMBERS OF THE SOCIETY FOR TECHNICAL SERVICES RENDERED BY THESE MEMBERS RE GARDING CIVIL JOB. FOR THIS, ASSESSEE HAS RAISED FOLLOWING TWO GROUNDS: 1) THAT ON THE FACT AND IN THE CIRCUMSTANCES OF TH E CASE, THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ORDER OF THE ITO AND THEREBY NOT ALL OWING THE ALLOWANCES PAID TO THE 10(TEN) MEMBERS OF THE COOPERATIVE SOCIETY. 3) THAT WHICH SERVICES ARE RENDERED BY MEMBERS, THE SAME SHOULD BE ALLOWED SINCE ALL THE CONDITIONS OF SEC. 37 OF THE I. T. ACT ARE MET. 3. I HAVE HEARD RIVAL CONTENTIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. I FIND THAT THE ASSESSING OFFICER HAS DISALLOWED MERE LY ON THE BASIS THAT REMUNERATION TO MEMBERS IS NOT ALLOWABLE UNDER THE INCOME-TAX ACT B UT HE HAS NOT CITED ANY PROVISION. THE CIT(A) ALSO CONFIRMED THE ACTION OF ASSESSING OFFIC ER RELYING ON THE DECISION OF KOLKATA BENCH IN THE CASE OF ITO VS. M/S. TECH ENGINEERS CO -OPERATIVE SOCIETY LTD. ITA NOS. 615 & 616/KOL/2004, ASSESSMENT YEAR 1999-2000 & 2000-01 D ATED 12.7.2004. AGGRIEVED, NOW ASSESSEE IS IN APPEAL BEFORE US. I FIND FROM RECOR DS THAT IT IS NOT THE ALLEGATION OF REVENUE THAT 2 ITA 1601/K/2008 EASTERN DIVISION PROJECT ENGINEERS COOP. SOCIETY LTD. A.Y.01-02 THESE MEMBERS HAVE NOT PROVIDED TECHNICAL SERVICES AS CONTENDED BY ASSESSEE FROM THE VERY BEGINNING. IT IS THE CASE OF ASSESSEE THAT THESE M EMBERS HAVE PROVIDED TECHNICAL SERVICES REGARDING CIVIL JOB AND FOR WHICH REMUNERATIONS WER E PAID TO THESE MEMBERS. I HAVE GONE THROUGH THE PROVISIONS OF SECTION 40, WHICH PRESCRI BED AMOUNT NOT TO BE DEDUCTED FROM INCOME CHARGEABLE UNDER THE HEADS PROFITS OR GAINS FROM BU SINESS OR PROFESSION OR U/S. 40A OF THE ACT WHERE EXPENSES OR PAYMENTS ARE NOT DEDUCTED IN CERT AIN CIRCUMSTANCES, BUT I FIND NONE OF THE PROVISION PRESCRIBES THAT PAYMENTS OF REMUNERATIONS ARE NOT DEDUCTIBLE IN THE CASE OF MEMBERS OF COOPERATIVE SOCIETY. THIS REMUNERATION FALLS UN DER THE PROVISIONS OF SECTION 37 OF THE ACT AND ALLOWABLE. ACCORDINGLY, WE ALLOW THE CLAIM OF ASSESSEE AND APPEAL OF ASSESSEE IS ALLOWED. 4. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. 5. ORDER PRONOUNCED IN OPEN COURT ON 05.08.2011 SD/- , (MAHAVIR SINGH) JUDICIAL ME MBER ( +, +, +, +,) )) ) DATED :5TH AUGUST, 2011 -. /0 1 JD.(SR.P.S.) )* 2 ' 3)'4- COPY OF THE ORDER FORWARDED TO: 1 . %& / APPELLANT EASTERN DIVISION PROJECT ENGINEERS COOP ERATIVE SOCIETY LTD., KALYANPUR-A.S.5/14/111 ASANSOL BURD WAN 713 304 2 '(%& / RESPONDENT, ACIT, CIRCLE-1, ASANSOL. . 3 . * ( )/ THE CIT(A), ASANSOL 4. * / CIT, ASNASOL 5 . ;< ' / DR, KOLKATA BENCHES, KOLKATA ( '/ TRUE COPY, )* =/ BY ORDER, 0 /ASSTT. REGISTRAR .