ACIT, CHENNAI V. Faiveley Transport Rail Technologies India Limited, Hosur

ITA 1672/CHNY/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 7941 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2016
• Appeal Filed By: Department
• Bench Allotted: B
• Next Hearing Date: 24-11-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 06-06-2016
• Court: TRIBUNAL
• Department Lawyers: SUPRIYO PAL
• Section: 143(3); 148

Judgement Text

, , IN THE INCOME - TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . , . , BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER & SHRI DUVVURU R L REDDY , JUDICIAL MEMBER ./ I T.A. NO. 1672 /MDS/201 6 / ASSESSMENT YEAR :20 08 - 09 THE ASSISTANT COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE 2 ( 1 ) , CHENNAI 600 034 . VS. M/S. FAIVELEY TRANSPORT RAIL TECHNOLOGIES INDIA LIMITED, P.B . NO. 39, HARITA, HOSUR 635 109. [PAN:AA G C S8 52 5B ] ( / APPELLANT ) ( / RESPONDENT ) / APPELLANT BY : SHRI SUPRIYO PAL, JCIT / RESPONDENT BY : NONE / DATE OF HEARING : 2 4 . 1 1 .201 6 / DATE OF P RONOUNCEMENT : 30 . 1 1 .201 6 / O R D E R PER DUVVURU RL REDDY , JUDICIAL MEMBER : THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) 6 , CHENNAI , DATE D 28 . 0 3 .20 1 6 RELEVANT TO THE ASSESSMENT YEAR 20 08 - 09 . IN THIS APPEAL, THE REVENUE HAS CHALLENGED THAT THE LD. CIT(A) HAS ERRED IN DELETING THE DISALLOWANCE MADE ON MANAGEMENT FEES BY VIOLATING THE PROVISIONS OF RULE 46A OF THE INCOME TAX RULES , 1962 . I.T.A. NO . 1672 /M/ 16 2 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF MANUFACTURING AND SUPPLY OF GOODS TO RAILWAYS AND FILED ITS RETURN OF INCOME ON 30 .0 9 .20 08 ADMITTING AN INCOME OF . 32,14,42,800 / - . THE ASSESSMENT WAS COMPLETED UNDER SECTION 143(3) OF THE ACT [ ACT IN SHORT]. SUBSEQUENTLY, NOTICE UNDER SECTION 148 OF THE ACT WAS ISSUED ON THE ASSESSEE ON 30.03.2013. REASONS FOR REOPENING OF THE ASSESSMENT WERE SOUGHT FOR AND SUPPLIE D. THEREAFTER, NOTICE UNDER SECTION 143(2) OF THE ACT WAS ISSUED. AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND THE DETAILS FILED THERETO, THE ASSESSING OFFICER HAS COMPLETED THE ASSESSMENT UNDER SECTION 143(3) R.W.S. 147 OF THE ACT AFTER MAKING DI SALLOWANCE OF MANAGEMENT FEES AT .46,60,000/ - . 3. THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A). AFTER CONSIDERING THE WRITTEN SUBMISSIONS OF THE ASSESSEE, THE LD. CIT(A) HAS DIRECTED THE ASSESSING OFFICER TO DELETE THE DISALLOWANCE MADE BY THE ASSESSING OFFICER TOWA RDS MANAGEMENT FEE PAID BY THE ASSESSEE . 4. ON BEING AGGRIEVED, THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. THE LD. DR HAS STRONGLY CONTENDED THAT WITHOUT AFFORDING AN OPPORTUNITY TO THE ASSESSING OFFICER, BASED ON THE WRITTEN SUBMISSIONS FILED BY THE ASSESSEE, THE LD. CIT(A) HAS DIRECTED THE ASSESSING OFFICER TO DELETE THE DISALLOWANCE MADE BY HIM IS ABSOLUTELY IN VIOLATION OF PROVISIONS OF RULE 46A I.T.A. NO . 1672 /M/ 16 3 OF THE INCOME TAX RULES. THEREFORE, HE PLEADED THAT THE MATTER SHOULD BE REMITTED BACK TO THE ASSESSING OFFICER FOR FRESH CONSIDERATION IN ACCORDANCE WITH LAW. 5. NONE APPEARED ON BEHALF OF THE ASSESSEE DESPITE SERVICE OF NOTICE [AD ON RECORD]. HENCE WE PROCEEDED TO DECIDE THE APPEAL ON MERITS AFTER HEARING THE LD. DR. 6 . WE HAVE HEARD THE LD. DR , PERU SED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. WE FIND THAT AFTER CONSIDERING THE WRITTEN SUBMISSIONS INCLUDING BROAD BREAKUP OF LEGAL AND PROFESSIONAL FEES PAID BY THE ASSESSEE, THE LD. CIT(A) WAS OF THE OPINION TH AT THE ASSESSING OFFICER HAS MADE THE DISALLOWANCE ON AN ERRONEOUS APPRECIATION OF FACTS. HOWEVER, WE FIND THAT BEFORE ACCEPTING THE WRITTEN SUBMISSIONS AND OTHER PARTICULARS FILED BY THE ASSESSEE, THE LD. CIT(A) HAS NOT OBTAINED REMAND REPORT FROM THE AS SESSING OFFICER AND THEREFORE, WE ARE OF THE OPINION THAT T HE LD. CIT(A) HAS NOT COMPLIED WITH THE PROVISIONS OF RULE 46A OF THE INCOME TAX RULES, 1962. THEREFORE, WE FIND IT JUST AND APPROPRIATE TO SET ASIDE THE ORDER OF THE LD. CIT(A) AND REMIT THE MATTE R BACK T O THE ASSESSING OFFICER WITH THE DIRECTION TO DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH LAW AFTER GIVING DUE OPPORTUNITY TO THE ASSESSEE. THUS, THE GROUND RAISED BY THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. I.T.A. NO . 1672 /M/ 16 4 7 . IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED ON THE 30 TH NOVEMBER , 2016 AT CHENNAI. SD/ - SD/ - (A. MOHAN ALANKAMONY ) ACCOUNTANT MEMBER ( DUVVURU RL REDDY ) JUDICIAL MEMBER CHENNAI, DATED, THE 30 . 1 1 .201 6 VM/ - / COPY TO: 1. / APPELLANT , 2. / RESPONDENT , 3. ( ) / CIT(A) , 4. / CIT , 5. / DR & 6. / GF.