ITO, Ward - 4(1), Kolkata, Kolkata V. M/s. R.B. Properties Pvt. Ltd., Kolkata

ITA 1723/KOL/2011

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 3123 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-06-2013
• Appeal Filed By: Department
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 16-12-2011
• Court: TRIBUNAL
• Department Lawyers: D K SONOWAL
• Section: 143(3); 115JB; 11

Judgement Text

ITA NO. 1723/KOL/2011-B-MVS 1 , B IN THE INCOME TAX APPELLATE TRIBUNAL, B BENCH: KO LKATA BEFORE SRI N.S. SAINI, AM & SRI MAHAVIR SINGH, JM () . . , ! ! ! ! ' #!' , !$ / I.T.A NO. 1723/KOL/2011 #% &'/ ASSESSMENT YEAR :2007-08 I.T.O WARD 4(1), KOLKATA VS. M/S. R.B PR OPERTIES PVT. LTD PAN: AABCR 4736N ()* /APPELLANT ) (+,)*/ RESPONDENT ) )* / FOR THE APPELLANT: - / SHRI D.K SONOWAL, JCIT, SR. DR +,)* / FOR THE RESPONDENT: NONE . / 0 1 /DATE OF HEARING: 14-06-2013 2& 0 1 /DATE OF PRONOUNCEMENT: 18 -06-2013 3 /ORDER ' #!' , SHRI MAHAVIR SINGH, JUDICIAL MEMBER: THIS APPEAL BY THE REVENUE IS ARISING OUT OF ORDER OF CIT(A), IV, KOLKATA IN APPEAL NO. 234/CIT(A)-IV/2009-10 DATED 07-03-2011 FOR THE ASSESSMENT YEAR 2007-08. THE ASSESSMENT IN THIS CASE WAS FRAMED BY ITO, WARD 4( 1), KOLKATA U/S. 143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT ) VIDE HIS ORDER DATED 18.12.2009. 2. THE TWO INTER-CONNECTED ISSUES IN THIS REVENUES APPEAL ARE AGAINST THE ORDER OF THE CIT(A) FOR DETERMINING THE BOOK PROFIT U/S. 115JB O F THE ACT. FOR THIS, THE REVENUE HAS RAISED THE FOLLOWING GROUNDS:- 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, LD. CIT(A) HAS ERRED IN LAW IN DELETING THE ADDITION OF 43,52,184/- MADE BY THE A. O. IN DETERMINING THE BOOK PROFIT U/S. 11 5JB OF THE I.T. ACT. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, LD. CIT(A) HAS ERRED IN LAW IN DIRECTING THE A.O. TO MODIFY HIS ORDER OF NOT ALLOW ING THE CREDIT OF SECURITY TRANSACTION ITA NO. 1723/KOL/2011-B-MVS 2 TAX PAID BY THE ASSESSEE AMOUNTING TO 1 7,02,184/- AS PROVIDED U/S.88E OF THE ACT IN VIEW OF THE DECISION DATED JULY 16TH ,2010 OF THE H ONBLE ITAT, BANGALORE BENCH A IN ITA NO. 592(BNG)/ 2010 IN THE CASE OF M/S. HORIZON CAPITAL LTD. 3. WE HAVE HEARD THE RIVAL CONTENTIONS AND GONE THR OUGH THE FACTS AND CIRCUMSTANCES OF THE CASE. WE FIND THAT THE AO WHILE COMPUTING TH E BOOK PROFIT U/S. 115JB OF THE ACT MADE FOLLOWING ADDITIONS:- STT 17,02,184/- DONATION DISALLOWED 26,50,000/- AGGRIEVED, THE ASSESSEE HAS PREFERRED APPEAL BEFORE THE CIT(A). 4. BEFORE THE LD. CIT(A), IT WAS CONTENDED BY THE A SSESSEE THAT THE AMOUNTS ADDED BY THE AO FOR COMPUTATION OF BOOK PROFIT IS CONTRARY T O THE PROVISIONS OF SECTION 115JB OF THE ACT. THE EXPLANATION TO SECTION 115JB OF THE ACT P ROVIDES THAT THE BOOK PROFIT MEANS THE NET PROFIT AS SHOWN IN THE P & L ACCOUNT FOR THE RELEVANT PREVIOUS YEAR PREPARED UNDER SUB SECTION (2) OF THE ACT. ACCORDING TO THE LD. CO UNSEL FOR THE ASSESSEE, THE INCREASE IN NET PROFIT OTHER THAN THE SPECIFIED ITEMS MENTIONED IN CLAUSES (A) TO (G) OF THE EXPLANATION (1) TO SECTION 115JB OF THE ACT IS OUTSIDE THE SCOP E OF THIS SECTION. ACCORDING TO THE LD. COUNSEL FOR THE ASSESSEE, THE EXPLANATION DOES NOT PROVIDE FOR INCREASE IN PROFIT BY STT (SECURITY TRANSACTION TAX) OR DONATION DEBITED TO T HE P & L ACCOUNT. AS FAR AS STT IS CONCERNED, THE ISSUE IS COVERED BY THE DECISION OF THE HONBLE ITAT, BANGALORE BENCH IN ITA NO.592/BNG/2010 IN THE CASE OF HORIZON CAPITAL LTD. THE CIT(A) DELETED THE ADDITION OF STT AND DONATIONS BY OBSERVING AS UNDER :- 4.2. THE STT AND DONATION ARE NOT COVERED BY THE A BOVE ITEMS PROVIDED IN THE EXPLANATION TO SEC. 1 153B. THEREFORE, THE ADDI TION OF THE STT RS. 17,02,184/- AND DONATION RS.26,50,000F- IN THE BOOK PROFIT U/S.11538 IS WRONG AND NOT IN ACCORDANCE WITH THE PROVISIONS OF THE ACT. THE ADDITION OF RS.43,52184/- MADE BY THE A.O. IN THE BOOK PROFIT I S THEREFORE DELETED AND THE BOOK PROFIT SHALL BE REDUCED BY THE ABOVE AMOUN T. 5. THE SECOND GROUND IS AGAINST THE DEMAND RAISED F OR THE YEAR AMOUNTING TO RS.24,35,001/- . APPELLANT HAS FURTHER FILED ADDITI ONAL GROUND OF APPEAL AS SECURITY AND TRANSACTION TAX PAID BY APPELLANT IS N OT ADJUSTED AGAINST THE DEMAND RAISED IN VIEW OF SECTION 88E. APPELLANT HAS DRAWN MY ATTENTION TOWARDS DECISION DATED JULY 16TH, 2010 OF THE HONB LE 1TAT, BANGALORE ITA NO. 1723/KOL/2011-B-MVS 3 BENCH A IN ITA NO. 592 (BNG)/ 2010 IN THE CASE OF M/S. HORIZON CAPITAL LTD. AS PER ASSESSMENT ORDER NO REASON IS GIVEN FOR NOT ALLOWING THE CREDIT OF ST1 PAID BY APPELLANT. A.O. IS DIRECTED TO LOOK INTO MA TTER AND MODIFY HIS ORDER IN VIEW OF THE DECISION CITED ABOVE BY APPELLANT OF BA NGALORE TRIBUNAL . AGGRIEVED, REVENUE CAME IN APPEAL BEFORE US. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND GONE THR OUGH THE FACTS AND CIRCUMSTANCES OF THE CASE. WE HAVE ALSO GONE THROUGH THE EXPLANAT ION (1) TO SECTION 115JB OF THE ACT, WHEREIN NET PROFIT AS SHOWN IN THE P&L ACCOUNT FOR THE RELEVANT PREVIOUS YEAR PREPARED UNDER SUB-SECTION 2 IS TO BE INCREASED BY ITEMS MEN TIONED IN CLAUSES (A) TO (G) AND ITEMS (I) TO (VIII) OF EXPLANATION (1) TO SEC. 115JB OF T HE ACT. WE FIND THAT NONE OF THE ITEMS ARE COVERED FOR MAKING THESE TWO DISALLOWANCES. EVEN OT HER WISE, THE ISSUE IS COVERED BY THE DECISION OF THE CO-ORDINATE BENCH OF ITAT BANGALORE IN THE CASE OF HORIZON CAPITAL LTD. IN VIEW OF THE ABOVE, WE CONFIRM THE ORDER OF THE LD. CIT(A) ON THIS ISSUE. . 6. IN THE RESULT, REVENUES APPEAL IS DISMISSED. ' 3 . 4 . 5 ' 1 18--06-2013 ORDER PRONOUNCED IN THE OPEN COURT ON 18 -06-2013 SD/- SD/- [ . . , ] [ ' #!' , ] [N.S. SAINI, ACCOUNTANT MEMBER] M AHAVIR SINGH, JUDICIAL MEMBER] (1) DATED 18--06-2013 *PP 67 #89 #: /SR.P.S. ITA NO. 1723/KOL/2011-B-MVS 4 3 0 +##; <;&=- COPY OF THE ORDER FORWARDED TO: 1 . )* /APPELLANT- ITO, WARD 4(1), P- 7 CHOWRINGHEE SQ, AAYKAR BHAWAN, 8 FL, KOL-69. 2 +,)* / RESPONDENT : M/S. R.B PROPERTIES PVT. LTD 11 POLL OCK ST, 3 RD FL., KOL-1. 3 . #3 / THE CIT, 4 . #3 ( )/ THE CIT(A), KOLKATA 5 . D#5 +# / DR, KOLKATA BENCHES, KOLKATA ,; +#/ TRUE COPY, 3./ BY ORDER, ' !9 /ASSTT. REGISTRAR