M/S. Jenson & Nicholson ( India) Ltd., Kolkata V. A.C.I.T., Circle - 12, Kolkata, Kolkata

ITA 1967/KOL/2008

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 7953 (ITAT-KOLKATA)
• Duration Of Justice: 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-03-2010
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2003-2004
• Appeal Filed On: 22-10-2009
• Court: TRIBUNAL
• Department Lawyers: HARI PRASAD
• Assessee Lawyers: R SALARPURIA
• Keywords: Depreciation; Additional evidence; Bad and doubtful debts

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL : B BENCH : KOLKATA [BEFORE HONBLE SMT. DIVA SINGH, JM & SHRI C.D.RAO , AM] I.T. A. NO. 1967/KOL/2008 ASSESSMENT YEAR 2003-04 M/S. JENSON & NICHOLSON (INDIA) LTD. -VS- A.C.I.T., CIRCLE-12, KOLKATA PAN:AAACJ 7231 P KOLKATA (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI R.SALARPURIA RESPONDENT BY : SHRI HARI PRASAD O R D E R PER SMT. DIVA SINGH, JM THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A)XII, KOLKATA DATED 19.06.2008 PERTAINING TO A.YR.2003-04 2. VARIOUS GROUNDS HAVE BEEN RAISED BY THE ASSESSEE IN THE PRESENT APPEAL. HOWEVER AT THE TIME OF HEARING IT WAS SUBMITTED BY THE LD. AR THAT THE ASSESSEE DOES NOT WISH TO PRESS GROUND NOS.2, 4 AND 8. ACCORDINGL Y APPROPRIATE SIGNATURES IN THE MAIN FILE INDICATING THE GROUNDS AS NOT PRESSED HAS BEEN MADE. THE EFFECTIVE GROUNDS WHICH REMAINED FOR ADJUDICATION ARE AS UNDER :- 1. THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF T HE CASE THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE BY THE AO IN RESPECT OF PROVISION OF DOUBTFUL DEBTS AMOUNTING TO RS.1.5 CRORE. ACTIONS O F BOTH THE AO & LD. CIT(A) WERE WHOLLY UNJUSTIFIED, UNREASONABLE, UNCAL LED FOR AND BAD IN LAW. 3. THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF TH E CASE THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE BY THE AO IN RESPECT OF DOUBTFUL ADVANCES AMOUNTING TO RS.96.75 LAKHS. ACTIONS OF BO TH THE AO & LD. CIT(A) WERE WHOLLY UNJUSTIFIED, UNREASONABLE, UNCALLED FOR AND BAD IN LAW. 5. THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF TH E CASE THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE BY THE AO IN RESPECT OF BAD DEBTS ABD ADVANCES WRITTEN OFF AMOUNTING TO RS.2.5 CRORE AND RS.96,000/-. ACTIONS OF BOTH THE AO & LD. CIT(A) WERE WHOLLY UNJUSTIFIED, UNREAS ONABLE, UNCALLED FOR AND BAD IN LAW. 2 6. THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF TH E CASE THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION MADE BY THE AO IN RESPECT OF PREFERENCE SHARES AND DEBENTURE ISSUE EXPENSES AMOUNTING TO RS .5,54,000/- AND RS.24,60,000/-. ACTIONS OF BOTH THE AO & LD. CIT(A) WERE WHOLLY UNJUSTIFIED, UNREASONABLE, UNCALLED FOR AND BAD IN LAW. 7. THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF TH E CASE THE LD. CIT(A) HAS ERRED IN CONFIRMING DIRECTING AO TO ALLOW 1/5 TH OF SUCH CLAIM IN RESPECT OF AMORTISATION OF VRS/RETRENCHMENT COMPENSATION AMOUN TING TO RS.20,16,000/- AND RS.25,20,000/- INSTEAD OF ALLOWING THE SAME. SU CH ACTIONS OF THE LD. CIT(A) WAS WHOLLY UNJUSTIFIED, UNREASONABLE, UNCALLED FOR AND BAD IN LAW. 3. IT WAS SUBMITTED BY THE LD. AR IN REGARD TO THE GROUNDS AGITATED BEFORE THE BENCH THAT THE TRIBUNAL HAD AN OCCASION TO CONSIDER THE SAME IN THE EARLIER A.YRS. I.E. NAMELY 1999-2000 AND 2000-01 VIDE ITS ORDER DATED 8 TH JANUARY, 2008 IN ITA NO.1380/KOL/2006 AND 1381/KOL/2006. THE ISSUE TODAY AS WELL AS IN EARLIER YEARS WAS ADDITION ON ACCOUNT OF REJECTION OF THE CLAIM OF TH E ASSESSEE FOR PROVISION OF DOUBTFUL DEBTS, PROVISION OF DOUBTFUL ADVANCES, PREFERENCE S HARES, EXPENSES AND LOSS OF FIXED ASSETS. THE TRIBUNAL TAKING NOTE OF THE FACT THAT THE ADDITIONAL EVIDENCES HAD TO BE TAKEN INTO CONSIDERATION FOR DECIDING THE ISSUE HAD RESTORED THE ISSUE BACK TO THE FILE OF THE AO FOR RE-CONSIDERATION ON MERIT. IN THE CIRCUM STANCES THE LIMITED PRAYER IN THE YEAR UNDER CONSIDERATION WAS THAT RELYING UPON THE CONSOLIDATED ORDER OR THE TRIBUNAL IN THE EARLIER YEARS, THE ISSUE QUA THE GROUND AGIT ATED MAY BE RESTORED BACK TO THE FILE OF THE AO TO TAKE INTO CONSIDERATION THE DECISION O F THE EARLIER YEARS ON THE BASIS OF EVIDENCES WHICH HAVE BEEN CONSIDERED IN THE EARLIER YEARS AS PER THE DIRECTION OF THE TRIBUNAL. 4. THE LD. DR SUBMITTED THAT AS FAR AS GROUND NOS. 1, 3 AND 5 ARE CONCERNED HE WOULD HAVE NO OBJECTION IF THE ISSUE IS RESTORED BA CK TO THE FILE OF THE AO. HOWEVER, IN REGARD TO THE PRAYER MADE QUA GROUND NO.6 AND 7 IT WAS HIS SUBMISSION THAT THE AO HAS MADE STATUTORY DEDUCTIONS AND THE RELEVANT FACTS HA VE BEEN LOOKED INTO AS SUCH THERE IS NO PURPOSE IN ACCEPTING THE PRAYER OF THE ASSESSEE IN RESTORING OF THE ISSUE. 3 5. THE LD. AR IN REPLY SUBMITTED THAT SINCE THE MAJ OR ISSUES ARE GOING BACK HIS PRAYER WOULD REMAIN THAT ALL THE ISSUES MAY BE REST ORED BACK TO THE FILE OF THE AO. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. ON A CAREFUL CONSIDERATION OF THE SAME, IT IS SEEN THAT IN THE EARLIER ASSESSMENT YEARS THE TRIBUNAL HAD AN OCCASION TO RESTORE THE ISSUE AGITATED VIDE GROUND NO.1,3,5 AND ALSO 6 AS REFERENCE IS MADE TO THE PREFERENCE S HARE ISSUE EXPENSES OF RS.7.41 LAKHS IN ITA NO.1380/KOL/2006 FOR 1999-2000 A.YR. A PERUS AL OF THE ORDERS OF THE TAX AUTHORITIES IN THE YEAR UNDER CONSIDERATION ALSO SH OW THAT AS PER THE REPRODUCTION MADE OF THE ASSESSEES SUBMISSION BEFORE THE CIT(A) THAT REFERENCE HAS BEEN SPECIFICALLY BEEN MADE IN PARA 1 OF PAGE 6 OF THE IMPUGNED ORDER . ACCORDINGLY WE ARE OF THE VIEW THAT THE PRAYER OF THE ASSESSEE CAN BE ACCEPTED QU A GROUND NOS. 1,3,5 AND 6 ARE IN LINE WITH THE ORDER OF THE TRIBUNAL AS REFERRED TO FOR C ONSIDERATION OF THE BENCH WOULD HAVE A BEARING ON THE ISSUES. ACCORDINGLY THE GROUNDS AR E RESTORED TO THE FILE OF THE AO TO DECIDE THE SAME IN ACCORDANCE WITH LAW TAKING INTO CONSIDERATION THE POSITION OF THE EARLIER YEARS. NEEDLESS TO SAY THAT A REASONABLE OP PORTUNITY SHALL BE AFFORDED TO THE ASSESSEE. 6.1. IN REGARD TO GROUND NO.7 WHEREIN THE ASSESSEE HAS REQUESTED FOR RESTORATION OF THE ISSUE AND THE ARGUMENT OF THE DEPARTMENT BEING THAT IT IS A STATUTORY DEDUCTION AND NO FACT IS REQUIRED TO BE CONSIDERED. IT IS SEEN TH AT THE CIT(A) WHILE CONSIDERING THE ISSUE RESTORED THE ISSUE BACK TO THE FILE OF THE A O WITH THE FOLLOWING DIRECTIONS : THE GR.NO.8 IS AGAIN AOS ACTION IN DISALLOWING RS .20,16,000/- OUT OF AMORTIZED 1/5 TH PORTION OF RS.25,20,000/- WRITTEN OFF IN PROFIT & LOSS A/C UNDER THE HEAD VOLUNTARY RETIREMENT. THE AO WRITES THAT THE ASSESSEE HAD CLAIMED THE WHO LE AMOUNT AS ALLOWABLE EXPENDITURE WHEREAS AS PER SECTION 35DDA ONLY 1/5 TH OF THE ABOVE EXPENDITURE WAS ALLOWABLE AS DEDUCTION. THE APPELLANT AHS STATE D IN ITS SUBMISSION THAT THE AMOUNT CLAIMED WAS 1/5 TH OF THE ACTUAL EXPENSE WHICH WAS CHARGED TO PROFIT AND LOSS ACCOUNT. THE AO ERRED IN TREATING THE SAME AS ENTIRE EXPENDITURE. THE AO IS DIRECTED TO LOOK INTO THE CLAIM OF THE APPELLANT AND IF THE CONTENTION OF THE APPELLANT IS CORRECT THEN THE 1/5 TH AMOUNT CLAIMED AS EXPENDITURE MUST BE 4 ALLOWED AS PER THE STATUTE. THIS GROUND IS ALLOWED SUBJECT TO VERIFICATION BY THE AO. 6.2. IT IS ALSO SEEN THAT WHILE DECIDING THE ISSUE THE CIT(A) WAS TAKING NOTE OF THE STATEMENT OF FACTS FILED BY THE ASSESSEE. IN THE FA CTS AND CIRCUMSTANCES AS ARE SET OUT ABOVE WE FIND THAT ONCE THE ISSUE HAS ALREADY BEEN RESTORED WITH THE SPECIFIC DIRECTION TO THE AO BY THE CIT(A) AND NO INFIRMITY IN THE DIR ECTION HAS BEEN BROUGHT TO THE NOTICE OF THE BENCH. THE PRAYER OF THE LD. AR CANNO T BE ACCEPTED QUA THIS GROUND. ACCORDINGLY GROUND NO.7 DOES NOT REQUIRE ANY FURTHE R DIRECTION. AS SUCH THE PRAYER OF THE ASSESSEE QUA GROUND NO.7 IS NOT ACCEPTED. 7. IN THE RESULT THE APPEAL OF THE ASSESSEE IS PART LY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 31.03.2010. SD/- SD/- (C.D.RAO) (DIVA SINGH) VICE PRESIDENT JUDICIAL MEMB ER DATED : 31.03.2010. COPY OF THE ORDER IS FORWARDED TO :- 1) M/S. JENSON & NICHOLSON (INDIA) LTD., C/O SALARPURI A JAJODIA & CO., 7, C.R.AVENUE, KOLKATA-700072. 2) A.C.I.T., CIRCLE-12, KOLKATA 3) CIT (A)-XII, KOLKATA (4) CIT - KOLKA TA. 5) D. R., I.T.A.T., KOLKATA. (TRUE COPY) BY ORDER ASSISTANT REGISTRAR, (RG) I.T.A.T., KOLKATA.