DCIT, Circle - 4, Kolkata, Kolkata V. M/s. Bhatkawa Tea Industries Ltd., Kolkata

ITA 2106/KOL/2010

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 59589 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2006-2007
• Appeal Filed On: 23-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B HAZRA
• Assessee Lawyers: D MITRA
• Keywords: Reasonable cause
• Section: 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: KOL KATA () BEFORE . . , ! '# '# '# '# /AND ' # , ! ) [BEFORE SHRI S. V. MEHROTRA, AM & SRI MAHAVIR SINGH , JM] #$ #$ #$ #$ / I.T.A NO. 2106/KOL/2010 %& ''( %& ''( %& ''( %& ''(/ // / ASSESSMENT YEAR: 2006-07 DEPUTY COMMISSIONER OF INCOME-TAX, VS. M/S. BHATK AWA TEA INDUSTRIES LTD. CIRCLE-4, KOLKATA. (PAN:AABCB 3341 D) (*+ /APPELLANT ) (,-*+/ RESPONDENT ) DATE OF HEARING: 23.01.2012 DATE OF PRONOUNCEMENT: 23.01.2012 FOR THE APPELLANT: SHRI B. HAZRA FOR THE RESPONDENT: SHRI D. MITRA . / ORDER PER MAHAVIR SINGH, JM ( ' # ' # ' # ' #, , , , ! ! ! ! ) THIS APPEAL BY REVENUE IS ARISING OUT OF ORDER OF C IT(A)-VI, KOLKATA IN APPEAL NO.276/CIT(A)-VI/08-09 DATED 25.03.2010. ASSESSMENT WAS FRAMED BY ACIT, CIRCLE-4, KOLKATA U/S. 143(3) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED T O AS THE ACT) VIDE HIS ORDER DATED 24.11.2008. 2. THIS APPEAL OF REVENUE HAS BEEN DELAYED BY 37DAY S. REVENUE HAS FILED AFFIDAVIT EXPLAINING THE REASONS FOR DELAY, WHICH ARE AS UNDE R: DATE REASONS 17.10.2010 TO 14.11.2010 : APPLICATION FOR FILING SECOND APPEAL WAS NOT COMMUNICATED. 15.11.2010 : APPLICATION FOR FILING SECOND APPEAL COMMUNICATED. 16.11.2010 TO 19.11.2010 : THE PAPERS WERE BEING P ROCESSED FOR FILING. 20.11.2010 TO 21.11.2010 : SATURDAY & SUNDAY 22.11.2010 : THE PAPERS WERE BEING PROCESSED FOR FILING 23.11.2010 : THE PAPERS ARE BEING FILED FOR S ECOND APPEAL. WHEN THIS WAS POINTED OUT, THE LD. COUNSEL FAIRLY C ONCEDED THE POSITION. IN VIEW OF THE FACT THAT LD. COUNSEL CONCEDED THAT THERE IS REASONABLE CAUSE, WE ADMIT THE APPEAL AND ADJUDICATE THE ISSUE. 2 ITA 2106/K/2010 BHATKAWA TEA INDUSTRIES LTD. A.Y.0 6-07 3. THE FIRST AND SECOND ISSUES IN THIS APPEAL OF TH E REVENUE ARE AGAINST THE ORDER OF CIT(A) IN DELETING THE ADDITIONS ON ACCOUNT OF INTEREST P ERTAINING TO W.B. RURAL EMPLOYMENT AND EDUCATION CESS AND CESS ON GREEN LEAF. FOR THIS, R EVENUE HAS RAISED FOLLOWING GROUND NOS.1 AND 2: 1) THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE , LD. CIT(A), KOLKATA HAS ERRED IN LAW IN DELETING THE ADDITION OF RS.33,94,822/- ON ACCOU NT OF INTEREST PERTAINING TO W.B. RURAL EMPLOYMENT AND EDUCATION CESS WITHOUT APPRECIATING THE FACT THAT SLP IS PENDING BEFORE THE HONBLE SUPREME COURT AGAINST THE DECISION OF C ALCUTTA HIGH COURT IN THE CASE OF AFT INDUSTRIES LTD. VS. CIT (270 ITR 167) IN THE LI GHT OF WHICH LD. CIT(A) DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE. 2) THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, LD. CIT(A, KOLKATA HAS ERRED IN LAW IN DELETING THE ADDITION OF RS.36,18,660/- ON ACCOU NT OF CESS ON GREEN LEAF WITHOUT CONSIDERING THE FACT THAT EXPENSES ON ACCOUNT OF CE SS ON GREEN LEAF IS RELATED TO 100% AGRICULTURAL OPERATION AND SLP IS PENDING BEFORE TH E HONBLE SUPREME COURT AGAINST THE DECISION OF CALCUTTA HIGH COURT IN THE CASE OF AFT INDUSTRIES LTD. VS. CIT (270 ITR 167) IN THE LIGHT OF WHICH LD. CIT(A) DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE. 3. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. BRIEF FACTS ARE THAT IN THE P&L ACCOUNT ASSESSEE DE BITED AN EXPENDITURE OF RS.37,65,212/- TO ACQUIRE PROFIT. AS PER NOTES OF ACCOUNT THE EXCEPT IONAL AND PRIOR PERIOD ADJUSTMENTS INCLUDE RS.33,94,822/- ON ACCOUNT OF INTEREST PERTAINING TO EARLIER YEAR AGAINST W.B. RURAL EMPLOYMENT & EDUCATION CESS AND REPLANTING SUBSIDY AMOUNTING T O RS.3,70,39/- NO LONGER RECEIVABLE AND HENCE, ASSESSEE WRITTEN BACK THE SAME. IN APPEAL, C IT(A) CONFIRMED THE ADDITION OF RS.3,70,390/- AND DELETED THE ADDITION OF RS.33,94, 822/- MADE BY ASSESSING OFFICER ON ACCOUNT OF INTEREST RELATING TO W.B. RURAL EMPLOYMENT & EDU CATION CESS. LD. D.R. CONTENDED THAT CIT(A) WHILE DECIDING THESE ISSUES DID NOT APPRECIA TE THE FACT THAT SLP IS PENDING BEFORE HONBLE SUPREME COURT AGAINST THE DECISION OF HONB LE CALCUTTA HIGH COURT IN THE CASE OF AFT INDUSTRIES LTD. VS. CIT 270 ITR 167. HENCE, HE PRAYED FOR RESTORATION OF ADDITIONS. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE EXPENDI TURE COMES UNDER THE HEAD CESS ON GREEN LEAF. HENCE, HE URGED BEFORE THE BENCH TO KEEP THE CONSISTENCY AND ALLOW THE ASSESSEES CLAIM IN TERM OF ORDER OF JURISDICTIONAL HIGH COURT IN TH E CASE OF AFT INDUSTRIES LTD. (SUPRA). WE FIND THAT LD. DR CONCEDED THAT THE EXPENDITURE CLAIMED B Y ASSESSEE IS COMING UNDER THE HEAD CESS ON GREEN LEAF. HENCE, WE RESPECTFULLY FOLLOWING THE DECISION OF JURISDICTIONAL HIGH COURT IN THE CASE OF AFT INDUSTRIES LTD. (SUPRA) ALLOW THE CLAIM OF ASSESSEE AND REJECTED THE GROUNDS RAISED BY REVENUE. 4. THE NEXT ISSUE IN THIS APPEAL OF REVENUE IS AGAI NST THE ORDER OF CIT(A) IN ALLOWING THE EXCESS BONUS PAID. FOR THIS, REVENUE HAS RAISED FO LLOWING GROUND NO.3 3 ITA 2106/K/2010 BHATKAWA TEA INDUSTRIES LTD. A.Y.0 6-07 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE , LD. CIT(A), KOLKATA HAS ERRED IN LAW IN NOT HOLDING THAT EXCESS OF BONUS PAID OF RS.8,53 ,679/- THAN THE PROVISION MADE FOR BONUS IN THE ACCOUNT IS ALLOWABLE IF PAID WITHIN TH E DUE DATE OF FILING OF RETURN. 5. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. WE FIND THAT THE ASSESSING OFFICER DISALLOWED A SUM OF RS.8,53,679/- REPRESENTING THE DIFFERENCE BETWEEN THE ACTUAL PAYMENT OF BONUS BEFO RE THE DUE DATE OF FILING OF RETURN U/S. 139(1) OF THE ACT AND THE PROVISIONS MADE IN THE AC COUNTS FOR THE YEAR UNDER CONSIDERATION. THE ASSESSEE HAS CLAIMED TOTAL BONUS OF RS.40,38,98 6/- AS AGAINST THE PROVISIONS OF RS.31,85,307/-. THE ASSESSING OFFICER ADDED THE DI FFERENTIAL AMOUNT BUT CIT(A) ALLOWED THE CLAIM OF ASSESSEE BY HOLDING THAT WHATEVER HAS BEEN PAID ON OR BEFORE THE STATUTORY TIME PRESCRIBED U/S. 139(1) OF THE ACT, THE SAME IS ALLO WABLE. THE CIT(A) HELD VIDE PARA 6.2 OF HIS APPELLATE ORDER AS UNDER: 6.2. THE BONUS REFERRED TO IN THE CLAUSE (II) OF S UB-SECTION (1) OF SECTION 36 IS ALLOWABLE ON ACTUAL PAYMENT IN TERMS OF SECTION 43B. SINCE T HE PAYMENTS WERE MADE BY THE APPELLANT BEFORE THE STATUTORY TIME PRESCRIBED IN S EC. 139, THE SUM OF RS.8,53,679/- ON A/C. OF BONUS IS ALLOWED AND THE DISALLOWANCE MADE BY THE A.O. IS THEREFORE CANCELLED. 6. IT IS NOT THE CONTENTION OF THE REVENUE THAT THE BONUS IS NOT PAID WITHIN THE DUE DATE OF FILING RETURN U/S. 139(1) OF THE ACT AND IT IS ALSO NOT THE CLAIM OF REVENUE THAT THIS IS NOT A GENUINE PAYMENT OR NOT ACTUAL PAYMENT. IN ABSENCE OF ANY ARGUMENTS, WE UPHOLD THE ORDER OF CIT(A) AND THIS ISSUE OF REVENUES APPEAL IS DISMIS SED. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. 8. ORDER PRONOUNCED IN OPEN COURT. SD/- SD/- . . , ! ' '' ' # # # # , ! (S. V. MEHROTRA (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER ( / / / /) )) ) DATED 23 RD JANUARY, 2012 '01 %23 4' JD.(SR.P.S.) . 5 ,6 76'8- COPY OF THE ORDER FORWARDED TO: 1 . *+ / APPELLANT DCIT, CIRCLE-4, KOLKATA. 2 ,-*+ / RESPONDENT, M/S. BHATKAWA TEA INDUSTRIES LTD., NI CCO HOUSE, 2, HARE STREET, KOLKATA-700 001. . 3 . .% ( )/ THE CIT(A), KOLKATA 4. .% / CIT, KOLKATA 5 . '> ,% / DR, KOLKATA BENCHES, KOLKATA -6 ,/ TRUE COPY, .%?/ BY ORDER, #3 /ASSTT. REGISTRAR .