Venkatesh Logistics Pvt. Ltd., , Kolkata V. JCIT, Range - 5, Kolkata , Kolkata

ITA 233/KOL/2018

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 7212 (ITAT-KOLKATA)
• Duration Of Justice: 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-09-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 12-02-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: KAPIL MONDAL J
• Assessee Lawyers: SANJOY BHOWMIK
• Keywords: Business expenditure; Procedural lapse
• Section: 143(3); 37

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH SMC KOLKATA BEFORE SHRI S.S, GODARA, JUDICIAL MEMBER ITA NO.233/KOL/2018 ASSESSMENT YEAR:2010-11 VENKATESH LOGISTICS PVT. LTD., 12, JUTE HOUSE, INDIA EXCHANGE PLACE, KOLKATA-001 [ PAN NO.AABCV 9499 E ] / V/S . JCIT, RANGE-5, AAAYKAR BHAWAN, 8 TH FLOOR, P-7, CHOWRINGHEE SQUARE, KOLKATA-69 /APPELLANT .. /RESPONDENT /BY APPELLANT SHRI SANJOY BHOWMIK, AR /BY RESPONDENT SHRI KAPIL MONDAL, JCIT-DR /DATE OF HEARING 18-09-2018 /DATE OF PRONOUNCEMENT 28-09-2018 /O R D E R THIS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2010-11 , IS DIRECTED AGAINST THE COMMISSIONER OF INCOME-TAX (APPEALS)-2, KOLKATAS O RDER DATED 21.08.2017 PASSED IN CASE NO.756/CIT(A)-2/14-15 INVOLVING PROCEEDINGS U /S. 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. I NOTICE AT THE OUTSET THAT THE INSTANT APPEAL S UFFERS FROM 55 DAYS DELAY IN FILING. THE ASSESSEE HAS FILED ITS CONDONATION PETITION CIT ING COMMUNICATION GAPS AND OTHER PROCEDURAL LAPSES. LEARNED DEPARTMENTAL REPRESENTAT IVE IS VERY FAIR IN NOT DISPUTING CORRECTNESS THEREOF. I THEREFORE CONDONE THE IMPUGN ED DELAY OF 55 DAYS IN FILING THIS APPEAL. MAIN CASE IS NOT TAKEN UP FOR ADJUDICATION ON MERITS. ITA NO.233/KOL/2008 A.Y 2010-11 VENKATESH LOGISTICS PVT LTD. VS. JCIT, RN G-5, KOL. PAGE 2 3. THE ASSESSEES FIRST SUBSTANTIVE GROUND CHALLENG ES BOTH THE LOWER AUTHORITIES ACTION DISALLOWING ITS CLAIM OF 18,11,509/- PERTAINING TO CASES AND FINES PAID TO TRAFFIC AUTHORITY FOR HAVING TRANSPORTED THE GOODS IN QUESTION BEYOND THE SPECIFIED DIMENSIONAL VEHICLES. THEY HOLD THE IMPUGNED CLAIM TO BE IN THE NATURE OF PENALTY PAYMENT NOT ALLOWABLE U/S 37 OF THE ACT. THIS TRIBU NALS CO-ORDINATE BENCHS DECISION (2011) 46 SOT 258 (MUM) DCIT VS. BHARAT C. GANDHI HOLDS SIMILAR CASES AND FINES AS NECESSARY BUSINESS EXPENDITURE NOT IN THE NATURE OF PENALTY. I THEREFORE DELETE THE IMPUGNED DISALLOWANCE / ADDITION OF 18,11,509/-. THIS FIRST SUBSTANTIVE GROUND IS ACCEPTED. 4. THE ASSESSEES SECOND SUBSTANTIVE GROUND SEEKS T O DELETE VEHICLE TRIP EXPENSE DISALLOWANCE OF 81,20,300/- @ 20% OF 4,06,01,502/- ON AD HOC BASIS IN BOTH THE LOWER PROCEEDINGS. THE ASSESSING OFFICER AS WELL AS CIT(A) HOLD THAT THE RELEVANT BILLS ARE IN THE NATURE OF SELF-MADE VOUCHERS ONLY. BOTH PARTIES REITERATE THEIR RESPECTIVE STANDS AGAINST AND IN SUPPORT OF THE IMP UGNED DISALLOWANCE DURING THE COURSE OF HEARING. I FIND THAT NEITHER THE LOWER AU THORITIES HAVE DRAWN ANY COMPARISON OF IMPUGNED EXPENDITURE IN THE NATURE OF VEHICLE TR IP EXPENSE VIS--VIS THE CORRESPONDING FIGURES IN PRECEDING AND SUCCEEDING A SSESSMENT YEARS NOR THE ASSESSEE ITSELF HAS PROVED ITS CASE TO THE HILT. THERE IS FU RTHER NO REASON FOR INVOKING THIS DISALLOWANCE @ 20%. I THEREFORE DEEM IT APPROPRIATE IN PECULIAR FACTS AND CIRCUMSTANCES THAT A LUMP SUM DISALLOWANCE OF 20 LAC OUT OF 81,20,300/- IN ISSUE WOULD MEET ENDS OF JUSTICE WITH A RIDER THAT THE SA ME SHALL NOT TAKE AS A PRECEDENT IN ANY OTHER ASSESSMENT YEAR. THE ASSESSEE GETS PART R ELIEF TO THE EXTENT OF 61,20,300/- ACCORDINGLY. 5. LEARNED COUNSEL REPRESENTING ASSESSEE DOES NOT P RESS FOR NEXT ADDITION OF 1.50 LAC WITH RESPECT TO ITS BILLS THIS GROUND IS THEREF ORE DECLINE AS NOT PRESSED. 6. THE ASSESSEES NEXT SUBSTANTIVE GROUND IS THAT C IT(A) HAS NOT ADJUDICATED HIS 7 TH SUBSTANTIVE GROUND CHALLENGING U/S 36(1)(III) INTE REST DISALLOWANCE AS NOT EMANATING FROM ASSESSMENT ORDER. I FIND THAT THIS I SSUE FORMS SUBJECT-MATTER OF ITA NO.233/KOL/2008 A.Y 2010-11 VENKATESH LOGISTICS PVT LTD. VS. JCIT, RN G-5, KOL. PAGE 3 ADDITION IN LAST PAGE AT ITEM NO.6 IN ASSESSMENT OR DER. I THEREFORE DIRECT THE CIT(A) TO CONSIDER ASSESSEES INSTANT IMPUGNED GRIEVANCE ON M ERITS AS PER LAW. 7. THIS ASSESSEES APPEAL IS PARTLY ALLOWED IN ABOV E TERMS. ORDER PRONOUNCED IN OPEN COURT ON 28/09/2018 SD/- (S.S. GODARA) JUDICIAL MEMBE R KOLKATA, *DKP/SR.PS - 28/09/2018 / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-VENKATESH LOGITICS PVT LTD. 12, JUTE HOU SE, INDIA EXCHANGE PLACE, K OLKATA-001 2. /RESPONDENT-JCIT, RANGE-5, AAYKAR BHAWAN, 8 TH FLOOR, P-7, CHOWRINGHEE SQUARE, KOLKAT A-69 3. ' % / CONCERNED CIT 4. % - / CIT (A) 5. & ))' , ' / DR, ITAT, KOLKATA 6. + / GUARD FILE. BY ORDER/ , /TRUE COPY/ SR. PRIVATE SECRETARY, HEAD OF OFFICE/DDO ',