Industrial Engineering Corporation, Ahmedabad V. ACIT, Circle (1), Ahmedabad

ITA 2446/AHD/2017

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 4623 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-11-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2014-2015
• Appeal Filed On: 06-11-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: MUKESH K KHANDWALA
• Section: 143(3); 201; 208

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH BEFORE: SHR I RAJPAL YADAV , JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER INDUSTRIAL ENGINEERING CORPORATION, D - 100 - 101 GRAIN MARKET, NR. ANUPAM CINEMA, KHOKHRA, AHMEDABAD PAN: AAAFI5548M (APPELLANT) VS THE ACIT , CIRCLE - 6(1) , AHMEDABAD (RESPONDENT) REVENUE BY : S H RI MUDIT NAGPAL , SR. D . R. ASSESSEE BY: SHRI MUKESH K. KHANDWALA , A.R. DATE OF HEARING : 26 - 09 - 2 019 DATE OF PRONOUNCEMENT : 15 - 11 - 2 019 / ORDER P ER : AMARJIT SINGH, ACCOUNTANT ME MBER : - THIS ASSESSEE S APPEAL FOR A.Y. 2014 - 15 , ARI SES FROM ORDER OF THE CIT(A) - 6, AHMEDABAD DATED 10 - 08 - 2 017 , IN PROCEEDINGS UNDER SECTION 1 4 3(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . 2. THE SOLITARY GROUND OF APPEAL IS PERTAINED TO THE ISS UE OF DISALLOWING THE CLAIM OF THE ASSESSEE U/S. 35(1 )(III) OF RS. 8,75,000/ - . I T A NO . 2446 / A HD/20 17 A SS ESSMENT YEAR 2014 - 15 I.T.A NO. 2446 /AHD /20 17 A.Y. 2014 - 15 PAGE NO INDUSTRIAL ENGINEERING CORPORATION VS. ACIT 2 3. T HE FACT IN BRIEF IS THAT ASSESSMENT U/S. 143(3) OF T HE ACT WAS FINALIZED ON 30 TH DECEMBER, 2016. DURING THE COURSE OF ASSESSMENT, THE ASSESSING OFFICER HAS NOTICED THAT ASSESSEE HAS CLAIM ED DEDUCTION U/S. 35(1 )(II) OF THE ACT @175% I.E. RS. 8,75,0000/ - ON DONATION OF RS. 5 LACS GIVEN TO HERVICUR E HEALTHCARE BIA HERBAL R ESEARCH FOUNDATION . THE ASSESSING OFFI CER HAS REPORTED THAT VIDE ORDER S H EET ENTRY DATED 15 TH NOV, 2016 HAS ACCEPTED THAT THIS DONATION WAS F IC TIT IOUS DONATION AND THOUGH THE DONATION WAS MADE BY CHEQUE THE AMOUNT RETURNED TO ASSESSEE BY CASH, THEREFORE, AS PER ORDER SHEET ENTRY, THE ASSESSEE HAS AGREED TO WITHDRAW THE AFORESAID D EDUCTION . 4. AGGRIEVED ASS ESSEE HAS FILED APPEAL BEFORE THE LD. CIT(A). THE LD. CIT(A) HAS DISMISSED THE APPEAL OF THE ASSESSEE. 5. DURING T H E COURSE OF APPELLATE PROCEEDINGS BEFORE US, THE LD. COUNSEL HAS CONTENDED THAT SAID INSTITUTE WAS APPR OVED FOR PURPOSE OF SECTION 35(1 )( II) IN THE PREVIOUS YEAR UNDER CONSIDERATION AND SAID APPROVAL WAS WITHDRAWN RETROSPECTIVELY. THE RE FORE, IT HAS NO EFFECT ON THE CLAIM OF THE ASSESSEE. IN THIS REGARD, THE LD. COUNSEL HAS PLACED RELIANCE ON THE DECISION S OF NATIONAL LEATHER CLOTH MANUFAC TURING CO VS. INDIAN COUNCIL OF AGRICULTURAL RESEARCH ORGANIZATION (2000) 241 ITR 0842 DATED 7 TH O CT, 1999 AND AGARWALLA & SONS LTD. VS. CIT & OTHERS (1994) 208 ITR 863 DATED 5 TH JULY, 1993. ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENTATIVE HAS SUPPORTED THE ORDER OF LOWER AUTHORITIES . 6. WE HAVE HEARD BOTH THE SIDES AND PERUSED THE MATERIAL ON RECORD. THE ASSESSEE HAS CLAIMED DEDUCTION U/S. 35(1)(II) OF THE ACT AT THE RATE OF I.T.A NO. 2446 /AHD /20 17 A.Y. 2014 - 15 PAGE NO INDUSTRIAL ENGINEERING CORPORATION VS. ACIT 3 175% ON GIVING DONATION OF RS. 5 , 00 , 000/ - TO HERBICURE BIO HERBAL R ESEARCH. THE ASSESSING OFFICER HAS DISALLOWED THE CLAIM OF DEDUCTION ON THE BASIS OF ADMISSION OF THE ASSESEE THAT DONATION WAS FICTITIOUS AND THE DONATED AMOUNT WAS RETURNED TO THE ASSESSEE BY CASH. IN THE LIGHT OF THE AFORESAID UNDISPUTED F ACTS, THE FACTS OF THE CASE OF THE ASSESSEE ARE DISTINGUISHABLE FROM THE FACTS PERTAINED TO THE JUDICIAL PRONOUNCEMENT REFERRED BY THE ASSESSEE SINCE THE ASSESSEE HAS ADMITTED BEFORE THE ASSESSING OFFICER THAT THE IMPUGNED ADDITION WAS MADE FICTITIOUSLY WH ICH WAS RE TURNED IN CAS H TO THE ASSESSEE. THE ASSESSEE COULD NOT CONTROVERT THESE FACTS DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE THE LD. CIT(A) AND ALSO FAILED TO DISPROVE THE ADMISSION MADE BEFORE THE ASSESSING OFFICER WITH ANY RELEVANT SUPPORTI NG MATERIAL AT THE TIME OF APPELLATE PROCEEDINGS BEFORE US. IN VIEW THE ABOVE FACTS, WE CONSIDER THAT ASSESSEE HAS CATEGORICALLY ADMITTED BEFORE THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS THAT DONATION WAS FICTITIOUS AND THE SAME WA S RETURNED TO IT IN CASH, THEREFORE, WE DO NOT FIND ANY SUBSTANCE IN THE APPEAL OF THE ASSESSEE. ACCORDINGLY, THE APPEAL OF THE ASSESSEE IS REJECTED. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PR ONOUNCED IN TH E OPEN C OURT ON 15 - 11 - 201 9 SD/ - SD/ - ( RAJPAL YADAV ) ( AMARJIT SINGH ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD : DATED 15 /11 /2019 I.T.A NO. 2446 /AHD /20 17 A.Y. 2014 - 15 PAGE NO INDUSTRIAL ENGINEERING CORPORATION VS. ACIT 4 / COPY OF ORDER FORWARDED TO: - 1. ASS ESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,