Dakshin Gujarat Vij Company Ltd., Surat V. The Dy.CIT.,Circle-1(1), Baroda

ITA 2459/AHD/2013

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 3165 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 10 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-08-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 10-08-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 17-10-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: APARNA M AGRAWAL
• Assessee Lawyers: M K PATEL A
• Keywords: Business expenditure
• Section: 11

Judgement Text

, - IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD - BENCH B BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ./ ITA NO.2459/AHD/2013 / ASSTT. YEAR: 2009-2010 DAKSHIN GUJARAT VIJ COMPANY LTD. NANA VARACHHA ROAD KAPODARA CHAR RASTA SURAT 395 006. VS. DCIT, CIR.1(1) BARODA. / (APPELLANT) / (RESPONDENT) ASSESSEE BY : SHRI M.K. PATEL, A REVENUE BY : SMT.APARNA M. AGRAWAL, CIT-DR ! / DATE OF HEARING : 13/08/2018 '#$ ! / DATE OF PRONOUNCEMENT: 27/08/2018 %& / O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL AGAINST O RDER OF THE LD.CIT(A)-I, BARODA DATED 2.7.2013 PASSED FOR THE A SSESSMENT YEAR 2009-10. 2. THE GROUNDS OF APPEAL TAKEN BY THE ASSESSEE READ AS UNDER: 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND FACTS IN CONFIRMING THE TOTAL VALUE OF FRINGE B ENEFITS AT RS.74,16,789/- AS AGAINST THE RETURNED FRINGE BENE FITS OF RS.NIL OFFERED BY THE APPELLANT. 2. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND FACTS IN CHARGING INTEREST UNDER SECTION 115WJ OF THE INCOME TAX ACT, 1961 ON THE ASSESSED TAX LIABILITY. ITA NO.2459/AHD/2013 2 3. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE INITIATION OF PENALT Y PROCEEDINGS UNDER SECTION 271(L)(D) OF THE INCOME TAX ACT, 1961 FOR T HE ALLEGED CONCEALMENT AND/OR FURNISHING OF INACCURATE PARTICU LARS OF INCOME. 4. THE APPELLANT CRAVES LEAVE TO ADD TO, ALTER, DELET E OR MODIFY ANY OF THE GROUNDS OF APPEAL EITHER BEFORE OR AT THE TIME OF H EARING OF THIS APPEAL. 3. THE LD.COUNSEL FOR THE ASSESSEE AT THE VERY OUTS ET CONCEDED THAT THE ISSUE IN DISPUTE IS SQUARELY COVERED AGAINST TH E ASSESSEE BY DECISION OF THE TRIBUNAL IN THE CASE OF GUJARAT ENE RGY TRANSMISSION CORPN LTD. VS. DCIT, IN ITA NO.2717/AHD/2013, VIDE WHICH THE TRIBUNAL HAS DISMISSED CLAIM OF THE ASSESSEE TOWARDS FRINGE BENEFIT EXPENDED FOR THE PURPOSE OF LEVY OF FBT. 4. AFTER HEARING BOTH THE SIDES, AND GOING THROUGH THE RECORD, WE FIND THAT IN THE RETURN OF INCOME THE ASSESSEE HAS DECLARED NIL FRINGE BENEFIT, BUT ON PERUSAL OF THE AUDIT REPORT, IT REV EALED TO THE AO THAT AUDITORS HAVE REPORTED VALUE OF FRINGE BENEFIT AT R S.74,16,789/-. THE AO RECORDED A FINDING THAT IN VIEW OF THE AUDITORS REPORT, IT COULD NOT BE HELD THAT THE ASSESSEE HAS NOT EXPENDED ANY FRINGE BENEFIT. THEREFORE, HE MADE ADDITION AND LEVIED FRINGE BENEFIT TAX. AP PEAL TO THE LD.CIT(A) DID NOT BRING ANY RELIEF TO THE ASSESSEE. 5. THE LD.CIT(A) WHILE CONFIRMING THE DISALLOWANCE MADE REFERENCE TO THE ORDER OF HIS PREDECESSOR IN THE ASSESSEES O WN CASE FOR THE ASSTT.YEAR 2007-08 AND HELD THAT ASSESSEE IS LIABLE TO PAY FRINGE BENEFIT TAX. THE RELEVANT PART OF FINDING RECORDED BY THE LD.CIT(A) READS AS UNDER: 6.2 THE ABOVE SUBMISSION OF THE AR IS OF GENERAL N ATURE. THE AR HAS NOT EXPLAINED AS TO HOW THE FRINGE BENEFIT IN T HE CASE OF APPELLANT IS NOT CHARGEABLE TO TAX AND HOW ITS CASE IS COVERED UNDER (A) AND (B) OF SECTION 115WB OF THE ACT. THE AR OF THE APPELLANT EITHER DURING THE COURSE OF ASSESSMENT PR OCEEDINGS U/S 115WE(3) R.W.S. 115WG OR DURING THE COURSE OF APPEL LATE PROCEEDINGS HAS NOT FILED ANY DETAILS AND EVIDENCES WHICH COULD ITA NO.2459/AHD/2013 3 SHOW THAT THE ITEMS OF BUSINESS EXPENDITURE WHICH H AVE BEEN INCURRED IN THE CASE OF APPELLANT ARE ONLY WITH REL ATION TO NON- EMPLOYEES AND DO NOT RELATE IN ANY MANNER TO THE EM PLOYEES OF THE APPELLANT AND WHICH THOUGH HAVING BEEN INCURRED , BUT BEING PURELY FOR THE BUSINESS PURPOSE OF THE APPELLANT AN D THUS IS NOT RESULTING IN ANY BENEFIT TO THE EMPLOYEES. THE AR O F THE APPELLANT WAS REQUIRED TO FILE NECESSARY DETAILS AND EVIDENCE S IN SUPPORT OF HIS ABOVE STATEMENT. THIS IS MORE PARTICULARLY IN V IEW OF THE FACT THAT THE AO IN THE ABOVE ORDER U/S 115WE(3) R.W.S. 115WG OF THE IT ACT HAS MENTIONED THAT THE BOOKS OF ACCOUNTS OF THE APPELLANT WERE EXAMINED ON TEST CHECK BASIS AND ITS SUBMISSIO N WAS ALSO CONSIDERED AND THE FACTS AND CIRCUMSTANCES AS QUOTE D ABOVE BY THE APPELLANT COMPANY VIZ WRIT PETITION FILED BY TH E GUJARAT CHAMBER OF COMMERCE AND INDUSTRIES AND OTHERS BEFOR E THE HON'BLE GUJART HIGH COURT WHILE CHALLENGING THE VAL IDITY OF CBDT CIRCULAR NO. 8 DATED 29/08/2005 SEEKING TO INTERPR ET THE PROVISION OF FBT AS PROVIDING FOR LEVY OF FBT DIFFE R FROM THE INSTANT CASE, HENCE, NOT APPLICABLE, IT IS ALSO M ENTIONED BY THE AO THAT SINCE, THE APPELLANT'S CASE IS NOT COVERED BY THE DECISION OF THE HON'BLE HIGH COURT OF GUJARAT, THE APPELLANT WAS LIABLE TO PAY FBT ON THE VALUE OF FB UNDER THE PROVISIONS OF CHAPTER XLL-H OF THE IT ACT AND ALSO THE ID. CIT(A)-I, BARODA HAS CONFIRMED THE ORDER PASSED U/S I15WE{3) FOR AY 2007-08 IN THE CAS E OF THE APPELLANT COMPANY VIDE ORDER NO. CAB-1/88/09-10 DAT ED 28/04/2010. WITH REGARD TO THESE FINDINGS OF THE AO AS GIVEN IN THE ORDER U/S 115WE(3) R.W.S. 115WG OF THE ACT THE SAME HAVE NOT BEEN REBUTTED BY THE AR OF THE APPELLANT IN HIS SUBMISSION DATED 01-07-2013 AS FILED THROUGH TAPAL. NO SPECIFI C DETAILS AND EVIDENCES HAVE BEEN FILED BY THE AR OF THE APPELLAN T DURING THE COURSE OF APPELLATE PROCEEDINGS WHICH COULD PROVE T HAT THE FRINGE BENEFIT WAS NOT CHARGEABLE TO TAX IN THE CASE OF AP PELLANT IN VIEW OF U/S 115WB(2)(A) AND 115WB(2)(B). ANOTHER IMPORTA NT ASPECT OF THE CASE IS THAT THE LD. CIT(A)-I, BARODA HAS CO NFIRMED THE SIMILAR ADDITION AS MADE IN THE ORDER PASSED U/S 11 5WE(3) FOR AY 2007-08 IN THE CASE OF THE APPELLANT COMPANY VIDE O RDER NO. CAB-F/88/09-10 DATED 28/04/2010. MOREOVER, THE APPE LLANT ITSELF HAS DEPOSITED THE AMOUNT OF FBT IN THE GOVERNMENT T REASURY FOR THE YEAR UNDER CONSIDERATION. AGAIN THE FINAL VERDI CT OF HON'BLE HIGH COURT OF GUJARAT IS YET TO BE PASSED. CONSIDER ING ALL THESE FACTS, I HOLD THAT THE AO HAS CORRECTLY TAXED THE V ALUE OF FRINGE BENEFIT OF RS.74,16,789/- AND THEREFORE THE SAME IS TAXED. THUS, THE GROUND OF APPEAL NO2 OF THE APPELLANT IS DISMIS SED. 6. IN VIEW OF THE ABOVE AND THE ORDER OF THE ITAT P ASSED IN THE CASE OF GUJARAT ENERGY TRANSMISSION CORPN. LTD. (SUPRA) DATED 27.6.2018 GUJARAT URJA VIKAS NIGAM LTD. (SUPRA), WE ARE OF TH E VIEW THAT THE ITA NO.2459/AHD/2013 4 LD.CIT(A) HAS RIGHTLY CONFIRMED THE VALUE OF FRINGE BENEFIT EXPENDED BY THE ASSESSEE FOR THE PURPOSE OF LEVY OF FBT. THE L D.COUNSEL HIMSELF ADMITTED THAT THERE IS NO MERIT IN THIS APPEAL. TH EREFORE, IT IS DISMISSED. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISS ED. ORDER PRONOUNCED IN THE COURT ON 27 TH AUGUST, 2018 AT AHMEDABAD. SD/- SD/- (WASEEM AHMED) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER