Shri Dhirendra H. Singh, Baroda V. The Income Tax Officer, Ward-3(1), Baroda

ITA 2662/AHD/2015

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 8177 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 8 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-06-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2010-2011
• Appeal Filed On: 18-09-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Section: 43B; 40A(3); 133(6); 68

Judgement Text

, B IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & SHRI MAHAVIR PRASAD, JUDICIAL MEMEBR ./ I.T.A. NO.2662/AHD/2015 ( ASSESSMENT YEAR : 2010-11) SHRI DHIRENDRA H. SINGH E-62, GIDC MANJUSAR, SAVLI ROAD, BARODA - 391775 / VS. THE INCOME TAX OFFICER, WARD 3(1), BARODA ./ ./ PAN/GIR NO. : ABTPS3636E ( APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI MUKUND BAKSHI, A.R. / RESPONDENT BY : SHRI MUDIT NAGPAL, SR.D.R. DATE OF HEARING 06/06/2018 !'# / DATE OF PRONOUNCEMENT 07/06/2018 / O R D E R PER PRADIP KUMAR KEDIA - AM: THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTANCE OF THE ASSESSEE AGAINST THE ORDER OF THE CIT(A)-II, BARODA (CIT(A) IN SHORT), DATED 11.05.2015 ARISING IN THE ASSESSMENT ORDER DATED 28.03.2013 PASSED BY THE ASSESSING OFFICER (AO) U/S .143(3) OF THE INCOME TAX ACT, 1961; (THE ACT) CONCERNING ASSESSME NT YEAR 2010-11. 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE REA DS AS UNDER: ITA NO. 2662/AHD/15 [SHRI DHIRENDRA H. SINGH VS. ITO] A.Y. 2010-11 - 2 - 1. LD. COMMISSIONER OF INCOME TAX (APPEALS)-2, VAD ODARA ERRED IN LAW AND FACTS IN CONFIRMING THE ADDITION OF RS. 50.00 LAKHS, BEING THE AMOUNT OF LOAN RECEIVED FROM M/S. SAI INN OVATIONS U/S. 68 OF THE I.T. ACT. 2. LD. COMMISSIONER OF INCOME TAX (APPEALS)-2, VADO DARA FAILED TO APPRECIATE TL AT THE ADDITION COULD NOT HAVE BEE N SUSTAINED WHEN THE LD. A.O. INVOKED HIS POWERS U/S. 133(6) TO SEEK NECESSARY CONFIRMATION AND AS SUCH THE ONUS SHIFTED TO HIM. 3. THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-2, VADODARA HAS FURTHER ERRED IN W AND IN FACTS IN NOT FOLLOWIN G THE RATIO OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT RA JKOT VS. AYACHI CHANDRASHEKHAR NARSANGI 42 TAXMANN.COM 251 WHEREIN IT IS HELD THAT ADDITION U/S. 68 IS UNWARRA NTED WHERE AMOUNT IS REPAID AND THE SAME IS ACCEPTED BY THE A. O. 4. LD. COMMISSIONER OF INCOME TAX (APPEALS)-2, VADO DARA HAS ERRED IN LAW AND FACTS IN DENYING THE DEDUCTION U/S . 80IB(11A) ON THE PORTION OF THE ELIGIBLE BUSINESS PROFIT ENHA NCED ON ACCOUNT OF DISALLOWANCES UNDER SEC. 40A(3) OF RS. 3 0,000/-. 5. THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-2, VADODARA HAS ERRED IN LAW AND IN FACTS IN DENYING THE DEDUCT ION U/S. 80IB(11A) ON THE PORTION OF THE ELIGIBLE BUSINESS P ROFIT ENHANCED ON ACCOUNT OF DISALLOWANCES UNDER SEC. 43B OF RS. 42,07,953/-. 3. IN THE COURSE OF HEARING, THE LEARNED AR ON BEHA LF OF THE ASSESSEE SUBMITTED THAT THE ASSESSEE WAIVES ITS RIG HT TOWARDS GROUND NOS.1, 2 & 3 AND DOES NOT SEEK TO PRESS THE ISSUE R AISED THEREIN. GROUND NOS. 1, 2 AND 3 ARE ACCORDINGLY DISMISSED AS NOT PRESSED. 4. GROUND NO.4 CONCERNS CORRESPONDING DEDUCTION U/S . 80IB(11A) ON THE PORTION OF THE ELIGIBLE BUSINESS PROFIT ENHA NCED ON ACCOUNT OF DISALLOWANCES UNDER S. 40A(3) OF RS.30,000/-. SIMI LARLY, GROUND NO.5 CONCERNS ENHANCED DEDUCTION UNDER S.80IB(11A) OWING TO INCREASE IN ELIGIBLE PROFITS IN VIEW OF THE DISALLOWANCES MADE UNDER S.43B AMOUNTING TO RS.42,07,953/-. IT IS THE CASE ON BEH ALF OF THE ASSESSEE THAT THE ASSESSEE IS ELIGIBLE FOR CORRESPONDING DED UCTION UNDER S.80IB(11A) ON ACCOUNT OF DISALLOWANCES MADE IN THE ASSESSMENT ITA NO. 2662/AHD/15 [SHRI DHIRENDRA H. SINGH VS. ITO] A.Y. 2010-11 - 3 - 40A(3) AND 43B OF THE ACT SINCE THE ELIGIBLE PROFIT STOOD ENHANCED DUE TO SUCH DISALLOWANCE. 5. AS SUBMITTED ON BEHALF OF THE ASSESSEE, WE FIND THAT CBDT HAS ADDRESSED THE AFORESAID ISSUE IN FAVOUR OF THE ASSE SSEE AS PER ITS CIRCULAR NO.37/2016 DATED 2ND NOVEMBER, 2016. AS P ER THE AFORESAID CIRCULAR, THE BOARD HAS ACCEPTED THE PROPOSITION TH AT DISALLOWANCES SO MADE UNDER S.40A(3), 43B ETC. OF THE ACT RELATED TO BUSINESS ACTIVITY WOULD BE ELIGIBLE FOR CHAPTER VI-A DEDUCTION IN VIE W OF THE ENHANCEMENT OF THE PROFITS OF THE ELIGIBLE BUSINESS . IN VIEW OF THE CBDT CIRCULAR, THE CONTROVERSY STANDS SETTLED IN VI EW OF THE ASSESSEE. THUS, GROUND NOS. 4 & 5 OF THE ASSESSEE ARE ALLOWED . 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED. SD/- SD/- (MAHAVIR PRASAD) (PRADIP K UMAR KEDIA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD: DATED 07/06/2018 TRUE COPY S. K. SINHA !'#' / COPY OF ORDER FORWARDED TO:- &. / REVENUE 2. / ASSESSEE (. )*+ , / CONCERNED CIT 4. ,- / CIT (A) /. 012 33*+4 *+#4 56) / DR, ITAT, AHMEDABAD 7. 289 : / GUARD FILE. BY ORDER / 4 /5 *+#4 56) THIS ORDER PRONOUNCED IN OPEN COURT ON 07/06/201 8