DCIT, Pondicherry V. Cooper Bussman India Pvt. Ltd., Pondicherry

ITA 2811/CHNY/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 5828 (ITAT-CHENNAI)
• Duration Of Justice: 3 year(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-11-2017
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 18-07-2017
• Assessment Year: 2005-2006
• Appeal Filed On: 13-11-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S VIJAYAPRABHA

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, CHENNAI . . . , !, # !$ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ./ ITA NO.2811/MDS/2014 ' (' / ASSESSMENT YEAR : 2005-06 THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE I, D.P. THOTTAM, MUTHIALPET, PUDUCHERRY 605 003. V. M/S COOPER BUSSMAN INDIA PVT. LTD., NO.34, EVR STREET, SEDARAPET, PONDICHERRY 605 001. PAN : AABCS 0431 R (*+/ APPELLANT) (,-*+/ RESPONDENT) *+ . / / APPELLANT BY : MS. S. VIJAYAPRABHA, JCIT ,-*+ . / / RESPONDENT BY : SHRI PERCY PARDIWALLA, ADVO CATE SHRI VISHAL KALRA, ADVOCATE 0 . 1# / DATE OF HEARING : 02.11.2017 23( . 1# / DATE OF PRONOUNCEMENT : 16.11.2017 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST TH E ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) VI, CHENN AI, DATED 30.07.2014 AND PERTAINS TO ASSESSMENT YEAR 2005-06. 2. THERE WAS A DELAY OF 25 DAYS IN FILING THIS APPE AL BY THE REVENUE. THE REVENUE HAS FILED A PETITION FOR COND ONATION OF 2 I.T.A. NO.2811/MDS/14 DELAY. WE HAVE HEARD THE LD. DEPARTMENTAL REPRESEN TATIVE AND THE LD. COUNSEL FOR THE ASSESSEE. WE FIND THAT THE RE WAS SUFFICIENT CAUSE FOR NOT FILING THE APPEAL BEFORE THE STIPULAT ED TIME. THEREFORE, WE CONDONE THE DELAY AND ADMIT THE APPEAL. 3. THE ONLY ISSUE ARISES FOR CONSIDERATION IS DISAL LOWANCE MADE BY THE ASSESSING OFFICER UNDER SECTION 40(A)(IA) OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT'). 4. MS. S. VIJAYAPRABHA, THE LD. DEPARTMENTAL REPRES ENTATIVE, SUBMITTED THAT THE CIT(APPEALS) ALLOWED THE CLAIM O F THE ASSESSEE ON THE GROUND THAT DISALLOWANCE UNDER SECTION 40(A) (IA) OF THE ACT CAN BE MADE ONLY IN RESPECT OF THE AMOUNTS WHICH RE MAIN PAYABLE. PLACING HER RELIANCE ON THE ORDER OF THIS TRIBUNAL IN ITO V. SHRI D. UMAPATHY IN I.T.A. NO.2435/MDS/2014, THE LD. D.R. S UBMITTED THAT THIS TRIBUNAL AFTER REFERRING TO THE JUDGMENT OF GU JARAT HIGH COURT IN CIT V. SIKANDARKHAN N. TUNVAR AND KERALA HIGH COURT IN THOMAS GEORGE MUTHOOT V. CIT IN ITA NO.278 OF 2014 DATED 0 3.07.2015, FOUND THAT THE ENTIRE AMOUNT PAID OR PAYABLE AFTER CREDITING TO BOOKS OF ACCOUNT NEEDS TO BE DISALLOWED. THE LD. D.R. AL SO POINTED OUT THAT THE SUPREME COURT HAS RECENTLY IN M/S PALAM GA S SERVICE V. CIT IN CIVIL APPEAL NO.5512 OF 2017 DATED 3 RD MAY, 2017 FOUND THAT 3 I.T.A. NO.2811/MDS/14 THE DISALLOWANCE CANNOT BE RESTRICTED TO THE AMOUNT S PAYABLE ALONE. IN VIEW OF THE ABOVE, THE CIT(APPEALS) IS NOT JUSTI FIED IN ALLOWING THE CLAIM OF THE ASSESSEE. 5. WE HEARD SHRI PERCY PARDIWALLA, THE LD.COUNSEL F OR THE ASSESSEE ALSO. AS RIGHTLY SUBMITTED BY THE LD. DEP ARTMENTAL REPRESENTATIVE, THE APEX COURT IN M/S PALAM GAS SER VICE (SUPRA) FOUND THAT DISALLOWANCE UNDER SECTION 40(A)(IA) OF THE ACT HAS TO BE MADE NOT ONLY ON THE AMOUNTS PAYABLE AFTER GIVING C REDIT INTO BOOKS OF ACCOUNT BUT ALSO THE AMOUNTS PAID TO THE RECIPIE NT. THEREFORE, THE CIT(APPEALS) IS NOT JUSTIFIED IN ALLOWING THE C LAIM OF THE ASSESSEE. ACCORDINGLY, THE ORDER OF THE LOWER AUTH ORITY IS SET ASIDE AND THAT OF THE ASSESSING OFFICER IS RESTORED. 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S ALLOWED. ORDER PRONOUNCED ON 16 TH NOVEMBER, 2017 AT CHENNAI. SD/- SD/- ( ! ) ( . . . ) (S. JAYARAMAN) (N.R.S. GANESAN) # / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 5 /DATED, THE 16 TH NOVEMBER, 2017. KRI. 4 I.T.A. NO.2811/MDS/14 . ,167 87(1 /COPY TO: 1. *+ /APPELLANT 2. ,-*+ /RESPONDENT 3. 0 91 () /CIT(A)-VI, CHENNAI-34 4. 0 91 / CIT, PONDICHERRY 5. 7: ,1 /DR 6. ' ; /GF.