Mehta Tubes Ltd., Ahmedabad V. The Dy.CIT, (OSD)-1, Circle-4, Ahmedabad

ITA 2981/AHD/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 7931 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 1 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-12-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Assessment Year: 2010-2011
• Appeal Filed On: 12-11-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ROOP CHAND
• Assessee Lawyers: P D SHAH
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH AHMEDABAD BEFORE, SHRI S. S. GODARA, JUDICIAL MEMBER AND SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER ITA NO. 2981/AHD/2014 (ASSESSMENT YEAR: 2010-11) MEHTA TUBES LTD., MEHTA LODHA & CO. CHARTERED ACCOUNTANTS, 105, SAKAR-I, ASHRAM ROAD, AHMEDABAD - 380009 APPELLANT VS. DEPUTY COMMISSIONER OF INCOME TAX (OSD)-1, CIRCLE - 4, AHMEDABAD RESPONDENT PAN: AACCM9337R /BY ASSESSEE : SHRI P. D. SHAH, A.R. /BY REVENUE : SHRI ROOPCHAND, SR. D.R. /DATE OF HEARING : 08.12.2017 /DATE OF PRONOUNCEMENT : 18.12.2017 ORDER PER S. S. GODARA, JUDICIAL MEMBER THIS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2010-11 EMANATES AGAINST THE CIT(A)-VIII, AHMEDABADS ORDER DATED 06.08.2014, IN CASE NO. CIT(A)- VIII/DCIT/CIR.4/69/13-14, UPHOLDING ASSESSING OFFIC ERS ACTION DISALLOWING TRAVELLING EXPENSES OF RS.2,55,933/- AND LATE PAYME NT OF EMPLOYEES CONTRIBUTION TOWARDS PF OF RS.20,232/-; RESPECTIVELY , IN PROCEE DINGS U/S. 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. HEARD BOTH THE PARTIES. CASE FILE PERUSED. ITA NO. 2981/AHD/14 [MEHTA TUBES LTD. VS. DCIT(OSD) -1] A.Y. 2010-11 - 2 - 2. WE COME TO THE FORMER ISSUE OF TRAVELLING EXPENS ES DISALLOWANCE AMOUNTING TO RS.2,55,933/-. THE ASSESSEE HAD DEBITED A TOTAL AMOUNT OF RS.6,05,909/- AS TRAVELLING EXPENSES. THE ASSESSING OFFICER NOTICED IT TO HAVE FAILED TO EXPLAIN THE JUSTIFICATION OF THE IMPUGNED EXPENSES COMING TO RS .2,55,933/- AS PAID TO SEVEN PARTIES IN THE RELEVANT PREVIOUS YEAR. HE THEREFOR E DISALLOWED THE SAME IN ASSESSMENT ORDER DATED 15.03.2013. THE CIT(A) CONF IRMS THE SAID DISALLOWANCE AFTER REJECTING ASSESSEES EXPLANATION TO HAVE INCU RRED THE IMPUGNED EXPENDITURE FOR THE PURPOSE OF ITS BUSINESS SUPPORTED BY ALL DU E VOUCHERS. HE HOLDS THAT THE ASSESSEES EXPLANATION HAS AGAIN FAILED TO PROVE AN Y NEXUS BETWEEN ITS BUSINESS VIS- -VIS THE IMPUGNED EXPENSES. THIS LEAVES THE ASSES SEE AGGRIEVED. 3. LEARNED COUNSEL REPRESENTING ASSESSEE VEHEMENTLY CONTENDS THAT BOTH THE LOWER AUTHORITIES HAVE FAILED TO APPRECIATE THE REL EVANT BACKDROP OF FACTS. THE RELEVANT LIST OF EXPENSES FORMS PART OF THE CASE RE CORD. IT EMANATES THEREFROM THAT THE ASSESSEE HAS PAID AN AMOUNT OF RS.1,19,778/- TO M/S. THOMAS COOK LTD. ON 31.10.2009. THE ASSESSEE PLEADS TO HAVE ACQUIRED F OREIGN EXCHANGE FROM THE SAID PAYEE. WE FIND NO SUCH MATERIAL IN THE CASE FILE W HICH COULD INDICATE SUCH FOREIGN EXCHANGE CURRENCY ACQUISITION. WE THEREFORE FIND N O REASON TO AGREE WITH ASSESSEES CONTENTIONS QUA THE SAID PAYEE ENTITY. WE HOWEVER NOTICE THAT THE REMAINING PARTIES, RELEVANT LEDGERS AND PAYMENT DET AILS HAVE NOT BEEN DISCUSSED IN BOTH THE LOWER PROCEEDINGS. COUPLED WITH THIS, THE ASSESSEE HAS ALSO NOT DISCHARGED ITS ONUS BETWEEN THE IMPUGNED EXPENDITURE AND ITS B USINESS PURPOSES. WE THEREFORE DEEM IT APPROPRIATE THAT LARGER INTEREST OF JUSTICE WOULD BE MET IN CASE THE IMPUGNED DISALLOWANCE IS RESTRICTED TO 50% ONLY SUB JECT TO A RIDER THAT THE SAME SHALL NOT BE TREATED AS A PRECEDENT IN ANY PRECEDIN G OR SUCCEEDING ASSESSMENT YEAR. THE ASSESSEES INSTANT SUBSTANTIVE GROUND IS PARTLY ACCEPTED IN ABOVE TERMS. 4. WE NOW ADVERT TO ASSESSEES LATTER SUBSTANTIVE G ROUND CHALLENGING BOTH THE LOWER AUTHORITIES ACTION DISALLOWING ITS EMPLOYEES CONTRIBUTION TOWARDS PF OF RS.20,232/-. IT EMERGES THAT THE WAGES IN QUESTION OF RS.10,491/- AND RS.9,741/- PERTAINED TO AUGUST 2009 AND JANUARY 2010 MONTHS AS PAID ON 02.09.2009 AND 02.02.2010 RESPECTIVELY. BOTH THE LOWER AUTHORITIE S HOLD THAT THE SAID DEPOSITS ON ITA NO. 2981/AHD/14 [MEHTA TUBES LTD. VS. DCIT(OSD) -1] A.Y. 2010-11 - 3 - 25.09.2009 AND 23.02.2010 WERE MADE MUCH AFTER THE CORRESPONDING DUE DATES COMING TO BE ON 20.09.2009 AND 20.02.2010. WE HOWE VER FIND THAT A CO-ORDINATE BENCH ORDER IN RAJRATNA METAL INDUSTRIES LTD. VS. A CIT ITA NO.950/AHD/2015 HOLDS THAT THE RELEVANT DUE DATE HAS TO BE CALCULAT ED FROM THE DATE OF ACTUAL SALARY PAYMENT AND NOT THE ONE BASED ON SALARY ACCRUAL. L EARNED DEPARTMENTAL REPRESENTATIVE FAILS TO DRAW ANY DISTINCTION ON FAC TS. WE THEREFORE ACCEPT ASSESSEES INSTANT SUBSTANTIVE GROUND. 5. THIS ASSESSEES APPEAL IS PARTLY ALLOWED IN ABOV E TERMS. [PRONOUNCED IN THE OPEN COURT ON THIS THE 18 TH DAY OF DECEMBER, 2017.] SD/- SD/- ( PRADIP KUMAR KEDIA ) (S. S. GODARA) ACCOUNTANT MEMBER JUDICIAL M EMBER AHMEDABAD: DATED 18/12/2017 TRUE COPY S.K.SINHA / COPY OF ORDER FORWARDED TO:- / REVENUE 2 / ASSESSEE ! / CONCERNED CIT 4 !- / CIT (A) ( )*+ ,--. . /0 / DR, ITAT, AHMEDABAD 1 +23 45 / GUARD FILE. BY ORDER / . // . /0