BIRLA SUN LIFE ASSET MANAGEMENT COMPANY LTD, MUMBAI V. DCIT RG 8(1), MUMBAI

ITA 3027/MUM/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 8702 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-01-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 20-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M C OMI NIGSHEN
• Assessee Lawyers: RONAK G DOSHI
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES H, MUMBAI BEFORE S/SHRI AMIT SHUKLA, JM & ASHWANI TANEJA, AM ITA NO.3027/MUM/2015 ASSESSMENT YEAR:2011-12 BIRLA SUN LIFE ASSET MANAGEMENT COMPANY LTD. ONE INDIA BULLS CENTRE TOWER 1, 17 TH FLOOR, JUPITER MILL COMPOUND, 841 SENAPATIBAPAT MARG, ELPHINSTONE, MUMBAI 400 013 PAN AAACB6134D VS. DY. CIT 6(1)(2) MUMBAI (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI RONAK G DOSHI RESPONDENT BY :SHRI M.C. OMI NIGSHEN DATE OF HEARING :17.01.2017 DATE OF PRONOUNCEMENT :17 .01.2017 O R D E R PER AMIT SHUKLA, JUDICIAL MEMBER THE AFORESAID APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST IMPUGNED ORDER DATED 27.02.2015, PASSED BYLD. CIT(AP PEALS)-16, MUMBAI FOR THE ASSESSMENT PASSED U/S. 143(3) OF THE I. T.ACT FOR A.Y. 2011-12. THE ASSESSEE IS AGGRIEVED BY THE DISALLOWA NCE FOR PROVISION FOR LEAVE ENCASHMENT EXPENSES OF RS.19,01,169/-. 2. THE BRIEF FACTS QUA THE ISSUE ARE THAT THE ASSESSEE H AS MADE PROVISION TOWARDS LEAVE ENCASHMENT FOR AN AMOUNT OF R S.19,01,169/-. ITA NO.3027/MUM/2015 M/S. BIRLA SUNLIFE ASSET MANAGEMENT CO. LTD. 2 THE SAID PROVISION REMAINED UNPAID TO THE EMPLOYEES T ILL THE DATE OF FILING OF THE RETURN OF INCOME. FOR CREATING THE PROVIS ION, THE ASSESSEE HAS RELIED UPON ACTUARIAL CERTIFICATE AND IN SUPPORT OF SAID CLAIM, THE ASSESSEE HAD RELIED UPON THE DECISION OF HONBLE CAL CUTTA HIGH COURT IN THE CASE OF EXIDE INDUSTRIES LIMITED VS. UOI, REP ORTED 292 ITR 470, WHEREIN THE HONBLE HIGH COURT HAS HELD THAT PROVI SIONS OF SECTION 43B(F) IS UNCONSTITUTIONAL AND, THEREFORE, SUC H A PROVISION OF LEAVE ENCASHMENT SHOULD BE ALLOWED AS DEDUCTION EVEN IF IT IS NOT PAID DURING THE TIME LIMIT PRESCRIBED U/S. 43B. THE LEARNE D AO OBSERVED THAT THE SAID JUDGMENT OF THE HONBLE CALCUTTA HAVE BEEN S TAYED BY THE HONBLE SUPREME COURT VIDE ITS INTERIM ORDER, THERE FORE, THE JUDGMENT OF HONBLE CALCUTTA HIGH COURT CANNOT BE FOLLO WED.HE FURTHER HELD THAT IN THE ASSESSEES OWN CASE FOR A.Y. 2008-09 AND 2010-11, SIMILAR ADDITION HAS BEEN CONFIRMED.THE LEA RNED CIT(A) TOO FOLLOWING THE EARLIER YEAR ORDER OF THE CIT(A) HAS CO NFIRMED THE SAID DISALLOWANCE. 3. AFTER HEARING BOTH THE PARTIES AND ON PERUSAL OF THE IMPUGNED ORDER AND MATERIAL PLACED ON RECORD, WE FIND THAT THE TRIBUNAL IN THE ASSESSEES OWN CASE FOR THE A.Y. 2010-11 HAD SET ASI DE THIS MATTER TO THE FILE OF THE AO TO DECIDE THE ISSUE AFRESH AFTER THE DECISION OF THE HONBLE SUPREME COURT. THE RELEVANT OBSERVATION AND F INDINGS OF THE TRIBUNAL IN THIS REGARD READS AS UNDER: ITA NO.3027/MUM/2015 M/S. BIRLA SUNLIFE ASSET MANAGEMENT CO. LTD. 3 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. IT IS CORRECT THAT THE DECISION OF THE HONBLE KOLKATA HIGH COURT IN THE CASE OF EXIDE INDUSTRIES LTD. (SUPRA) HAS BEEN STAYED BY THE HONBLE SUPREME COURT VIDE ORDER DATED 08.09.08 PAS SED IN SLP TO APPEAL (CIVIL) ...CC 12060/2008 WHEREIN THE HONBLE SUPREME COURT HAS MADE THE FOLLOWING OBSERVATIONS: UPON HEARING COUNSEL THE COURT MADE THE FOLLOWING ORDER ISSUE NOTICE. IN THE MEANTIME, THERE SHALL BE STAY OF THE IMPUGNE D JUDGMENT, UNTIL FURTHER ORDER. 7. WE FURTHER FIND THAT THE HONBLE SUPREME COURT VIDE ORDER DATED 08.05.2009, PASSED IN SLP (CIVIL NO.228 89/2008) WHILE GRANTING THE LEAVE TO FILE APPEAL, HAS MADE T HE FOLLOWING OBSERVATIONS: ORDER DELAY CONDONED. LEAVE GRANTED. PENDING HEARING AND FINAL DISPOSAL OF THE CIVIL APP EAL, DEPARTMENT IS RESTRAINED FROM RECOVERING PENALTY AN D INTEREST WHICH HAS ACCRUED TILL DATE. IT IS MADE CLEAR THAT AS FAR AS THE OUTSTANDING INTEREST DEMAND AS OF DATE IS CONCERNED , IT WOULD BE OPEN TO THE DEPARTMENT TO RECOVER THAT AMOUNT IN CASE CIVIL APPEAL OF THE DEPARTMENT IS ALLOWED. WE FURTHER MAKE IT CLEAR THAT THE ASSESSEE WOULD, D URING THE PENDENCY OF THIS CIVIL APPEAL, PAY TAX AS IF SECTIO N 43B(F) IS ON THE STATUTE BOOK BUT AT THE SAME TIME IT WOULD BE E NTITLED TO MAKE A CLAIM IN ITS RETURNS. 8. A PERUSAL OF THE ABOVE OBSERVATIONS REVEALS THA TWHILE ACCEPTING THE PETITION FOR LEAVE TO FILE THE APPEAL VIDE ORDER DATED 8.05.2009, THE HONBLE SUPREME COURT HAS DIRE CTED THAT ENDING THE HEARINGAND DISPOSAL OF THE CIVIL APPEAL, THE DEPARTMENT IS RESTRAINED FROM RECOVERING PENALTY AN D INTEREST WHICH HAS ACCRUED TILL DATE. IT HAS ALSO BEEN MADEC LEAR THAT IT WOULD BE OPEN TO DEPARTMENT TO RECOVER THE AMOUNT O F OUTSTANDING INTEREST DEMAND IN CASE THE APPEAL OF T HE DEPARTMENT IS ALLOWED. IT HAS ALSO BEEN DIRECTED TH AT DURING THE PENDENCY OF THE CIVIL APPEAL, THE ASSESSEE WILL PAY TAX AS ITA NO.3027/MUM/2015 M/S. BIRLA SUNLIFE ASSET MANAGEMENT CO. LTD. 4 IF SECTION 43B(F) IS ON STATUTE BOOK BUT AT THE SAM E TIME THE ASSESSEE WOULD BE ENTITLED TO MAKE A CLAIM IN THIS RESPECT IN ITS RETURNS. 9. IN VIEW OF THE OBSERVATIONS OF THE HONBLE SUPR EME COURT, IN OUR VIEW, IT WILL BE PROPER TO DISPOSE OF THIS APPEAL IN THE LIGHT OF THE ORDER OF THE HONBLE SUPREME COURT DATED 08.05.2009 PASSED IN THE CASE OF CIT VS. EXIDE IND USTRIES LTD. (SUPRA). WE THEREFORE DISPOSE OF THE PRESENT APPEAL WITH A DIRECTION THAT THE ASSESSEE WILL PAY THE TAX AS I F SECTION 43B(F) IS ON THE STATUTE BOOK, HOWEVER, TILL THE DE CISION OF THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. EXIDE INDUSTRIES LTD. (SUPRA), THE REVENUE WILL NOT RECOVER THE PEN ALTY AND INTEREST WHICH MAY ACCRUE TILL THE DECISION OF THE APPEAL BY THE HONBLE SUPREME COURT IN THE CASE OF EXIDE INDUSTR IES LTD. IT WOULD BE OPEN TO THE DEPARTMENT TO RECOVER THE OUTS TANDING INTEREST DEMAND IN CASE THE CIVIL APPEAL OF THE DEP ARTMENT IN THE CASE OF EXIDE INDUSTRIES LTD. (SUPRA) IS ALLO WED BY THE HONBLE SUPREME COURT. SUBJECT TO OUR ABOVE OBSERVA TIONS, THE MATTER IS RESTORED TO THE FILE OF THE AO TO BE ADJU DICATED AFRESH AS PER THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF EXIDE INDUSTRIES LTD. (SUPRA). THUS, FOLLOWING THE EARLIER YEAR PRECEDENCE, WE RES TORE THIS MATTER TO THE FILE OF THE AO WITH SIMILAR DIRECTIONS FOR THIS YEAR ALSO. 4. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 17 TH DAY OF JANUARY 2017 SD/- SD/- (ASHWANITANEJA) (AMIT SHUKLA) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI; DATED: 17 TH JANUARY, 2017. SA ITA NO.3027/MUM/2015 M/S. BIRLA SUNLIFE ASSET MANAGEMENT CO. LTD. 5 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE C I T(A), MUMBAI. 4. THE C I T 5. DR, H BENCH, ITAT, MUMBAI BY ORDER, //TRUE COPY// (ASSISTANTREGISTRAR) INCOME TAX APPELLATE TRIBUNAL, MUMBAI