DCIT, CIR-4(2), KOLKATA, Kolkata V. M/s Santipara Tea Co. Ltd., Kolkata

ITA 305/KOL/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 1499 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 3 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-07-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2008-2009
• Appeal Filed On: 26-03-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANJANA BHATTACHARYYA CITSR
• Assessee Lawyers: G A SESHAN
• Keywords: Tax effect
• Section: 2

Judgement Text

ITA NO.305/KOL/2015- M/S. SANTIPARA TEA CO. PVT. LT D. A.Y.2008-09 1 IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : KOLKATA [BEFORE HONBLE SRI N.V.VASUDEVAN, JM & SHRI WASE EM AHMED, AM] I.T.A NO. 305/KOL/2015 ASSES SMENT YEAR : 2008-09 D.C.I.T., CIRCLE-4 (2), -VS.- M/S. SANTIPARA T EA CO.LTD. KOLKATA KOLKATA [PAN : AADCS 8008 C] (APPELLANT) (RESPONDENT) FOR THE APPELLANT : SH RI ANJANA BHATTACHARYYA, ADDL. CIT(SR.DR) FOR THE RESPONDENT : SHRI G.A.SESHAN, A R DATE OF HEARING : 24.07.2017 DATE OF PRONOUNCEMENT : 24.07.2017 ORDER PER N.V.VASUDEVAN, JM THIS IS AN APPEAL BY THE REVENUE AGAINST THE ORDER DATED 16.12.2014 OF CIT(A)-IV, KOLKATA, RELATING TO AY 2008-09. 2. GROUNDS OF APPEAL RAISED BY THE REVENUE READ AS FOLLOWS :- 1 THAT ON THE FACTS AND IN CIRCUMSTANCES OF THE CA SE, THE LD. CIT(A) ERRED ON IN LAW AS WELL AS ON FACTS IN HOLDING THAT EMPLOYEE'S CONTRIBUTION TO PF IS ALLOWABLE IF DEPOSITED WITHIN THE DUE DATE OF FILING OF RETUR N U/S 139(1), IGNORING THE FACT THAT EMPLOYEE'S CONTRIBUTION GOVERNED BY THE PROVIS IONS OF SECTION 36(1 )(VA) READ WITH SECTION 2(24(X) AND AS SUCH, EMPLOYEE'S C ONTRIBUTION TO BE DEPOSITED WITHIN THE DUE DATE AS PER RESPECTIVE RULES, NOT ON ACTUAL PAYMENT BASIS AS PER PROVISIONS OF SECTION 43B. 2 THAT ON THE FACTS AND IN CIRCUMSTANCES OF THE CAS E, THE CIT(A) ERRED IN LAW AS WELL AS ON FACTS IN HOLDING THAT ON PAYMENT OF INTE REST TO M/S CONTEMPORARY BROKERS LTD. OF RS.16,79,297/- DID NOT REQUIRE DEDU CTION OF TAX U/S 194A AND AS SUCH, DISALLOWANCE U/S 40(A)(IA) WAS NOT WARRANTED, IGNORING THE FACT THAT THE PAYMENT WAS MADE TO M/S CONTEMPORARY BROKERS LTD. O N ACCOUNT OF INTEREST WHICH ATTRACTED THE PROVISIONS OF DEDUCTION U/S 194 A. 3 THAT THE APPELLANT CRAVES FOR LEAVE TO ADD, DELET E OR MODIFY ANY OF THE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING. ITA NO.305/KOL/2015- M/S. SANTIPARA TEA CO. PVT. LT D. A.Y.2008-09 2 3. IT WAS BROUGHT TO OUR NOTICE THAT THE TAX E FFECT IN RESPECT OF THE GROUNDS TAKEN BY REVENUE IS ONLY RS.3,83,426/- AS COMPUTED BELOW :- GROUND NO.1 RELIEF ALLOWED (RS.) EMPLOYEES CONTRIBUTION TO PF NOT DEPOSITED WITHIN THE DUE DATES U/S 36(1)(VA) BUT BEFORE FILING OF THE RETURN 26,07,480 GROUND NO.2 DISALLOWANCE OF INTEREST MADE U/S 40(A)(IA) AS PER THE ASSESSMENT ORDER WAS RS.16,79,297 OUT OF WHICH RS.11,84,626/- WAS ALREADY TREATED AS DISALLOWABLE BY THE ASSESSEE. HENCE RELIEF ALLOWED BY THE CIT(A) WAS ONLY RS.4,94,671/- AND NOT RS.16,70,297/- 4,94,671 TOTAL RELIEF AGITATED BY THE DEPARTMENT 31,02, 151 40% OF ABOVE SUBJECT TO INCOME TAX AS PER RULE 8D OF THE I.T.RULES, 1962 12,40,860 NOTIONAL TAX PAYABLE @30.9% INCLUSIVE OF CESS ON DISPUTED ADDITIONS 3,83,426 4. THIS POSITION HAS NOT BEEN DISPUTED BY THE DE PARTMENT. SINCE THE TAX EFFECT IN THE APPEAL IS LESS THAN RS.10 LAKHS AND IN VIEW OF THE CIRCULAR OF CBDT NO.21/2015 DATED 10.12.2015 THE APPEAL BY THE REVENUE WHERE THE TAX EFFECT IS BELOW RS.,10 LAKHS HAS TO BE DISMISSED AS NOT MAINTAINABLE BEING CONTRARY TO THE TENOR OF THE CIRCULAR. THE APPEAL OF THE REVENUE IS ACCORDINGLY DISMISSED. 5. IN THE RESULT THE APPEAL BY THE REVENUE IS D ISMISSED. ORDER PRONOUNCED IN THE COURT O N 24.07.2017. SD/- SD/- [WASEEM AHMED] [ N.V.VASUDEVAN ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 24.07.2017. [RG PS] ITA NO.305/KOL/2015- M/S. SANTIPARA TEA CO. PVT. LT D. A.Y.2008-09 3 COPY OF THE ORDER FORWARDED TO: 1. M/S. SANTIPARA TEA CO.LTD., 31, N.S.ROAD, KOLKAT A-700001. 2. D.C.I.T., CIRCLE-4(2), KOLKATA. 3. CIT(A)-2, KOLKATA. 4. C.I.T.-2, KOLKATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER SENIOR PRIVATE SECRETARY HEAD OF OFFICE/ D. D.O., ITAT, KOLKATA BENCHES