R.S Rice Mills (P) Ltd., Hardoi V. Income Tax Officer-3(3), Hardoi

ITA 341/LKW/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3964 (ITAT-LUCKNOW)
• Duration Of Justice: 4 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-10-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 18-10-2016
• Assessment Year: 2012-2013
• Appeal Filed On: 07-06-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Depreciation

Judgement Text

I.T.A. NO.341/LKW/2016 ASSESSMENT YEAR: 2012-13 1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH SMC, LUCKNOW BEFORE SHRI P. K. BANSAL, ACCOUNTANT MEMBER ITA NO.341/LKW/2016 ASSESSMENT YEAR :2012-13 M/S. R.S. RICE MILLS (P) LTD. MANGLIPURVA CHAURAHA, RAILWAY GANJ, HARDOI. PAN:-AABCR 1729 D VS. INCOME TAX OFFICER WARD-II, HARDOI (APPELLANT) (RESPONDENT) O R D E R PER P. K. BANSAL, A.M. THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A) BAREILLY, DATED 16.03.2016 FOR ASSESSMENT Y EAR 2012-13. 2. THE ONLY ISSUE INVOLVED IN THIS APPEAL RELATES T O THE DISALLOWANCE OF A SUM OF RS. 97,500/- OUT OF THE MISCELLANEOUS EXPENS ES. 3. I HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY CONSIDERED THE SAME ALONG WITH THE ORDERS OF THE TAX AUTHORITIES BELOW. I NOTED THAT IN THIS CASE THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAS SHOWN NET PROFIT AT RS. 1,46,899/- AFTER CLAIMING OF THE DEPRECIATION. THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAS SHOWN EXPENSES AT RS. 20,42,011/- AS OTHER EXPENSES, RS. 10,66,212/- AS FINANCE COSTS AND RS. 6,71,050/- AS EMPLOYEES BENEFIT EXPENSES. THE ASSESSING OFFICER ON VERIFICATION FOUND THAT AL L THE VOUCHERS RELATE TO THE WAGES WERE HANDMADE AND THE PAYMENTS WERE MADE IN C ASH. HE, THEREFORE, DISALLOWED RS. 97,500/- ON AD HOC BASIS. WHEN THE M ATTER WENT BEFORE THE LD. CIT(A), LD. CIT(A) CONFIRMED THE DISALLOWANCE. APPELLANT BY SHRI SANJAY SAXENA, F.C.A. RESPONDENT BY SHRI AMIT NIGAM, D.R. DATE OF HEARING 18.10.2016 DATE OF PRONOUNCEMENT 19.10.2016 I.T.A. NO.341/LKW/2016 ASSESSMENT YEAR: 2012-13 2 4. I NOTED THAT THE ASSESSEE HAS SUBMITTED ALL THE DETAILS OF ALL THE EXPENSES AND THE VOUCHERS WHATEVER HAS BEEN DEBITED BY THE A SSESSEE IN HIS PROFIT & LOSS ACCOUNT. MERELY EXPENSES HAS BEEN CLAIMED ON H ANDMADE VOUCHERS IN RESPECT OF THE WAGES, IN MY OPINION, IT CANNOT BE T HE BASIS FOR MAKING THE DISALLOWANCE. IT IS NOT A CASE OF THE REVENUE THAT THE ASSESSEE HAS INCURRED THE EXPENDITURE IN CASH IN EXCESS OF THE LIMIT PRESCRIB ED U/S 40A SUB-SECTION (3). THEREFORE, IT CANNOT BE THE BASIS OF DISALLOWING TH E EXPENSES THAT THE ASSESSEE HAS MADE THE PAYMENT OF EXPENSES IN CASH. THE REVEN UE HAS NOT BROUGHT OUT ANY VIOLATION OF THE PROVISION OF SECTION 40A SUB-S ECTION (3) ON THE PART OF THE ASSESSEE. THE DISALLOWANCE MADE BY THE ASSESSING OF FICER IS MERELY AD HOC DISALLOWANCE. NO AD HOC DISALLOWANCE CAN BE MADE. I , THEREFORE, DELETE THE SAID DISALLOWANCE OF RS. 97,500/-. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ( ORDER PRONOUNCED IN THE OPEN COURT DURING THE COURS E OF HEARING ). SD/- (P. K. BANSAL) ACCOUNTANT MEMBER DATED: 19.10.2016 *SHARAD COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. CONCERNED CIT 4. THE CIT(A) 5. D.R., I.T.A.T., LUCKNOW ASSTT. REGIS TRAR