Appeal details
Counselvise Citation
[2019] 116 COUNSELVISE.COM (IT) 7527 (ITAT-KOLKATA)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
1 year(s) 4 month(s) 21 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
26-07-2019
Appeal Filed By
Assessee
Order Result
Partly Allowed
Bench Allotted
A
Assessment Year
2010-2011
Appeal Filed On
07-03-2018
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH A, KOLKATA [BEFORE SHRI P.M. JAGTAP, VP (KZ) AND SHRI S.S. VISWANETHRA RAVI, JM] I.T.A. NOS. 371 & 121/KOL/2018 ASSESSMENT YEAR: 2010-11 M/S. S.R. BATLIBOI & ASSOCIATES LLP....................................................APPELLANT 22, CAMAC STREET, KOLKATA 700 016. [PAN : ACHFS 9118 A] DCIT CIRCLE-54 (CURRENTLY CIRCLE 22)...............RESPONDENT KOLKATA. APPEARANCES BY: SHRI DEBABRATA GHOSH, FCA APPEARING ON BEHALF OF THE ASSESSEE. SHRI RAJA SENGUPTA, JCIT APPEARING ON BEHALF OF THE REVENUE. DATE OF CONCLUDING THE HEARING : JULY 18, 2019 DATE OF PRONOUNCING THE ORDER : JULY 26, 2019 ORDER PER P.M. JAGTAP, VICE-PRESIDENT (KZ) THESE TWO APPEALS FILED BY THE ASSESSEE ARE DIRECTED AGAINST TWO SEPARATE ORDERS PASSED BY THE LD. CIT(APPEALS) 6, KOLKATA DATED 25.01.2018 AND LD. CIT(APPEALS) 21, KOLKATA DATED 22.11.2017 FOR THE SAME ASSESSMENT YEAR I.E. 2010-11 AND SINCE THE ISSUES INVOLVED THEREIN ARE INTERLINKED, THEY HAVE BEEN HEARD TOGETHER AND ARE BEING DISPOSED OF BY A SINGLE CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 2. THE ASSESSEE IN THE PRESENT CASE IS A PARTNERSHIP FIRM OF PRACTISING CHARTERED ACCOUNTANTS. THE RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION WAS FILED BY IT ON 29.09.2010 DECLARING A TOTAL INCOME OF RS. 27,15,96,744/-. IN THE ASSESSMENT ORIGINALLY COMPLETED U/S 143(3) VIDE AN ORDER DATED 18.06.2012, THE TOTAL INCOME OF THE ASSESSEE WAS DETERMINED BY THE AO AT RS. 27,64,78,240/- AFTER MAKING INTER ALIA THE ADDITION OF RS. 48,78,054/- ON ACCOUNT OF LEAVE ENCASHMENT U/S 43B OF THE INCOME TAX ACT, 1961. AGAINST THE ORDER 2 I.T.A. NOS. 371 & 121/KOL/2018 ASSESSMENT YEAR: 2010-11 M/S. S.R. BATLIBOI & ASSOCIATES LLP PASSED BY THE AO U/S 143(3), AN APPEAL WAS FILED BY THE ASSESSEE BEFORE THE LD. CIT(A) - 21 AND VIDE HIS APPELLATE ORDER DATED 22.11.2017, THE LD. CIT(A) 21 CONFIRMED THE DISALLOWANCE MADE BY THE AO ON ACCOUNT OF PROVISION MADE FOR LEAVE ENCASHMENT U/S 43B. AGAINST THE SAID ORDER OF THE LD. CIT(A), THE ASSESSEE HAS PREFERRED AN APPEAL BEFORE THE TRIBUNAL BEING ITA NO. 121/KOL/2018. 3. MEANWHILE THE ORDER PASSED BY THE AO U/S 143(3) ON 18.06.2012 WAS SET ASIDE BY THE CONCERNED LD. CIT VIDE HIS ORDER U/S 263 PASSED ON 27.03.2015 WITH THE DIRECTION TO THE AO TO FRAME THE ASSESSMENT AFRESH AND RECOMPUTE THE ASSESSEES INCOME AFTER MAKING FURTHER ENQUIRIES ON CERTAIN ISSUES. ACCORDINGLY A FRESH ASSESSMENT WAS MADE BY THE AO U/S 143(3) READ WITH SECTION 263 VIDE AN ORDER DATED 31.03.2016 DETERMINING THE TOTAL INCOME OF THE ASSESSEE AT RS. 27,69,48,810/- WHICH INCLUDED THE ADDITION OF RS. 48,78,054/- AS MADE IN THE ORIGINAL ASSESSMENT ON ACCOUNT OF DISALLOWANCE OF PROVISION MADE BY THE ASSESSEE FOR LEAVE ENCASHMENT. AGAINST THE ORDER PASSED BY THE AO U/S 143(3) READ WITH SECTION 263, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A) AND THE LD. CIT(A) 6, KOLKATA VIDE HIS APPELLATE ORDER DATED 25.01.2018 CONFIRMED THE DISALLOWANCE MADE BY THE AO ON ACCOUNT OF PROVISION MADE BY THE ASSESSEE FOR LEAVE ENCASHMENT U/S 43B. AGGRIEVED BY THE ORDER OF THE LD. CIT(A), THE ASSESSEE HAS PREFERRED AN APPEAL BEFORE THE TRIBUNAL BEING ITA NO. 371/KOL/2018. 4. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AND ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. AS AGREED BY THE LEARNED REPRESENTATIVES OF BOTH THE SIDES, THE ASSESSMENT ORDER 3 I.T.A. NOS. 371 & 121/KOL/2018 ASSESSMENT YEAR: 2010-11 M/S. S.R. BATLIBOI & ASSOCIATES LLP ORIGINALLY PASSED BY THE AO U/S 143(3) VIDE AN ORDER DATED 18.06.2012 HAVING BEEN SET ASIDE BY THE CONCERNED LD. CIT VIDE AN ORDER DATED 27.03.2015 PASSED U/S 263 WHICH HAS BECOME FINAL, THE ORDER PASSED BY THE AO U/S 143(3) ON 18.06.2012 HAS BECOME NON- EST IN THE EYES OF LAW AND THE APPEAL FILED BY THE ASSESSEE AGAINST THE SAID ORDER AS WELL AS THE ORDER PASSED BY THE LD. CIT(A) 21 DATED 22.11.2017 DISPOSING OF THE APPEAL OF THE ASSESSEE HAS BECOME INFRUCTUOUS. WE ACCORDINGLY CANCEL THE SAID ORDER OF THE LD. CIT(A) 21 DATED 22.11.2017 HAVING BECOME INFRUCTUOUS AND TREAT THE APPEAL OF THE ASSESSEE BEING ITA NO. 121/KOL/2018 AS ALLOWED. 5. AS REGARDS THE APPEAL OF THE ASSESSEE BEING ITA NO. 371/KOL/2018 WHICH IS DIRECTED AGAINST THE ORDER OF LD. CIT(A) 6, KOLKATA DATED 25.01.2018, THE LEARNED REPRESENTATIVES OF BOTH THE SIDES HAVE AGREED THAT THE SOLITARY ISSUE INVOLVED THEREIN RELATING TO THE DISALLOWANCE OF RS. 48,78,054/- MADE BY THE AO AND CONFIRMED BY THE LD. CIT(A) ON ACCOUNT OF PROVISION MADE BY THE ASSESSEE FOR LEAVE ENCASHMENT IS SQUARELY COVERED BY THE ORDER OF THE COORDINATE BENCH OF THIS TRIBUNAL PASSED IN THE CASE OF M/S. S.R.B. & ASSOCIATES LLP FOR AY 2007-08 (ITA 498/KOL/2015) WHEREIN A SIMILAR ISSUE WAS DECIDED BY THE TRIBUNAL VIDE PARAGRAPH NO. 4 OF ITS ORDER WHICH READS AS UNDER: 4. AFTER HEARING RIVAL SUBMISSIONS AND GOING THROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE ORDER OF THE TRIBUNAL CITED SUPRA, WE FIND THAT THE ISSUE IS DEALT BY THE COORDINATE BENCH OF THIS TRIBUNAL AS UNDER: 3. AT THE OUTSET, LD. SENIOR COUNSEL FOR THE ASSESSEE SUBMITTED THAT IN ALL THESE THREE APPEALS, THE ISSUE RELATES TO ALLOWABILITY OF PROVISION FOR LEAVE ENCASHMENT IN TERMS OF SUB-SECTION (F) OF SECTION 43B OF THE INCOME TAX ACT. THE ASSESSEE HAD ADVANCED ITS CLAIM RELYING ON THE DECISION OF THE HONBLE KOLKATA HIGH COURT IN THE CASE OF M/S. EXIDE INDUSTRIES LTD. REPORTED IN 292 ITR 470. HOWEVER, THE ASSESSING OFFICER DID NOT ACCEPT THE ASSESSEES CLAIM 4 I.T.A. NOS. 371 & 121/KOL/2018 ASSESSMENT YEAR: 2010-11 M/S. S.R. BATLIBOI & ASSOCIATES LLP OBSERVING THAT DEPARTMENT HAS PREFERRED A SPECIAL LEAVE PETITION BEFORE THE HONBLE SUPREME COURT AND STAY OF THE ORDER OF THE HONBLE KOLKATA HIGH COURT WAS GRANTED BY THE HONBLE APEX COURT. LD. SENIOR COUNSEL SUBMITTED THAT UNDER IDENTICAL CIRCUMSTANCES, TRIBUNAL HAS RESTORED THE MATTER TO THE FILE OF ASSESSING OFFICER TO DECIDE THE ISSUE IN ACCORDANCE WITH THE DECISION OF THE HONBLE APEX COURT IN THE CASE OF DCIT, CIRCLE-8, KOLKATA VS.- M/S. ERNST & YOUNG PVT. LTD. IN ITA NO. 1787/KOL./2008. HE, THEREFORE, SUBMITTED THAT THE MATTER MAY BE RESTORED BACK TO THE FILE OF ASSESSING OFFICER. 4. LEARNED DEPARTMENTAL REPRESENTATIVE DID NOT RAISE ANY OBJECTION. 5. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND HAVE PERUSED THE RECORDS OF THE CASE. WE FIND THAT TRIBUNAL ON IDENTICAL ISSUE IN ITA NO. 1787/KOL./2008 IN THE CASE OF M/S. ERNST & YOUNG PVT. LTD. HAS OBSERVED AT PARA 12 IN PAGE 6 AS UNDER :- 12. GROUND NO. 5 OF THE REVENUES APPEAL IS AGAINST THE RELIEF ALLOWED BY THE CIT(A.) IN RESPECT OF PROVISION FOR LEAVE ENCASHMENT WHICH WAS DELETED BY THE CIT(A.) FOLLOWING THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF M/S. EXIDE INDUSTRIES LTD. (SUPRA). IT WAS POINTED OUT BY THE LD. DR THAT THE HONBLE APEX COURT INSLP (CIVIL) 22889 OF 2008 HAS STAYED THE OPERATION OF THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT. IN VIEW OF THE ABOVE, WE SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW ON THIS POINT AND RESTORE THE MATTER BACK TO THE FILE OF THE AO WITH THE DIRECTION THAT HE WILL READJUDICATE THIS ISSUE AS PER DECISION OF THE HONBLE APEX COURT IN THE CASE OF M/S. EXIDE INDUSTRIES LTD. (SUPRA). RESPECTFULLY FOLLOWING THE SAME WE SET ASIDE THE ORDERS OF AUTHORITIES BELOW ON THIS POINT AND RESTORE THE MATTER BACK TO THE FILE OF ASSESSING OFFICER FOR ADJUDICATION AS PER THE DECISION OF THE HONBLE APEX COURT IN THE CASE OF M/S. EXIDE INDUSTRIES LTD.(SUPRA). IN VIEW OF THE ABOVE AND RESPECTFULLY FOLLOWING THE SAME, WE SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND RESTORE THE MATTER BACK TO THE FILE OF ASSESSING OFFICER FOR ADJUDICATION AS PER THE DECISION OF HONBLE APEX COURT IN THE CASE OF M/S. EXIDE INDUSTRIES LTD. (SUPRA). THIS GROUND OF APPEAL OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 6. AS THE ISSUE INVOLVED IN THE PRESENT APPEAL AS WELL AS ALL THE MATERIAL FACTS RELEVANT THERETO ARE SIMILAR TO THE CASE OF M/S. S.R.B. & ASSOCIATES LLP, WE RESPECTFULLY FOLLOW THE ORDER OF THE TRIBUNAL PASSED IN THE SAID CASE AND RESTORE THE MATTER TO THE FILE OF THE AO FOR FRESH ADJUDICATION AS PER THE SAME DIRECTION AS GIVEN IN THE CASE OF 5 I.T.A. NOS. 371 & 121/KOL/2018 ASSESSMENT YEAR: 2010-11 M/S. S.R. BATLIBOI & ASSOCIATES LLP M/S. S.R.B. & ASSOCIATES LLP. THE APPEAL OF THE BEING ITA NO. 371/KOL/2018 IS ACCORDINGLY TREATED AS ALLOWED FOR STATISTICAL PURPOSE. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE BEING ITA NO. 121/KOL/2018 IS TREATED AS ALLOWED WHILE THE APPEAL OF THE ASSESSEE BEING ITA NO. 371/KOL/2018 IS TREATED AS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 26 TH JULY, 2019. SD/- SD/- (S.S. VISWANETHRA RAVI) (P.M. JAGTAP) JUDICIAL MEMBER VICE PRESIDENT DATED: 26/07/2019 BISWAJIT, SR. PS COPY OF ORDER FORWARDED TO: 1. M/S. S.R. BATLIBOI & ASSOCIATES, 22, CAMAC STREET, KOLKATA 700 016. 2. DCIT, CIRCLE-54 (CURRENTLY CIRCLE -22), KOLKATA. 3. THE CIT(A) 4. THE CIT 5. DR TRUE COPY, BY ORDER, ASSISTANT REGISTRAR/H.O.O. ITAT, KOLKATA
