ACIT, Faridabad V. M/s. A.R. Industries Pvt. Ltd, Faridabad

ITA 4375/DEL/2009

• Counselvise Citation: [2010] 119 COUNSELVISE.COM (IT) 5697 (ITAT-DELHI)
• Duration Of Justice: 3 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-03-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 24-02-2010
• Assessment Year: 2004-2005
• Appeal Filed On: 16-11-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRATIMA KAUSHIK
• Assessee Lawyers: K SHANKARAN MANAGER ACCOUNTS

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH A : NEW DELHI) SHRI R.P. TOLANI, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBE ITA NO.4375/DEL./2009 (ASSESSMENT YEAR : 2004-05) ACIT, CIRCLE 1, VS. M/S. A.R. INDUSTRIES PVT. LT D., FARIDABAD. 14/6, MATHURA ROAD, FARIDABAD. (PAN : AABCA5358D) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI K. SHANKARAN, MANAGER (ACCOUNTS ) REVENUE BY : MS. PRATIMA KAUSHIK, DR ORDER PER R.P. TOLANI, JUDICIAL MEMBER : THIS APPEAL FILED BY THE REVENUE IS AGAINST THE ORD ER OF THE CIT (APPEALS) FOR THE ASSESSMENT YEAR 2004-05. FOLLOWI NG GROUNDS OF APPEAL ARE RAISED : 1. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN DELETIN G THE ADDITION OF RS.9,21,097/- MADE BY THE ASSESSING OFF ICER ON ACCOUNT OF LATE DEPOSIT OF EMPLOYEES CONTRIBUTION TOWARDS EPF & ESI DISREGARDING THE FACT THAT THE PAYMENTS WERE MADE BEYOND THE DUE DATES AND WERE, THEREFORE, NOT ALLOW ABLE U/ S 36(1)(VA) AND WERE TO BE TREATED AS INCOME U/S 2(24 )(X) OF THE INCOME TAX ACT, 1961, IN CONTRAVENTION OF THE DECIS ION IN THE CASE OF CIT VS. PAMWI TISSUES LIMITED 215 CTR 150 ( BOM.) ?' ITA NO.4375/DEL./2009 2 2. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN DELETIN G THE ADDITION OF RS.25,000/- MADE BY THE ASSESSING OFFIC ER ON ACCOUNT OF SALE PROMOTION EVEN THOUGH INCURRING OF EXPENSES FOR NON-BUSINESS CANNOT BE RULED OUT.' 3. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN DELETIN G THE ADDITION OF RS.25,000/- MADE BY THE ASSESSING OFFIC ER ON ACCOUNT OF TRAVELING EXPENSES DISREGARDING THE FACT THAT INCURRING OF EXPENSES FOR NON BUSINESS CANNOT BE RU LED OUT.' 4. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN DELETIN G THE ADDITION OF RS.4,000/- MADE BY THE ASSESSING OFFICE R ON ACCOUNT OF ADVERTISEMENT EXPENSES EVEN THOUGH THE A SSESSEE HAD FAILED TO PRODUCE ANY EVIDENCE FROM WHICH THE B USINESS PURPOSE OF THE EXPENDITURE COULD BE PROVED.' 5. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN DELETIN G THE ADDITION OF RS.3,90,000/- MADE BY THE ASSESSING OFF ICER ON ACCOUNT OF EXPORT CONSULTANCY EVEN THOUGH THE ASSES SEE HAD FAILED TO PRODUCE ANY EVIDENCE REGARDING PURPOSE AN D INCURRED FOR BUSINESS PURPOSES. 2. LEARNED DR RELIED ON THE ORDER OF ASSESSING OFFI CER. LEARNED REPRESENTATIVE FOR THE ASSESSEE AT THE OUTSET CONTE NDS THAT THE ISSUE ABOUT EPF & ESI HAS BEEN DECIDED BY THE CIT (A) RELYING O N THE HON'BLE DELHI HIGH COURT JUDGMENT IN THE CASE OF CIT VS. P.M. ELE CTRONICS LTD. (2009) 177 TAXMAN 1 (DELHI HIGH COURT). A FINDING OF FACT HAS BEEN GIVEN THAT THE RETURN OF ASSESSEE WAS FURNISHED ON 30.10.2004 AND THE PAYMENT OF EPF AND ESI CONTRIBUTION HAS BEEN PAID WITHIN THE TIME PRES CRIBED FOR FURNISHING THE RETURN. IN THE PRECEDING YEAR, THE ITAT IN ASSESSE ES OWN CASE IN ASSESSMENT ITA NO.4375/DEL./2009 3 YEAR 2005-06 IN ITA NO.712/DEL/2009 HAS AGREED TO T HE CLAIM OF THE ASSESSEE AND MATTER WAS REMANDED BACK TO AO TO FURN ISH THE ACTUAL DATE OF PAYMENTS OF EPF AND ESI. IN THIS YEAR, THE A.O. HA S GIVEN A FINDING THAT THESE PAYMENTS WERE MADE UP TO 31.3.2004 AND CIT (A ) HAS CONFIRMED THE SAME. THE ORDER OF CIT (A) MAY BE UPHELD. APROPOS GROUND NOS.2 TO 5, THE ORDER OF CIT (A) WAS RELIED UPON. 3. APROPOS GROUND NO.2 REGARDING SALE PROMOTION EXP ENSES, ASSESSEE CONTENDED THAT THE EXPENSES WERE INCURRED FOR BUSIN ESS PURPOSES ONLY AND EVEN IF INCURRED ON LUNCH AND CREDIT CARD PAYMENTS OF MD, THEY DO NOT BECOME NON-BUSINESS PAYMENT. NONE OF THE SPECIFIC EXPENDITURE HAS BEEN POINTED OUT AND A LUMP-SUM ADDITION OF RS.25,000/- HAS BEEN MADE. CIT (A), RELYING ON HIS ORDER FOR ASSESSMENT YEAR 2005- 06, DELETED THE ADDITION. 4. APROPOS GROUND NO.3, I.E. TRAVELLING EXPENSES, S IMILAR ADDITION IN RESPECT OF MR. PUNEET SONI HAS BEEN DELETED BY ITAT IN PRECEDING YEAR. 5. APROPOS GROUND NO.4, I.E. RS.4,000/- ON ACCOUNT OF ADVERTISEMENT EXPENSES, CIT (A) GAVE PARTIAL RELIEF OF RS.4,000/- AND THE REMAINING DISALLOWANCE OF RS.1,500/- WAS UPHELD. 6. APROPOS GROUND NO.5, I.E. EXPORT CONSULTANCY CHA RGES, SIMILAR CHARGES HAVE BEEN ALLOWED BY ITAT IN PRECEDING YEAR. ITA NO.4375/DEL./2009 4 7. CONSIDERING THE ABOVE, WE DO NOT FIND ANY INFIRM ITY IN THE ORDER OF THE CIT (A), WHICH IS ACCORDINGLY UPHELD. 8. IN THE RESULT, THE APPEAL OF REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 12 TH DAY OF MARCH, 2010. SD/- SD/- (A.K. GARODIA) (R.P. TOLANI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 12.3.2010 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT (A), FARIDABAD. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.