Kirloskar Corrocoat Pvt. Ltd., Pune V. Joint Commissioner of Income-tax,

ITA 489/PUN/2015

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 7508 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 4 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 16-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Corroborative evidences
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO. 2108 /P U N/201 4 / ASSESSMENT YEAR : 20 1 0 - 1 1 KIRLOSKAR CORROCOAT PVT. LTD., UDYOG BHAVAN, TILAK ROAD, PUNE 411002 . / APPELLANT PAN: AA CCK7947D VS. THE JT. COMMISSIONER OF INCOME TAX, RANGE 11 , PUNE . / RESPONDENT . / ITA NO. 489 /P U N/201 5 / ASSESSMENT YEAR : 20 07 - 08 KIRLOSKAR CORROCOAT PVT. LTD., UDYOG BHAVAN, TILAK ROAD, PUNE 411002 . / APPELLANT PAN: AACCK7947D VS. THE JT. COMMISSION ER OF INCOME TAX, RANGE 11, PUNE . / RESPONDENT ASSESSEE BY : SHRI SHARAD SHAH REVENUE BY : SHRI RAJEEV KUMAR, CIT / DATE OF HEARING : 09 .0 8 . 2017 / DATE OF PRONOUNCEMENT: 30 . 0 8 .201 7 ITA NO. 2108 /P U N/20 1 4 ITA NO. 489 /PUN/201 5 KIRLOSKAR CORROCOAT PVT. LTD. 2 / ORDER PER SUSHMA CHOWLA, J M : BOTH THE APPEAL S FILED BY THE ASSESSEE ARE AGAINST SEPARATE ORDER S OF CIT (A) - I , PUNE , DATED 1 5 . 09 .201 4 AND 31.10.2014 RELATING TO ASSESSMENT YEAR S 2010 - 11 AND 2007 - 08 AGAINST RESPECTIVE ORDER S PASSED UNDER SECTION 143(3) AND 143(3) R.W.S. 147 OF THE INCOME - TAX ACT , 1961 (IN SHORT THE ACT) . 2 . BOTH THE APPEALS RELATING TO THE SAME ASSESSEE WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 3. THE ASSESSEE IN ITA NO. 2108 / PUN/201 4 HAS RAISED THE FOLLOWING GROUND OF APPEAL : - THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED ON FACTS & IN LAW IN UPHOLDING DISALLOWANCE OF RS.1,78,975/ - BEING EMPLOYEES CONTRIBUTION TO PROVIDENT FUND, ON THE GROUND THAT THE SAID AMOUNT WERE DEPOSITED BEYOND THE DUE DATE FOR THE PAYMENT. HE FAILED TO APPRECIATE CONTENTION AND ARGUMENTS ADVANCED BY THE ASSESSEE IN THIS REGARD. 4. THE ONLY ISSUE ARISING IN THE PRESENT APPEAL IS AGAINST DISALLOWANCE OF EMPLOYEES CONTRIBUTION TO PROVIDENT FU ND OF RS.1,78,975/ - . 5. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN CIT VS. GHATGE PATIL TRANSPORTS LTD. (2014) 368 IT R 749 (BOM). ITA NO. 2108 /P U N/20 1 4 ITA NO. 489 /PUN/201 5 KIRLOSKAR CORROCOAT PVT. LTD. 3 6. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE ON THE OTHER HAND, PLACED RELIANCE ON THE ORDER OF CIT(A). 7. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE LIMITED ISSUE ARISING IN THE PRESENT APPEAL IS AGAINST THE DISALLOWANCE MADE ON ACCOUNT OF EMPLOYEES CONTRIBUTION TO PROVIDENT FUND. ADMITTEDLY, THE SAID DISALLOWANCE WAS MADE IN THE HANDS OF ASSESSEE AS THE AMOUNT WAS PAID BY THE ASSESSEE AFTER THE DUE DATE. ON THE OTHER HAND, THE CASE OF ASSESSEE IS THAT THE SAID AMOUNT WAS PAID BEFORE THE DUE DATE FOR FILING THE RETURN OF INCOME. THE DETAILS OF DATES OF PAYMENTS FOR THE RESPECTIVE MONTHS ARE AVAILABLE UNDER PARA 5.1 AT PAGE 14 OF THE APPELLATE ORDER. THE ISSUE RAISED BY THE ASSESSEE IS SQUARELY COVERED BY THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN CIT VS. GHATGE PATIL TRANSPORTS LTD. (SUPRA) AND FOLLOWING THE SAME PARITY OF REASONING, WE HOLD THAT NO ADDITION IS WARRANTED ON ACCOUNT OF EMPLOYEES CONTRIBUTION TO PROVIDENT FUND BEING PAID BELATEDLY BUT BEFORE THE DUE DATE OF FILING THE RETURN OF INCOME. THUS, WE DIRECT THE ASSESSING OFFICER TO DELETE THE ADDITION OF RS.1,78,975/ - . THE GROUND OF APPEAL RAISED BY THE ASSESSEE IS THUS, ALLOWED. 8. THE ASSESSEE IN ITA NO.489/PUN/2015 HAS RAISED THE F OLLOWING GROUNDS OF APPEAL: - GROUND OF APPEAL : DISALLOWANCE OF BROKERAGE PAID TO A DEALER M/S CHEMPS INDIA PRIVATE LIMITED RS. 1,71,318/ - . THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED ON FACTS & IN LAW IN UPHOLDING DISALLOWANCE OF RS.1,71,318/ - IN RESPECT OF COMMISSION PAID TO A DEALER M/S CHEMPS INDIA PRIVATE LIMITED, CHENNAI. 9. THE ONLY ISSUE RAISED IN THE PRESENT APPEAL IS IN RESPECT OF DISALLOWANCE OF BROKERAGE PAID OF RS.1,71,312/ - . ITA NO. 2108 /P U N/20 1 4 ITA NO. 489 /PUN/201 5 KIRLOSKAR CORROCOAT PVT. LTD. 4 10. BRIEFLY, IN THE FACTS RELATING TO THE ISSUE, THE A SSESSEE HAD DEBITED SUM OF RS.1,73,03,622/ - UNDER THE HEAD BROKERAGE AND COMMISSION. DURING THE COURSE OF SURVEY CONDUCTED AT THE PREMISES OF ASSESSEE ON 09.01.2013, THE ASSESSEE OFFERED ADDITIONAL INCOME ON ACCOUNT OF COMMISSION AND BROKERAGE. HOWEVER , DURING THE COURSE OF POST SURVEY PROCEEDINGS, THE ASSESSEE VIDE LETTER DATED 06.03.2013 IN CONNECTION WITH THE DISALLOWANCE OF COMMISSION PAID TO CERTAIN ENTITIES OFFERED DURING THE SURVEY, STATED THAT THE AMOUNT DECLARED AS ADDITIONAL INCOME NEEDED TO B E RECTIFIED, SINCE THE SAID COMMISSION PAYMENTS WERE SUPPORTED BY DOCUMENTARY EVIDENCE AND SERVICES HAD BEEN RENDERED. THE ASSESSEE ALSO FILED DOCUMENTARY EVIDENCES TO SUBSTANTIATE ITS CLAIM BEFORE THE SURVEY TEAM. THE INVESTIGATION UNIT IN VIEW OF VARIO US DOCUMENTS SUBMITTED BY THE ASSESSEE, ACCEPTED THE CLAIM OF ASSESSEE PARTLY. THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION OFFERED FOR TAXATION SUM OF RS.2,44,694/ - ON ACCOUNT OF COMMISSION WHICH INCLUDED SUM OF RS.1,71,318/ - UNDER THE HEAD MISCELLANEO US. THE ASSESSEE CLAIMS THAT THE SAID AMOUNT WAS PAID TO M/S. CHEMPES (INDIA) PVT. LTD., CHENNAI. THE ASSESSEE FURNISHED DOCUMENTS IN SUPPORT OF ITS CLAIM BEFORE THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND CLAIMED THE SAME TO B E ALLOWABLE IN ITS HANDS. HOWEVER, THE ASSESSING OFFICER NOTED THAT THE SAME WAS NOT SUPPORTED BY DOCUMENTARY EVIDENCE LIKE CONFIRMATION FROM THE PARTY, CALCULATION OF THE AMOUNT AND OTHER EVIDENCES. HENCE, COMMISSION OF RS.1,71,318/ - WAS DISALLOWED IN T HE HANDS OF ASSESSEE. 11. BEFORE THE CIT(A), THE ASSESSEE EXPLAINED THE REASONS FOR OFFERING THE SAME FOR TAXATION DURING THE COURSE OF SURVEY PROCEEDINGS AND ITS WITHDRAWAL ITA NO. 2108 /P U N/20 1 4 ITA NO. 489 /PUN/201 5 KIRLOSKAR CORROCOAT PVT. LTD. 5 THEREAFTER. THE ASSESSEE ALSO FURNISHED COPY OF DEBIT ADVI C E RECEIVED FROM M/S . KIRLOSKAR BROTHERS LTD. ALONG WITH LETTER DATED 21.08.2013 AND THE PAYMENT OF COMMISSION TO M/S. CHEMPES (INDIA) PVT. LTD. ACCORDINGLY. THE ASSESSEE POINTED OUT THAT THE SAID AMOUNT WAS SHOWN UNDER THE HEAD MISCELLANEOUS BUT WAS ACTUALLY PAID TO M/S. CHEMPES (INDIA) PVT. LTD. ON THE ADVICE OF ITS PARENT COMPANY. THE CIT(A) REJECTING THE CLAIM OF ASSESSEE, UPHELD THE ADDITION IN THE HANDS OF ASSESSEE, AGAINST WHICH THE ASSESSEE IS IN APPEAL BEFORE US. 12. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT IN VIEW OF DEBIT ADVI C E BEING SUPPORTING EVIDENCE EVIDENCING THE PAYMENT OF COMMISSION TO M/S. CHEMPES (INDIA) PVT. LTD., FOR WHICH THE CLAIM WAS MADE DURING ASSESSMENT PROCEEDINGS ITSELF SHOULD BE ALLOWED IN THE HANDS OF ASSESSEE . 13. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE ON THE OTHER HAND, PLACED RELIANCE ON THE ORDER OF CIT(A). 14. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE LIMITED ISSUE RAISED BY THE ASSESSEE IN THE PRESENT APPEAL IS AG AINST THE CLAIM OF COMMISSION PAID TO M/S. CHEMPES (INDIA) PVT. LTD. TOTALING RS.1,71,318/ - . THE ASSESSEE DURING THE COURSE OF SURVEY PROCEEDINGS HAD OFFERED CERTAIN AMOUNTS AS ITS INCOME OUT OF COMMISSION CLAIMED BY IT. THE ASSESSEE HAD OFFERED THE AFOR ESAID SUM OF RS.1,71, 318 / - AS ADDITIONAL INCOME WHICH WAS DEBITED IN ITS BOOKS OF ACCOUNT UNDER THE HEAD MISCELLANEOUS. HOWEVER, DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE FURNISHED COPY OF ADVI C E RECEIVED FROM ITS PARENT COMPANY KIRLOSKA R BROTHERS LTD. DIRECTING THE ITA NO. 2108 /P U N/20 1 4 ITA NO. 489 /PUN/201 5 KIRLOSKAR CORROCOAT PVT. LTD. 6 ASSESSEE TO MAKE THE PAYMENT TO M/S. CHEMPES (INDIA) PVT. LTD. THE ASSESSEE ACCORDINGLY, HAS CLAIMED THE SAID EXPENSES AS COMMISSION IN ITS HANDS. IN VIEW OF THE SAID EVIDENCES FILED BY THE ASSESSEE, WE FIND MERIT IN THE CLA IM OF ASSESSEE AND DIRECT THE ASSESSING OFFICER TO ALLOW THE SAME IN THE HANDS OF ASSESSEE. WE HOLD SO. THUS, WE DELETE THE ADDITION OF RS.1,71,318/ - . 1 5 . IN THE RESULT, BOTH THE APPEALS OF ASSESSEE ARE ALLOWED. ORDER PRONOUNCED ON THIS 30 TH DAY OF AUG UST , 201 7 . SD/ - SD/ - (ANIL CHATURVEDI ) (SUSHMA CHOWLA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 30 TH AUGUST , 201 7 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APP ELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT (A) - I, PUNE ; 4. / THE CIT - I , PUNE ; 5. , , / DR A , ITAT, PUNE; 6. / GUARD FILE . / BY ORDE R , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE