JYOTI CONTROLS, MUMBAI V. DCIT RG 22(1), NAVI MUMBAI

ITA 5468/MUM/2013

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 2735 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 1 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-09-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: J
• Next Hearing Date: 03-06-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 14-08-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL J BENCH, MUM BAI . . , , ! ' #$, % , & BEFORE SHRI R.C.SHARMA, AM AND SHRI AMARJIT SINGH, JM / I.T.A. NO.5468/MUM/2013 ( %' !( / ASSESSMENT YEAR: 2009-10) M/S. JYOTI CONTROLS 412, 4 TH FLOOR, SHREE SAI DHAM CHS, TILAK ROAD, ZULELAL CHOWK, GHATKOPAR (W) MUMBAI - 400077 ' / VS. THE DEPUTY COMMISSIONER OF INCOME TAX RANGE 22(1) VASHI ./ ./ PAN/GIR NO. : AAEFJ7515K ( / APPELLANT ) .. ( / RESPONDENT ) / DATE OF HEARING: 03.06.2016 !' /DATE OF PRONOUNCEMENT: 23.09.2016 #$ / O R D E R PER AMARJIT SINGH, JM: THE ASSESSEE HAS FILED THE PRESENT APPEAL AGAINST T HE ORDER DATED 28.09.2012 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) 33, MUMBAI [HEREINAFTER REFERRED TO AS THE CIT(A)] R ELEVANT TO THE A.Y.2009-10. ASSESSEE BY: SHRI RAVINDRA KUMAR JAIN DEPARTMENT BY: SHRI B.S.BIST ITA NO.5468/M/2013 A.Y. 2009-10 2 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS:- 1. THE APPELLANT PRAYS AND SUBMITS THAT THE ADDITI ON OF RS.96,277/- AS EXCISE DUTY HAS BEEN WRONGLY TREATED AS INCOME BEING DIFFERENCE BECAUSE OF ENTRY MADE BY TH E ASSESSEE IN THE BOOKS OF ACCOUNT AND IN THE EXCISE BOOKS AND SAME HAS BEEN ABSORBED BY THE VENDOR I.E. SIEME NS LTD. 2. THE APPELLANT PRAYS THAT DISALLOWANCE OF RS.1,23 ,12,500/- BEING AMOUNT WRITTEN OFF IN RESPECT OF DISCOUNT TO SIEMENS LTD. IS WRONG AND BAD IN LAW AS SAME IS TO BE TREAT ED AS SALES DISCOUNT. THEREFORE NOT JUSTIFIED IN DISALLO WING THE AMOUNT OF RS.1,23,12,500/- WITH WHOM THE ASSESSEE H AD THE TOTAL BUSINESS. 3. THE APPELLANT PRAYS THAT THE APPELLANT AUTHORITY HAS ERRED IN NOT CONSIDERING THE MATTER OF DISALLOWANCE OF PROFESSIONAL FEES OF RS.12,39,000/- IN THE APPELLAT E ORDER. 4. THE ASSESSEE HAS SUBMITTED LETTER FOR RECTIFICAT ION TO THE APPELLANT AUTHORITY FOR SUPPLEMENTARY ORDER BUT NOT ACCEPTED BY THE AUTHORITY, THEREFORE IT HAS BEEN SE NT BY COURIER TO THE SAME AND CC TO THE ASSESSING OFFICER . 3. THE BRIEF FACT OF THE CASE ARE THAT THE ASSESSEE FILED THE RETURN OF INCOME ON 31.03.2010 DECLARING THE TOTAL INCOME TO THE TUNE OF RS.66,36,290/-. THE ASSESSMENT WAS COMPLETED U/S.1 43(3) OF THE INCOME TAX ACT, 1961 ( IN SHORT THE ACT) ON 20.12 .2011 DETERMINING THE TOTAL INCOME TO THE TUNE OF RS.9,04 ,89,200/-. THE CIT(A) HAS CONFIRMED THE DISALLOWANCE TO THE TUNE O F RS.1,23,12,500/- ON ACCOUNT OF SALE DISCOUNT TO M/ S. SIEMENS LTD. AND ALSO CONFIRMED THE DISALLOWANCE OF RS.12,39,000 /- AND CONFIRMED ITA NO.5468/M/2013 A.Y. 2009-10 3 THE ADDITION OF RS.96,277/- WHICH WAS EXCISE DUTY, THEREFORE THE PRESENT APPEAL HAS BEEN FILED BEFORE US. ISSUE NO.1:- 4. THE LEARNED REPRESENTATIVE OF THE ASSESSEE DID NOT PRESS THE GROUND NO.1 WHICH IS IN CONNECTION WITH THE ADDITIO N OF RS.96,277/- OF THE EXCISE DUTY. THEREFORE, IN THE SAID CIRCUMSTAN CES WE DISMISSED THIS GROUND OF APPEAL BEING NOT PRESSED. ISSUE NO.2:- 5. ACCORDING TO ISSUE NO.2, THE ASSESSEE HAS CHALLE NGED THE CONFIRMATION OF DISALLOWANCE TO THE TUNE OF RS.1,23 ,12,500/- BEING AMOUNT WRITTEN OFF IN RESPECT OF DISCOUNT TO SIEMEN S LTD. THE LEARNED REPRESENTATIVE OF THE ASSESSEE HAS ARGUED THAT THE SIEMENS LTD. HAS CONFIRMED THE RETENTION MONEY TO THE TUNE OF RS.2,1 6,19,897/-. THEREFORE, IN THE SAID CIRCUMSTANCES AN AMOUNT OF R S.1,23,12,500/- WHICH IS LESS THAN THE SAID RETENTION AMOUNT IS LIA BLE TO BE ALLOWED IN THE INTEREST OF JUSTICE. IT IS ALSO ARGUED THAT TH E DETAILS OF RETENTION MONEY HELD BY THE SIEMENS LTD. HAS ALSO BEEN PLACED ON RECORD THEREFORE, THE RETENTION MONEY TO THE TUNE OF RS.2, 16,19,897/- AS ON 31.03.2009 IS NOT IN DISPUTE BUT THE CIT(A) HAS WRO NGLY CONFIRMED THE DISALLOWANCE TO THE TUNE OF RS.1,23,12,500/- WH ICH IS REQUIRED TO BE ALLOWED IN THE INTEREST OF JUSTICE. HOWEVER, ON THE OTHER HAND LEARNED REPRESENTATIVE OF THE DEPARTMENT HAS PLACED RELIANCE UPON THE ITA NO.5468/M/2013 A.Y. 2009-10 4 ORDER PASSED BY THE CIT(A) IN QUESTION. ON APPRAIS AL OF THE ORDER ON RECORD IT CAME INTO NOTICE THAT THE ASSESSING OFFIC ER BY VIRTUE OF LETTER DATED 08.11.20111 REQUISITIONED THE RELEVANT RECORD FROM M/S.SIEMENS LTD. AND IN REPLY TO THIS LETTER M/S.SIEMENS LTD. W AS HAVING THE RETENTION AMOUNT TO THE TUNE OF RS.2,16,19,897/- AS ON 31.03.2009, M/S. SIEMENS LTD. ALSO FURNISHED THE DETAILS OF RET ENTION MONEY WHICH WAS HELD BY THEM. IT IS NOT IN DISPUTE THAT THE RET ENTION MONEY WHICH WAS HELD BY M/S. SIEMENS LTD. WAS MORE THAN THE WRI TTEN OFF AMOUNT OF RS.1,23,12,500/-. IN VIEW OF THE SAID CIRCUMSTA NCES WE ARE OF THE VIEW THAT THE CIT(A) HAS WRONGLY CONFIRMED THE DISA LLOWANCE OF RS.1,23,12,500/- BEING AMOUNT OF WRITTEN OFF IN RES PECT OF QUANTITY DISCOUNT TO M/S. SIEMENS LTD. THEREFORE, WE SET AS IDE THE FINDING OF THE CIT(A) ON THIS ISSUE AND ALLOWED THE WRITTEN OF F AMOUNT OF RS.1,23,12,500/- BEING AMOUNT OF WRITTEN OFF IN RES PECT OF QUANTITY DISCOUNT TO M/S. SIEMENS LTD. ACCORDINGLY, THIS IS SUE IS DECIDED IN FAVOUR OF THE ASSESSEE AGAINST THE REVENUE ISSUE NO.3:- 6. ISSUE NO.3 IS IN CONNECTION WITH THE DISALLOWANC E OF PROFESSIONAL FEES TO THE TUNE OF RS.12,39,000/-. T HE ASSESSING OFFICER DISALLOWED THE PROFESSIONAL FEES TO THE TUNE OF RS. 12,39,000/-. THE ASSESSEE HAS PAID THE PROFESSIONAL FEES TO THE 14 P ARTIES AND TDS HAS BEEN DEDUCTED AT THE TIME OF PAYMENT. THE TDS HAS DULY BEEN REFLECTED IN THE RETURN FILED BY THE ASSESSEE. T HERE IS NO PLAUSIBLE ITA NO.5468/M/2013 A.Y. 2009-10 5 EXPLANATION ON RECORD AS TO WHY THE SAID PROFESSION AL FEES HAS BEEN DISALLOWED. COPY OF INCOME TAX RETURNS IN CONNECTI ON WITH THIS PROFESSIONAL FEES ARE ON RECORD WHICH IS REPRODUCED BELOW:- 1. BAKULESH M. NAGARSHETH RS.50,000/- TDS RS.5150/- THE COPY OF ITR AND OTHER RELEVANT DETAILS ENCLOSED . HE IS DIRECTOR OF INSTRUMENT COMPANY AND HE HAS VERSED KNOWLEDGE IN COMPUTER AND ALL FIELD RELATED TO INST RUMENT BUSINESS. 2. BUNTY B. NAGARSHETH RS.1,00,000/- TDS RS.10,900/- THE COPY OF ITR AND OTHER RELEVANT DETAILS ENCLOSED . HE IS SON OF THE DIRECTOR OF THE COMPANY AND HE HAS VERSE D KNOWLEDGE IN COMPUTER AND ALL FIELD RELATED TO INST RUMENT BUSINESS. 3. MEHTA & SONS RS.12,000/- TDS NIL COPY OF BILL ENCLOSED. THIS FIRM IS REPUTED AND DOING THE CONSULTANCY IN L ABOUR LAW ESIC PF ETC. HE IS LABOUR LAW CONSULTANT. 4. NAYAK & ASSOCIATES (PROP. V. B. NAYAK) RS.90,000/- TDS RS.9000/- HIS ITR FOR A.Y.12-13 AND COPY OF INVOICE ENCLOSED FOR REFERENCE. HE IS WELL VERSED IN ACCOUNTS AND DOING ALL TYPES OF RECONCILIATION IN RESPECT OF BANKS, SALES TAX, E XCISES, SET OFF OF SALES TAX ETC. HE IS IN THIS FIELD FOR MORE THAN 35 YEARS. 5. POOJA DARSHAN NAGARSHETH RS.1,50,000/- TDS RS.15,450/- ITA NO.5468/M/2013 A.Y. 2009-10 6 THE COPY OF ITR AND BILL ENCLOSED. SHE IS WELL VER SED IN COMPUTER DATA ENTRY AND PROCEEDING. 6. SUNIL NAGARSHETH RS.50,000/- TDS RS.5150/- THE COPY OF ITR, COPY OF BILL AND OTHER DETAILS ENC LOSED. HE IS WELL VERSED IN CONSULTANCY AND LESSENING IN RESP ECT OF INSTRUMENT INDUSTRY. HE IS ALSO DIRECTOR OF HIS GR OUP COMPANY I.E.ALTOP INDUSTRIES LIMITED. 7. THE DETAILS HAVE BEEN PLACED ON RECORD IN WHICH THEY HAVE BEEN SHOWN TO RECEIVE THE SAID PROFESSIONAL INCOME WHICH HAVE DULY BEEN REFLECTED IN THEIR RETURN. COPY OF BILL WITH REGAR D TO OTHER PROFESSIONAL FEES HAVE ALSO BEEN PLACED ON RECORD ON WHICH THE T DS HAVE BEEN DEDUCTED. THE RECEIVERS HAVE CONFIRMED THE THE PROF ESSIONAL FEES BY WAY OF RECEIPT OF THE PAYMENT. THEREFORE, IN THE S AID CIRCUMSTANCES THERE IS NO REASON TO DISALLOW THE SAID PROFESSIONA L FEES. THEREFORE, WE ALLOWED THE PROFESSIONAL FEES TO THE TUNE OF RS. 12,39,000/-. ACCORDINGLY THIS ISSUE IS DECIDED IN FAVOUR OF THE ASSESSEE AGAINST THE REVENUE. 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS HEREBY ALLOWED . ITA NO.5468/M/2013 A.Y. 2009-10 7 ORDER PRONOUNCED IN THE OPEN COURT ON 23 RD SEPTEMBER , 2016. SD/- SD/- (R.C.SHARMA) (AMARJIT SINGH) # / ACCOUNTANT MEMBER %& # /JUDICIAL MEMBER ' ( MUMBAI; )# DATED : 23 RD SEPTEMBER, 2016 MP MP MP MP * +%'#, -,(' / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. * ( ) / THE CIT(A)- 4. * / CIT 5. -./ &&01 , 01' , ' ( / DR, ITAT, MUMBAI 6. /34 5 / GUARD FILE. ' / BY ORDER, - & //TRUE COPY// ./$ /(DY./ASSTT. REGISTRAR) , ' ( / ITAT, MUMBAI