SABERO ORGANICS GUJARAT LTD, MUMBAI V. ITO 7(2)(2), MUMBAI

ITA 6044/MUM/2010

• Counselvise Citation: 604419914 RSA 2010
• Duration Of Justice: 4 year(s) 11 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-07-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: E
• Assessment Year: 2007-2008
• Appeal Filed On: 05-08-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUMBAI BEFORE S/SHRI B.R.BASKARAN (AM) AND SANJAY GARG, (JM) . . , , ./ I.T .A. NO. 6044 / MUM/20 1 0 ( / ASSESSMENT YEAR : 200 7 - 08 ) M/S SABERO ORGANICS GUJARAT LTD, A/302, PHOENIX HOUSE, 462, SENAPATI BAPAT ROAD, WORLI (E), MUMBAI - 400 013 / VS. THE INCOME TAX OFFICER, WARD 7(2)(2), A A YAKAR BHAVAN, M.K.R OAD, MUMBAI - 400020 ( / APPELLANT ) .. ( / RESPONDENT ) ./ ./PAN/GIR NO. : AABCS5313C / APPELLANT BY MS.VASANTI PATEL / RSPONDENT BY SHRI NEIL PHILIP / DATE OF HEARING : 8. 7 . 201 5 / DATE OF PRONOUNCEMENT : 8. 7. 201 5 / O R D E R PER B.R. BASKARAN (AM) THE ASSESSEE HAS FILED THIS APPEAL CHALLENGING THE ORDER DATED 29.4.2010 PASSED BY LD CIT(A) - 1 3 , MUMBAI FOR THE ASSESSMENT YEAR 200 7 - 08 ON THE FOLLOWING ISSUES : A) DISALLOWANCE OF PRIOR PERIOD EXPENDITURE O F RS.10.27 LAKHS; B) DISALLOWANCE OF EMPLOYEES CONTRIBUTION TO PF/ESIC OF RS.11.60 LAKHS; AND C) ADJUSTMENT U/S 145A OF THE ACT T O THE CLOSING STOCK OF RS.509.79 LAKHS. ITA NO .6044/MUM/2010 2 2. AT THE TIME OF HEARING, THE LD. C OUNSEL APPEARING FOR THE ASSESSEE DID NOT PRESS THE GROUND S RELATING TO ADJUSTMENT MADE U/S 145A OF THE ACT I.E. I TEM (C) ABOVE. THE LD. COUNSEL MADE NECESSARY ENDORSEM ENT IN THE G ROUNDS OF APPEAL IN THAT REGARD. ACCORDINGLY, THE GROUND S RELATING TO SAID ISSUE IS DISMISSED AS NOT PRESSED. 3. THE NEXT ISSUE RELATES TO DISALLOWANCE OF PRIOR PERIOD EXPENSES. THE LD. AR SUBMITTED THAT THE ASSESSEE HAS GIVEN BREAK UP OF D ETAILS OF PRIOR PERIOD EXPENSES AND T HE SAID LIST INCLUDES SOME OF THE ITEMS WHICH GOT CRYSTALLIZED DURING THE YEAR UNDER CONSIDERATION. ACCORDINGLY SHE SUBMITTED THOSE EXPENSES, WHICH GOT CRYSTALLIZED DURING THE YEAR UNDER CONSIDERATION, SHOULD HAVE BEEN ALLOWED BY THE AO, EVEN THOUGH THE ASSESSEE HAD DESCRIBED THE SAME AS PRIOR PERIOD EXPENSES. THE LD A.R SUBMITTED THAT THE AO , WITHOUT CONDUCTING THE DETAILED EXAMINATION , HAS MADE IMPUGNED DISALLOWANCE AND THE SAME HAS ALSO BEEN CONFIRMED BY THE LD.CI T(A). ACCORDINGLY, THE LD. AR PRAYED THAT THIS ISSUE MAY BE SET ASIDE TO THE FILE OF THE AO FOR CARRYING OUT THE NECESSARY EXAMINATION. 4. WE HAVE HEARD THE LD. DR AND ALSO PERUSED THE DETAILS FURNISHED BY THE ASSESSEE . FROM THE DETAILS, WE NOTICE THAT THE ASSESSEE DID NOT FURNISH BILLS RELATING TO SOME OF THE EXPENDITURE AND FURTHER THE DATES SHOWN IN SOME OF THE BILLS PERTAIN ED TO EARLIER YEARS. IF THE ASSESSEE HAS FAILED TO FURNISH THE BIL LS RELATING TO ANY OF THE EXPENDITURE AND IF THE RELEVANT BIL LS DID NOT PERTAIN TO T HE YEAR UNDER CONSIDERATION , CERTAINLY SUCH KIND OF EXPENDITURE CANNOT BE ALLOWED AS DEDUCTION . HOWEVER, THE SUBMISSION OF LD A.R IS THAT SOME OF THE EXPENDITURE GOT CRYSTALLIZED DURING THE YEAR UNDER CONSIDERATION AND IF THE ASSESSE E IS ABLE TO PROVE THE SAME, THEN S UCH EXPENDITURE HAS TO BE ALLOWED BY TREAT ING THEM AS THE EXPENDITURE RELATING TO THE INSTANT YEAR . HOWEVER, WE NOTICE FROM THE ITA NO .6044/MUM/2010 3 ORDERS OF TAX AUTHORITIES THAT THEY HAVE NOT CARRIED OUT DETAILED EXAMINATION WITH REGARD TO THIS CLAIM. ACCORDINGLY, WE ARE OF THE VIEW THAT THIS ISSUE REQUIRES FRESH EXAMINATION AT THE END OF THE AO BY DULY C ONSIDERING BREAK - UP DETAILS FURNISHED BY THE ASSESSEE IN THE LIGHT OF DISCUSSIONS MADE SUPRA. ACCORDINGLY, WE SET ASIDE THE ORDER OF L D.CIT(A) ON THIS ISSUE AND RESTORE TH E SAME TO THE FILE OF THE AO WITH A DIRECTION TO EXAMINE THIS ISSUE AFRESH IN THE LIGHT OF DISCUSSION MADE SUPRA. 5 . THE LD. AR SUBMITTED THAT THE AO MAY BE DIRECTED TO ALLOW EXPENDITURE IN THE RESPECTIVE YEAR S, IF THEY WERE DISALLOWED DURING THE INSTANT YEAR. THE LD. AR PLACED RELIANCE IN THIS REGARD ON THE DECISION OF AHMEDABAD BENCH OF TRIBUNAL RENDERED IN THE CASE OF PERFECT EQUIPMENT V/S DCIT ( 2003) ( 85 IT D 50 ) (AHD) . HOWEVER, WE ARE OF THE VIEW THAT THE ASSES SEE MAY SEEK APPROPRIATE REMEDIES IN THIS REGARD BEFORE THE AO /OTHER HIGHER AUTHORITIES, IN ACCORDANCE WITH THE LAW . 6 . THE NEXT ISSUE RELATES TO DISALLOWANCE OF EMPLOYEES PF /ESI CONTRIBUTION OF RS.11.60 LAKHS MADE UNDER SECTION 2(24)(X) OF THE ACT. T HE LD. AR SUBMITTED THAT THIS ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF JURISDICTIONAL HIGH COURT RENDERED IN THE CA SE OF CIT V/S GHATGE PATIL TRANSPORTS LTD IN INCOME TAX APPEAL NO.1002 OF 2012 AND INCOME TAX APPEAL NO. 1034 OF 2 012 ORDER DATED 14.10.2014. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD. CIT(A) ON THIS ISSUE AND RESTORE TH E SAME TO THE FILE OF THE AO WITH A DIRECTION TO EXAMINE THE SAME AFRESH IN THE LIGHT OF THE DECISION RENDERED BY THE JURISDICTIONAL HIGH COURT IN T HE CAS E OF GHATGE PATIL TRANSPORTS LTD (SUPRA). ITA NO .6044/MUM/2010 4 7 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS TREATED AS PARTLY ALLOWED. PRONOUNCED ACCORDINGLY ON 8 TH JULY , 2015. 8 TH J ULY , 2015 SD SD ( / SANJAY GARG ) ( . . / B.R. BASKARAN) / J UDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI: 8TH JULY ,2015 . . . ./ SRL , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - CONCERNED 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI CONCERNED 6. / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) , /ITAT, MUMBAI