Ranvir Singh Chaudhary, New Delhi V. DCIT, Circle-68(1), New Delhi

ITA 659/DEL/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 9665 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 5 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-07-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 30-01-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M BARNWAL
• Assessee Lawyers: DHARAMVIR TANEJA
• Keywords: Salary income; TDS; Set aside
• Section: 10(14); 201

Judgement Text

IN TH E INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : SMC - 1 : NEW DELHI BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBER ITA NO. 659 /DEL/201 9 ASSESSMENT YEAR : 20 1 4 - 15 RANVIR SINGH CHAUDHARY, E - 157, SARITA VIHAR, NEW DELHI. PAN: A CXPC3842R VS DCIT, CIRCLE - 68(1), N EW DELHI. (APP ELL A NT ) (RESPONDENT) A SSESSEE BY : SHRI DHARAMVIR TANEJA, CA RE VENUE BY : SHRI M. BARNWAL, SR. DR DATE OF HEARING : 1 5 . 07 . 20 2 1 DATE OF PRONOUNCEMENT : 29 . 0 7 . 20 2 1 ORDER TH IS APPEAL FIL ED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 31 ST MAY, 201 8 OF THE CIT(A) - 21 , NEW DELHI, RELATING TO ASSESSMENT YEAR 20 1 4 - 15 . 2. ALTHOUGH A NUMBER OF GROUNDS HAVE BEEN RAISED BY THE ASSESSEE , THESE ALL RELATE TO THE ORDER OF THE CIT(A) IN CONFI RMING THE ADDITION OF RS.4,13,210/ - MADE BY THE AO ON ACCOUNT OF THE FOLLOWING: - I) ADDL. CONVEYANCE ALLOWANCE - RS.1,67,125/ - II) ALLOWANCE TO DEVELOPMENT OFFI CER F OR PROCURING BUSINESS - RS.1,67,125/ - III) FIXED CONVEYANCE ALLOWANCE - RS. 78,960/ - ------------- --- TOTAL TAXABLE INCOME RS.4,13,210/ - ========= ITA NO. 659 /DEL/201 9 2 3 . FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSEE IS A N INDIVIDUAL AND AN EMPLOYEE OF LIC OF INDIA. HE HAS FILED HIS RETURN OF INCOME ON 31 ST JULY, 2014 DECLARING A TOTAL INCOME OF RS.21,51,240/ - . D URING THE COURSE OF ASSESSMENT PROCEEDINGS, T HE AO OBSERVED FROM FORM NO.26AS THAT TDS HAS BEEN DEDUCTED ON SALARY INCOME OF RS.25,18,896/ - WHEREAS THE ASSESSEE HAS DECLARED SALARY INCOME OF RS.20,94,610/ - . HE NOTED THAT THE ASSESSEE HAS CLAIMED EXEMPTION U/S 10(14)(1) FOR RS.4,22,810/ - UNDER THE FOLLOWING HEADS: - I) ADDL. CONVEYANCE ALLOWANCE - RS.1,67,125/ - II) ALLOWANCE TO DEVELOPMENT OFFI CER F OR PROCURING BUSINESS - RS.1,67,125/ - III) FIXED CONVEYANCE ALLOWANCE - RS. 88,560/ - ---------------- TOTAL TAXABLE INCOME RS.4,22,810/ - ========= 4. HE, THEREFORE, ASKED THE ASSESSEE TO EXPLAIN THE DEDUCTION OF THE SAME IN VIEW OF THE PROVISIONS OF SECTION 10(14). IT WAS EXPLAINED BY THE ASSESSEE THAT THE ENTIRE ALLOWANCE OF RS.4,22,810/ - HAS BEEN TOTALLY SPENT. REJECTING THE VARIOUS EXPLANATIONS GIVEN BY THE ASSESSEE, THE AO MADE ADDITION OF RS.4,13,210/ - TO THE TOTAL INCOME OF THE ASSESSEE AFTER GIVING EXEMPTION OF RS.9,600/ - . IN APPEAL, THE LD.CIT(A) UPHELD THE ACTION OF THE AO. 5 . AGGRIEVED WITH SUCH ORDER O F THE CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. ITA NO. 659 /DEL/201 9 3 6 . TH E LD. COUNSEL FOR THE ASSESSEE , RELYING ON THE FOLLOWING DECISIONS SUBMITTED THAT IN ALL THESE DECISIONS IT HAS BEEN HELD THAT CONVEYANCE ALLOWANCE AND ADDITIONAL CONVEYANCE ALLOWANCE IS A LLOWABLE: - I) 241 ITR 442 (PUNJAB & HARYANA) CIT VS. CHAMAN LA L CHANDHOK ; II) 245 ITR 224 (MADRAS) LIC VS. CIT CHENNAI ; III) 263 ITR 536 (M.P) CIT VS. A.K. GHOSH; IV) 156 CTR 533 (PUNJAB) CIT VS. H.S.SANDHU; V) ITAT (DELHI) SATISH KUMAR GUPTA 7. HE SUBM ITTED THAT THE LD.CIT(A) WITHOUT GIVING PROPER REASONS HAS UPHELD THE ACTION OF THE AO. HE ACCORDINGLY SUBMITTED THAT IN VIEW OF THE VARIOUS DECISIONS RELIED UPON, THE CONVEYANCE ALLOWANCE AND ADDITIONAL CONVEYANCE ALLOWANCE CLAIMED BY THE ASSESSEE SHOUL D BE ALLOWED. 8 . THE LD. DR, ON THE OTHER HAND, HEAVILY RELIED ON THE ORDER OF THE CIT(A) . 9 . I HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES , PERUSED THE ORDERS OF THE AO AND THE CIT(A) AND THE PAPER FILED ON BEHALF OF THE ASSESSEE. I H A VE ALSO CONSIDERED THE VARIOUS DECISIONS CITED BEFORE ME. THE ONLY ISSUE TO BE DECIDED IN THE IMPUGNED APPEAL IS REGARDING THE ALLOWABILITY OF FIXED CONVEYANCE ALLOWANCE AND ADDITIONAL CONVEYANCE ALLOWANCE AND ALLOWANCE TO DEVELOPMENT OFFICER FOR PROCURING BUSINESS AS AN ALLOWABLE EXPENDITURE. THE HON BLE MADHYA PRADESH HIGH COURT (JABALPUR BENCH) IN THE CASE OF CIT VS. A.K. GHOSH, 263 ITR ITA NO. 659 /DEL/201 9 4 536, HAS HELD THAT CONVEYANCE ALLOWANCE AND ADDITIONAL CONVEYANCE ALLOWANCE RECEIVED BY THE DEVELOPMENT OFFICER OF LIC ARE EXEMPT U/S 10(14) OF THE IT ACT. I FIND, THE VISAKHAPATNAM BENCH OF THE TRIBUNAL IN THE CASE OF THANGIRALA IMMANUEL VS. ITO, VIDE ITA NO.13 & 14/VIZ/2019, ITA NO.16/VIZ/2019 AND ITA NO.25/VIZ/2019, ORDER DATED 29 TH MAY, 2019, HAS OBSERVED AS UNDER: - ASSESSEE CLAIMED EXEMPTION UNDER SECTION 10(14) IN RESPECT OF FIXED CONVEYANCE ALLOWANCE, CONVEYANCE EXPENDITURE AND ALLOWANCE FOR PROCURING NEW BUSINESS. AO DISALLOWED THE SAME ON THE GROUND THAT THE ASSESSEE DID NOT SATISFY CONDITIONS FOR ALLOWING EXEMP TION UNDER SECTION 10(14), WHICH WAS CONFIRMED BY CIT(A). HELD: IDENTICAL FACTS WERE COVERED IN CASE OF THOTA SRINIVASA BABU AND AVADHANULA SRINIVASA RAO V. ITO, WARD - 1, PALKOL IN (ITA NO. 242/VIZ/2017 AND ITA NO. 243/VIZ/2017, DT. 9 - 11 - 2018), WHEREIN HEL D THAT WHERE AMOUNTS WERE PAID TO EMPLOYEES BY AN EMPLOYER TO MEET EXPENSES WHOLLY, NECESSARILY AND EXCLUSIVELY FOR THE PERFORMANCE OF DUTIES, SUCH AMOUNTS COULD BE EXEMPTED TO THE EXTENT IT WAS SHOWN THAT IT HAD BEEN INCURRED FOR THE PURPOSE FOR WHICH IT WAS GRANTED. IF IT WAS NOT INCURRED FOR WHICH IT HAD BEEN GIVEN, IT WOULD ENTAIL DISCIPLINARY ACTION AGAINST THE EMPLOYEE. UNLESS SUCH A CASE HAD BEEN INITIATED AGAINST AN EMPLOYEE BY AN EMPLOYER, THE PRESUMPTION THAT THE EMPLOYEE HAD INCURRED THE EXPENDIT URE FOR WHICH IT WAS GRANTED, WOULD APPLY AND IT WOULD NOT BE NECESSARY FOR THE EMPLOYEES TO SUBMIT ACCOUNTS EVERY MONTH TO THE EMPLOYER AND ALONG WITH RETURN TO THE ASSESSING AUTHORITY. IF, IN SUCH MATTERS, FILING OF ACCOUNTS AND VOUCHERS/RECEIPTS WERE IN SISTED UPON TO CLAIM EXEMPTION UNDER SECTION 10(14) BY INCOME TAX AUTHORITIES, IT WOULD LEAD TO VOIDABLE WASTE OF TIME AND EXPENDITURE AND WOULD SERVE NO USEFUL PURPOSE BUT ON THE CONTRARY IT WOULD BE COUNTER - PRODUCTIVE. THUS, THE O RDER PASSED BY THE CIT(A ) WAS SET ASIDE AND THE EXEMPTION CLAIMED BY THE ASSESSEE WAS ALLOWED. 10. SIMILAR VIEW HAS BEEN TAKEN BY THE COORDINATE BENCHES OF THE TRIBUNAL IN VARIOUS OTHER DECISIONS RELIED ON BY THE LD. COUNSEL FOR THE ASSESSEE. RESPECTFULLY FOLLOWING THE DECISIO N CITED ABOVE, I AM OF THE CONSIDERED OPINION THAT THE ASSESSEE IS ENTITLED TO CLAIM THE EXEMPTION OF RS.4,13,210/ - ON ACCOUNT OF ADDITIONAL CONVEYANCE ALLOWANCE AND FIXED CONVEYANCE ALLOWANCE AND THE ALLOWANCE TO ITA NO. 659 /DEL/201 9 5 DEVELOPMENT OFFICER FOR PROCURING BUSINESS . THE ORDER OF THE CIT(A) IS ACCORDINGLY SET ASIDE AND THE GROUND RAISED BY THE ASSESSEE IS ALLOWED. 11 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED . P RONOUNCED IN THE OPEN COURT ON 29 .07 .20 21 . SD/ - ( R. K. PANDA ) ACCOUNTANT MEMBER DATED: 29 TH J ULY, 20 21 DK COPY FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASSTT. REGISTRAR, ITAT, NEW DELHI