ANANDA FILM & TELECOMMUNICATION P.LTD (COMPANY), MUMBAI V. ASST CIT RG 11(1), MUMBAI

ITA 6776/MUM/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 1305 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 5 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-04-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 20-04-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 07-11-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAJESH KUMAR YADAV

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES A, MUMBAI , , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI RAJENDRA, ACCOUNTANT MEMBER ITA NOS. 5398 & 6776/MUM /2014 ASSESSMENT YEARS-2010-11 & 2011-12 M/S ANANDA FILM & TELECOMMUNICATION PVT. LTD. (COMPANY), 1101, BUILDING-3,RAHEJA CLASSIQUE, OSHIWARA, OFF. LINK ROAD, ANDHERI(W), MUMBAI-400053 / VS. ACIT-11(1), ROOM NO.467, 4 TH FLOOR, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI-400020 PAN NO. AADCA0599E ( / ASSESSEE) ( / REVENUE) / ASSESSEE BY SHRI HARIDAS BHATT / REVENUE BY SHRI RAJESH KUMAR YADAV- DR / DATE OF HEARING : 20/04/2017 / DATE OF ORDER: 25/04/2017 ITA NOS.5398 & 6776/MUM/2014 ANANDA FILM & TELECOMMUNICATION PVT. LTD. 2 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) BOTH THESE APPEALS ARE BY THE ASSESSEE AGAINST THE IMPUGNED ORDERS DATED 30/07/2014 FOR ASSESSMENT YEA R 2011-12 AND DATED 20/10/2014 FOR ASSESSMENT YEAR 2010-11 OF THE LD. FIRST APPELLATE AUTHORITY, MUMBA I. THE GROUND RAISED IN THESE APPEALS PERTAINS TO DISALLOWANCE OF CLAIM OF RS.7,20,000/- BEING SALARY PAID IN BOTH THE YEARS AND SPONSORSHIP CHARGES OF RS.10,24, 395/- IN EACH YEAR BEING PAID TO DIRECTOR OF THE COMPANY. 2. DURING HEARING, THE LD. COUNSEL FOR THE ASSESSE E, SHRI HARI DAS BHATT, CONTENDED THAT THE SALARY AND SPONSORSHIP EXPENSES WERE PAID TO SHRI SIDHANT SINH A, WHO WAS PURSUING EDUCATION IN BUSINESS ADMINISTRATI ON IN USA. IT WAS ALSO SUBMITTED THAT THE SALARY PAID TO SIDHANT SINHA WAS OFFERED FOR TAXATION IN HIS HANDS AFTER DEDUCTION OF TDS. SO FAR AS, SPONSORSHIP OF EDUCAT IONAL EXPENSES IS CONCERNED, IT WAS CONTENDED THAT HE WOU LD BE USEFUL IN FUTURE FOR THE MANAGEMENT OF THE COMPANY. 2.1. ON THE OTHER HAND, SHRI RAJESH KUMAR YADAV, LD. DR, STRONGLY DEFENDED THE IMPUGNED ORDER BY CONTENDING THAT FIRSTLY NO SERVICE WAS RENDERED BY SHRI SIDHANT SINHA TO THE ASSESSEE COMPANY AND HE IS MER ELY A STUDENT STUDYING IN USA. SO FAR AS, SPONSORSHIP ITA NOS.5398 & 6776/MUM/2014 ANANDA FILM & TELECOMMUNICATION PVT. LTD. 3 EXPENSES ARE CONCERN, THESE ARE ARGUED TO BE PURELY PERSONAL IN NATURE. 2.2. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT SHRI SIDHANT SINHA IS SON OF THE MA NAGING DIRECTOR. DURING THE RELEVANT ASSESSMENT YEAR, THE ASSESSEE COMPANY PAID SALARY OF RS.7,20,000/- TO HI M BEING THE DIRECTOR OF THE COMPANY. THIS SALARY WAS OFFERED FOR TAXATION IN THE INDIVIDUAL INCOME TAX RETURN OF SHRI SIDHANT SINHA. THE LD. ASSESSING OFFICER DISALLOWED THE SAME ON THE GROUND THAT NO SERVICES WERE ACTUALLY RENDERED BY SHRI SIDHANT SINHA. IDENTICAL WAS HELD BY THE LD. COMMISSIONER OF INCOME TAX (APPEAL). THIS BENCH ASKED A QUERY WHETHER SERVICE WAS RENDERED BY SHRI SIDHANT SINHA TO THE ASSESSEE COMPANY, IT WAS EXPLA INED THAT HE IS A STUDENT, STUDYING ABROAD. IN SUCH A SI TUATION, WE ARE SATISFIED THAT IN FACT NO SERVICE WAS RENDER ED BY SHRI SIDHANT SINHA TO THE ASSESSEE COMPANY AND MERE LY HE HAS SHOWN AS DIRECTOR ON PAPERS ONLY. IN THE ABS ENCE OF ANY PLAUSIBLE REASONING, WE FIND NO INFIRMITY IN THE CONCLUSION DRAWN BY THE LD. COMMISSIONER OF INCOME TAX (APPEAL). WE AFFIRM THE SAME IN BOTH THE YEARS. 3. SO FAR AS, EDUCATIONAL EXPENSES ARE CONCERNED, CONSIDERING THE TOTALITY OF FACTS, WE ARE OF THE VI EW THAT EDUCATIONAL EXPENSES ARE PURELY OF PERSONAL NATURE AND CANNOT BE ALLOWED. SO FAR AS, THE CONTENTION OF THE LD. COUNSEL THAT HE WILL BE USEFUL FOR THE ASSESSEE COM PANY IS ITA NOS.5398 & 6776/MUM/2014 ANANDA FILM & TELECOMMUNICATION PVT. LTD. 4 CONCERNED, AT THIS STAGE, NO USEFULNESS WAS SHOWN B Y THE ASSESSEE AND WHEN ACTUAL SERVICES WILL BE RENDERED, AFTER COMPLETION OF EDUCATION, AT THAT TIME, IT WILL BE D EPEND UPON THE CIRCUMSTANCES. FUTURE IS ALWAYS UNCERTAIN . THUS, WE FIND NO INFIRMITY IN THE CONCLUSION OF THE LD. COMMISSIONER OF INCOME TAX (APPEAL). THIS GROUND OF THE ASSESSEE IN BOTH YEARS IS DISMISSED. FINALLY, THE APPEALS OF THE ASSESSEE ARE DISMISSED. THIS ORDER WAS PRONOUNCED IN THE OPEN IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 20/04/2017. SD/- SD/- (RAJENDRA) (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER MUMBAI; # DATED : 25/04/2017 F{X~{T? P.S/. . . %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. %& '( / THE APPELLANT (RESPECTIVE ASSESSEE) 2. )*'( / THE RESPONDENT. 3. + + , ( %& ) / THE CIT, MUMBAI. 4. + + , / CIT(A)- , MUMBAI, 5. /01 )2 , + %& %23 , / DR, ITAT, MUMBAI 6. 14 5 / GUARD FILE. / BY ORDER, */& ) //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI