Shivkumar Sadashuvrao Tahalkari, Latur V. Deputy Commissioner of Income-tax,

ITA 698/PUN/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 1103 (ITAT-PUNE)
• Duration Of Justice: 4 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 17-08-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 13-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIL KUMAR CHAWARE
• Keywords: Salary income; Additional evidence
• Section: 143(3); 10(14)

Judgement Text

- IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC , PUNE , BEFORE MS. SUSHMA CHOWLA, JM . / ITA NO. 698 /PN/201 6 / ASSESSME NT YEAR : 20 11 - 12 SHRI SHIVKUMAR SADASH I VRAO THALKARI LIC BUILDING, INDIRA NAGAR, AMBEJOGAI ROAD, LATUR, DIST. LATUR . / APPELLANT PAN: A APPT7114B VS. THE DY. COMMISSIONER OF INCOME TAX, CIRCLE 3, NANDED . / RESPON DENT / APPELLANT BY : SHRI SUHAS BORA / RESPONDENT BY : SHRI ANIL KUMAR CHAWARE / DATE OF HEARING : 1 7 . 0 8 .201 6 / DATE OF PRONOUNCEMENT: 17 . 0 8 .201 6 / ORDER PER SU SHMA CHOWLA, J M : TH IS APPEAL FILED BY THE ASSESSEE IS AGAINST THE ORDER OF CIT (A) - 2 , AURANGABAD , DATED 08 . 0 2 .20 1 6 RELATING TO ASSESSMENT YEAR 20 11 - 12 AGAINST ORDER PASSED UNDER SECTION 1 43(3) OF THE INCOME - TAX ACT , 1961 (IN SHORT THE ACT) . 2 . THE ASSES SEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : - 1. THE LEARNED CIT(APPEAL - 2), AURANGABAD ERRED IN CONFIRMING THE ORDER PASSED U/S 143(3) OF THE INCOME TAX ACT, 1961; IN SPITE OF THE FACT THAT ASSESSEE HAS PRODUCED ALL THE DETAILS SUCH AS CASH FLOW STATEME NT OF F Y 2010 - 11 AND ALSO PRODUCED ALL SUPPORTING FOR EXPENSES CLAIMED BY ITA NO. 698 /PN/20 1 6 SHRI SHIVKUMAR SADASH I VRAO THALKARI 2 ASSESSEE FOR THE PURPOSE OF DEVELOPING LIC BUSINESS. THEREFORE THE ORDER CONFIRMING ENTIRE DISALLOWANCE OF RS.7,60,236/ - (WHICH IS TOTAL REIMBURSEMENTS) AND RESULTANT TAX AND INTER EST DEMAND OF RS.2,69,200/ - MAY PLEASE BE QUASHED. 2. THE ADDITIONAL EVIDENCE I.E. A CERTIFICATE ISSUED BY L.I.C. OF INDIA MAY PLEASE BE ALLOWED. 3. THE APPELLANT CRAVES LEAVE TO ADD, TO ALTER OR TO AMEND THE ABOVE GROUNDS OF APPEAL. RELIEF CLAIMED 1. THE APPEAL ORDER OF CIT(APPEALS - 2), AURANGABAD CONFIRMING THE ASSESSMENT ORDER PASSED BY LEARNED DCIT U/S 143(3) OF INCOME TAX ACT, 1961 MAY PLEASE BE QUASHED. 2. DEMAND RAISED AS PER ASSESSMENT ORDER OF RS.2,69,200/ - REFERRED ABOVE MAY PLEASE BE DROPPED. 3. THE ISSUE ARISING IN THE PRESENT APPEAL IS AGAINST THE ADDITION OF RS.7,60,236/ - . 4. BRIEFLY, IN THE FACTS OF THE CASE, THE ASSESSEE WAS AN INDIVIDUAL WHO WAS CLASS - II DEVELOPMENT OFFICER OF LIC OF INDIA. THE ASSESSEE FOR THE YEAR UNDER CONSIDERATIO N HAD CLAIMED EXEMPTION UNDER SECTION 10(14) OF THE ACT AT RS.7,65,236/ - TOWARDS CONVEYANCE ALLOWANCE AND ADDITIONAL CONVEYANCE ALLOWANCE PAID TO THE DEVELOPMENT OFFICER FOR PROCURING THE BUSINESS. THE ASSESSING OFFICER DID NOT ALLOW THE CLAIM OF ASSESSEE EXCEPT TO THE EXTENT OF RS.5,000/ - UNDER SECTION 17(2) OF THE ACT. 5. THE CIT(A) UPHELD THE ORDER OF ASSESSING OFFICER. THE CIT(A) OBSERVED THAT THE ASSESSEE HAD NOT GIVEN CERTIFICATE FROM ITS EMPLOYER THAT THE AFORESAID EXPENSES WERE MADE FOR THE PURPO SE OF DEVELOPMENT OF BUSINESS OF LIC OF INDIA. THE CIT(A) ALSO OBSERVED THAT IN THE ABSENCE OF ANY EVIDENCE THAT EXPENDITURE WAS REIMBURSED AND ALSO BECAUSE NO NOTIFICATION HAD BEEN ISSUED FOR EXEMPTING CONVEYANCE ALLOWANCE AND OTHER ALLOWANCES UNDER SECT ION 10(14)(I) OF THE ACT, IT WAS HELD THAT THE ASSESSING OFFICER WAS JUSTIFIED IN MAKING THE AFORESAID DISALLOWANCE. ITA NO. 698 /PN/20 1 6 SHRI SHIVKUMAR SADASH I VRAO THALKARI 3 6. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF CIT(A). 7. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE A SSESSEE HAD FURNISHED BREAKUP OF EXPENSES BEFORE LIC OF INDIA, WHO IN TURN, HAD REIMBURSED THE SAME. HE FURTHER STATED THAT COMPLETE DETAILS WERE FURNISHED BEFORE THE ASSESSING OFFICER AND ALSO BEFORE THE CIT(A), WHICH HA D BEEN PRIMARILY NOT CONSIDERED AN D HENCE, NO MERIT IN THE ORDERS OF AUTHORITIES BELOW. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE FURTHER POINTED OUT THAT THE SAID EXPENDITURE WAS CLAIMED AS EXEMPT UNDER SECTION 10(14) OF THE ACT AND THE SAID EXPENDITURE WAS DULY REIMBURSED B Y LIC OF INDIA AND HENCE, NOT TO BE ADDED IN THE HANDS OF ASSESSEE. 8. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE PLACED RELIANCE ON THE ORDERS OF AUTHORITIES BELOW. 9. ON PERUSAL OF RECORD AND AFTER HEARING BOTH THE LEARNED AUTHORIZED REPRE SENTATIVES, THE ISSUE WHICH ARISES FOR ADJUDICATION IN THE PRESENT APPEAL IS ALLOWANCE OF CONVEYANCE AND ADDITIONAL ALLOWANCES PAID BY THE EMPLOYER LIC OF INDIA TO THE ASSESSEE WHO WAS DEVELOPMENT OFFICER TO THE EXTENT OF RS. 7,65,236/ - . THE ASSESSING OFFI CER HAD ALLOWED SUM OF RS.5,000/ - . HENCE, THE ISSUE WHICH ARISES IN THE PRESENT APPEAL IS AGAINST BALANCE EXPENDITURE OF RS. 7,60,236/ - . THE CLAIM OF THE ASSESSEE BEFORE AUTHORITIES BELOW WAS THAT THE SAID EXPENSES WERE REIMBURSED BY THE LIC OF INDIA AND HENCE, HAVE NO CONNECTION WITH SALARY INCOME EARNED BY THE ASSESSEE. THE CERTIFICATE FROM THE LIC OF INDIA IN THIS REGARD IS ALSO PLACED ON RECORD. THE ASSESSEE HAS ALSO GIVEN BREAKUP OF EXPENSES INCURRED IN ORDER TO DEVELOP THE BUSINESS OF LIC OF INDIA, WHICH IS RECOGNIZED MODE, UNDER WHICH THE ASSESSEE AS THE DEVELOPMENT OFFICER, AS PER THE POLICY OF EMPLOYER LIC OF INDIA, IS ABLE TO GET ITA NO. 698 /PN/20 1 6 SHRI SHIVKUMAR SADASH I VRAO THALKARI 4 HIS CONVEYANCE ALLOWANCE AND OTHER ALLOWANCES REIMBURSED FROM THE EMPLOYER. ONCE THE CLAIM IS WITH REGARD TO REIMBUR SEMENT OF EXPENSES, THEN IN SUCH CIRCUMSTANCES, THERE IS NO MERIT IN THE ORDERS OF AUTHORITIES BELOW IN DENYING THE EXEMPTION TO THE ASSESSEE UNDER SECTION 10(14) OF THE ACT. THE AMOUNT WHICH HAS BEEN PAID TO THE ASSESSEE IS AGAINST EXPENSES INCURRED BY T HE ASSESSEE AND CONSEQUENTLY, THE SAME IS TO BE ALLOWED AS EXEMPT IN THE HANDS OF ASSESSEE UNDER SECTION 10(14) OF THE ACT. ACCORDINGLY, THE ASSESSING OFFICER IS DIRECTED TO ALLOW EXEMPTION UNDER SECTION 10(14) OF THE ACT AT RS. 7,60,236/ - . THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE THUS, ALLOWED. 1 0 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON THIS 17 TH DAY OF AUGUST , 201 6 . SD/ - (SUSHMA CHOWLA) / JUDICIAL MEMBER / PUNE ; DATED : 17 TH AUGUST , 201 6 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPO NDENT; 3. ( ) / THE CIT(A) - 2 , AURANGABAD ; 4. / THE PR. CIT - 2 , AURANGABAD ; 5. 6. , , , - / DR SMC , ITAT, PUNE; / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE