TARA MINEALS & CHEMICALS P. LTD, MUMBAI V. ITO WD 2(3)(3), MUMBAI

ITA 724/MUM/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 93230 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-07-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: E
• Assessment Year: 2010-2011
• Appeal Filed On: 31-01-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: NAVEEN GUPTA

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUMBAI . . , , , BEFORE SHRI A.D. JAIN , JUDICIAL MEMBER AND SHRI N.K . BILLAIYA, A CCOUNTANT M EMBER / I .T.A. NO . 724/MUM/2014 ( / ASSESSMENT YEAR : 2010 - 11 M/S. TARA MINERALS & CHEMICALS PVT. LTD., 2, KALYAN BHAWAN, OPP. HOTEL IMPERIAL, TELLI GALLI,ANDHERI (E), MUMBAI - 400 069 / VS. THE ITO, WARD 2(3)(3), AAYAKAR BHAVAN, MUMBAI - 400 020 ./ ./ PAN/GIR NO. : AAACT 1570B ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY: SHRI MAHESH SABOO / RESPONDENT BY : SHRI NAVEEN GUPTA / DATE OF HEARING : 13 . 0 7 .2015 / DATE OF PRONOUNCEMENT : 13 .0 7 .2015 / O R D E R PER N.K. BILLAIYA, AM: T HIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST THE ORDER OF THE LD. CIT(A) - 6 , MUMBAI DT. 2 7 . 11 .2013 PERTAINING TO ASSESSMENT YEAR 20 1 0 - 11 . 2. THE ASSESSEE HAS RAISED THREE SUBSTANTIVE GROUNDS OF APPEAL. AT THE VERY OUTSET, THE LD. COUNSEL FOR THE ASSESSEE STATED THAT HE IS NOT PRESSING GROUND NO. 2, THEREFORE THE SAME IS DISMISSED AS NOT PRESSED. ITA. NO. 724/M/2014 2 3. GROUND NO. 1 RELATES TO THE ADHOC DISALLOWANCE OF RS. 3,11,614/ - OUT OF REPAIRS AND MAINTENANCE. 3.1. WHILE SCRUTINIZING THE RETURN OF INCOME, THE ASSESSING OFFICER NOTICED THAT U NDER THE HEAD OTHER EXPENSES THE ASSESSEE HAS DEBITED RS. 23,13,590/ - TOWARDS REPAIRS AND MAINTENANCE OF PLANT AND MACHINERY AND RS. 8,02,553/ - FOR OTHERS. THE ASSESSEE WAS ASKED TO FURNISH THE DETAILS I.E. BILLS/VOUCHER/INVOICE IN RESPECT OF THE SAID E XPENSES. ON RECEIVING NO PLAUSIBLE REPLY INSPITE OF SEVERAL REMINDERS, THE AO PROCEEDED TO DISALLOW 10% OF THE EXPENSES SO CLAIMED AND COMPUTED THE DISALLOWANCE @ 10% AT RS. 3,11,614/ - . 4. AGGRIEVED BY THIS, THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) BUT WITHOUT ANY SUCCESS. 5. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE STATED THAT THE AO HAS WRONGLY STATED THAT NO DETAILS WERE FURNISHED, ON THE CONTRARY, EACH AND EVERY ITEM OF EXPENSES DEBITED UNDER THE HEAD REPAIRS AND MAINTENANCE WAS EXP LAINED WITH SUPPORTING BILLS AND VOUCHERS. THE LD. COUNSEL DREW OUR ATTENTION TO THE LETTER DT. 24.12.2012 FILED WITH THE OFFICE OF THE AO. IT IS THE SAY OF THE LD. COUNSEL THAT SINCE ALL THE DETAILS WERE FURNISHED BEFORE THE REVENUE AUTHORITIES, IT IS I NCORRECT TO SAY THAT PROPER DETAILS WERE NOT FILED. THE LD. COUNSEL STATED THAT THE ADHOC DISALLOWANCE IS UNCALLED FOR. 6. PER CONTRA, THE LD. DEPARTMENTAL REPRESENTATIVE STRONGLY RELIED UPON THE FINDINGS OF THE AO. 7. WE HAVE CAREFULLY PERUSED THE OR DERS OF THE AUTHORITIES BELOW AND THE RELEVANT DOCUMENTS BROUGHT TO OUR NOTICE BY THE LD. COUNSEL. THE ITA. NO. 724/M/2014 3 AO ON PAGE - 2 PARA - 1 OF HIS ORDER HAS CATEGORICALLY MENTIONED THAT INSPITE OF SEVERAL REMINDERS, THE ASSESSEE HAS FAILED TO SUBMIT THE DETAILS WHEREAS BY HIS LETTER DT. 24.12.2012, THE ASSESSEE HAS MENTIONED THAT THE DETAILS OF REPAIRS AND MAINTENANCE EXPENSES ARE ENCLOSED HEREWITH WITH MAJOR BILLS REQUIRED. SINCE THERE IS A CONTRADICTION OF FACT, THEREFORE IN THE INTEREST OF JUSTICE AND FAIR PLAY, WE RES TORE THIS ISSUE TO THE FILE OF THE AO. THE ASSESSEE IS DIRECTED TO ONCE AGAIN FILE THE REQUISITE DETAILS AND THE AO IS DIRECTED TO DECIDE THE ISSUE AFRESH IN THE LIGHT OF THE DOCUMENTARY EVIDENCES FILED BEFORE HIM. GROUND NO. 1 IS TREATED AS ALLOWED FOR STATISTICAL PURPOSE. 8. GROUND NO. 3 RELATES TO THE DISALLOWANCE OF RS. 69,425/ - OUT OF MISCELLANEOUS EXPENSES. 8.1. WHILE SCRUTINIZING THE PROFIT AND LOSS ACCOUNT, THE AO NOTICED THAT UNDER THE HEAD OTHER EXPENSES, THE ASSESSEE HAS DEBITED A SUM OF RS. 11,77,970/ - TOWARDS MISCELLANEOUS EXPENSES. THE AO FURTHER OBSERVED THAT OUT OF THIS, RS. 4,83,720/ - HAS BEEN DEBITED AS BANK CHARGES AND BANK LOAN PROCESSING FEES. THE ASSESSEE WAS ASKED TO FURNISH THE DETAILS IN SUPPORT OF THE BALANCE AMOUNT I.E. RS . 6,94,250/ - . INSPITE OF SEVERAL REMINDERS, THE ASSESSEE FAILED TO SUBMIT THE DETAILS. THE AO PROCEEDED BY DISALLOWING 10% OF RS. 6,94,250/ - AND ADDED RS. 69,425/ - . 9. AGGRIEVED BY THIS, THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) BUT WITHOUT ANY SUCCESS. 10. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE ONCE AGAIN STATED THAT THE DETAILS OF MISCELLANEOUS EXPENSES WERE FILED WITH THE AO ALONGWITH NECESSARY BILLS WHEREAS THE AO AT PARA - 3 ON PAGE - 2 OF HIS ORDER HAS MENTIONED THAT INSPITE OF SEVERA L REMINDERS, THE ASSESSEE HAS FAILED TO ITA. NO. 724/M/2014 4 SUBMIT THE SAID DETAILS. THERE BEING A CONTRADICTION IN THE FACTS, WE THEREFORE RESTORE THIS ISSUE TO THE FILE OF THE AO. THE ASSESSEE IS DIRECTED TO FURNISH ONCE AGAIN THE DETAILS RELATING TO THE MISCELLANEOUS EXP ENSES. THE AO IS DIRECTED TO DECIDE THE ISSUE AFRESH IN THE LIGHT OF THE DOCUMENTARY EVIDENCES FILED BY THE ASSESSEE. THIS GROUND OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSE. 11. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PAR TLY ALLOWED FOR STATISTICAL PURPOSE. OR DER PRONOUNCED IN THE OPEN COURT ON 13 TH JU LY , 2015 SD/ - SD/ - ( A.D. JAIN ) (N.K. BILLAIYA) /JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 13 TH JU LY , 2015 . . ./ RJ , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI