The DCIT, Circle-5, Ahmedabad V. Omni Lens Pvt.Ltd., Ahmedabad

ITA 863/AHD/2010

• Counselvise Citation: 86320514 RSA 2010
• Duration Of Justice: 2 year(s) 5 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-09-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2006-2007
• Appeal Filed On: 22-03-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B L YADAV
• Assessee Lawyers: MUKESH M PATEL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, D BENCH, AHMEDABAD BEFORE SHRI A. K. GARODIA, ACCOUNTANT MEMBER AND SHRI KUL BHARAT, JUDICIAL MEMBER I.T.A. NO.863 / AHD/2010 (ASSESSMENT YEAR 2006-07) DCIT, CIRCLE 5, AHMEDABAD VS. M/S. OMNI LENS PVT. LTD., 5/A, SAMRUDDHI, OPP. SAKAR III, NEAR OLD HIGH COURT, ASHRAM ROAD, AHMEDABAD-14. PAN/GIR NO. : AAACO1725F (APPELLANT) .. (RESPONDENT) APPELLANT BY: SHRI B L YADAV, SR. DR RESPONDENT BY: SHRI MUKESH M PATEL, AR DATE OF HEARING: 16.07.2012 DATE OF PRONOUNCEMENT: 21.09.2012 O R D E R PER SHRI A. K. GARODIA, AM:- THIS IS REVENUES APPEAL DIRECTED AGAINST THE ORDE R OF LD. CIT(A) XI, AHMEDABAD DATED 27.01.2010 FOR THE ASSESSMENT Y EAR 2006-07. THE GROUNDS RAISED BY THE REVENUE ARE AS UNDER: 1. THE LD. COMMISSIONER OF INCOME TAX (A)-XI , AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN DELETING OF ADDITI ON OF RS.36,50,0007- U/S 40A(2)(B).MADE ON ACCOUNT OF DIS ALLOWANCE OF PERFORMANCE INCENTIVE. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE LD. COMMISSIONER OF INCOME TAX (A) -XI AHMEDABAD OUGHT TO HAVE UPHELD THE ORDER OF THE ASSESSING OFFICER. 3. IT IS THEREFORE PRAYED THAT THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (A) - XI, AHMEDABAD MAY BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. I.T.A.NO.863 /AHD/2010 2 2. LD. D.R. OF THE REVENUE SUPPORTED THE ASSESSMENT ORDER WHEREAS THE LD. A.R. SUPPORTED THE ORDER OF LD. CIT(A). HE FURTHER SUBMITTED THAT THIS ISSUE IS NOW COVERED IN FAVOUR OF THE ASS ESSEE BY THE TRIBUNAL DECISION IN THE ASSESSEES OWN CASE FOR THE ASSESSM ENT YEAR 2004-05 IN I.T.A.NO. 3336/AHD/2007 DATED 21.05.2010 AND HE HAS SUBMITTED THAT A COPY OF THIS TRIBUNAL DECISION IS AVAILABLE ON PAGE S 1-4 OF THE PAPER BOOK. HE FURTHER SUBMITTED THAT IN THAT YEAR ALSO, INCENT IVE BONUS WAS PAID BY THE ASSESSEE TO THE DIRECTORS OF THE COMPANY TO THE EXTENT OF RS.21 LACS WHICH WAS DISALLOWED BY THE A.O. IN THAT YEAR ALSO BY INVOKING THE PROVISIONS OF SECTION 40A(2)(B) AND THE SAME WAS DE LETED BY LD. CIT(A) AND THE TRIBUNAL HAS CONFIRMED THE ORDER OF LD. CIT (A) IN THAT YEAR BY HOLDING THAT IF PERFORMANCE INCENTIVE IS PAID TOTAL TAX LIABILITY PAYABLE BY THE COMPANY AND THE DIRECTORS OF THE ASSESSEE COMPA NY IS TO THE EXTENT OF RS.47.05 LACS WHEREAS IT WOULD HAVE BEEN ONLY RS.45 .89 LACS IF THE PERFORMANCE INCENTIVE WAS NOT PAID. HE ALSO SUBMI TTED A CHART OF TAX LIABILITY FOR THE PRESENT YEAR OF THE ASSESSEE COMP ANY ALONG WITH ITS DIRECTORS IN BOTH THE SITUATIONS WHERE PERFORMANCE INCENTIVE IS PAID AND NOT PAID. HE POINTED OUT THAT IN THE PRESENT YEAR ALSO, TOTAL TAX LIABILITY OF THE ASSESSEE COMPANY AND ITS DIRECTORS IS OF RS.106 .40 LACS, WHEN PERFORMANCE INCENTIVE HAS BEEN PAID AND WAS ONLY RS .102.62 LACS IF NO SUCH PAYMENT WAS MADE FOR PERFORMANCE INCENTIVE. H E SUBMITTED THAT LD. CIT(A) HAS ALSO FOLLOWED THE ORDER OF LD. CIT(A ) IN ASSESSMENT YEAR 2004-05 AND HENCE, THE ISSUE IN DISPUTE IN THE PRES ENT YEAR IS SQUARELY COVERED BY THIS TRIBUNAL DECISION. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS, PERUSE D THE MATERIAL ON RECORD AND HAVE GONE THROUGH THE ORDERS OF AUTHORIT IES BELOW AND THE TRIBUNAL DECISION CITED BY THE LD. A.R. OF THE ASSE SSEE HAVING BEEN I.T.A.NO.863 /AHD/2010 3 RENDERED IN THE ASSESSEES OWN CASE FOR THE ASSESSM ENT YEAR 2004-05. AFTER EXAMINING THE FACTS OF THE PRESENT YEAR AS WE LL AS THE FACTS OF THE ASSESSMENT YEAR 2004-05, WE ARE SATISFIED THAT THIS ISSUE IN THE PRESENT YEAR IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THIS TRIBUNAL DECISION RENDERED IN THE ASSESSEES OWN CASE FOR THE ASSESSM ENT YEAR 2004-05. LD. D.R. COULD NOT POINT OUT ANY DIFFERENCE IN FACTS. WE HAVE ALSO SEEN THAT THE TAX LIABILITY WOULD HAVE BEEN LESSER FROM PRESE NT TAX LIABILITY OF THE ASSESSEE AND ITS DIRECTORS ARE TAKEN TOGETHER IN CA SE NO SUCH PAYMENT WOULD HAVE BEEN MADE ON ACCOUNT OF INCENTIVE BONUS. SUCH PAYMENT OF INCENTIVE BONUS IS DULY AUTHORIZED BY THE BOARD OF DIRECTORS ALSO AND THE SAME IS COMMENSURATE WITH THE TURNOVER AND THE PROF IT OF THE ASSESSEE COMPANY IN THE PRESENT YEAR AS WELL AS IN THE EARLI ER YEARS. CONSIDERING ALL THESE FACTS, WE DO NOT FIND ANY REASON TO INTER FERE IN THE ORDER OF LD. CIT(A) AND HENCE, WE CONFIRM THE SAME. 4. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. 5. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE M ENTIONED HEREINABOVE. SD./- SD./- (KUL BHARAT) (A. K. GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER SP COPY OF THE ORDER FORWARDED TO: 1. THE APPLICANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE LD. CIT (APPEALS) 5. THE DR, AHMEDABAD BY ORDER 6. THE GUARD FILE AR,ITAT,AHMEDABAD I.T.A.NO.863 /AHD/2010 4 1. DATE OF DICTATION 03.09.2012 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 10.09.2012.OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P .S./P.S. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 21/09/2012 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S./P.S.21/9/12 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 21/09/2012 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK .. 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER . 9. DATE OF DESPATCH OF THE ORDER. .