Jila Sahkari Kendriya Bank Maryadit, Ujjain V. The ACIT Circle, 2(1), Ujjain

ITA 903/Ind/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 7741 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2014-2015
• Appeal Filed On: 29-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PUNIT KUMAR
• Assessee Lawyers: S S DESHPANDE
• Section: 143(3); 142(1); 143(2)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE HONBLE KUL BHARAT, JUDICIAL MEMBER AND HONBLE MANISH BORAD, ACCOUNTANT MEMBER ITA NO.903/IND/2018 ASSESSMENT YEAR 2014-15 ASSESSEE BY SHRI S.S. DESHPANDE, CA REVENUE BY SHRI PUNIT KUMAR, SR. DR DATE OF HEARING 23.1.2020 DATE OF PRONOUNCEMENT 29 .1.2020 O R D E R PER MANISH BORAD, AM THE ABOVE CAPTIONED APPEAL FILED AT THE INSTANCE OF THE ASSESSEE PERTAINING TO ASSESSMENT YEAR 2014-15 IS DIRECTED AGAINST THE ORDERS OF LD. COMMISSIONER OF INCOME TAX (APPEA LS) (IN SHORT LD.CIT(A)], UJJAIN DATED 26.09.2018 WHICH IS ARIS ING OUT OF THE ORDER U/S 143(3) OF THE INCOME TAX ACT 1961(IN SHOR T THE ACT) DATED 09.12.2016 FRAMED BY ACIT-2(1), UJJAIN. 2. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEA L; JILA SAHAKARI KENDRIYA BANK MARYADIT, 03, BHARATPURI ADMINISTRATIVE AREA, DEWAS ROAD, UJJAIN VS. ASSTT. COMMISSIONER OF INCOME TAX, CENTRAL-2(1), UJJAIN (APPELLANT) (RESPONDENT ) PAN NO. A A ABJ0014F JILA SAHAKARI KENDRIYA BANK MARYADIT ITA NO. 903/IND/2018 2 1. THE LD. CIT(A) HAS ERRED IN MAINTAINING THE ADDI TION OF RS.9,88,736/- BEING THE 20% FROM THE PROFESSIONAL AND CONSULTANCY FEES PAID. 1.1. THE LD. CIT(A) HAS ERRED IN REMARKING THAT THE RETURN SUBMISSIONS ARE NOT MADE AND THEREFORE THE GROUND IS DISMISSED. TH E DISALLOWANCE OF 20% ON AN ADHOC BASIS IS UNCALLED FOR AND THE ADDITION MAY PLEASE BE DELETED. 2. THE LD. CIT(A) HAS ERRED IN MAINTAINING THE DISA LLOWANCE OF 20% OUT OF THE ABOVE ENCASHMENT PAYMENT. 3. BRIEF FACTS OF THE FACTS AS CULLED OUT FROM THE RECORDS ARE THAT THE ASSESSEE IS A CO-OPERATIVE BANK CARRYING OUT BA NKING BUSINESS. INCOME OF RS.6,25,47,650/- DECLARED IN THE E-RETURN FILED ON 27.11.2014. THE CASE SELECTED FOR SCRUTINY, THEREF ORE STATUTORY NOTICES U/S 143(2) AND 142(1) WERE DULY SERVED UPON THE ASSESSEE. AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE C ERTAIN DISALLOWANCES WERE MADE WHICH INCLUDED DISALLOWANCE OF PROFESSIONAL CONSULTANCY FEES OF RS.9,88,736/- AND ADHOC DISALLOWANCE OF RS.38,298/- OUT OF THE LEAVE ENCASH MENT EXPENSES THEREBY ASSESSING INCOME AT RS. 6,86,81,259/-. AGG RIEVED ASSESSEE PREFERRED APPEAL BEFORE LD. CIT(A) AND PARTLY SUCCE EDED. 4. NOW THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL AGAINST THE DISALLOWANCE OF PROFESSIONAL AND CONSULTANCY FEES O F RS.9,88,736/- AND DISALLOWANCE OF LEAVE ENCASHMENT EXPENSES AT RS .38,298/-. JILA SAHAKARI KENDRIYA BANK MARYADIT ITA NO. 903/IND/2018 3 5. LD. COUNSEL FOR THE ASSESSEE WITH REGARD TO DISALL OWANCE OF PROFESSIONAL & CONSULTANCY FEES OF RS.9,88,736/- SU BMITTED THAT COMPLETE EXPENDITURE DETAILS WERE FILED AND PAYMENT MADE AFTER DEDUCTION OF TAX AT SOURCE AS AND WHERE APPLICABLE. BOOKS OF ACCOUNTS WERE AUDITED AND THE ALLEGED FAILURE OF TH E ASSESSEE TO PRODUCE DETAILS OF VOUCHERS WAS DUE TO THE REASON T HAT DURING THE PERIOD 8.11.2016 TO 31.11.2016 THE BANK STAFF WERE DEPUTED IN COMPLYING THE INSTRUCTIONS/ORDERS ISSUED BY RESERVE BANK OF INDIA/MINISTRY OF FINANCE UNDER DEMONETIZATION SCHE ME. PRAYER WAS ALSO MADE TO DELETE THE ADDITION FOR DISALLOWAN CE OF LEAVE ENCASHMENT EXPENSES AT RS.38,298/-. 6. PER CONTRA LD. DEPARTMENTAL REPRESENTATIVE VEHE MENTLY ARGUED SUPPORTING THE ORDER OF LOWER AUTHORITIES. 7. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RE CORDS PLACED BEFORE US. AS REGARDS GROUND NO.1 WHERE THE ASSESSEE HAS CHALLENGED THE FINDING OF LD. CIT(A) CONFIRMING THE DISALLOWANCE OF RS.9,88,736/- BEING 20% OF THE PROFESSIONAL & CONSU LTANCY FEES, WE OBSERVE THAT DETAILS OF VARIOUS PROFESSIONAL CHARGE S PAID BY THE ASSESSEE BANK ARE PLACED AT PAPER BOOK AT PAGE 12 T O 61. ASSESSEE HAS PROVIDED MINUTE DETAILS OF ALL THE PROFESSIONAL CHARGES PAID JILA SAHAKARI KENDRIYA BANK MARYADIT ITA NO. 903/IND/2018 4 DURING THE YEAR. AS SUBMITTED BY THE LD. COUNSEL F OR THE ASSESSEE THAT ALL THE PAYMENTS FOR PROFESSIONAL AND LEGAL FE ES HAVE BEEN MADE THROUGH ACCOUNT PAYEE CHEQUE AND TAX DEDUCTED AT SOURCE (AS APPLICABLE). WE ARE SATISFIED WITH THESE DETAILS A ND ARE OF CONSIDERED VIEW THAT THE ADHOC DISALLOWANCE OF RS.9 ,88,736/- WAS UNCALLED FOR AND LD. CIT(A) ERRED IN SUSTAINING THE DISALLOWANCE IGNORING THE FACT THAT THE ASSESSEE BEING A CO-OPER ATIVE BANK IS MAINTAINING COMPLETE DETAILS. THUS SUCH ADHOC DISAL LOWANCE ARE UNCALLED FOR WHEN COMPLETE DETAILS HAVE BEEN FILED BY THE ASSESSEE WITH DOCUMENTARY EVIDENCE. WE, THUS DELETE THE DIS ALLOWANCE OF RS. 9,88,736/- MADE OUT OF PROFESSIONAL AND CONSULTANCY FEES AND ALLOW GROUND NO.1 RAISED BY THE ASSESSEE. 8. AS REGARDS GROUND NO.2 FOR THE DISALLOWANCE OF LEA VE ENCASHMENT OF RS. 38,298/- CONFIRMED BY THE LD. CIT (A) WE OBSERVE THAT THE PARTICULAR LEDGER UNDER THE NAME LEAVE SA LARY CONTRIBUTION ORDERS FOR THE FINANCIAL YEAR 2013-14 IS PLACED AT PAGE 62 OF THE PAPER BOOK AND ALONG WITH THE LEDGER ACCOUNT ALL TH E VOUCHERS ARE ALSO BEEN ATTACHED WHICH SHOWS THE CALCULATION OF LEAVE ENCASHMENT EXPENDITURE INCURRED BY THE ASSESSEE BANK UNDER VARIOUS HEADS. FOR INSTANCE LEAVE ENCASHMENT EXPEN DITURE OF JILA SAHAKARI KENDRIYA BANK MARYADIT ITA NO. 903/IND/2018 5 RS.16,295/- RS.15,919/- AND RS.15,919/- HAVE BEEN B OOKED FOR THE MONTH OF MAY, 2013, JUNE,2013 AND JULY,2013. SIMIL ARLY EXPENSES HAVE ALSO BEEN BOOKED FOR OTHER MONTHS. THE ENTRY IN THE LEDGER ACCOUNT HAS BEEN MADE ON THE BASIS OF VOUCHERS REGU LARLY PREPARED BY THE BANK DULY SIGNED BY THE BRANCH MANAGER AND C LERK. WE SEE NO REASON TO DOUBT THE GENUINENESS OF LEAVE ENCASHM ENT EXPENSES INCURRED BY THE ASSESSEE AND THERE REMAINS HARDLY A NY POSSIBILITY TO MAKE DISALLOWANCE FOR SUCH EXPENSES. THUS ADHOC DISALLOWANCE OF RS.38,298/- OUT OF LEAVE ENCASHMENT EXPENDITURE IS UNCALLED FOR AND LIABLE TO BE DELETED. WE ACCORDINGLY ORDER SO. GROUND NO.2 OF THE ASSESSEE IS ALLOWED. 9. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWE D. THE ORDER PRONOUNCED IN THE OPEN COURT ON 29.01.20 20. SD/- SD/- ( KUL BHARAT) (MANIS H BORAD) JUDICIAL MEMBER ACCOUNTANT M EMBER / DATED : 29 JANUARY, 2020 /DEV JILA SAHAKARI KENDRIYA BANK MARYADIT ITA NO. 903/IND/2018 6 COPY TO: THE APPELLANT/RESPONDENT/CIT CONCERNED/CIT (A) CONCERNED/ DR, ITAT, INDORE/GUARD FILE. BY ORDER, ASSTT.REGISTRAR, I.T.A.T., INDORE