I. S. Leather, Kolkata V. ACIT, CIR-25, KOLKATA, Kolkata

ITA 967/KOL/2015

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 3143 (ITAT-KOLKATA)
• Duration Of Justice: 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-02-2016
• Appeal Filed By: Assessee
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 03-07-2015
• Court: TRIBUNAL
• Department Lawyers: DAVID Z CHOWNGTHU ADD L
• Assessee Lawyers: V N DUTTA; R S GHOSHAL
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH: K OLKATA [BEFORE SHRI MAHAVIR SINGH, JM] I.T.A NO.967/KOL/2015 ASSESSMENT YEAR: 2010-11 I. S. LEATHER VS. ASSISTANT COMMISSIONER OF INCO ME-TAX, (PAN:AABFI 1937 M) CIRCLE-25, KOLKATA. ( APPELLANT ) ( RESPONDENT ) DATE OF HEARING: 03.02.2016 DATE OF PRONOUNCEMENT: 03.02.2016 FOR THE APPELLANT: S/SHRI R. S. GHOSHAL & V. N. D UTTA, ADVOCATES FOR THE RESPONDENT: SHRI DAVID Z. CHOWNGTHU, ADD L. CIT ORDER THIS APPEAL BY ASSESSEE IS ARISING OUT OF ORDER OF CIT(A)-7, KOLKATA VIDE APPEAL NO. 443/CIT(A)-7/CIR-25/14-15 DATED 06.05.2015. ASSESSM ENT WAS FRAMED BY ACIT, CIRCLE-52, KOLKATA U/S. 143(3) OF THE INCOME TAX ACT, 1961 (HE REINAFTER REFERRED TO AS THE ACT) FOR ASSESSMENT YEAR 2010-11 VIDE HIS ORDER DATED 19.03. 2013. 2. THE ONLY ISSUE IN THIS APPEAL OF ASSESSEE IS AG AINST THE ORDER OF CIT(A) CONFIRMING THE DISALLOWANCE OF ESTIMATED WAGES AND ESTIMATED EXPEN SES AT 10% AMOUNTING TO RS.4,70,000/- UNDER THE HEAD WAGES AND RS.2.5 LACS UNDER OTHER EX PENSES. 3. I HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. I FIND THAT THE ASSESSEE HAS CLAIMED TRADING AND MANU FACTURING EXPENSES AT RS.47,50,281/- UNDER THE HEAD WAGES AND ALSO TRADING EXPENSES I.E. GENER AL EXPENSES, CARRIAGE INWARD EXPENSES ETC. AMOUNTING TO RS.25,16,092/-. THE AO ESTIMATED THE DISALLOWANCE UNDER BOTH THE HEADS AT 10% I.E. RS. 4.70 LACS AND RS. 2.50 LACS ONLY ON THE B ASIS THAT SOME OF THE VOUCHERS OF EXPENSES ARE SELF MADE VOUCHERS. THE CIT(A) ALSO CONFIRMED THE ACTION OF AO ON SAME REASONING BUT REASONING GIVEN IN RESPECT TO WAGES READS AS UNDER: I HAVE CAREFULLY CONSIDERED THE OBSERVATION MADE BY THE AO IN THE ASSESSMENT ORDER AND SUBMISSION FILED BY THE AUTHORIZED REPRESENTATIVE O F THE APPELLANT. I FOUND THAT APPELLANT FAILED TO FULL DETAIL OF LABOURERS WHOM WAGES WERE PAID AT TH E TIME OF ASSESSMENT PROCEEDINGS AS WELL AS APPELLATE PROCEEDINGS. THE WAGES PAID BY THE APPELL ANT SEEMS EXCESSIVE AND UNREASONABLE AND FULLY NOT VERIFIABLE. THEREFORE, CONSIDERING THE A BOVE OBSERVATION AND FACTS OF THE CASE I AM OF THE VIEW THAT THE ACTION OF THE AO IS AS PER LAW TO MAK E THE ADDITION OF RS.4,70,000/- OUT OF WAGES. HENCE, I CONFIRM THE ADDITION MADE BY THE AO OF RS. 4,70,000/- OUT OF WAGES. THIS GROUND IS NOT ALLOWED. 2 ITA NO.967/KOL/2015 I.S. LEATHER, AY 2010-11 2 SIMILAR IS THE FINDING IN REGARD TO TRADING EXPENSE S BY CIT(A). I FIND THAT NOW LD. COUNSEL FOR THE ASSESSEE MADE A REQUEST OF REASONABLE DISALLOWA NCE AND AGREED THAT IF THE DISALLOWANCE IS RESTRICTED AT 5% ON BOTH THE HEADS IT WILL MEET THE ENDS OF JUSTICE. ON QUERY FROM THE BENCH, LD. SR. DR CONCEDED THE POSITION. AS BOTH THE PARTIES CONCEDED TO RESTRICT THE DISALLOWANCE AT 5% ON BOTH THE HEADS, I RESTRICT THE DISALLOWANCE AT 5 %. THIS APPEAL OF ASSESSEE IS ALLOWED IN PART. 4. IN THE RESULT, APPEAL OF ASSESSEE IS PARTLY ALLO WED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- (MAHAVIR SINGH) JUDICIAL MEMBER DATED : 3RD FEBRUARY, 2016 JD. SR. P.S COPY OF THE ORDER FORWARDED TO: 1. APPELLANT I.S. LEATHER, 15A/10, CHOWBAGA ROAD, KO LKATA-700 039 2. RESPONDENT ACIT, CIR-25, KOLKATA. 3. CIT(A) , KOLKATA 4. CIT , KOLKATA 5. DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, ASSTT. REGISTRAR .