M/s. Antriksh Communication, Ahmedabad V. The ACIT, Circle-10, Ahmedabad

MA 105/AHD/2015

• Counselvise Citation: [2017] 124 COUNSELVISE.COM (IT) 5168 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 19 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 17-01-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 28-12-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: PF JAIN
• Keywords: Business expenditure; Additional evidence
• Section: 37

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH AHMEDABAD BEFORE SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER, AND SHRI S. S. GODARA, JUDICIAL MEMBER. M.A. NO. 105/AHD/2015 (IN ITA NO.709/AHD/2013) (ASSESSMENT YEAR:2008-09) M/S. ANTRIKSH COMMUNICATION S/5, AJAY CENTRE, PALLAVI TOWER, NAVRANGPURA, AHMEDABAD 380009 APPELLANT VS. A.C.I.T., CIRCLE-10, AHMEDABAD RESPONDENT PAN: AALFA7625A /BY ASSESSEE : SHRI P. F. JAIN, A.R. /BY REVENUE : SHRI K. MADHUSUDAN, SR. D.R. /DATE OF HEARING : 16.12.2016 /DATE OF PRONOUNCEMENT : 17.01.2017 ORDER PER S. S. GODARA, JUDICIAL MEMBER THIS ASSESSEES MISCELLANEOUS PETITION FILED U/S.25 4(2) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT SEEKS TO RECTIFY/ RECALL TRIBUNALS ORDER DATED 22.11.2013 DISMISSING ITS MAIN APPEAL THEREBY UPHOL DING BOTH THE LOWER AUTHORITIES ACTION MAKING DISALLOWANCE/ADDITION OF RS.16,22,781/- IN THE NATURE OF EXPENDITURE ON OUTSTANDING ENTERTAINMENT TAX PAID IN THE NAME OF M/S. SPACE CHANNEL COMMUNICATION PVT. LTD. M.A. NO. 105/AHD/2015 (M/S. ANTRIKSH COMMUNICATION VS. ACIT) A.Y. 2008-09 - 2 - WE COME TO BASIC FACTS FIRST AS NARRATED IN TRIBUN ALS ORDER DATED 22.11.2013. 2. THE APPLICANT /ASSESSEE IS A FIRM ENGAGED IN CHA NNEL CONNECTION AND CABLING NETWORK. THE ASSESSING OFFICER COMPLETED A BEST JUDGMENT ASSESSMENT ON 20.11.2010 REJECTING ITS ABOVE EXPEND ITURE CLAIM OF HAVING PAID OUTSTANDING ENTERTAINMENT EXPENSES ON ACCOUNT OF ITS FAILURE IN FILING NECESSARY EVIDENCE PROVING BUSINESS EXIGENCY FORCIN G IT TO PAY THE ABOVE ARREARS OF EARLIER YEARS TO CONTINUE THE BUSINESS I N QUESTION. 3. THE ASSESSEE FILED APPEAL. IT RAISED ADDITIONAL EVIDENCE / SUBMISSIONS IN THE LOWER APPELLATE PROCEEDINGS. THE CIT(A) SOU GHT A REMAND REPORT. THE ASSESSING OFFICER FILED THE SAME ON 27.08.2012 THAT ASSESSEE FIRMS ONE PARTNER MS. RENUKA GAMBHIR IS WIFE OF SHRI ASHWIN K . GAMBHIR WHO IS ONE OF THE DIRECTOR IN M/S. SPACE CHANNEL PVT. LTD. HE FURTHER REPORTED THAT THE ASSESSEE CARRIED ITS BUSINESS FROM THE VERY PREMISE S AND THEREFORE IT PAID THE IMPUGNED SUM IN THE NATURE OF A COMPULSIVE BUSINESS EXPENDITURE. THE CIT(A) STILL DECLINED ASSESSEES ARGUMENT TO CONCLU DE THAT THE ABOVE ARREARS OF M/S. SPACE CHANNEL WAS ONLY PAYABLE BY THE SAID ENTITY WITHOUT HAVING ANY NEXUS WITH EITHER THE ASSESSEE OR ITS BUSINESS. IT IS EVIDENT THAT HE DID NOT DISCUSS CONTENT OF THE ABOVE REMAND REPORT. WE FUR THER FIND THAT THIS TRIBUNALS ORDER DATED 22.11.2013 ALSO ACTED IN THE SAME MANNER IN UPHOLDING THE ABOVE LOWER APPELLATE FINDINGS. 4. WE COME TO ASSESSEES PLEADINGS NOW. LEARNED CO UNSEL VEHEMENTLY SUBMITS THAT THE ASSESSING OFFICERS ABOVE REMAND R EPORT DULY FORMED PART OF RECORD TERMING THE EXPENSES IN QUESTION TO BE IN TH E NATURE OF ITS COMPULSIVE BUSINESS EXIGENCY SINCE CARRYING THE BUSINESS FROM THE VERY PREMISES. LD. DEPARTMENTAL REPRESENTATIVE STRONGLY SUPPORTS THE C ONCLUSIONS DRAWN IN ABOVE TRIBUNALS ORDER IN AFFIRMING THE CIT(A)S FI NDING UNDER CHALLENGE. M.A. NO. 105/AHD/2015 (M/S. ANTRIKSH COMMUNICATION VS. ACIT) A.Y. 2008-09 - 3 - 5. HEARD BOTH SIDES. CASE FILE PERUSED. THERE IS NO DISPUTE THAT THE ASSESSEE/APPLICANT HAS THROUGHOUT CLAIMED THE IMPUG NED EXPENSES PAID IN THE NATURE OF OUTSTANDING ENTERTAINMENT TAX IN THE NAME OF M/S. SPACE CHANNEL PVT. LTD. TO BE COVERED UNDER SECTION 37 OF THE ACT ON THE GROUND THAT IT CARRIED THE VERY BUSINESS FROM EARLIER ENTITIES PRE MISES. THE ASSESSING OFFICERS REMAND REPORT ITSELF TREATING THE SAME TO BE INVOLVING ELEMENT OF COMPULSIVE BUSINESS EXPEDIENCY HAS APPARENTLY MISSE D CIT(A) AS WELL AS THIS TRIBUNALS CONSIDERATION IN THE RESPECTIVE ORD ERS. WE THUS HOLD THAT TRIBUNALS ORDER DATED 22.11.2013 SUFFERS FROM AN A PPARENT ERROR ON THE FACT OF IT IN NOT TAKING INTO CONSIDERATION THE ABOVE REMAN D REPORT. WE ACCORDINGLY RECALL OUR ORDER. THE MAIN APPEAL ITA NO.709/AHD/2 013 IS RESTORED AT ITS ORIGINAL NUMBER. THE SAME SHALL BE FIXED FOR HEARI NG IN DUE COURSE. 6. THIS ASSESSEES MISCELLANEOUS APPLICATION IS ALL OWED IN ABOVE TERMS. [PRONOUNCED IN THE OPEN COURT ON THIS THE 17 TH DAY OF JANUARY, 2017.] SD/- SD/- ( PRAMOD KUMAR ) (S. S. GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD: DATED 17/01/2017 TRUE COPY S.K.SINHA / COPY OF ORDER FORWARDED TO:- / REVENUE 2 / ASSESSEE ! / CONCERNED CIT 4 !- / CIT (A) ( )*+ ,--. . /0 / DR, ITAT, AHMEDABAD 1 +23 / GUARD FILE. BY ORDER / . // . /0