SELVA GANESH CONSTRUCTIONS PVT LTD, CHENNAI V. ITO CORPORATE WARD-6(2), CHENNAI

MA 119/CHNY/2022

AI Insights

The case revolves around a Miscellaneous Application by Selvaganesh Constructions Pvt. Ltd. against an earlier Tribunal order which confirmed the addition of Rs. 60 Lakhs to the assessee's income. This amount was recorded as 'Pannallur Minister Expenses' in the books of the assessee, which the Tribunal initially disallowed under Section 37(1) of the Income Tax Act, citing it as a payment to a Minister. The assessee argued that this amount was depicted under 'work in progress' as advances in their balance sheet and should not have been disallowed. However, the Tribunal found no evidence during the hearing to support this claim and upheld the disallowance.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 134875 (ITAT-CHENNAI)
• Duration Of Justice: 6 month(s) 24 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 11-05-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 11-05-2023
• Assessment Year: 2016-2017
• Appeal Filed On: 17-10-2022
• Laws Referred To: Section 37(1) of the Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 37(1)

Judgement Text

आयकर अपीलीय अिधकरण, ‘ए’ ’’ ’ यायपीठ, चे ई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH: CHENNAI ी महावीर सह, उपा य एवं ी मनोज कुमार अ वाल, लेखा सद य के सम BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENTAND SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER M.A No.119/Chny/2022 (Arising out of ITA No.1658/Chny/2019) िनधा रण वष /Assessment Year: 2016-17 Selvaganesh Constructions Pvt. Ltd., New No.9, Rajakrishna Road (II Floor), Teynampet, Chennai – 600 018. [PAN: AAECS-8937-P] Vs. The Income Tax Officer, Corporate Circle-VI(2), Chennai. ( अपीलाथ /Appellant) ( यथ /Respondent) अपीलाथ की ओर से/ Assessee by : Shri J. Prabhakar, C.A थ की ओर से /Revenue by : Shri AR V Sreenivasan, Addl. JCIT सुनवाई क तारीख/Date of Hearing : 12.05.2023 घोषणा क तारीख /Date of Pronouncement : 12.05.2023 आदेश / O R D E R Per Mahavir Singh, Vice President : This Miscellaneous Application filed by the assessee is against the order of Tribunal in ITA No.1658/Chny/2019 order dated 07.09.2022. 2. Before us, the Ld. counsel for the assessee argued that the amount of Rs. 60 Lakhs is depicted under work in progress as advances in the balance sheet of the assessee and this plea was MA No.119/Chny/2022 :- 2 -: made by the assessee during the course of hearing before the Tribunal but the Tribunal, according to Ld. counsel has confirmed the addition at Rs. 60 Lakhs by observing as under: “After hearing rival contentions and going through the facts and circumstances of the case, we noted that the addition that was made of Rs. 64.00 lakhs should be restricted to Rs. 60.00 lakhs only for the reason that the payment of Rs. 60.00 lakhs made to the Minister on 03.11.2015, i.e. "Pannallur Minister Expenses" is clearly hit by the Explanation I ofSection 37(l) of the Act. We affirm the findings of the lower authorities and this issue in the Assessee's appeal is dismissed.” 3. The Ld. counsel stated that once the amount is depicted under working progress as advance in the balance sheet there should have been any disallowance. 4. On the other hand, the Ld. Sr. D.R stated that there is no mistake apparent from the record in the order passed by the Tribunal and the Tribunal has confirmed the disallowance because, the amount of Rs. 60 Lakhs is payment made to the Minister on 03.11.2015 i.e., Pannallur Minister Expenses. 5. After hearing both the sides and going through the Tribunal order, we noted that there is a clear cut finding by the Tribunal that this amount of Rs. 60 Lakhs is the payment made to the Minister on 03.11.2015 under the Head “Pannallur Minister Expenses” and clearly hit by Explanation 1 to Section 37(1) of the Act. Once, this is the position and it is clearly hit by Explanation 1 to Section 37(1) of the Act. MA No.119/Chny/2022 :- 3 -: Further, it is noticed that the claim of the assessee that this amount is depicted under working progress as advance in the balance sheet, no evidence has been led by the assessee during the course of hearing of appeal or this fact emerges from the orders of lower authorities. Hence, we find that no mistake apparent from the record in the order of the Tribunal and hence, the Miscellaneous Application of the assessee is dismissed. 6. In the result, Miscellaneous Application of the assessee is dismissed. Order pronounced in the Open Court on 12 th May, 2023. Sd/- Sd/- (मनोज मनोजमनोज मनोज कुमार कुमारकुमार कुमार अ वाल अ वालअ वाल अ वाल) (Manoj Kumar Aggarwal) लेखा लेखालेखा लेखा सद य सद यसद य सद य /Accountant Member (महावीर िसंह) (Mahavir Singh) उपा / Vice President चे ई/Chennai, दनांक/Dated: 12 th May, 2023 EDN/- आदेश क ितिलिप अ ेिषत/Copy to: 1. अपीलाथ /Appellant 2. थ /Respondent 3. आयकर आयु /CIT 4. िवभागीय ितिनिध/DR 5. गाड फाईल/GF