M/s. URC Construction Pvt. Ltd., Erode V. ACIT, Erode

MA 174/CHNY/2017

• Counselvise Citation: [2017] 124 COUNSELVISE.COM (IT) 5773 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 16 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 06-09-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2012-2013
• Appeal Filed On: 20-06-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI ... , !',$ %& BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI SANJAY ARORA, ACCOUNTANT MEMBER '' / M.P. NO.174/MDS/2017 (IN I.T.A. NO.2760/MDS/2016) ( )( / ASSESSMENT YEAR : 2012-13 M/S URC CONSTRUCTION (P) LTD., #119, POWER HOUSE ROAD, ERODE 638 001. PAN : AAACU 2425 Q V. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1, ERODE 638 001. (+,( /PETITIONER) (+-,./ RESPONDENT) +,( 0 1 /PETITIONER BY : SH. PHILIP GEORGE, ADVOCATE +-,. 0 1 / RESPONDENT BY : SHRI AR.V. SREENIVASAN, JCIT 2 0 3$ / DATE OF HEARING : 18.08.2017 4!) 0 3$ / DATE OF PRONOUNCEMENT : 06.09.2017 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: THE ASSESSEE HAS FILED THE PRESENT MISCELLANEOUS PETITION ON THE GROUND THAT THERE IS AN ERROR IN THE ORDER O F THIS TRIBUNAL DATED 20.04.2017. 2. SH. PHILIP GEORGE, THE LD.COUNSEL FOR THE ASSESS EE, SUBMITTED THAT THE GENERAL MANAGERS SON SHRI S. KA THIRVEL WAS 2 M.P. NO.174/MDS/17 EMPLOYED IN THE ASSESSEE-COMPANY AND HE HAD GONE FO R HIGHER STUDIES. THE ASSESSEE-COMPANY MET THE EXPENDITURE OF HIGHER EDUCATION OF SHRI KATHIRVEL. THIS TRIBUNAL FOUND T HAT THERE WAS NO MATERIAL TO SHOW THAT SHRI KATHIRVEL AGREED TO WORK FOR THE COMPANY EVEN AFTER COMPLETION OF HIGHER EDUCATION. NO AGRE EMENT OR BOND WAS PRODUCED. ACCORDING TO THE LD. COUNSEL, THIS O BSERVATION OF THE TRIBUNAL MAY NOT BE CORRECT. THE ASSESSEE HAS PROD UCED THE APPOINTMENT LETTER, ADMISSION OFFER LETTER FOR POST GRADUATE PROGRAMME, SPONSOR LETTER AND REAPPOINTMENT LETTER OF SHRI S. KATHIRVEL. ACCORDING TO THE LD. COUNSEL, SHRI S. KA THIRVEL WAS REEMPLOYED AFTER COMPLETION OF EDUCATION. THIS WAS NOT TAKEN INTO CONSIDERATION. 3. WE HAVE HEARD SHRI AR.V. SREENIVASAN, THE LD. DEPARTMENTAL REPRESENTATIVE ALSO. IT IS NOT IN DIS PUTE THAT SHRI S. KATHIRVEL IS THE SON OF GENERAL MANAGER OF THE COMP ANY. WHEN SHRI KATHIRVEL WAS DEPUTED FOR HIGHER EDUCATION, NO BOND OR AGREEMENT WAS OBTAINED FROM HIM COMPELLING HIM TO W ORK FOR THE COMPANY. MERELY BECAUSE SHRI KATHIRVEL WAS REAPPOI NTED AFTER COMPLETION OF HIGHER EDUCATION, IT WAS NOT AN OBLIG ATION ON THE PART OF SHRI KATHIRVEL TO JOIN THE COMPANY. SHRI KATHIR VEL HAD HIS OWN OPTION EITHER TO WORK HIMSELF IN SOME OTHER COMPANY OR TO JOIN THE 3 M.P. NO.174/MDS/17 ASSESSEE-COMPANY. SINCE SUCH AN OPTION WAS GIVEN T O SHRI KATHIRVEL, IT CANNOT BE SAID THAT THE EXPENDITURE I NCURRED BY THE ASSESSEE-COMPANY ON HIGHER EDUCATION OF SHRI KATHIR VEL WAS FOR BUSINESS PURPOSE OF THE ASSESSEE. THEREFORE, THIS TRIBUNAL FINDS NO ERROR MUCH LESS PRIMA FACIE ERROR IN THE ORDER OF THIS TRIBUNAL. 4. NOW COMING TO THE EXPENDITURE INCURRED BY THE AS SESSEE ON THE HIGHER EDUCATION OF VICE-PRESIDENT, IT IS NOT I N DISPUTE THAT SHRI P. RAMPRASAD WAS NOT ON THE ROLL OF THE COMPANY DUR ING THE STUDY PERIOD. THE ASSESSEE HAS PRODUCED SOME OF THE EXTR ACTS OF MINUTES OF THE MEETING OF THE GENERAL BODY MEETING. THE FACT REMAINS THAT SHRI RAMPRASAD IS THE SON OF MANAGING DIRECTOR OF THE ASSESSEE-COMPANY. IT IS THE PARENTS RESPONSIBILIT Y TO MEET THE EXPENDITURE OF THE EDUCATION OF THEIR CHILDREN. ME RELY BECAUSE SHRI RAMPRASADS FATHER HAPPENED TO BE THE MANAGING DIRE CTOR OF THE ASSESSEE-COMPANY, IT CANNOT BE CONSTRUED AS BUSINES S EXPENDITURE OF THE ASSESSEE. AS OBSERVED BY THE TRIBUNAL, THE MATTER WOULD STAND DIFFERENTLY IN CASE SHRI RAMPRASAD WAS GRANTE D STUDY LEAVE AND SALARY WAS GIVEN DURING THE LEAVE PERIOD. ADMI TTEDLY, SHRI RAMPRASAD WAS NOT IN THE PAY ROLL OF THE COMPANY DU RING THE STUDY PERIOD. HENCE, THERE IS NO ERROR IN THE ORDER OF T HIS TRIBUNAL. 4 M.P. NO.174/MDS/17 5. IN THE RESULT, THE MISCELLANEOUS PETITION FILED BY THE ASSESSEE STANDS DISMISSED. ORDER PRONOUNCED COURT ON 6 TH SEPTEMBER, 2017 AT CHENNAI. SD/- SD/- ( !' ) ( ... ) (SANJAY ARORA) (N.R.S. GANESAN) $ / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 6 /DATED, THE 6 TH SEPTEMBER, 2017. KRI. 0 +37' 8')3 /COPY TO: 1. +,( / PETITIONER 2. +-,. /RESPONDENT 3. 2 93 () /CIT(A) 4. 2 93 /CIT 5. ': +3 /DR 6. ;( < /GF.