BIHAR FOUNDAARY & CASTING LTD , RANCHI V. DCIT CIRCLE-1 , RANCHI

MA 40/RAN/2020

AI Insights

The case involves Bihar Foundry And Castings Limited, the applicant, who filed a Miscellaneous Application under section 254(2) of the Income Tax Act against an order of the Income Tax Appellate Tribunal dated September 10, 2020. The original dispute centered on the disallowance of business expenditure amounting to Rs. 50,43,431/-, which included repair and maintenance charges and delayed payment charges among others. The Tribunal had initially dealt with part of this expenditure but overlooked a significant portion amounting to Rs. 25,36,440/-. The Departmental Representative conceded that this remaining expenditure needed adjudication. Consequently, the Tribunal decided to recall the earlier order to address this specific issue.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 129852 (ITAT-RANCHI)
• Duration Of Justice: 2 year(s) 1 month(s) 12 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 16-11-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 13-11-2022
• Assessment Year: 2015-2016
• Appeal Filed On: 04-10-2020
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 90

Judgement Text

M.A. No. 40/RAN/2020 (in ITA No. 99/RAN/2019) Assessment Year : 2015-2016 Bihar Foundry And Castings Limited, Ranchi 1 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA-RANCHI ‘e-COURT’, KOLKATA [Virtual Court Hearing] Before Dr. Manish Borad, Accountant Member & Shri Sonjoy Sarma, Judicial Member M.A. No. 40/RAN/2020 (in I.T.A. No. 99/RAN/2019) Assessment Year: 2015-2016 Bihar Foundry And Castings Limited,.......................................Applicant Shanti Niwas, Main Road, Ranchi-834001, Jharkhand [PAN: AABCB1852D] -Vs.- Deputy Commissioner of Income Tax,........................................Respondent Circle-1, Ranchi, Jharkhand-834001 Appearances by: Shri Debasish Sannigrahi, A.R., appeared on behalf of the assessee Shri Rupesh Agarwal, ACIT (DR), appeared on behalf of the Revenue Date of concluding the hearing : November 14, 2022 Date of pronouncing the order: November 17, 2022 O R D E R Per Dr. Manish Borad, Accountant Member:- T h e p r e s e n t M i s c e l l a n e o u s A p p l i c a t i o n u n d e r s e c t i o n 2 5 4 ( 2 ) o f t h e I n c o m e T a x A c t f i l e d b y t h e a s s e s s e e i s a g a i n s t t h e o r d e r o f t h i s T r i b u n a l i n I T A N o . 9 9 / R A N / 2 0 1 9 d a t e d 1 0 t h S e p t e m b e r , 2 0 2 0 . 2 . R e f e r r i n g t o t h e c o n t e n t s o f t h e M i s c e l l a n e o u s Ap p l i c a t i o n , i t w a s s t a t e d b y t h e l d . C o u n s e l f o r t h e a s s e s s e e t h a t t h e d i s a l l o w a n c e o f e x p e n d i t u r e o f R s . 5 0 , 4 3 , 4 3 1 / - w a s c h a l l e n g e d b e f o r e t h i s T r i b u n a l f o r M.A. No. 40/RAN/2020 (in ITA No. 99/RAN/2019) Assessment Year : 2015-2016 Bihar Foundry And Castings Limited, Ranchi 2 a d j u d i c a t i n g t h e i s s u e . O n l y t h e e x p e n d i t u r e o f R s .2 5 , 0 6 , 9 9 1 / - w a s d e a l t b y t h i s T r i b u n a l , w h i c h r e l a t e d t o r e p a i r a n d m a i n te n a n c e c h a r g e s o f b u i l d i n g a n d o t h e r s . H o w e v e r , t h e r e m a i n i n g d i s a l l ow a n c e o f R s . 2 5 , 3 6 , 4 4 0 / - w a s n o t d e a l t b y t h i s T r i b u n a l a n d , t h e r e f o r e , t h e r e i s a n a p p a r e n t m i s t a k e a n d t h e o r d e r o f t h e T r i b u n a l m a y b e r e c a l l e d f o r l i m i t e d p u r p o s e f o r a d j u d i c a t i n g t h e s a i d i s s u e . 3 . P e r c o n t r a , l d . D e p a r t m e n t a l R e p r e s e n t a t i v e w a s f a i r e n o u g h t o a c c e p t t h a t t h e i s s u e o f d i s a l l o w a n c e o f d e l a y e d p ay m e n t c h a r g e s a n d m i s c e l l a n e o u s e x p e n s e s a m o u n t i n g t o R s . 2 5 , 3 6 , 4 4 0 / - , b y t h e a s s e s s e e r e m a i n e d t o b e a d j u d i c a t e d b y t h i s T r i b u n a l . 4 . W e h a v e h e a r d t h e r i v a l s u b m i s s i o n s a n d p e r u s e d t h e r e l e v a n t m a t e r i a l p l a c e d b e f o r e u s . W e f i n d t h a t i n I T A N o . 9 9 / R A N / 2 0 1 9 , t h e a s s e s s e e h a s r a i s e d t h e f o l l o w i n g g r o u n d o f a p p e a l :- “For that on the facts and circumstances of the case, the action of the Hon’ble Commissioner of Income Tax (Appeals) not proper in confirming wrong addition made by ld. Assessing Officer for Rs.50,43,431/- by disallowing expenditure incurred by appellant in course of business under various heads. The addition is totally arbitrary and is not legal, proper and justified and hence such addition of Rs.50,43,431/- is liable to be deleted”. 5 . I n t h e a b o v e r e f e r r e d g r o u n d , d i s a l l o w a n c e o f e xp e n d i t u r e o f R s . 5 0 , 4 3 , 4 3 1 / - c o m p r i s e d o f f o l l o w i n g : - N a t u r e o f e x p e n s e s A m o u n t c o n f i r m e d Repair and maintenance R e p a i r a n d m a i n t e n a n c e o f b u i l d i n g 1 8 , 0 2 , 5 1 5 R e p a i r a n d m a i n t e n a n c e o f o t h e r s 7 , 0 4 , 4 7 3 Sub-Total 2 5 , 0 6 , 9 9 1 Delayed payment charge I n t e r e s t o n i n c o m e t a x 1 3 , 3 7 , 9 8 4 M.A. No. 40/RAN/2020 (in ITA No. 99/RAN/2019) Assessment Year : 2015-2016 Bihar Foundry And Castings Limited, Ranchi 3 L a t e f i l i n g f e e s 2 , 3 1 , 6 0 0 I n t e r e s t o n T D S 7 , 9 0 , 0 3 9 Sub Total 2 3 , 5 9 , 6 2 3 R O C f i l i n g f e e s 1 , 7 1 , 6 0 0 R o u n d e d o f f 5 , 2 1 7 Total 50,43,431 6 . O n p e r u s a l o f t h e p a r a g r a p h 7 o f t h e i m p u g n e d o rd e r , w e f i n d t h a t t h i s T r i b u n a l h a s d e a l t t h e i s s u e o f r e p a i r a n d m a in t e n a n c e o f b u i l d i n g a n d r e p a i r a n d m a i n t e n a n c e o f o t h e r s , w h e r e i n o r i g in a l l y t h e a c t u a l e x p e n d i t u r e w a s R s . 5 0 , 1 3 , 9 8 1 / - a n d t h e s a m e w a s d i sa l l o w e d b y t h e l d . A s s e s s i n g O f f i c e r a n d w h e n t h e m a t t e r t r a v e l l e d t o C I T ( A p p e a l s ) , h e s u s t a i n e d 5 0 % d i s a l l o w a n c e w h i c h c o m e s t o R s . 2 5 , 0 6 ,9 9 1 / - a n d t h e a d d i t i o n c o n f i r m e d b y t h e l d . C I T ( A p p e a l s ) w a s d e l et e d b y t h i s T r i b u n a l o b s e r v i n g t h a t – “Therefore, in our view, the action of the Commissioner of Income Tax (Appeals) for confirming the addition of 50% expenditure as capital expenditure on estimated basis is not tenable therefore, it needs to be deleted, accordingly, we delete the 50% addition confirmed by the ld. CIT(A)”. W e , t h e r e f o r e , f i n d t h a t a p a r t f r o m t h e i s s u e o f r ep a i r a n d m a i n t e n a n c e e x p e n d i t u r e a t R s . 2 5 , 0 6 , 9 9 1 / - , t h e r e m a i n i n g e x p e n di t u r e o f R s . 2 5 , 3 6 , 4 4 0 / - , w h i c h w a s d i s a l l o w e d b y t h e l d . A s se s s i n g O f f i c e r a n d t h e r e a f t e r c o n f i r m e d b y t h e l d . C I T ( A p p e a l s ) r e m a i ne d t o b e a d j u d i c a t e d b y t h i s T r i b u n a l . T h i s i s a n a p p a r e n t m i s t a k e a n d , t h e r e f o r e , w e r e c a l l t h e o r d e r d a t e d 1 0 . 0 9 . 2 0 2 0 f o r l i m i t e d p u r p o s e o f a d j u di c a t i n g t h e i s s u e o f d i s a l l o w a n c e o f e x p e n d i t u r e o f R s . 2 5 , 3 6 , 4 4 0 / - a s i nd i c a t e d h e r e i n a b o v e . 7 . R e g i s t r y i s d i r e c t e d t o f i x t h e c a s e f o r h e a r i n g i n d u e c o u r s e a n d i n f o r m b o t h t h e p a r t i e s a c c o r d i n g l y . M.A. No. 40/RAN/2020 (in ITA No. 99/RAN/2019) Assessment Year : 2015-2016 Bihar Foundry And Castings Limited, Ranchi 4 8. In the result, the Miscellaneous Application filed by the assessee is allowed. O r d e r p r o n o u n c e d i n t h e o p e n C o u r t o n N o v e m b e r 1 7 , 2 0 2 2 . Sd/- Sd/- (Sonjoy Sarma) (Manish Borad) Judicial Member Accountant Member Kolkata, the 17 th day of November, 2022 Copies to : (1) Bihar Foundry And Castings Limited, Shanti Niwas, Main Road, Ranchi-834001, Jharkhand (2) Deputy Commissioner of Income Tax, Circle-1, Ranchi, Jharkhand-834001 (3) Commissioner of Income Tax(Appeals), Ranchi; (4) Commissioner of Income Tax------------, Ranchi (5) The Departmental Representative (6) Guard File TRUE COPY By order Assistant Registrar, Income Tax Appellate Tribunal, Kolkata Benches, Kolkata Laha/Sr. P.S.