SOFTOUCH HYGINE PRODUCTS (MKT.) PVT. LTD. V. DY. COMMISSIONER OF INCOME-TAXCO.CIR 7(6) OR HIS SUCCESSOR

TAXAP/1387/2007

AI Insights

The case involves SofTouch Hygiene Products (Mkt.) Pvt. Ltd., the appellant, challenging the order of the ITAT, Ahmedabad, which had dismissed their earlier appeal regarding certain disallowances made by the Assessing Officer (AO) under the Income Tax Act, 1961. The disallowances pertained to various expenses including foreign travel, medical, marketing, sales promotion, and traveling expenses for the assessment year 1997-98. The High Court's decision to remand the case back to the Tribunal was influenced by the parallel case (Tax Appeal No. 1386 of 2007) which was also remanded for fresh consideration, suggesting a need for a consistent approach in similar cases.

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 744278 (HC-GUJARAT)
• Appeal Type: Others
• Pronouncement Date: 05-12-2014
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: NITIN MEHTA
• Assessee Lawyers: S N DIVATIA
• Keywords: Assessment Order; Disallowance; Foreign Travel Expenses; Income Tax; Medical expenses; Sales promotion expenses; Traveling Expenses; Marketing Commercial Expenses
• Section: 143(2)

Judgement Text

"O/TAXAP/1387/2007 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD TAX APPEAL NO. 1387 of 2007 FOR APPROVAL AND SIGNATURE: HONOURABLE MR.JUSTICE KS JHAVERI and HONOURABLE MR.JUSTICE K.J.THAKER ================================================================ 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ================================================================ SOFTOUCH HYGINE PRODUCTS (MKT.) PVT. LTD.....Appellant(s) Versus DY. COMMISSIONER OF INCOME-TAXCO.CIR 7(6) OR HIS SUCCESSOR....Opponent(s) ================================================================ Appearance: MR SN DIVATIA, ADVOCATE for the Appellant(s) No. 1 MR NITIN K MEHTA, ADVOCATE for the Opponent(s) No. 1 ================================================================ CORAM: HONOURABLE MR.JUSTICE KS JHAVERI and HONOURABLE MR.JUSTICE K.J.THAKER Date : 05/12/2014 ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE KS JHAVERI) 1. This is an appeal by the appellant- assessee, seeking to challenge the order of the ITAT, Ahmedabad Bench-B, Ahmedabad (for short, Page 1 of 4 O/TAXAP/1387/2007 JUDGMENT ‘the Tribunal’), Dated : 16.03.2007, rendered in ITA No. 755/Ahd/2003 for the A.Y. 1997-98, whereby, the Tribunal dismissed the same. 2. The brief facts giving rise to the present appeal are that the appellant-assessee filed its return of income for the year under consideration on 28.11.1997, declaring its total income at Rs.55,060/-. Pursuant thereto, the case of the assessee was examined by the concerned Revenue and a notice u/s. 143(2) of the Income Tax Act, 1961, (‘the Act’, for short)came to be issued to the assessee. Later on, the concerned AO passed the Assessment Order, making certain additions / disallowances. The assessee, hence, approached the learned CIT(A) by way of an appeal against the same and the CIT(A) partly allowed the appeal of the assessee. However, since, the assessee as well as the Revenue both were not satisfied with the order of the CIT(A), they carried the matter before the Tribunal filing separate appeals, wherein, the Tribunal passed the impugned order. Hence, the present appeal. 3. At the time of admitting this appeal, this Court framed the following question of law; “Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal, was right in Page 2 of 4 O/TAXAP/1387/2007 JUDGMENT law in confirming without passing a speaking and reasoned order as well as ignoring the material / evidence on record the disallowance of (i) foreign travel expenses of Rs.3,20,515/-, (ii) Medical expenses of Rs.1,70,000/-, (iii) marketing commercial expenses of Rs.3,10,027/-, (iv) sales promotion expenses of Rs.1,35,123/- and (v) traveling expenses of Rs.77,506/-?” 4. Heard. Before proceeding with the matter, the note of the fact may be taken that Tax Appeal No. 1386 of 2007, which arises from the very order of the Tribunal, has been remanded by this Court to the Tribunal for its consideration afresh, on merits and in accordance with law, it would be just and proper, if, this matter is also referred to the concerned Tribunal for its consideration, afresh. 5. In the result, present appeal is PARTLY ALLOWED. The order of the Tribunal, Dated : 16.03.2007, is quashed and set aside and the matter is remanded to the Tribunal for its consideration afresh, on merits, and in accordance with law. Since, the matter pertains to A.Y. 1997-98, the Tribunal will, after providing an opportunity of hearing to the parties, decide the matter at the earliest. It is needless to say that we have not entered into the merits of the matter. No order as to costs. Page 3 of 4 O/TAXAP/1387/2007 JUDGMENT (K.S. JHAVERI, J.) (K.J. THAKER, J) UMESH Page 4 of 4 "