ITA NO. 3352/Del/2013
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH "H", NEW DELHI
BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER
AND
SHRI J.S. REDDY, ACCOUNTANT MEMBER
I.T.A. No. 3352/DEL/2013
A.Y. : 2009-10
The Exchange Agencies, Income Tax Officer,
13, Alipur Road, VS. Ward-20(2),
Civil Lines, New Delhi
Delhi 110 054
(PAN: AAAFT0754C)
(APPELLANT) (RESPONDENT)
Assessee by : Sh. Lalita Krishnamurty, CA
Department by : Sh. J.P. Chandrekar, Sr. DR
Date of Hearing : 18-06-2015
Date of Order : 24-06-2015
ORDER
PER H.S. SIDHU : JM
This appeal by the Assessee is directed against the Order of
the Ld. Commissioner of Income Tax (Appeals)-XXII, New Delhi dated
30.3.2013 pertaining to assessment years 2009-10.
2. The grounds raised by the Assessee reads as under:-
1. That the sustaining of disallowance of brought forward
unabsorbed business loss claimed of Rs. 3,75,293/- and
unabsorbed depreciation claimed of Rs. 6,77,240/- is
unjust, unwarranted and not tenable on facts and in law.
2. That the authorities below ought to have taken the
income from business or profession at Rs. 11,72,363/-
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as per revised return and not Rs. 13,10,582/- taken in the
assessment order.
3. That the sustaining of adhoc disallowance of telephone
expenses of Rs. 24,334/- @20% of claim is arbitrary,
unjust and at any rate very excessive compared to
previous years more particularly FBT had been paid on
such expenses in the relevant year.
4. That the sustaining of adhoc disallowance of vehicle
maintenance of Rs. 1,18,400/- @20% of claim is arbitrary,
unjust and at any rate very excessive compared to
previous years more particularly when FBT has been paid
on such expense in the relevant year.
5. That the Assessing Officer be directed to grant
consequential relief on account of interest charged under
section 234B and withdrawn under section 234D.
6. The above grounds are independent and without
prejudice to one another.
7. You appellant craves leave to add, alter, amend or
withdraw any of the grounds of appeal at the time of
hearing.
3. The brief facts of the case are that the assessee has filed its
return of income for the assessment year 2009-10 on 29.9.2009
declaring of Rs. 1,19,829/-. The return was processed u/s. 143(1) of
the I.T. Act. The case was selected for scrutiny and first notice u/s.
143(2) was issued 15.9.2010, which was served upon the assessee
through speed post. In response to notices issued u/s. 143(2) and
142(1) Smt. Lalita Krishnamurthy, CA attended the proceedings from
time to time. In this case the assessee firm derives from distribution
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of bread manufactured by Britannia Industries Ltd. as in the past.
The assessee has claimed bread dealer discount of Rs. 45,70,903/-
to various dealers, which includes an amount of Rs. 45,58,252/-
being paid in cash to parties from whom the amount exceeded Rs.
2500/-. In the assessment order, the AO treated the said discount
as commission to the dealers, and as no TDS has been deducted on
the incentive / discount paid to the dealers the AO disallowed such
payments amounting to Rs. 45,58,252/- u/s. 40(a)(ia) of the I.T. Act.
The AO has also made part disallowance out of vehicle expenses of
Rs. 1,18,400/- and out of telephone expenses of Rs. 24,334/-, which
were added to the total income and also disallowed the claim of
brought forwarded losses and completed the assessment u/s. 143(3)
of the I.T. Act, 1961 vide order dated 29.11.2011.
4. Aggrieved with the aforesaid assessment order dated
29.11.2011, assessee appealed before the Ld. CIT(A), who vide
impugned order 30.3.2013 has partly allowed the appeal of the
assessee.
5. Against the aforesaid order of the ld. CIT(A), assessee is in
appeal before the Tribunal.
6. Ld. Authorised Representative for the Assessee, Smt. Lalita
Krishnamurty, CA stated that AO has made the disallowance in
dispute contrary to the facts and law which deserve to be deleted.
She further stated that the Ld. First Appellate Authority has
sustained the disallowance of brought forward unabsorbed
business loss in dispute and unabsorbed depreciation which is
contrary to the record of the case. She further stated that the Ld.
CIT(A) ought to have taken the income from business or profession
at Rs. 11,72,363/- as per the Revised Return and not Rs.
13,10,582/- taken in the assessment order. As regards the other
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disallowances on account of telephone expenses and vehicle
expenses, she stated that these disallowances are not warranted in
view of the decision of the ITAT, Mumbai Bench in the case of SGS
India Private Limited vs. Addl. CIT in ITA No. 3499/Mum/2011.
Finally, she stated that the issue involved in ground no. 1 and 2
requires reconsideration at the level of the AO, because the
Assessee has filed the Application u/s. 154 of the I.T. Act, 1961
against the order u/s. 143(3) of the Act dated 29.11.2011 wherein all
the relevant evidence on the issue in dispute has been filed and the
AO as well as the Ld. First Appellate Authority has not appreciated
the same, which requires re-examination at the level of the AO. But
as regards to issue involved in ground no. 3 & 4 she stated that the
same is covered in favor of the assessee, in view of the decision of
the ITAT, Mumbai Bench in the case of SGS India Private Limited vs.
Addl. CIT in ITA No. 3499/Mum/2011 and the issue involved in
ground no. 5 regarding the interest charged u/s. 234B & 234D are
consequential.
7. On the contrary, Ld. Departmental Representative relied upon
the order of the Ld. First Appellate Authority.
8. We have heard both the counsel and perused the records
available on record, especially the orders of the revenue authorities
and we are of the view that the assessee has filed a Paper Book
containing pages 1 to 33 in which the assessee has enclosed various
documentary evidence supporting its claim. We have gone through
the Written Submissions filed by the assessee and we are of the
view that assessee has elaborately disclosed in the Application u/s.
154 of the I.T. Act to the AO regarding income assessed by the AO
as well as the income declared by the assessee. In the Application,
the Assessee's Authorised Representative has submitted that the
assessee is in receipt of assessment order wherein income declared
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by the assessee (before adjustment of brought forward
losses/unabsorbed deprecation claimed of Rs. 10,52,533/-) has been
shown in the last page of the assessment order at Rs. 13,10,582/-.
Whereas the income declared by the assessee before such
adjustment (as per computation filed undercover with letter dated
28.5.2011) is Rs. 11,72,363/-. The Assessee has also enclosed the
computation of income for the assessment years 2005-06, 2006-07,
2007-08 & 2008-09 with the said letter dated 25.8.2011 to the AO.
The Assessing Officer and the Ld. First Appellate Authority has not
appreciated the contention of the assessee. In our considered view
the issue involved in ground no. 1 and 2 regarding the disallowances
of brought forward business loss/ unabsorbed deprecation are
required to be reexamined at the level of the AO. Therefore, we set
aside the issue involved in ground no. 1 and 2 to the file of the AO to
decide the same afresh, under the law, after giving adequate
opportunity of being heard to the assessee.
8.1 As regards the issue involved in ground no. 3 and 4 regarding
adhoc disallowance on account of telephone expenses of Rs.
24,334/- @20% of the claim and the disallowance on account of
vehicle expenses of Rs. 1,18,400/- @20%, as stated by the Ld.
Counsel of the assessee the issue involved in ground no. 3 and 4
are covered in favor of the assessee, in view of the decision of the
ITAT, Mumbai Bench in the case of SGS India Private Limited vs.
Addl. CIT in ITA No. 3499/Mum/2011. We also find that this issue
has already been decided by the Ld. CIT(A) in the case of the
assessee in assessee's own case for the assessment year 2007-08
and 2008-09 which have attained finality. Assessee has also filed
the copy of the order of the Ld. CIT(A) for the assessment year 2007-
08 and 2008-09 with the Paper Book. Keeping in view of the
aforesaid decision of the ITAT, Mumbai Bench and the decision of
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the Ld. CIT(A) in assessee's own case for the assessment year
2007-08 and 2008-09, we are of the view that the adhoc addition on
account of telephone expenses and vehicle maintenance expenses
are not required in the case of the assessee, therefore, both the
additions are deleted and the ground no. 3 and 4 are decided in
favor of the assessee.
8.2 As regards issue involved in ground no. 5 regarding charging of
interest u/s. 234B and 234D are concerned, the same is
consequential in nature.
9. In the result, the appeal filed by the Assessee partly allowed
for statistical purposes.
Order pronounced in the Open Court on 24/06/2015.
Sd/- Sd/-
[J.S. REDDY] [H.S. SIDHU]
ACCOUNTANT MEMBER JUDICIAL MEMBER
Date 24/06/2015
"SRBHATNAGAR"
Copy forwarded to: -
1. Appellant -
2. Respondent -
3. CIT
4. CIT (A)
5. DR, ITAT
TRUE COPY
By Order,
Assistant Registrar,
ITAT, Delhi Benches
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