M/S CEMENT SUPPLY AGENCIES,RANCHI vs. DCIT CIRCLE-1, RANCHI

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ITA 304/RAN/2016Status: DisposedITAT Ranchi28 February 2018AY 2012-133 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal directed the AO to levy interest under sections 234A and 234B only on the income returned by the assessee, not on the assessed income, following the jurisdictional High Court's decision.

What were the facts?

The assessee appealed an order from the CIT(Appeals) regarding disallowance of general expenditure and levy of interest under sections 234A and 234B. The disallowance of general expenditure was upheld by the Tribunal.

What were the issues?

Whether interest under sections 234A and 234B should be levied on returned income or assessed income.

Which sections of the Income-tax Act were involved?

Section 234A,Section 234B

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, RANCHI BENCH (SMC

Before: Hon’ble Shri J. Sudhakar Reddy]

IN THE INCOME TAX APPELLATE TRIBUNAL RANCHI BENCH (SMC), RANCHI [Before Hon’ble Shri J. Sudhakar Reddy] I.T.A. No. 304/Ran/2016 Assessment Year : 2012-13 M/s. Cement Supply Agencies, .................................................................................Appellant 2nd Floor, Adarsh Market, J.J. Road, Upper Bazar, Ranchi – 834 001. [Pan : AACFC 6329 C] DCIT CIR 1...................……………………………………...................................................Respondent Ranchi Appearances by: Shri Devesh Poddar, Advocate appearing on behalf of the Assessee. Shri P.K. Mondal, Jr. DR appearing on behalf of the Revenue. Date of concluding the hearing : February 27, 2018 Date of pronouncing the order : February 28, 2018 ORDER Per J. Sudhakar Reddy, AM

This is an appeal filed by the assessee directed against the order of CIT (Appeals) Ranchi, Jharkhand dated 17.08.2016 for the assessment year 2012-13.

2.

Ground No. 1 and 2 are directed against adhoc disallowance of 10% of the general expenditure amounting to Rs. 83,520/-. I do not find any merit in the submissions of the assessee, I refuse to interfere in these factual findings of the revenue authorities. In the result, ground no 1 and 2 is dismissed.

3.

Ground no 3 is on the levy of interest under section 234A and 234B).

2 I.T.A. No. 304/Ran/2016 A.Y. 2012-13 Cement Supply Agencies 4. The issue is whether interest u/s 234A and 234B is to be levied only on the total income disclosed by the assessee in the return of income or on the total income determined by the A.O. in the assessment order i.e. assessed income. The Hon’ble Jharkhand High Court in T.A. No. 38 of 2010 order dated 25th July, 2012 in the case of Ajay Prakash Verma vs. ITO, Dhanbad reported in 2013(1) TMI 140 has held that interest u/s 234A and 234B can be levied only on the income declared by the assessee in the return of income. The Hon’ble Jharkhand High Court in I.A. No. 5725 of 2014 in Civil Review No. 66 of 2013 judgment dated 1st September, 2015 dismissed the civil review application filed by the department on this issue in this very case of Ajay Prakash Verma. Respectfully following the propositions of law laid down by the jurisdictional High Court, I direct the A.O. to levy interest u/s 234A and 234B only on the income returned by the assessee and not on the income assessed by the A.O.

5.

In the result, the appeal of the assessee is allowed in part. Order Pronounced in the Open Court on 28th February, 2018. Sd/- (J. Sudhakar Reddy) ACCOUNTANT MEMBER Dated: 28/02/2018 Biswajit, Sr. PS

Copy of order forwarded to: 1. M/s. Cement Supply Agencies, 2nd Floor, Adarsh Market, J.J. Road, Upper Bazar, Ranchi – 834 001.

2.

DCIT CIR 1, Ranchi.

3.

The CIT(A)

3 I.T.A. No. 304/Ran/2016 A.Y. 2012-13 Cement Supply Agencies

4.

The CIT

5.

DR True Copy, By order,

Sr. P.S. / H.O.O. ITAT, Ranchi

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