TIGER STEEL ENGINEERING,NAVI MUMBAI vs. DCIT CIR 15(3)(1), MUMBAI

We have heard the rival contentions and gone through the facts and circumstances of the case. We find that the assessee has submitted the payment of `10,28,152/- made to M/s Greenply Industries Ltd. which pertains to refund of excess money received from the said party. In this regard, drew our attention to the copy of Email communication, the Ledger Account Copy, the bank statement as a proof of refunding the amount, letter of intent and statement of order value on payment received against assessee’s billing and eligible for refund. The assessee submitted that this sum of `10,28,152/- has been duly recognized as revenue in terms of section 36(2) of the Act. We find that assessee has duly recognized revenue in the respective year of billing while raising the tax invoices. Hence, at the time of refund of payment, assessee has claimed deduction. In our consideration, this sum deserves to be allowed and is hereby allowed.

We have heard the rival contentions and gone through the facts and circumstances of the case. We find that assessee at the end of the year in accordance with mercantile system of accounting had made provision for transportation expenses on the basis of per Metric Ton of Goods transported. In other words, this provision for transport expenses has been made by the assessee in respect of transportation where work has been provided or performed by the transporter but for which invoices has not been furnished by them to the assessee as on 31.3.2012. We find that subsequently the concerned transporters while raising the invoices on the assessee for the services rendered during the year under consideration had also submitted their PAN along with invoices. We find pursuant to the amendment brought in under section 194C(6) of the Act with effect from 01.04.2010, once PAN of the transporter is furnished, there is no requirement on the part of the assessee to deduct tax at source. We hold that this provision for 4 | P a g e Tiger Steel Engineering India Pvt. Ltd. transportation expenses has been made by following the rate mentioned in the purchase order on the basis of per Metric Ton of goods transported which is on a scientific basis. Merely because the transporters account is not credited by mentioning his name, the said liability does not become contingent in nature in the facts and circumstances of the instant case. Hence, the addition made by the Assessing Officer under section 68 of the Act towards provision for creditors of `15,10,910/-is hereby directed to be deleted.

The next issue in this appeal of assessee is as regards to the order of Dispute Resolution Panel, in disallowing the interest expenses amounting to `20,10,346/-. For this, assessee has raised the following grounds: -

We have heard rival contentions and gone through the facts and circumstances of the case. We find from the observation of the learned Dispute Resolution Panel which are enclosed in page 84 of the paper book filed before us that a sum of `18,00,082/- being interest on CST/ VAT payable by the assessee vide order dated 24.04.2012 was finally paid by the 5 | P a g e Tiger Steel Engineering India Pvt. Ltd. assessee on 08.01.2013 falling in Assessment Year 2013-14. Since, the same was paid beyond the due date of the filing of return of income for Assessment Year 2012-13, the same cannot be allowed as deduction under section 43B of the Act in the Assessment Year 2012-13. However, we hold that the assessee would be eligible for deduction of the same in Assessment Year 2013-14 in the sum of `18,00,082/-. Accordingly, the ground Nos. 3 & 4 raised by the assessee are dismissed.

The last issue to be decided with regard to disallowance of prior period expenses in the sum of 19,78,890/-. For this, assessee has raised the following ground No.5: -

We have heard rival contentions and gone through the facts and circumstances of the case. We find that the assessee has claimed that amount of `19,78,890/- was reversed towards sales tax liability. We find that the Assessing Officer had mixed up the issue of VAT order, where adjustment of VAT payable for interest issued against the VAT refund of different years which are already been dealt by us in ground Nos.3&4 above. We find that this VAT order has nothing to do with the disallowance of Prior Period Expenses made by the Assessing Officer. We find that assessee has filed an elaborate reconciliation year wise with regard to this issue, which is enclosed in page 10 of the assessee’s paper book. The learned Assessing Officer fairly