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Income Tax Appellate Tribunal, “C” BENCH : KOLKATA
Before: Hon’ble Shri S.S. Godara, JM & Shri Dr. A.L. Saini] Shri Dinesh Sancheti
ORDER Shri S.S. Godara, JM:
This Revenue’s appeal for assessment year 2013-14 arises against the CIT(A)-12, Kolkata’s order dated 19-09-2016 passed in case no. 118/CIT(A)-12/Kol/Circle- 40/2015-16 involving proceedings u/s 147/143(3) of the Act. Heard both the parties. Case file perused.
We noticed at the outset the Revenue raised the following substantive grounds in its appeal:- Grounds of Appeal : In the instant case AO in course of assessment u/s. 143(3) made following additions/disallowance : i) Disallowance of Rs.8,80,000/ on account of Rent paid. ii) Disallowance of Rs. 19,20,000/ on account of Liability against Siliguri Maintenance. i i i) Disallowance of Rs. 7,50,648/ u/s 40(a)(ia)on account of Rent paid. iv) Addition of Rs. 6,18,000/ on account of undisclosed income. v) Disallowance of Rs. 30,00,000/ on account of commission payment. vi) Disallowance of Rs. 10,82,284/ u/s 43B on account of unpaid liability Being aggrieved of the order, assessee preferred appeal before CIT(A).
The first issue in which the CIT(A) has given relief of Rs. 8,80,0001 on account of Rent paid which was disallowed by the A.a.as the assessee had failed to establish that business activities were carried out from the previous year which was paid to Mls Tulsi Mercantile P. Ltd. The CIT(A) deleted the disallowance following the decision of Hon'ble Madras High Court in the case of Vairavan Chettiar vs. Commissioner of Income Tax(l969) 72 ITR 114. The CIT(A) observed that assessee had earned enough revenue from Siliguri area in the financial year 201213 and deleted the disallowance. Appeal against the decision of the CIT(A) may not be preferred as it does not have merit or legal dispute, if approved.
The second issue in which the CIT(A) has given relief of Rs. 19,20,0001 on account of Siliguri maintenance liability. A.a. made the disallowance of Rs. 19,20,0001 on the ground that the assessee failed to establish the claim of liability. The CIT(A) deleted the disallowance of Rs. 19,20,0001 on the basis of details submission of the assessee and observed that liability being credited by debiting Koutons Retails India Ltd. and the same has no bearing on the expenditure in the P/L A/c. The CIT(A) further observed that the A.a. was not justified to make the said addition in this financial year because the said amount was paid in the next financial year. The CIT(A)'s decision appears to be based on sound legal footing and considered the relevant material facts. Therefore, appeal may not be preferred.
The CIT(A) has given relief on the addition ofRs.6,18,000/ on account of Undisclosed professional Income. At the time scrutiny proceedings assessee had submitted details of commission received to the tune of Rs. 1,20,39,2401 (excluding service tax) from different parties which included commission received to the tune of Rs. 70,00,000/ from Avani Project Infrastructure Ltd. I Details requisitioned from Avani Project Infrastructure Ltd. uls 133(6), revealed that apart from commission income of Rs. 70,00,000/, the assessee also derived professional income of Rs. 6,18,000/ from the said concern. A.O. added Rs. 6,18,0001as undisclosed professional income. The CIT(A) deleted the addition on the 2 basis of explanation and on examination of documents submitted by the assessee that the said amount was related to Service Tax. Although, assessee submitted the details of commission received which is excluding of service tax. Since the CIT(A) deleted the addition after proper verification and consideration of the materials. Therefore, appeal against the decision of the CIT(A) may not be preferred. , The fifth issue in which the CIT(A) has given relief of Rs.30,00,0001 on account of commission paid to Amit International u/s 40(a)(ia). During the scrutiny proceedings, assessee did not produce any supporting documents in support of deduction of tax against said payment. The CIT(A) deleted the disallowance after verifying the copies of bill and TDS Challan which were submitted by assessee before the CIT(A).CIT(A) deleted the disallowance without providing any opportunity to A.O for verification of the said documents. Therefore, appeal against the decision of the CIT(A) may be preferred.
The sixth issue in which the CIT(A) has given relief of Rs. l0,82,284/ u/s 43B on account of unpaid liability. per Auditor's report in form no. 3CB, it was found that a sum of Rs. 2,83,223/ was liability of the previous year. During the assessment proceedings assessee filed copies of service tax challan to the tune of Rs. 10,82,284/ where it has found that the said amount was paid beyond the due date of filling of return of income. Accordingly, A.O. added the said amount to the total income of the assessee. The CIT(A)deleted the addition after verification of the ledger of service tax payable, service tax cenvat, Service tax return, copy of payment of challan both for the A.Y. 201314 & 201415 which is submitted by the assessee before the CIT(A). Since the CIT(A) deleted the addition after proper verification and consideration of the materials. Therefore, appeal against the decision of the CIT(A) may not be preferred.
In Sum, appeal is suggested only on one i sue as mentioned in above. However, the tax effect involved in the instant issue is Rs. 9,27,000/ only, which is lower than the threshold limit as prescribed by the Board vide Circular No. 21 015 dated 10122015, further appeal may not be preferred. “ Submitted for kind perusal.
Mr. Robin Choudhury, fails to dispute that the Assessing Officer has himself made it clear that no appeal should be preferred against the CIT(A)’s findings on all but one issue (supra). The question as to whether the Revenue’s appeal is maintainable in such a case involving the Assessing Officer’s favourable opinion in an assessee’s case stands decided in Smt. B. Jayalakshmi V/s ACIT (2018) 96 taxmann.com 486 (Mad.) holding that when an Assessing Officer agrees with tax payer’s case, the Revenue’s appeal is not maintainable. We decline the Revenue’s stand on this count alone. It further transpires during the course of hearing the Assessing Officer has narrated in very clear terns that tax effect involving is Rs. 9,27,000/- only. We conclude that the instant Revenue’s grievance does not satisfy with the tax effect limit of Rs. 20 lakhs for the purpose of filing the appeal in tribunal as per latest CBDT’s Circular/Instruction No. 3/2018 dated 11.07.2018.