M/S RANISATI DISTRIBUTORS PVT. LTD.,KOLKATA vs. THE ITO, WD-4(1), KOLKATA, KOLKATA

ITA 1138/KOL/2016Status: DisposedITAT Kolkata31 January 2019AY 2011-20122 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the disallowance of administrative expenditure was not applicable as there was no actual expenditure incurred by the assessee under that head. Reliance was placed on a previous Tribunal decision for this principle.

What were the facts?

The assessee, engaged in a money lending business, had its administrative expenditure disallowed by the lower authorities. This disallowance was in relation to exempt income derived from dividends in mutual funds. The assessee's directors had not received any dividend or remuneration.

What were the issues?

Whether administrative expenditure can be disallowed in relation to exempt income when no actual expenditure has been incurred by the assessee.

Which sections of the Income-tax Act were involved?

Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, KOLKATA BENCH “SMC” KOLKATA

Before: Shri S.S, Godara

This assessee’s appeal for assessment year 2011-12, arises against the Commissioner of Income-tax (Appeals)-2, Kolkata’s order dated 29.04.2016 passed in case No.1260/CIT(A)-2/14-15 involving proceedings u/s. 143(3) of the Income Tax Act, 1961; in short ‘the Act’. Heard both the parties. Case file perused.

The assessee’s sole substantive ground pleaded in the instant appeal seeks to reverse both the lower authorities action disallowing administrative expenditure of ₹1,25,200/- in relation to its exempt income of ₹1,96,423/-. This assessee is stated to be engaged in money landing business as a company. Its director admittedly have not received any dividend or remuneration as it transpires during the course of hearing. It derived impugned exempt income from dividends in mutual funds. Learned

ITA No.1138/Kol/2016 A.Y. 2011-12 M/s Ranisati Distributors Pvt. Ltd. vs. ITO Wd-4(1), Kol. Page 2 Departmental Representative fails to indicate any actual expenditure incurred by of assessee under the head “administrative expenditure”. This Tribunal’s decision in Gautam Kumar Mitra vs. DCIT in ITA No.1336/Kol/2013 decided on 27.05.2016 holds that the impugned disallowance provision does not apply in absence of any actual expenditure. I direct the Assessing Officer to delete the impugned administrative expenditure disallowance therefore.

This assessee’s appeal is allowed. Order pronounced in open court on 31/01/2019 (S.S. Godara) Judicial Member Kolkata, *Dkp/Sr.PS "दनांकः- 31/01/2019 कोलकाता आदेश क" ""त"ल"प अ"े"षत / Copy of Order Forwarded to:- 1. अपीलाथ"/Appellant-M/s Ranisati Distributors Pvt. Ltd., 13, Becharam Chowdhury Lane, Howrah-711101

""यथ"/Respondent-ITO Ward-4(1), P-7, Chowringhee Sq. Kolkata-69 3. संबं"धत आयकर आयु%त / Concerned CIT 4. आयकर आयु%त- अपील / CIT (A) 5. &वभागीय ")त)न"ध, आयकर अपील"य अ"धकरण कोलकाता / DR, ITAT, Kolkata 6. गाड+ फाइल / Guard file. By order/आदेश से, // उप/सहायक पंजीकार आयकर अपील"य अ"धकरण, कोलकाता ।

Recent GST High Court judgments

Search GST case law →