MRS.RITY SANJAY TOSHNIWAL,MUMBAI vs. ASSISTANT COMMISSIONER OF INCOME TAX 21(3), MUMBAI

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ITA 4258/MUM/2018Status: DisposedITAT Mumbai25 July 2018AY 2013-144 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that similar matters for earlier assessment years were remitted back to the AO for re-adjudication. Therefore, the current year's appeal was also remitted back to the AO to consider the outcome of those earlier proceedings.

What were the facts?

The assessee reversed commission expenses of Rs. 4.94 crores in its Profit & Loss account. These provisions were made in earlier assessment years and had been added back/disallowed. The assessee claimed this reversal should reduce its taxable income for the current year.

What were the issues?

Whether a write-back of previously disallowed commission expenses should be reduced from the current year's taxable income, especially when earlier years' assessments are pending re-adjudication.

Which sections of the Income-tax Act were involved?

Section 143(3)

AI-generated summary — verify with the full judgment below

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Income Tax Appellate Tribunal, “D” BENCH, MUMBAI

Before: SHRI SAKTIJIT DEY, JM & SHRI MANOJ KUMAR AGGARWAL, AM

Per Manoj Kumar Aggarwal (Accountant Member)

1.

Aforesaid appeal by assessee for Assessment Year [AY] 2013-14 contest the order of the Ld. Commissioner of Income-Tax (Appeals)-33 [CIT(A)], Mumbai, Appeal No.CIT(A)-33/Rg.21/94/2016-17 dated 31/05/2018 by raising the following sole ground of appeal:- On the facts and in the circumstances of the case and in law, the learned A.O. erred in not reducing the taxable income by Rs.4,94,48,280/- being the commission expense written back in the Profit & Loss account. The Ld. CIT(A) has upheld the action of the Ld. AO and failed to appreciate the claim of the appellant.

Ritu Sanjay Toshniwal Assessment Year-2013-14 The assessment for impugned AY was framed by Ld. Assistant Commissioner of Income Tax-21(3), Mumbai [AO] u/s 143(3) of the Income Tax Act, 1961 on 09/03/2016 wherein the returned income of Rs.506.19 Lacs was accepted.

2.

During assessment proceedings, it was noted that the assessee had credited an amount of Rs.494.48 Lacs in the Profit & Loss Account as “Amount no more payable w/back”. It was explained that the same represented provisions made in the Balance Sheet for payment of commission expenses. The said provisions were stated to be made by debiting Profit & Loss Account during various years beginning from AY 2005-06. It was further submitted that the said sum was already been added back / disallowed during assessment proceedings for AYs 2007- 08 to 2010-11 and therefore, the same should be reduced from the income of the impugned AY. However, Ld. AO, relying upon the decision of Hon’ble Apex Court rendered in Goetze India Ltd. 284 ITR 323, opined that the new claim could not be admitted otherwise than by way of filing the revised return of income.

3.

Aggrieved, the assessee contested the same without any success before Ld. CIT(A) vide impugned order dated 31/05/2018 wherein Ld. CIT(A) rejected the assessee’s submissions on the premise that that the assessment for earlier years had not attained finality. Aggrieved, the assessee is in further appeal before us.

4.

The sole plea raised by Ld. AR is that the matter may be remitted back to the file of Ld. AO as done by the Tribunal for earlier AYs so as to enable the lower authorities to take a holistic view in the matter which

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