DR. PARTHA BISWAS,KOLKATA vs. JCIT, RANGE - 55, KOLKATA, KOLKATA

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ITA 1641/KOL/2017Status: DisposedITAT Kolkata31 July 2018AY 2011-122 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal held that the payment to Dr. Shule Kumar was in the nature of salary, as there was an employee-employer relationship, and accepted the assessee's ground challenging the disallowance under Section 40(a)(ia). Regarding the car depreciation and driver's salary, the Tribunal restricted the disallowance to 10% instead of 20%.

What were the facts?

The assessee disallowed a payment of ₹62,000 made to Dr. Shule Kumar, treating it as salary without deducting TDS. The lower authorities treated it as a fee for professional services and disallowed it. The assessee also claimed depreciation on a car and driver's salary, of which 20% was disallowed.

What were the issues?

Whether the payment made to a doctor constituted salary or a fee for professional services, and the extent to which depreciation and driver's salary could be disallowed.

Which sections of the Income-tax Act were involved?

Section 40(a)(ia),Section 192

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, KOLKATA BENCH “D” KOLKATA

Before: Shri P.M.Jagtap & Shri S.S.Godara

O R D E R

PER S.S.Godara, Judicial Member:

1.

- This assessee’s appeal for assessment year 2011-12 arises against Commissioner of Income Tax (Appeals)-6, Kolkata’s order dated 07.03.2017, passed in case No.135/CIT(A)-6/Kol/14-15 upholding Assessing Officer’s action disallowing addition his salary payment made to Dr. Shule Kumar of ₹62,000/- as well as depreciation of car and driver salary @ 20% coming to ₹28,204; respectively, involving proceedings u/s 143(3) of the Income Tax Act, 1961; in short ‘the Act’.

2.

We come to former issue of section 40(a)(ia) disallowance of ₹62,000/-. The assessee had admittedly paid the impugned sum in the months of June to November, 2010 @ ₹10,000/- per month for four months and ₹ 11,000/- each for two months. He did not deduct TDS thereupon by treating the same to be in the nature of salary. Both the lower authorities have rejected his claim in absence of employee-employer relationship to treat the sum in question as fee in lies of availing professional services. They conclude that payee doctor had in fact assisted the assessee rather than having

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