JAMES WARREN TEA LTD,KOLKATA vs. DCIT, CIR-4(1), KOLKATA, KOLKATA

This assessee’s appeal for assessment year 2013-14 arises from the Commissioner of Income Tax (Appeals)-2, Kolkata’s order dated 02.01.2017 passed in case No.270/CIT(A)-2/16-17 involving proceedings under section 143(3) of the Income Tax Act, 1961; in short ‘the Act’. Heard both the parties. Case file perused.

We come to assessee’s pleadings. It emerges at the outset that it has raised two substantive grounds. The former one avers that the CIT(A) has erred in law as well as on fact in not admitting/adjudicating its additional ground(s) of appeal that the Assessing Officer had wrongly disallowed deduction for professional fee of ₹12,31,807/- paid and on which tax was deducted / paid during F.Y. 2012-13 in terms of section 40(a)(ia) (i) Proviso. Its latter substantive ground is that the Assessing Officer be directed to allow deduction for James Warren Tea Ltd. Vs. DCIT Cir-4(1), Kol. Page 2 the above professional fee since the corresponding TDS deducted thereupon has seen paid to the ex-chequer during F.Y. 2012-13 only.

We have given our thoughtful consideration to rival contentions. We make it clear at the outset that there is no dispute between the parties about the assessee having pleaded its corresponding additional grounds during the course of lower appellate proceedings before CIT(A) as evident from page no 2 of the lower appellate order under challenge. The Revenue fails to rebut the fact that the CIT(A) has neither considered admission of said additional ground nor has he adjudicated the same on merits. The above statutory provision makes it clear that a claim of relevant expenditure liable subjected to TDS deduction is allowable in the year of payment thereof to the said ex-chequer. The assessee’s paper book available in case file makes it evident that it has duly deducted / paid the relevant TDS on 06.03.2013 and 21.03.2013. It has also filed assessment order dated 27.01.2015 for assessment year 2012-13 in order to prove that it had nowhere claimed the deduction in the year of accrual. Learned Departmental Representative’s only plea is that all these facts require Assessing Officer’s verification since involving assessee’s additional grounds of appeal. Learned Authorised Representative does not object to this verification plea. We therefore restore the instant issue of professional fee deduction claim amounting to ₹12,31,807/- back to the Assessing Officer for factual verification as per law.

This assessee’s appeal is allowed for statistical purpose. Order pronounced in the open court 18/07/2018