JAY POLYCHEM INDIA LTD.,NEW DELHI vs. ACIT, CENTRAL CIRCLE- 3, NEW DELHI

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ITA 6680/DEL/2017Status: DisposedITAT Delhi31 August 2023AY 2014-15Bench: Sh. C. M. Garg, Judicial Member Dr. B. R. R. Kumar (Accountant Member)3 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal granted liberty to the assessee to submit proof of sales tax payment and related orders to the AO within 6 months. The ground related to EPF disallowance was dismissed following a Supreme Court judgment.

What were the facts?

The assessee appealed against the CIT(A)'s order sustaining a portion of the additional sales tax demand and disallowing employee provident fund contributions. The CIT(A) had disallowed the sales tax demand due to non-submission of supporting documents.

What were the issues?

Whether additional sales tax paid is a deductible business expenditure and whether disallowance of employee provident fund contributions is justified.

Which sections of the Income-tax Act were involved?

Section 37(1),Section 43B,Section 234B,Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘C’, NEW DELHI

Before: Sh. C. M. GargDr. B. R. R. Kumar

Hearing: 09.08.2023Pronounced: 31.08.2023

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘C’, NEW DELHI Before Sh. C. M. Garg, Judicial Member Dr. B. R. R. Kumar, Accountant Member Asstt. Year : 2014-15 Jay Polychem India Ltd., Vs ACIT, B-115, Okhla Industrial Area, Central Circle-3, Phase-1, New Delhi-110020 New Delhi (APPELLANT) (RESPONDENT) PAN No. AAACJ0657M Assessee by : None Revenue by : Sh. Vivek Vardhan, Sr. DR Date of Hearing: 09.08.2023 Date of Pronouncement: 31.08.2023 ORDER Per Dr. B. R. R. Kumar, Accountant Member:

The present appeal has been filed by the assessee against the order of ld. CIT(A)-23, New Delhi dated 30.08.2017.

2.

Following grounds have been raised by the assessee:

1. That the order of the commissioner of the Income Tax (Appeals) (hereinafter refer to Ld. CIT (A)") dated 30.08.2017 is bad in law and on facts.

2. That the Ld. CIT (A) has erred in law in sustaining the amount of Rs. 24,00,000/- out of Rs. 26,60,480/- being additional demand of sales tax paid by the assessee during the year under appeal. 3.1 That the addition was sustained despite sufficient evidences in form of challans, ledgers and statement have been furnished in respect of the addition. 3.2 That the expenditure was genuine business expenditure and allowable u/s 37(1) as well as section u/s 43B of the Income Tax Act.

2 Jay Polychem India Ltd.

4. That the Ld. CIT (A) has erred in law in sustaining the disallowance of employee's provident fund amounting to Rs. 34,823/- 4.1 That the Id. CIT(A) sustained the addition on the ground that change of assessee's stand regarding addition means raising an additional ground which is not admissible in assessee's case. 4.2 That the Id. CIT (A) has erred in law in rejecting the explanation of assessee and Tax Audit Report for AY 2013-14 on the ground that same was not furnished before Id. AO nor an application under Rule 46A of the Income Tax Rules was filed by the assessee company.

5.

That the Id. CIT (A) has erred in sustaining the Interest levied u/s 234B of the Income Tax Act.

6.

That the ld. CIT(A) has erred in sustaining the penalty proceedings u/s 271(1)(c) of the Income Tax Act, 1961.”

3.

The ld. CIT (A) sustained addition made on the amount of Rs. 24,00,000/- out of Rs. 26,60,480/- being additional demand of sales tax paid by the assessee during the year under appeal owing to the reason of non-submission of challans, order of VAT assessment and the demand notice before the revenue authorities. Liberty is granted to the assessee to submit the challan proving the payment of sales tax and the relevant order of the VAT assessment along with the demand notice before the JAO within 6 months from the date of this order, failing which the revenue would at liberty to initiate the recovery proceedings as the provisions of the Act.

4.

Respectfully following the judgment of Hon’ble Supreme Court in the case Checkmate Services P. Ltd. vs. Commissioner Of Income Tax-I in CA No. 2833/2016 vide order dated 12.10.2022, the ground no. 3 relating to disallowance of EPF is hereby dismissed.

3 Jay Polychem India Ltd. 5. In the result, the appeal of the assessee is partly allowed for statistical purpose. Order Pronounced in the Open Court on 31/08/2023.

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