Income Tax Appellate Tribunal - Ahmedabad
The Asstt.Commissioner Of Income Tax, ... vs M/S. Bombay Sales Corporation,, ... on 10 May, 2018
IN THE INCOME TAX APPELLATE TRIBUNAL
AHMEDABAD "D" BENCH
Before: Shri Rajpal Yadav, Judicial Member
And Shri Amarjit Singh, Accountant Member
ITA Nos. 880 to 881/Ahd/2017
Assessment Year 2012-13 to 2013-14
The ACIT, M/s. Bo mba y Sales
Circle-5(2), Corporation, Ground Floor,
Ah medabad Vs Mrudul Toer, B/h. Times of
(Appellant) India, Nr. Vasant Nature
View Building,
Off: Ashra m Road,
Ah medabad-380009
Pan: AAAFB8515 F
(Respondent)
Reve nue by: Shri V.K. Si ngh, Sr. D.R.
Assessee by: Shri Nishit B. Jesur, A.R.
Date of hearing : 20-03-2018
Date of pronounce ment : 10-05-20 18
आदेश /ORDER
PER : AMARJIT SINGH, ACCOUNTANT MEMBER:-
These two Revenue's appeals for A.Y. 2012-13 to 2013-14, arise from order of the CIT(A)-5, Ahmedabad dated 06-01-2017, in proceedings under section 143(3) of the Income Tax Act, 1961; in short "the Act".
2. The Revenue has raised following grounds of appeal:-
ITA No. 880/Ahd/2017"(1) The Ld. CIT(A) has erred on facts and in law in deleting the addition of Rs.5,82,00,457/- u/s 40(a) (ia) of the Act.
(2) On the facts and circumstances of the case, the Ld.CIT(A) ought to have upheld the addition made by the AO.
I.T.A Nos.880 to 881/Ahd/2017 A.Y. 2012-13 to 2013-14 Page No 2 ACIT vs. M/s. Bombay Sales Corporation (3) It is therefore, prayed that the order of the Ld.CIT(A) may be set aside and the order of the Assessing Officer be restored."
3. As the facts in both the appeals are similar, so, we take the facts of ITA No. 880/Ahd/2017 and decide both the appeals for the sake of convenience.
4. In this case, return of income declaring of Rs. 72,24,060/- was filed on 25 th Sep, 2012. Subsequently, the case was selected under scrutiny by issuing of notice u/s. 143(2) of the act. During the course of appellate proceedings, the assessing officer noticed that assessee has debited an amount of Rs. 5,82,00,457/- in the profit and loss a/c under the head sales incentives. The assessing officer observed that such sales incentives is in the nature of commission paid on which the assesse was liable to deduct tax at source u/s. 194H of the act. Consequently the assessing officer has disallowed the aforesaid amount u/s. 40(a)(ia) of the act.
5. Aggrieved assessee filed appeal before the ld. CIT(A). The ld. CIT(A) has allowed the appeal of the assessee by stating that the Co-ordinate Bench of the ITAT in the case of assessee itself vide ITA No. 1835/Ahd/2011 dated 2nd August, 2013 and further in assessment year 2010-11 has decided the identical issue in favour of the assessee.
6. We have heard the rival contentions and perused the material on record carefully. The assessing officer has made disallowance of Rs. 5,82,00,457/- u/s. 40(a)(ia) treating the sales incentive paid by the assessee as commission on which TDS was not deducted. The assessee is a distributor in Gujarat State of the Company called Shila Foam Pvt. Ld. (SFPL) and their relationship is principal to principal. After purchasing goods from SFPL, the assessee firm sale it to various dealers appointed by the SFPL. The dealers are only purchasing goods from the assessee without rendering any services. The assessee get cash discount from the SFPL for making early payment for purchase of goods. The I.T.A Nos.880 to 881/Ahd/2017 A.Y. 2012-13 to 2013-14 Page No 3 ACIT vs. M/s. Bombay Sales Corporation assessee in turn provides discount to the dealers on the basis of purchases made by them from the assessee. After considering the above fact, we observe that the dealers have purchased goods from the assessee and they have not rendered any services to the assessee. The identical issue has been decided by the Co-ordinate Bench of the ITAT in the case of the assessee itself Vide ITAT 2553/Ahd/2013 for assessment year 2010-11 dated 13/06/2014 and vide ITA No. 3224/Ahd/2014 in favour of the assessee. In view of the these facts and findings, we do not find any error in the decision of the ld. CIT(A). In the result, the appeal of the Revenue is dismissed.
7. In the combined result, both the appeals of the revenue are dismissed.
Order pronounced in the open court on 10-05-2018 Sd/- Sd/-
(RAJPAL YADAV) (AMARJIT SINGH)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Ahmedabad : Dated 10/05/2018
आदेश क त ल प अ े षत / Copy of Order Forwarded to:-
1. Assessee
2. Revenue
3. Concerned CIT
4. CIT (A)
5. DR, ITAT, Ahmedabad
6. Guard file.
By order/आदेश से,
उप/सहायक पंजीकार
आयकर अपील य अ धकरण,
अहमदाबाद