Gujarat High Court
Principal Commissioner Of Income Tax vs Applitech Solutions ... on 17 January, 2017
Bench: M.R. Shah, B.N. Karia
O/TAXAP/914/2016 JUDGMENT
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
TAX APPEAL NO. 914 of 2016
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE M.R. SHAH sd/
and
HONOURABLE MR.JUSTICE B.N. KARIA sd/
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1 Whether Reporters of Local Papers may be allowed to see NO
the judgment ?
2 To be referred to the Reporter or not ? NO
3 Whether their Lordships wish to see the fair copy of the NO
judgment ?
4 Whether this case involves a substantial question of law as NO
to the interpretation of the Constitution of India or any
order made thereunder ?
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PRINCIPAL COMMISSIONER OF INCOME TAX1,....Appellant(s)
Versus
APPLITECH SOLUTIONS LTD....Opponent(s)
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Appearance:
MR. MANISH BHATT FOR MRS MAUNA M BHATT, ADVOCATE for the
Appellant(s) No. 1
MR SN DIVATIA, ADVOCATE for the Opponent(s) No. 1
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CORAM: HONOURABLE MR.JUSTICE M.R. SHAH
and
HONOURABLE MR.JUSTICE B.N. KARIA
Date : 17/01/2017
ORAL JUDGMENT
(PER : HONOURABLE MR.JUSTICE M.R. SHAH) 1.0. Feeling aggrieved and dissatisfied with the impugned judgment and order passed by th learned Income Tax Appellate Tribunal passed in ITA No.1600/AHD/2014 for AY 200001, the Revenue has preferred present Tax Appeal with the following proposed question of law.
"Whether the Tribunal has erred in law and on facts in Page 1 of 3 HC-NIC Page 1 of 3 Created On Sat Aug 12 12:06:43 IST 2017 O/TAXAP/914/2016 JUDGMENT dismissing the appeal relying upon the findings of the CIT(A) and deleting the disallowance of Rs.20.10 lakhs towards consulting charges paid to Satellite Management Services, Rs. 14.59 lakhs towards management consultancy paid to CAs and rs. 11.51 lakhs towards commission payment paid to Jayesh Parikh despite the fact that the AO had rightly disallowed these expenses for not being wholly and exclusively for business purpose ?"
2.0. We have heard Shri Manish Bhatt, learned counsel for the appellantrevenue and Shri S.N. Divatia, learned counsel for the assessee. It is in not in dispute that earlier the AO disallowed the Rs. 20.10 lakhs towards consulting charges and Rs. 14.59 lakhs paid to Chartered Accountant for management of consultancy and Rs. 11.51 Lakhs towards commission. Against the order passed by the AO, the matter was carried to the learned Tribunal and the learned Tribunal remanded the matter to the AO only qua the disallowance of Rs. 20.10 lakhs towards consulting charges and set aside the order passed by the AO with respect to other disallowance. Despite the above, on remand the AO again made disallowance of not only Rs. 20.10 lakhs towards consulting charges, he also disallowed Rs.14.59 lakhs paid to Chartered Accountant for management consultancy and Rs. 11.51 lakhs towards commission which was as such earlier not approved by the learned Tribunal. Therefore, the learned Tribunal is justified in deleting disallowance of Rs. 14.59 lakhs paid to Chartered Accountant for management consultancy and Rs. 11.51 lakhs towards commission, which by observing that thereafter the AO has not justified on remand in making the aforesaid disallowance which was not earlier approved by the learned Tribunal.
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O/TAXAP/914/2016 JUDGMENT
3.0. While dealing the disallowance of Rs. 20.10 Lakhs towards consulting charges, learned CIT(A) as well as learned Tribunal have observed that on remand the learned AO has not found any additional material and therefore, in absence of any further material collected during the remand, the AO was not justified in making the disallowance of Rs. 20.10 Lakhs towards consulting charges. Even no reasons were assigned by the AO while passing the order in remand and again making disallowance of Rs. 20.10 lakhs. He only reiterated what was stated in the original assessment order which as such was set aside by the learned Tribunal and the matter was remanded. Considering the aforesaid facts and circumstances of the case, it cannot be said that the learned Tribunal has committed any error in deleting the disallowance of Rs. 20.10 lakhs towards consulting charges also.
4.0. In view of the above, no substantial question of law arise. Under the circumstances, present appeal deserves to be dismissed and is accordingly dismissed.
sd/ (M.R. SHAH, J.) sd/ (B.N. KARIA, J.) Kaushik Page 3 of 3 HC-NIC Page 3 of 3 Created On Sat Aug 12 12:06:43 IST 2017