Income Tax Appellate Tribunal - Mumbai
New Era Mercantile P.Ltd, Mumbai vs Dcit 7(1), Mumbai on 13 December, 2017
ITA No.1082 &1083//Mum/2013 New Era Mercantile Private Limited Assessment Years-2005-06 & 2007-08 आयकर अपीलीय अिधकरण "बी"
ायपीठ मुंबई म ।
IN THE INCOME TAX APPELLATE TRIBUNAL "B" BENCH, MUMBAI ी डी.टी. गरािसया, ाियक सद एवं ी मनोज कुमार अ वाल, लेखा सद के सम ।
BEFORE SHRI D.T. GARASIA, JM AND SHRI MANOJ KUMAR AGGARWAL, AM आयकर अपील सं ./I.T.A. No.1082/Mum/2013 (िनधा रण वष / Assessment Year: 2005-06) New Era Mercantile Private Ltd Income Tax Officer 7(1)(1) 442,Industry Manor, बनाम/ Mumbai A Marathe Marg, Prabhadevi Vs. Mumbai-400 025 थायी ले खा सं ./जीआइआर सं ./PAN/GIR No. AAACN-1711-G (अ पीलाथ# /Appellant) : ($%थ# / Respondent) & आयकर अ पील सं ./I.T.A. No.1083/Mum/2013 (िनधा रण वष / Assessment Year: 2007-08) New Era Mercantile Private Ltd Deputy Commissioner of Income 442,Industry Manor, बनाम/ Tax Officer 7(1)(1) A Marathe Marg, Prabhadevi Vs. Mumbai Mumbai-400 025 थायी ले खा सं ./जीआइआर सं ./PAN/GIR No. AAACN-1711-G (अ पीलाथ# /Appellant) : ($%थ# / Respondent) Assessee by : Reepal G.Tralshawala, Ld.AR Revenue by : Suman Kumar, Ld. Sr. DR सु नवाई की तारीख / : 02/11/2017 Date of Hearing घोषणा की तारीख / : 13/12 /2017 Date of Pronouncem ent आदे श / O R D E R Per Manoj Kumar Aggarwal (Accountant Member) 2 ITA No.1082 &1083//Mum/2013 New Era Mercantile Private Limited Assessment Years-2005-06 & 2007-08
1. The captioned appeals by assessee for Assessment Years [AY] 2005-06 & 2007-08 assails separate orders of first appellate authority qua confirmation of certain additions. Since common issues are involved, we dispose-off the same by way of this common order for the sake of convenience & brevity. The assessee, vide letter dated 24/10/2017, has pleaded for admission of additional evidences. First we take up ITA No. 1082/Mum/2013 for AY 2005-06 which contest the order of Ld. Commissioner of Income-Tax (Appeals)-20 [CIT(A)], Mumbai, Appeal No. CIT(A)20/7(1)(1)/IT-290/07-08/2011-12 dated 22/11/2012. The assessment for impugned AY was framed by Ld. Income Tax Officer 7(1)(1), Mumbai [AO] u/s 143(3) of the Income Tax Act,1961 on 24/12/2007.
2.1 Facts leading to the same are that the assessee being resident corporate assessee engaged as manufacturer & trader of synthetic detergents, soaps, oils etc. was assessed for impugned AY at Rs.29.05 Lacs as against returned income of Rs.9.40 Lacs filed by the assessee on 26/10/2005.
2.2 During assessment proceedings, it was noted that the assessee claimed commitment charges of Rs.18 Lacs in the Profit & Loss Account. It was found that the same were paid @1.5 Lacs per month to assessee's holding company namely Muskan Projects Private Ltd. [payee] in terms of agreement dated 10/05/2004. The assessee submitted that the commitment charges were paid to obtain production capacity in future. However, the said payment, in the opinion of Ld. AO, attracted the provisions of Section 40A(2)(a) and moreover, the payment was over and above the actual labor / processing charges paid by the 3 ITA No.1082 &1083//Mum/2013 New Era Mercantile Private Limited Assessment Years-2005-06 & 2007-08 assessee to the payee. Since the payment were made without purchasing any goods or availing any services, the same were disallowed in terms of Section 40A(2)(a). Alternatively, the Ld. AO further concluded that the same were not allowable to the assessee in terms of Section 40(a)(ia) also since no Tax at source was deducted there against.
3. Aggrieved, the assessee contested the same without any success before Ld. CIT(A) vide impugned order dated 22/11/2012 where Ld. CIT(A), after considering assessee's submissions, upheld the stand of Ld. AO. Aggrieved, the assessee is in further appeal before us.
4. The Ld. Counsel for the assessee [AR], at the outset, pleaded for admission of additional evidences which was vehemently opposed by Ld. Departmental Representative [DR] on the premises that nothing precluded the assessee to adduce the same during assessment as well as appellate proceedings.
5. Heard the rival contentions and perused relevant material on record. Although upon perusal of quantum order as well as appellate order, we find the same to be reasoned one yet in the interest of justice and fair play, we see no harm in providing another opportunity to the assessee to defend his case in the light of the additional evidences. Hence, without delving much deeper into the issue, we remit the matter back to the file of Ld. AO to re-adjudicate the issue after considering additional evidences being submitted by the assessee. The assessee, in turn, is directed to substantiate his claim in terms of Section 37(1), 40A(2)(a) & 40(a)(ia). Resultantly, the assessee's appeal stands allowed for statistical purposes.
4ITA No.1082 &1083//Mum/2013 New Era Mercantile Private Limited Assessment Years-2005-06 & 2007-08
6. The assessee, in similar manner, in AY 2007-08 has been saddled with disallowance of Rs.15 Lacs which has since been confirmed by Ld. CIT(A) by following the decision in AY 2005-06. Since, the issue is identical in all respect, the same is also restored back to the file of Ld. AO with similar directions.
7. Resultantly, both the appeals filed by the assessee stands allowed for statistical purposes.
Order pronounced in the open court on 13th December, 2017.
Sd/- Sd/-
(D.T. Garasia) (Manoj Kumar Aggarwal)
ाियक सद / Judicial Member लेखा सद / Accountant Member
मुंबई Mumbai; िदनां क Dated : 13.12 .2017 Sr.PS:- Thirumalesh आदे श की ितिलिप अ !े िषत/Copy of the Order forwarded to :
1. अपीलाथ# / The Appellant
2. $%थ# / The Respondent
3. आयकर आयु+(अपील) / The CIT(A)
4. आयकर आयु+ / CIT - concerned
5. िवभागीय $ितिनिध, आयकर अपीलीय अिधकरण, मुंबई / DR, ITAT, Mumbai
6. गाड. फाईल / Guard File आदे शानुसार/ BY ORDER, उप/सहायक पं जीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण, मुंबई / ITAT, Mumbai