Income Tax Appellate Tribunal - Indore
Jila Sahkari Kendriya Bank Maryadit, ... vs The Acit Circle, 2(1), Ujjain on 29 January, 2020
आयकर अपील य अ धकरण, इंदौर यायपीठ, इंदौर
IN THE INCOME TAX APPELLATE TRIBUNAL,
INDORE BENCH, INDORE
BEFORE HON'BLE KUL BHARAT, JUDICIAL MEMBER
AND HON'BLE MANISH BORAD, ACCOUNTANT MEMBER
ITA No.903/Ind/2018
Assessment Year 2014-15
Jila Sahakari Kendriya Bank Asstt. Commissioner of
Maryadit, Vs. Income Tax, Central-2(1),
03, Bharatpuri Administrative Ujjain
Area, Dewas Road, Ujjain
(Appellant) (Respondent )
PAN No.AAABJ0014F
Assessee by Shri S.S. Deshpande, CA
Revenue by Shri Punit Kumar, Sr. DR
Date of Hearing 23.1.2020
Date of Pronouncement 29.1.2020
ORDER
PER MANISH BORAD, AM
The above captioned appeal filed at the instance of the assessee pertaining to Assessment Year 2014-15 is directed against the orders of Ld. Commissioner of Income Tax (Appeals) (in short 'Ld.CIT(A)'], Ujjain dated 26.09.2018 which is arising out of the order u/s 143(3) of the Income Tax Act 1961(In short the 'Act') dated 09.12.2016 framed by ACIT-2(1), Ujjain.
2. The assessee has raised following grounds of appeal; Jila Sahakari Kendriya Bank Maryadit ITA No. 903/Ind/2018
1. The Ld. CIT(A) has erred in maintaining the addition of Rs.9,88,736/- being the 20% from the professional and consultancy fees paid. 1.1. The Ld. CIT(A) has erred in remarking that the return submissions are not made and therefore the ground is dismissed. The disallowance of 20% on an adhoc basis is uncalled for and the addition may please be deleted.
2. The Ld. CIT(A) has erred in maintaining the disallowance of 20% out of the above encashment payment.
3. Brief facts of the facts as culled out from the records are that the assessee is a Co-operative Bank carrying out banking business. Income of Rs.6,25,47,650/- declared in the e-return filed on 27.11.2014. The case selected for scrutiny, therefore statutory notices u/s 143(2) and 142(1) were duly served upon the assessee. After considering the submissions of the assessee certain disallowances were made which included disallowance of professional consultancy fees of Rs.9,88,736/- and adhoc disallowance of Rs.38,298/- out of the leave encashment expenses thereby assessing income at Rs. 6,86,81,259/-. Aggrieved assessee preferred appeal before Ld. CIT(A) and partly succeeded.
4. Now the assessee is in appeal before the Tribunal against the disallowance of professional and consultancy fees of Rs.9,88,736/- and disallowance of leave encashment expenses at Rs.38,298/-. 2 Jila Sahakari Kendriya Bank Maryadit ITA No. 903/Ind/2018
5. Ld. Counsel for the assessee with regard to disallowance of professional & consultancy fees of Rs.9,88,736/- submitted that complete expenditure details were filed and payment made after deduction of tax at source as and where applicable. Books of accounts were audited and the alleged failure of the assessee to produce details of vouchers was due to the reason that during the period 8.11.2016 to 31.11.2016 the bank staff were deputed in complying the instructions/orders issued by Reserve Bank of India/Ministry of Finance under demonetization scheme. Prayer was also made to delete the addition for disallowance of leave encashment expenses at Rs.38,298/-.
6. Per contra Ld. Departmental Representative vehemently argued supporting the order of lower authorities.
7. We have heard rival contentions and perused the records placed before us. As regards Ground No.1 where the assessee has challenged the finding of Ld. CIT(A) confirming the disallowance of Rs.9,88,736/- being 20% of the professional & consultancy fees, we observe that details of various professional charges paid by the assessee bank are placed at paper book at page 12 to 61. Assessee has provided minute details of all the professional charges paid 3 Jila Sahakari Kendriya Bank Maryadit ITA No. 903/Ind/2018 during the year. As submitted by the Ld. Counsel for the assessee that all the payments for professional and legal fees have been made through account payee cheque and tax deducted at source (as applicable). We are satisfied with these details and are of considered view that the adhoc disallowance of Rs.9,88,736/- was uncalled for and Ld. CIT(A) erred in sustaining the disallowance ignoring the fact that the assessee being a co-operative bank is maintaining complete details. Thus such adhoc disallowance are uncalled for when complete details have been filed by the assessee with documentary evidence. We, thus delete the disallowance of Rs. 9,88,736/- made out of professional and consultancy fees and allow Ground No.1 raised by the assessee.
8. As regards Ground No.2 for the disallowance of leave encashment of Rs. 38,298/- confirmed by the Ld. CIT(A) we observe that the particular ledger under the name "leave salary contribution orders" for the Financial Year 2013-14 is placed at page 62 of the paper book and along with the ledger account all the vouchers are also been attached which shows the calculation of leave encashment expenditure incurred by the assessee bank under various heads. For instance leave encashment expenditure of 4 Jila Sahakari Kendriya Bank Maryadit ITA No. 903/Ind/2018 Rs.16,295/- Rs.15,919/- and Rs.15,919/- have been booked for the month of May, 2013, June,2013 and July,2013. Similarly expenses have also been booked for other months. The entry in the ledger account has been made on the basis of vouchers regularly prepared by the bank duly signed by the Branch Manager and Clerk. We see no reason to doubt the genuineness of leave encashment expenses incurred by the assessee and there remains hardly any possibility to make disallowance for such expenses. Thus adhoc disallowance of Rs.38,298/- out of leave encashment expenditure is uncalled for and liable to be deleted. We accordingly order so. Ground No.2 of the assessee is allowed.
9. In the result the appeal of the assessee is allowed.
The order pronounced in the open Court on 29.01.2020.
Sd/- Sd/-
( KUL BHARAT) (MANISH BORAD)
JUDICIAL MEMBER ACCOUNTANT MEMBER
दनांक /Dated : 29 January, 2020
/Dev
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Jila Sahakari Kendriya Bank Maryadit
ITA No. 903/Ind/2018
Copy to: The Appellant/Respondent/CIT concerned/CIT(A)
concerned/ DR, ITAT, Indore/Guard file.
By Order,
Asstt.Registrar, I.T.A.T., Indore
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