Umang Dhanuka, Kolkata v. ITO, Ward - 32(2), Kolkata, Kolkata

ITA 1085/KOL/2011 | 2008-2009
Pronouncement Date: 30-12-2011 | Result: Dismissed

Appeal Details

RSA Number 108523514 RSA 2011
Assessee PAN ADLPD0494K
Bench Kolkata
Appeal Number ITA 1085/KOL/2011
Duration Of Justice 4 month(s) 18 day(s)
Appellant Umang Dhanuka, Kolkata
Respondent ITO, Ward - 32(2), Kolkata, Kolkata
Appeal Type Income Tax Appeal
Pronouncement Date 30-12-2011
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted C
Tribunal Order Date 30-12-2011
Assessment Year 2008-2009
Appeal Filed On 12-08-2011
Judgment Text
' IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : KOLKATA ( ) . . ) [BEFORE SRI S.V. MEHROTRA A.M. & SRI MAHAVIR SING H J.M.] ! ! ! ! / I.T.A NO. 1085/KOL/2011 ASSESSMENT YEAR : 2008-2009 UMANG DHANUKA KOLKATA -VS.- INCOME TAX OFFICER WARD-32(2) KOLKATA (PAN : ADLPD 0494 K) ( '# /APPELLANT ) ( $%'# / RESPONDENT ) FOR THE APPELLANT ( '# ) : SHRI S.L. KOCHAR A.R. FOR THE RESPONDENT ( $%'# ) : SHRI N. DUTTA GUPTA D.R. &' ( ) * &' ( ) * &' ( ) * &' ( ) * /DATE OF HEARING : 28.12.2011 + ) * + ) * + ) * + ) * /DATE OF PRONOUNCEMENT : 30.12.2011 - / ORDER PER SHRI S.V. MEHROTRA ACCOUNTANT MEMBER/ . . :- THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE O RDER OF LD. COMMISSIONER OF INCOME- TAX (APPEALS)-XIX KOLKATA DATED 06.06.2011 FOR THE ASSESSMENT YEAR 2008-09. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IN DIVIDUAL FILED HIS RETURN OF INCOME FOR ASSESSMENT YEAR 2008-09 DECLARING TOTAL INCOME OF R S.3 03 718/-. THE FIRST EFFECTIVE GROUND IN THIS APPEAL IS THAT LD. CIT(APPEALS) ERRED IN HOLDI NG THAT THE SUM AGGREGATING TO RS.1 71 775/- WAS TO BE TREATED AS PERQUISITES UNDER SECTION 17(2 ) OF THE INCOME TAX ACT IN THE HANDS OF THE ASSESSEE. THE ASSESSING OFFICER EXAMINED THE DETAIL S OF PAYMENT MADE THROUGH CREDIT CARDS AND FOUND THAT THE ASSESSEE HAD MADE A PAYMENT OF RS.9 31 645/- WHICH INTER ALIA INCLUDING FOLLOWING TWO PAYMENTS :- SUBSCRIPTION PAYMENTS - RS. 4 782/- OTHER EXPENSES - RS.1 66 993/- THE ASSESSEE EXPLAINED THAT BEING DEPUTY GENERAL MA NAGER (EXPORTS) OF M/S. I.G. PETROCHEMICALS LIMITED IT WAS NECESSARY TO TRAVEL ABROAD FOR DEVELOPMENT AND EXPANSION OF THE BUSINESS OF THE SAID COMPANY. HE HAD ALSO EXPLA INED THAT FOR THE SALES PROMOTION OF THE COMPANY AND FOR DEALING WITH THE CLIENTS OF THE COM PANY VARIOUS EXPENSES LIKE HOTEL EXPENSES REFRESHMENT EXPENSES MEETING EXPENSES ETC. WERE M ET BY USING THE CREDIT CARDS OF THE ITA NO. 1085/KOL./2011 2 ASSESSEE. THE ASSESSING OFFICER OBSERVED THAT OUT O F RS.9 31 645/- EXPENSES INCURRED BY ASSESSEE FROM HIS CREDIT CARDS ALLEGEDLY ON BEHALF OF COMPANY TOWARDS FOREIGN TRAVELING OF RS.3 13 957/- AND SALES PROMOTION OF RS.4 45 913/- WERE DULY EXPLAINED BUT THE SUBSCRIPTION PAYMENT OF RS.4 782/- AND OTHER EXPENSES AGGREGATIN G TO RS.1 66 993/- WERE NEITHER EXPLAINED BY THE ASSESSEE NOR BY THE COMPANY. THE ASSESSING O FFICER THEREFORE TREATED THESE TWO EXPENSES REIMBURSED BY THE COMPANY AS PERQUISITES I N THE HANDS OF ASSESSEE UNDER SECTION 17(2) OF THE ACT AND MADE AN ADDITION OF RS.1 71 77 5/-. LD. CIT(APPEALS) CONFIRMED THE ADDITION OBSERVING THAT THE ASSESSEE FAILED TO PROV E THAT THE EXPENDITURES ON ACCOUNT OF SUBSCRIPTION AND OTHER EXPENSES WERE NOT PERSONAL I N NATURE. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT SINCE THE EXPENSES WERE REIMBURSED B Y THE ASSESSEE-COMPANY THEREFORE IT COULD NOT BE TREATED AS NOT BEING INCURRED WHOLLY AND EXC LUSIVELY FOR THE PURPOSE OF COMPANYS BUSINESS. 3. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE P ARTIES AND HAVE PERUSED THE RECORDS OF THE CASE. ADMITTEDLY THE EXPENDITURE WAS INCURRED BY THE ASSESSEE FROM HIS CREDIT CARD BUT IT WAS REIMBURSED BY THE COMPANY. MERELY BECAUSE THE E XPENDITURE HAD BEEN REIMBURSED BY COMPANY IT COULD NOT BE CONCLUDED THAT ENTIRE EXPE NDITURE WAS WHOLLY AND EXCLUSIVELY ON BEHALF OF COMPANY. THE ASSESSEE NO DOUBT WAS ON BUS INESS TRIP BUT HE HAD TO INCUR PERSONAL EXPENSES ALSO DURING SUCH VISIT. THE ONUS WAS SQUAR ELY ON THE ASSESSEE TO ESTABLISH THAT THE EXPENSES HAD BEEN INCURRED BY HIM ON BEHALF OF COMP ANY. THE HONBLE SUPREME COURT IN THE CASE OF CIT VS.- CALCUTTA AGENCY LIMITED REPORTED IN (1951) 19 ITR 199 HAS HELD THAT ONUS IS SQUARELY ON THE ASSESSEE TO ESTABLISH THE FACTS CLA IMED BY IT. IN THE PRESENT CASE ADMITTEDLY THERE IS NO EVIDENCE TO SUBSTANTIATE THE ASSESSEES CLAIM. WE THEREFORE CONFIRM THE ORDER OF LD. CIT(APPEALS). 4. IN REGARD TO GROUND NO. 2 OF THE APPEAL BRIEF F ACTS ARE THAT LD. CIT(APPEALS) ERRED IN UPHOLDING THE DISALLOWANCE OF RS.2 64 813/- MADE BY THE ASSESSING OFFICER BY INVOKING PROVISIONS OF SECTION 14A OF THE INCOME TAX ACT. TH E ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAD SHOWN RS.8 26 319/- AS INTEREST RECEIP T DURING THE FINANCIAL YEAR 2007-08. HE NOTED THAT THE ACTUAL RECEIPT OF INTEREST WAS RS.11 88 505/- AND PAID INTEREST OF RS.3 62 186/-. THE ASSESSING OFFICER FURTHER NOTICED THAT THE ASSE SSEE HAD EARNED INCOME FROM DIVIDEND AND INTEREST ON TAX SAVINGS BOND WHICH WERE TOTALLY EX EMPT FROM TAX. BUT THE ASSESSEE ALSO CLAIMED DEDUCTION ON ACCOUNT OF VARIOUS EXPENSES V IZ. INTEREST ON LOAN DEMAT CHARGES BANK CHARGES MADE FOR EARNING THESE INCOMES. THE ASSESS ING OFFICER HAS ALSO COMPUTED ITA NO. 1085/KOL./2011 3 DISALLOWANCE UNDER SECTION 14A READ WITH RULE 8D AN D ACCORDINGLY MADE AN ADDITION OF RS.2 64 813/- AS PER COMPUTATION GIVEN AT PAGE 3 O F THE ASSESSMENT ORDER. BEING AGGRIEVED WITH THE ASSESSMENT ORDER ASSESSEE PREFERRED APPEA L BEFORE LD. CIT(APPEALS) WHO HAS CONFIRMED THIS ADDITION. LD. COUNSEL FOR THE ASSESS EE REFERRED TO THE PROFIT & LKOSS A/C. OF ASSESSEE AND POINTED OUT THAT THE ASSESSEE HAD CLAI MED ONLY BANK CHARGES OF RS.1 720/- AND DEMAT CHARGES OF RS.1 677/-. HE SUBMITTED THAT AS F AR AS TWO EXPENSES INCURRED FOR EARNING EXEMPT INCOME BEING RS.1 677/- AND PROPORTIONATE AM OUNT OF INTEREST EXPENSES AT RS.1 59 187/- IS CONCERNED THERE IS NO DISPUTE. HO WEVER THE ASSESSEE HAD NOT CLAIMED ANY EXPENDITURE OF RS.1 03 949/- IN THE PROFIT & LOSS A /C. THEREFORE NO DISALLOWANCE WAS CALLED FOR. 5. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE P ARTIES AND HAVE PERUSED THE RECORDS OF THE CASE. THE ASSESSING OFFICER HAD MADE THE COMPUT ATION AS PER RULE 8D AND HAS ACCORDINGLY DISALLOWED % OF AVERAGE INVESTMENT AGGREGATING TO RS.4 73 01 464/- HENCE THERE WAS NO QUESTION OF CLAIMING THIS AMOUNT IN THE PROFIT & LO SS A/C. THEREFORE THE ARGUMENT OF LD. COUNSEL CANNOT BE ACCEPTED. 6. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. . / . / . / . / ' 0. ' 0. ' 0. ' 0. .1 .1 .1 .1 2 2 2 2 1 1 1 1 34 3434 34 ORDER PRONOUNCED IN THE OPEN COURT ON 30/ 12 /2011. & 5 6 - 30/12/2011. SD/- SD/- [ MAHAVIR SINGH / ] [S.V. MEHROTRA/ ( . . )] JUDICIAL MEMBER/ ACCOUNTANT MEMBER/ DATED : 30/ 12/ 2011 COPY OF THE ORDER FORWARDED TO: 1. UMANG DHANUKA S.L. KOCHAR ADVOCATE 86 CANNING S TREET KOLKATA-1 2 ITO WARD-32(2) 10 MIDDLETON ROW KOLKATA 3. COMMISSIONER OF INCOME-TAX (APPEALS)- KOLKATA 4. CIT- KOLKATA 5. DR KOLKATA BENCHES KOLKATA (TRUE COPY) BY ORDER ASSISTANT REGISTRAR I.T.A.T. KOLKATA LAHA SR. P.S.