THE DCIT-3(1), Indore v. M/S. NARMADA MALWA GRAMIN BANK, Indore

ITA 300/Ind/2018 | 2008-2009
Pronouncement Date: 22-11-2019 | Result: Dismissed

Appeal Details

RSA Number 30022714 RSA 2018
Assessee PAN AACCN2847F
Bench Indore
Appeal Number ITA 300/Ind/2018
Duration Of Justice 1 year(s) 7 month(s) 11 day(s)
Appellant THE DCIT-3(1), Indore
Respondent M/S. NARMADA MALWA GRAMIN BANK, Indore
Appeal Type Income Tax Appeal
Pronouncement Date 22-11-2019
Appeal Filed By Department
Order Result Dismissed
Bench Allotted DB
Tribunal Order Date 22-11-2019
Date Of Final Hearing 17-09-2019
Next Hearing Date 17-09-2019
Last Hearing Date 22-07-2019
First Hearing Date 22-07-2019
Assessment Year 2008-2009
Appeal Filed On 11-04-2018
Judgment Text
[ITA NO.300/IND/2018] [M/S. NARMADA MALWA GRAMIN BANK INDORE] IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH INDORE BEFORE SHRI KUL BHARAT JUDICIAL MEMBER AND SHRI MANISH BORAD ACCOUNTANT MEMBER ITA NO.300/IND/2018 ASSESSMENT YEAR: 2008-09 DCIT - 3(1) INDORE / VS. M/S. NARMADA MALWA GRAMIN BANK 201 ARCADE SILVER 56 SHOPS INDORE ( APPELLANT ) ( REVENUE ) P.A. NO. AACCN2847F APPELLANT BY SMT. ASHIMA GUPTA D.R. RESPONDENT BY SHRI S.K. DESHPANDE A.R. DATE OF HEARING: 19.11.2019 DATE OF PRONOUNCEMENT: 22.11.2019 / O R D E R PER KUL BHARAT J.M: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST ORDER OF THE CIT(A)-1 INDORE DATED 15.1.2018 PERTAINING TO T HE ASSESSMENT YEAR 2008-09. THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPEAL: [ITA NO.300/IND/2018] [M/S. NARMADA MALWA GRAMIN BANK INDORE] 2 1. WHETHER IN THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE LD. CIT(A) WAS JUSTIFIED IN ADMITTING AND ADJUDICATING THE GROUND REGARDING ADDITION OF RS.16 95 83 384/- U/S 369(1)(VIIA) OF THE ACT EVEN WHEN NO SUCH ADDIT ION WAS MADE IN THE ORDER U/S 147/143(3) OF THE I.T. ACT DATED 20.3.2016. 2. WHETHER IN THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE LD. CIT(A) WAS JUSTIFIED IN DELETING ADDITION OF RS.47 90 498/- ON ACCOUNT O F THE EXCESS PROVISION OF GRATUITY AND LEAVE ENCASHMENT. 3. WHETHER IN THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE LD. CIT(A) WAS JUSTIFIED IN SUSTAINING ONLY RS.48 790/- OUT OF ADDITION OF R S.2 10 395/- U/S 40(A)(IA) IN VIEW OF FINDINGS IN ASSESSMENT ORDER. 4. WHETHER IN THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE LD. CIT(A) WAS JUSTIFIED IN DELETING THE ADDITION OF RS.5 89 91 207/- ON ACC OUNT OF PROVISION OF GRATUITY AND LEAVE ENCASHMENT WITHOUT GIVING ANY FINDINGS AS TO WHETHER IT WAS NOT ALREADY ALLOWED ON PROVISION BASIS AND ALSO NOT MAK ING ANY VERIFICATION ABOUT ITS ACTUAL PAYMENTS. 5. THE APPELLANT CRAVES LEAVE TO ADD TO DEDUCT FROM O R OTHERWISE AMEND THE ABOVE GROUND OF APPEAL. 2. BRIEFLY STATED FACTS ARE THAT CASE OF THE ASSESSEE WAS REOPENED AND THE ASSESSMENT U/S 147 R.W.S. 143(3) OF THE INCOME TAX ACT 1961 (HEREINAFTER CALLED AS THE ACT) WAS FRAMED VIDE ORDER DATED 23.3.2016. WHILE FRAMING THE ASSESSMENT THE A.O. MADE ADDITION OF RS.47 90 498/- O N ACCOUNT OF THE EXCESSIVE PROVISION IN RESPECT OF LEAV E ENCASHMENT AND GRATUITY. THE A.O. ALSO MADE ADDITION OF RS.2 10 395/- ON ACCOUNT OF NON-DEDUCTION OF TAX AT SOURCE. FURTHER ADDITION WAS MADE IN RESPECT OF PROV ISION [ITA NO.300/IND/2018] [M/S. NARMADA MALWA GRAMIN BANK INDORE] 3 OF GRATUITY AND LEAVE ENCASHMENT U/S 143(3) OF THE ACT. AGGRIEVED AGAINST THIS THE ASSESSEE PREFERRED AN APPEAL BEFORE LD. CIT(A) WHO AFTER CONSIDERING THE SUBMISS IONS DELETED THE ADDITION OF RS.47 90 498/- OUT OF THE PR OVISION MADE FOR LEAVE ENCASHMENT AND GRATUITY. THE LD. CIT(A) HELD THAT BOTH THE PAYMENTS WERE ACTUALLY MADE. IN RESPECT OF THE ADDITION MADE ON ACCOUNT OF NON-DEDUCTI ON OF TAX AT SOURCE THE LD. CIT(A) PARTLY ALLOWED THE RE LIEF TO THE ASSESSEE. THEREBY HE CONFIRMED ADDITION TO THE EXTENT OF RS.47 790/- OUT OF THE TOTAL ADDITION OF RS.2 10 3 95/- IN RESPECT OF ADDITION MADE ON ACCOUNT OF EXCESS PROVISI ON OF RS.5 89 91 207/- WAS ALSO DELETED. AGAINST THIS THE REVENUE IS IN PRESENT APPEAL. 3. GROUND NO.1 OF THE REVENUES APPEAL READS AS UNDER: 1. WHETHER IN THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE LD. CIT(A) WAS JUSTIFIED IN ADMITTING AND ADJUDICATING THE GROUND REGARDING ADDITION OF RS.16 95 83 384/- U/S 369(1)(VIIA) OF THE ACT EVEN WHEN NO SUCH ADDIT ION WAS MADE IN THE ORDER U/S 147/143(3) OF THE I.T. ACT DATED 20.3.2016. [ITA NO.300/IND/2018] [M/S. NARMADA MALWA GRAMIN BANK INDORE] 4 4. IT IS NOTICED THAT THE ASSESSEE HAD TAKEN A GROUND BEFORE LD. CIT(A) I.E. GROUND NO.2 WHICH IS REPROD UCED AS UNDER: THE LD. A.O. HAS ERRED IN DISALLOWING THE CLAIM OF THE ASSESSEE MADE OF RS.16 95 85 384/- U/S 36(1)(VII)(A). 5. THIS GROUND OF THE ASSESSEES APPEAL WAS DISMISSED B Y THE LD. CIT(A) IN PARA 4.2.5 BY OBSERVING AS UNDER: RESPECTFULLY FOLLOWING THE AFORESAID DECISIONS OF CIT(A) ITAT AND HON'BLE SUPREME COURT THE DISALLOWANCE OF CLAIM OF DEDUCTION U/S 36(1)(VIIA) OF I.T. ACT OF RS.16 95 85 384/- IS HER EBY CONFIRMED . THEREFORE THE APPEAL ON THIS GROUND IS DISMISSED. 6. IN VIEW OF THE ABOVE GROUND NO.1 OF THE REVENUE S APPEAL IS DISMISSED. 7. GROUND NO.2 IS AGAINST DELETING THE ADDITION MADE O N ACCOUNT OF EXCESS PROVISION OF GRATUITY AND LEAVE ENCASHMENT. 8. LD. CIT(DR) SUPPORTED THE ORDER OF THE A.O. AND SUBMITTED THAT LD. CIT(A) WAS NOT JUSTIFIED IN DELET ING THE ADDITION. [ITA NO.300/IND/2018] [M/S. NARMADA MALWA GRAMIN BANK INDORE] 5 9. LD. COUNSEL FOR THE ASSESSEE OPPOSED THESE SUBMISSIONS AND SUBMITTED THAT ALL PAYMENTS HAVE BEEN MADE DURING THE YEAR UNDER CONSIDERATION AND IN VIEW OF THE PROVISIONS OF SECTION 43B(B) OF THE ACT TOTAL D EMAND IS ALLOWABLE AS A DEDUCTION. 10. WE HAVE HEARD THE RIVAL SUBMISSIONS PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. WE FIND THAT LD. CIT(A) HAS GIVEN A FINDING ON FACT THAT ALL THE PAYMENTS HAVE BEEN ACTUALL Y MADE. THIS FACT IS NOT CONTROVERTED BY THE REVENUE THEREFORE WE DO NOT SEE ANY REASON TO INTERFERE WITH THE FINDING OF THE LD. CIT(A). GROUND RAISED BY THE REV ENUE IS REJECTED. 11. GROUND NO.3 IS AGAINST SUSTAINING THE ADDITION OF RS.48 790/- OUT OF TOTAL ADDITION OF RS.2 10 395/- U /S 40(A)(IA) OF THE ACT. [ITA NO.300/IND/2018] [M/S. NARMADA MALWA GRAMIN BANK INDORE] 6 12. LD. CIT(DR) SUPPORTED THE ORDER OF THE A.O. AND SUBMITTED THAT LD. CIT(A) WAS NOT JUSTIFIED IN REDUCI NG THE ADDITION. 13. WE FIND THAT LD. CIT(A) HAS FOLLOWED THE JUDICIAL PRONOUNCEMENTS APPLICABLE ON THE FACTS OF THE PRESENT CASE THEREFORE THE VIEW OF THE LD. CIT(A) IS AFFIR MED AS THE REVENUE FAILED TO BRING ANY JUDGEMENT OF THE HON'BLE JURISDICTIONAL HIGH COURT ON THIS ISSUE. 14. GROUND NO.4 IS AGAINST DELETING THE ADDITION OF RS.5 89 91 207/- ON ACCOUNT OF PROVISION OF GRATUITY AND LEAVE ENCASHMENT. 15. LD. CIT(DR) SUPPORTED THE ORDER OF THE A.O. AND SUBMITTED THAT LD. CIT(A) HAS MECHANICALLY ALLOWED THE CLAIM OF THE ASSESSEE WITHOUT VERIFYING THE ACTUAL PAYMENTS. LD. D.R. SUBMITTED THAT THE LD. CIT(A) OU GHT TO HAVE CONFIRMED THESE ADDITIONS. [ITA NO.300/IND/2018] [M/S. NARMADA MALWA GRAMIN BANK INDORE] 7 16. ON THE CONTRARY LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS AS MADE IN THE WRITTEN SUBMISSIONS BEFORE THE LD. CIT(A). THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE A.O. MADE ADDITION ON A WRO NG APPRECIATION OF FACT THAT NO DETAILS HAVE BEEN SUBMITTED ABOUT THE PAYMENTS AND IT IS NOT ASCERTAINABLE AS TO HOW THIS CLAIM OF RS.5 89 91 207/- IS ALLOWABLE. HE SUBM ITTED THE COMPLETE DETAILS OF PAYMENTS WAS FILED VIDE LETTE R DATED 22.6.2015 AND 11.8.2015 WHEREIN IT WAS ALSO STATED THAT DEDUCTION IS CLAIMED ON THE BASIS OF ACTUAL PAYMENT. T HE ATTENTION WAS ALSO DRAWN TO THE AUDIT REPORT FOR THE FINANCIAL YEAR 2006-07 & 2007-08 WHEREIN IT WAS SUBMITTED THAT THIS IS A PRE-EXISTING LIABILITY WHICH WAS DISALLOWED IN THE EARLIER YEARS BEING NOT PAID DURING THOSE YEARS. THE COMPUTATION OF THE EARLIER YEARS DISALLOWING THE SAID PAYMENT WAS ALSO ATTACHED WITH THE TAX AUDIT REPORT FOR THE ASSESSMENT YEAR 2007-08. IT WOULD BE SEEN TH AT THE [ITA NO.300/IND/2018] [M/S. NARMADA MALWA GRAMIN BANK INDORE] 8 SAID AMOUNT HAD BEEN MENTIONED ON THE PRE-EXIST LIABILI TY ON THE FIRST DAY OF THE PREVIOUS YEAR NOT ALLOWED IN THE EARLIER ASSESSMENT YEAR AND NOT PAID DURING THE YEAR. DURING THE YEAR UNDER CONSIDERATION THE SAID AMOUNT WAS PAID AND IN VIEW OF THE PROVISIONS OF SECTION 43B(B) OF THE ACT THE SAID AMOUNT IS ALLOWABLE AS DEDUCTION. HE SUBMITTED THAT THE CHALLANS OF THE ACTUAL PAYMENTS WERE FILED BEFORE THE A.O. AND COPIES OF THE SAME WERE ENC LOSED IN THE PAPER BOOK BEFORE LD. CIT(A). 17. WE HAVE HEARD THE RIVAL SUBMISSIONS PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. LD. CIT(A) HAS ALLOWED THE DEDUCTION BY OBSERVING AS UNDER: THE APPELLANT SUBMITTED THAT THE EXPENSE HAS BEEN DEBITED ON THE BASIS OF ACTUAL PAYMENT. THE APPELLANT HAS SHOWN PRE EXISTING LIABILITY IN THE F.Y. 2006-07 AND F.Y. 200 7-08 WHICH HAS BEEN DISALLOWED IN THE EARLIER YEAR. THE APPELLANT HAS MADE THE SAID PAYMENT DURING THE YEAR UNDER CONSIDERATION AN D THE SAME IS ALLOWABLE U/S 43B OF THE INCOME TAX ACT. THEREFORE THE A.O. IS NOT JUSTIFIED IN MAKING THE ADDITION. [ITA NO.300/IND/2018] [M/S. NARMADA MALWA GRAMIN BANK INDORE] 9 18. FOR THE SAKE OF CLARITY SECTION 43B(B) OF THE AC T IS REPRODUCED AS UNDER: 43B(B) ANY SUM PAYABLE BY THE ASSESSEE AS AN EMPLOY ER BY WAY OF CONTRIBUTION TO ANY PROVIDENT FUND OR SUPERANNUA TION FUND OR GRATUITY FUND OR ANY OTHER FUND FOR THE WELFARE OF EMPLOYEES [OR] SHALL BE ALLOWED (IRRESPECTIVE OF THE PREVIOUS YEAR IN WHICH THE LIABILITY TO PAY SUCH SUM WAS INCURRED BY THE ASSES SEE ACCORDING TO THE METHOD OF ACCOUNTING REGULARLY EMPLOYED BY HIM) ONLY IN COMPUTING THE INCOME REFERRED TO IN SECTION 28 OF T HAT PREVIOUS YEAR IN WHICH SUCH SUM IS ACTUALLY PAID BY HIM. 19. THE LD. CIT(A) HAS GIVEN A FINDING ON FACT THAT THE PAYMENTS WERE ACTUALLY MADE IN THE YEAR UNDER APPEAL THEREFORE IN VIEW OF THE AFORESAID PROVISION WE DO NOT SEE ANY INFIRMITY IN TO THE FINDING OF LD. CIT(A) AND TH E SAME IS HEREBY AFFIRMED. THIS GROUND OF THE REVENUES APPEAL IS REJECTED. 20. GROUND NO.5 IS GENERAL IN NATURE NEEDS NO SEPARATE ADJUDICATION. [ITA NO.300/IND/2018] [M/S. NARMADA MALWA GRAMIN BANK INDORE] 10 21. IN THE RESULT THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 22 . 11.2019. SD/- (MANISH BORAD) SD/- (KUL BHARAT) A CCOUN TANT MEMBER JUDICIAL MEMBER INDORE; DATED : 22/11/2019 VG/SPS COPY TO: ASSESSEE/AO/PR. CIT/ CIT (A)/ITAT (DR)/GUAR D FILE. BY ORDER ASSISTANT REGISTRAR INDORE