Samuel Jose, Kollam v. ITO, Kollam

ITA 310/COCH/2011 | 2006-2007
Pronouncement Date: 04-10-2013 | Result: Partly Allowed

Appeal Details

RSA Number 31021914 RSA 2011
Assessee PAN AAPPJ2297P
Bench Cochin
Appeal Number ITA 310/COCH/2011
Duration Of Justice 2 year(s) 4 month(s) 28 day(s)
Appellant Samuel Jose, Kollam
Respondent ITO, Kollam
Appeal Type Income Tax Appeal
Pronouncement Date 04-10-2013
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted DB
Tribunal Order Date 04-10-2013
Date Of Final Hearing 30-09-2013
Next Hearing Date 30-09-2013
Assessment Year 2006-2007
Appeal Filed On 06-05-2011
Judgment Text
ITA NO. 310/ COCH/ 2011 1 IN THE INCOME TAX APELALTER TIBUNAL COCHIN BENCH COCHIN BEFORE S/SHRI N.R.S. GANESAN JM & B. R. BASKARAN AM ITA NO.310/COCH/2011 (ASST YEAR 2006 - 07 ) SHRI SAMUEL JOSE JOSE BHAVANAM SOORANADU ANAYADI PO KOLLAM DIST PIN 690 561 VS THE INCOME TAX OFFICER WARD 3 CIRCLE 1 KOLLAM ( APPELLANT) (RESPONDENT) PAN NO. AAPPJ2297P ASSESSEE BY SHRI K M V PANDALAI REVENUE BY SMT S LATHA V KUMAR/ SRI M ANUL KUMAR CIT - DR DATE OF HEARING 30 TH SEPT 2013 DATE OF PRONOUNCEMENT 4TH OCT 2013 OREER PER N.R. S GANESAN JM: THE APPEAL OF THE ASSESSEE WAS DISMISSED FOR NON PROSECUTION BY THE TRIBUNAL VIDE ORDER DATED 21.3.2013 . ON THE APPLICATION FILED BY THE ASSESSEE IN MP NO.81/COCH/201 3 THE ORDER OF THE TRIBUNAL DATED 21.3.2013 WAS RECALLED AND THE APPEA L OF THE ASSESSEE WAS RESTORED ON THE FILE AND ACCORDINGLY THE APPEAL WAS AGAIN POSTED FOR FINAL DISPOSAL. 2 SRI K M V PANDALAI LD COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE AO DISALLOWED BONUS PAYABLE TO THE EXTENT OF RS. 10 66 212/ - . ACCORDING TO T HE LD COUNSEL THE ASSESSEE MAINTAINED THE BOOKS OF ACCOUNTS INCLUDING VOUCHERS. THE ASSESSEE HAS FILED ALL T H E MATERIALS BEFORE THE AO WITH REGARD TO THE PAYMENT OF BONUS. HOWEVER THE AO SAYS THAT THE ASSESSEE HAS NOT FILED THE DE TAI LS REGARDING THE PAY MENT OF BONUS; ACCORDINGLY HE DISALLOWED THE CLAIM OF THE ITA NO. 310/ COCH/ 2011 2 ASSESSEE. THE LD COUNSEL FURTHER SUBMITTED THAT THE GOVERNMENT OF KERALA FIXED THE BONUS @ 20% OF THE WAGES. ACCORDING TO THE LD COUNSEL THE ASSESSEE IS FOLLOWING THE MERCANTILE SYSTEM OF ACCOUNT ING. THE BONUS ACCRUED FROM SEPT 2005 TO MARCH 2006 WAS PROVIDED IN THE ACCOUNT AS ON 31.3.2006; HOWEVER THE SAME WILL BE PAYABLE ONLY IN AUG 2006 DURING ONAM SEASON. THE AO ALLOWED ONLY RS. 8.76.532/ - WHICH COMES TO 8.35% OF THE WAGES. ACCORDING TO THE LD COUNSEL THE ASSESSEE IS LIABLE TO PAY 20% OF THE WAGES AS BONUS. THEREFORE THE CIT(A) WAS NOT CORRECT IN CONFIRMING THE ORDER OF THE AO. 2.1 ON THE QUERY FROM THE BENCH THE LD COUNSEL SUBMITTED THAT THE ASSESSEE IS READY AND WILLING TO PRODUCE A LL THE VOUCHERS FOR THE PAYMENT OF BONUS TO THE EMPLOYEES. THE LD COUNSEL FURTHER SUBMITTED THAT HE HAS NO OBJECTION IF THE MATTER REMAND TO THE FILE OF THE AO TO VERIFY THE LEDGER S AND VOUCHERS FOR PAYMENT OF WAGES. 2.2 ON THE CONTRARY SMT LATHA V KUM AR THE LD DR SUBMITTED THAT THE ASSESSEE HAS NOT FILED ANY DETAILS BEFORE THE AO EVEN THOUGH THE AO CALLED FOR THE SAME. THE AO REQUESTED THE ASSESSEE TO PRODUCE THE RELEVANT CASH BOOK BONUS REGISTER S VOUCHERS ETC. FOR PAYMENT OF BONUS . SINCE THE ASSES SEE COULD NOT FILE ALL THESE DETAILS THE AO DISALLOWED THE CLAIM OF THE ASSESSEE WHICH WAS CONFIRMED BY THE CIT(A). IF THE ASSESSEE IS READY TO FILE THE BOOKS OF ACCOUNT AND OTHER VOUCHERS AS CALLED BY THE AO THE DEPARTMENT IS READY TO VERIFY THE SAME IF THE MATTER REMAND BACK TO THE FILE OF THE AO. 3 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND PERUSED THE RELEVANT MATERIAL ON RECORD. THE ASSESSEE NOW CLAIMS THAT HE IS READY AND WILLING TO PRODUCE ALL THE BOOKS OF ACCOUNT INCLUDING REG ISTER S FOR BONUS AND OTHER VOUCHERS. THEREFORE THIS TRIBUNAL IS OF ITA NO. 310/ COCH/ 2011 3 THE CONSIDERED OPINION THAT THE MATTER NEEDS TO BE VERIFIED BY THE AO. ACCORDINGLY THE ORDER S OF THE LOWER AUTHORITIES ARE SET ASIDE AND THE ISSUE OF BONUS IS REMANDED BACK TO THE FILE OF THE AO. THE ASSESSEE IS DIRECTED TO FILE ALL THE BOOKS O F ACCOUNT INCLUDING BONUS REGISTER S VOUCHERS ETC. BEFORE THE AO AND T HE AO SHALL VERIFY THE SAME AND THEREAFTER DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH LAW AFTER GIVING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 4 THE NEXT GROUND OF APPEAL IS WITH REGARD TO DISALLOWANCE OF RS. 1 26 340/ - BEING EXPENSES FOR TRANSPORT ING . 5 ACCORDING TO THE LD COUNSEL FOR THE ASSESSEE THE CLAIM TOWARDS TRANSPORT ING EXPENSES WAS DISALLOWED ON THE GR OUND THAT IT WAS NOT PROVED. THE LD COUNSEL SUBMITTED THAT THIS AMOUNT IS PAYABLE TO M/S AGRAWAL & CO TOWARDS TRANSPORT ING CHARGES. ACCORDING TO THE LD COUNSEL THE ASSESSEE FLED ALL THE NECESSARY DETAILS BEFORE THE AO FOR VERIFICATION. WE HAVE HEARD THE LD DR ALSO. 6 THE MAIN REASON FOR THE DISALLOWANCE IS THAT THE ASSESSEE HAS NOT PRODUCED ANY MATERIAL BEFORE THE AO WITH REGARD TO TRANSPORTING CHARGES. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT WHEN THE ASSESSEE IS READY AND WILLING TO PRODUCE TH E MATERIAL FOR THE EXPENSE INCURRED TOWARDS TRANSPORTATION THE SAME NEEDS TO BE VERIFIED BY THE AO. ACCORDINGLY THE ORDERS OF THE LOWER AUTHORITIES ARE SET ASIDE AND THE ISSUE IS REMANDED BACK TO THE FILE OF THE AO. THE AO SHALL RECONSIDER THE SAME AND VERIFY ALL THE MATERIAL THAT MAY BE FILED BY THE ASSESSEE AND THEREAFTER DECIDE THE ISSUE IN ACCORDANCE WITH LAW AFTER GIVING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 7 NEXT GROUND OF APPEAL IS WITH REGARD TO THE DISALLOWANCE OF RS. 5 20 000 . ITA NO. 310/ COCH/ 2011 4 7.1 ACCORDING TO THE LD COUNSEL THE ASSESSEE OFFERED ADDITIONAL INCOME FOR TAXATION. THE ASSESSEE CLAIMED TELESCOPING OF THE ADDITIONAL INCOME WITH REGARD TO UNEXPLAINED INVESTMENT TRANSPORTING CHARGES AND PAYMENT OF BONUS. THE AO HOWEVER REJECTED T HE CLAIM OF THE ASSESSEE TOWARDS TELESCOPING . ACCORDING TO THE LD COUNSEL THE ASSESSEE OFFERED ADDITIONAL INCOME AND THE SAME HAS TO BE TELESCOPED WITH REGARD TO THE EXPENSES INCURRED BY THE ASSESSEE. 7.2 ON THE CONTRARY THE LD DR SUBMITTED THAT THE A DDITIONAL INCOME OFFERED BY THE ASSESSEE WAS DISCLOSED IN THE BOOKS OF ACCOUNTS AND THE ASSESSEE HIMSELF TREATED THE ADDITIONAL INCOME AS INCOME FROM BUSINESS. THE DISALLOWANCE MADE BY THE AO WAS SPECIFICALLY TOWARDS THE EXPENSES INCURRED FOR BONUS AND TRA NSPORTING CHARGES. THE ASSESSEE HAS NOT TAKEN INTO CONSIDERATION THE EXPENDITURE WHILE OFFERING THE ADDITIONAL INCOME. THEREFORE THE LOWER AUTHORITIES HAVE RIGHTLY REJECTED THE CLAIM OF TELESCOPING. 8 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SI DE AND PERUSED THE RELEVANT MATERIAL ON RECORD. THE ADDITIONAL INCOME WAS OFFERED BY THE ASSESSEE AS BUSINESS INCOME. THE DISALLOWANCE WAS MADE TOWARDS PAYMENT OF BONUS TRANSPORTING CHARGES AND OTHER EXPENSES. THE ASSESSEE HAS NOT CONSIDERED THE PAYMENT O F THESE EXPENSES WHILE OFFERING THE ADDITIONAL INCOME. SINCE THE ASSESSEE HAS INDEPENDENTLY OFFERED THE ADDITIONAL INCOME OF RS. 5 20 000/ - WITHOUT ANY REFERENCE TO THE INVESTMENT OF EXPENSES THE TRIBUNAL IS OF THE CONSIDERED OPINION THAT THERE IS NO Q UESTION OF ANY TELESCOPING AS CLAIMED BY THE ASSESSEE . THEREFORE WE DO NOT FIND ANY INFIRMITY I N THE ORDER OF THE LOWER AUTHORITIES ; ACCORDINGLY THE SAME IS CONFIRMED . ITA NO. 310/ COCH/ 2011 5 9 IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCE D IN THE OPEN COURT ON THIS DAY OF 4 TH OCT 2013. SD/ - S D/ - (B.R. BASKARAN) ( N.R.S GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER COCHIN: DATED 4 TH OCT 2013 RAJ* COPY TO: 1. APPELLANT SRI SAMUEL JOSE JOSE BHAVANAM SOORANADU ANAGADI PO KOLLAM DIST 2. RESPON DENT - THE ITO WARD 3 CIRCLE 2 KOLLAM 3. CIT(A) 4. CIT KOLLAM 5. DR 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR ITAT COCHIN