M/s. Richa Fashion (P) Ltd., New Delhi v. DCIT, New Delhi

ITA 383/DEL/2016 | 2012-2013
Pronouncement Date: 08-11-2017 | Result: Allowed

Appeal Details

RSA Number 38320114 RSA 2016
Assessee PAN AAFCR1814B
Bench Delhi
Appeal Number ITA 383/DEL/2016
Duration Of Justice 1 year(s) 9 month(s) 11 day(s)
Appellant M/s. Richa Fashion (P) Ltd., New Delhi
Respondent DCIT, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 08-11-2017
Appeal Filed By Assessee
Tags No record found
Order Result Allowed
Bench Allotted A
Tribunal Order Date 08-11-2017
Assessment Year 2012-2013
Appeal Filed On 27-01-2016
Judgment Text
1 ITA NO. 383/DEL/2016 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: A NEW DELHI BEFORE SHRI R. K. PANDA ACCOUNTANT MEM BER AND MS SUCHITRA KAMBLE JUDI CIAL MEMBER ITA NO. 383/DEL/2015 ( A.Y 2009-10) RICHA FASHION (P) LTD. C/O. MAYANK JAIN ADVOCATE JAIN SINGH AND COMPANY 2 CENTRAL LANE (BASEMENT) BENGALI MARKET NEW DELHI AAFCR1814B (APPELLANT) VS DCIT CIRLCE-15(1) NEW DELHI (RESPONDENT) APPELLANT BY SH. ADITYA JAIN ADV RESPONDENT BY SH. R. C. DANDEY SR. DR ORDER PER SUCHITRA KAMBLE THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER DATED 10/12/2015 PASSED BY CIT(A)-7 NEW DELHI. 2. THE GROUNDS OF APPEAL ARE AS UNDER:- 1. THAT THE DISALLOWANCES CONFIRMED BY THE LD. CIT (A) IN THE IMPUGNED ORDER ARE UNSUSTAINABLE IN LAW AND FACTS A ND DESERVE TO BE DELETED. 2. THAT THE LD.CIT(A) ERRED ON LAW AND FACTS IN CO NFIRMING THE DISALLOWANCE TO THE EXTENT OF RS.1 75 000/- ON ACCO UNT OF DATE OF HEARING 28.09.2017 DATE OF PRONOUNCEMENT 08.11.2017 2 ITA NO. 383/DEL/2016 WAGES AND OVERTIME PAID TO THE EMPLOYEES BY THE APPELLANT. 3. THAT THE LD.CIT(A) ERRED ON LAW AND FACTS IN CON FIRMING THE DISALLOWANCE OF RS.94 293/- OUT OF FOREIGN TRAVEL E XPENSES AND HOLDING THE SAME AS EXPENSES INCURRED FOR NON- BUSINESS PURPOSES. 4. THAT THE FINDINGS PERTAINING TO THE IMPUGNED DISALLOWANCES ARE PERVERSE IN AS MUCH AS THEY ARE ARBITRARY AND AD HOC. 5. THAT THE CHARGE OF INTEREST U/S 234B & SECTION 2 34C OF THE ACT IS OPPOSED TO FACTS AND LAW AND IN THE ALTERNAT E IS EXCESSIVE. 3. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF MANUF ACTURING AND EXPORT OF READYMADE GARMENTS. RETURN DECLARING TAX ABLE INCOME OF RS.9 33 73 720/- WAS FILED ON 29/09/2012 . THE CAS E WAS SELECTED FOR SCRUTINY. NOTICE U/S 143(2)/142(1) WAS ISSUED TO THE ASSESSEE. THE ASSESSING OFFICER MADE AN ADDITION OF RS.3.5 LA KH IN RESPECT OF EMPLOYEES BENEFIT EXPENSES AND ALSO ADDITION OF RS. 94 293/- U/S 37(1). 4. BEING AGGRIEVED BY THE SAME THE ASSESSEE FILED APPEAL BEFORE THE CIT(A). THE CIT(A) RESTRICTED AD-HOC ADDITION OF RS.3 50 000 TO 50% OF THE DISALLOWED AMOUNT AND GRANTED RELIEF OF RS.1 75 000/- ACCORDINGLY. THE CIT(A) ALSO CONFIRMED THE ADDITION OF RS.94 293/- OUT OF FOREIGN TRAVEL EXPENSES. 3 ITA NO. 383/DEL/2016 5. THE LD. AR SUBMITTED THAT AS RELATES TO GROUND N O. 2 ALL THE EXPENSES WERE DULY ENTERED INTO BOOKS OF ACCOUNTS A LONG WITH VOUCHERS WHICH WERE PRODUCED FROM TIME TO TIME DURI NG THE COURSE OF ASSESSMENT PROCEEDINGS AND WHICH WERE DULY VERIF IED. THE LD. AR FURTHER SUBMITS THAT REQUISITE DETAILS CALLED FOR W ERE ALSO PRODUCED FOR EXAMINATION/VERIFICATION OF THE ASSESSING OFFIC ER. THE ASSESSING OFFICER HOWEVER ARBITRARILY AND WITHOUT APPRECIAT ING THE PECULIAR FACTS PROCESSED TO MAKE ADDITIONS/DISALLOWANCES AND COMPLETED THE ASSESSMENT AT AN INCOME OF RS.9 39 72 420/-. THE C IT(A) IGNORED THE FACT THAT THE VOUCHERS RELATING TO WAGES AND OV ER TIME PAID TO ITS EMPLOYEES WERE PRODUCED BEFORE THE ASSESSING OFFICE R. AS RELATES TO GROUND NO. 3 THE LD. AR FURTHER SUBMITS THAT THE F OREIGN TRAVEL BY THE DIRECTOR WAS FOR STUDYING FASHION TRENDS AND EX PLORE MARKETS WHICH IS IN RELATION TO BUSINESS OF THE ASSESSEE AN D FOR WHICH DETAILS HAS BEEN PRODUCED BEFORE THE ASSESSING OFFI CER AS WELL AS CIT(A). 6. THE LD. DR RELIED UPON THE ORDER OF THE ASSESSIN G OFFICER AND THE CIT(A). 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. GROUND NO. 1 IS GENERAL. HENC E DO NOT REQUIRE ADJUDICATION. AS RELATES TO GROUND NO. 2 FROM THE RECORDS IT EMERGES THAT OVER TIME PAYMENT THROUGH CASH AND CHE QUES WERE DULY ENTERED INTO VOUCHERS AS WELL AS IN BOOKS OF A CCOUNT BY THE ASSESSEE. THESE VOUCHERS OR BOOKS OF ACCOUNTS WERE NEVER DOUBTED BY THE ASSESSING OFFICER. THEREFORE THE ADDITION SUSTAINED BY THE 4 ITA NO. 383/DEL/2016 CIT(A) ON AD-HOC BASIS WILL NOT BE PERMISSIBLE UNDE R THE ACT. THUS GROUND NO. 2 IS ALLOWED. 8. AS RELATED TO GROUND NO. 3 THE FOREIGN TRAVEL E XPENSES WERE ACTUALLY INCURRED FOR STUDY OF BUSINESS TRENDS IN T HE MARKET. THE DETAILS WERE FILED BEFORE THE ASSESSING OFFICER AS WELL AS THE CIT(A). THEREFORE THE SAME SHOULD HAVE BEEN ALLOWED BY THE ASSESSING OFFICER AS WELL AS BY THE CIT(A). GROUND NO. 3 IS ALLOWED. 9. GROUND NO. 4 & 5 ARE CONSEQUENTIAL. THEREFORE THE SAME ARE ALSO ALLOWED. 10. IN RESULT THE APPEAL OF THE ASSESSEE IS ALLOW ED. ORDER PRONOUNCED IN THE OPEN COURT ON 08 TH NOVEMBER 2017 . SD/- SD/- (R. K. PANDA) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEM BER DATED: 08/11/2017 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI 5 ITA NO. 383/DEL/2016 DATE 1. DRAFT DICTATED ON 11/10/2017 PS 2. DRAFT PLACED BEFORE AUTHOR 11/10/2017 PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER .2017 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 08 .10.2017 PS/PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK 0 8 .10.2017 PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER.