TMI Blog2015 (8) TMI 1033X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd. (2010 (3) TMI 80 - SUPREME COURT) has held that a mere making of a claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee. Such a claim made in the return cannot amount to furnishing of inaccurate particulars. In the present case, the assessee is rather on a better footing. The assessee is eligible to claim deduction u/s. 80HHC on exports. The only shortcoming is that the assessee has not recovered the export proceeds on which the deduction has been claimed. The impugned order of the CIT (Appeals) in deleting the penalty levied u/s. 271(1)(c) on both the grounds is well reasoned and warrants no interference. Addition on account of Management Incentive Bonus (MIPB) and Leave Travel Assistance (LTA) - CIT(A) deleted the addition - Held that:- It is an admitted position that the assessee is following mercantile system of accounting and has been making provision for the aforesaid incentives. It has come on record that the incentives are paid to the assessee in the subsequent year, if they are not claimed by the employees in the year in which provision is made. The assessee has been consistentl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the assessee has inflated the purchase or has claimed excessive depreciation.We find that there is disparity between the bills produced by the assessee before the Assessing Officer and as recorded by the CIT (Appeals). In such circumstances, we deem it appropriate to remit this issue back to the Assessing Officer for reconsideration of the bills/invoices. - Decided in favour of assessee for statistical purpose. - ITA Nos. 638 & 639/PN/2014 - - - Dated:- 19-8-2015 - SHRI R.K. PANDA AND SHRI VIKAS AWASTHY, JJ. For The Assessee : Shri R. D. Onkar For The Revenue : Shri Hitendra Ninave ORDER PER VIKAS AWASTHY, JM : ITA No. 638/PN/2014 has been filed by the Revenue against the order of Commissioner of Income Tax (Appeals)-I, Nashik dated 30-01-2014 for the assessment year 2004-05. In appeal, the Revenue has impugned deleting of penalty levied u/s. 271(1)(c) of the Act. In ITA No. 639/PN/2014 the Revenue has assailed the order of Commissioner of Income Tax (Appeals)-I, Nashik dated 31-01-2014 for assessment year 2008-09. In the said appeal, the Revenue has challenged the findings of Commissioner of Income Tax (Appeals) in deleting the addition made on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , no TDS was liable to be deducted. The Commissioner of Income Tax (Appeals) in the light of un-rebutted facts, deleted the penalty on account of addition made u/s. 40(a)(ia). In respect of disallowance u/s. 80HHC, it was observed that the total income assessed is to the tune of ₹ 5,28,58,006/-. The assessee had claimed total deduction of ₹ 87,29,808/- u/s. 80HHC on the export sales. However, during reassessment proceedings, it transpired that an amount of ₹ 13,39,318/- was not realized from export debtors and the assessee had claimed deduction on the said amount u/s. 80HHC. The excess deduction of ₹ 1,96,381/- was claimed due to oversight and there was no deliberate intention of the assessee to claim the higher deduction. It was further pointed out that unrealized export debtors were discovered during the reassessment proceedings. It is not a case where any facts were suppressed dishonestly or the income was concealed deliberately. The Commissioner of Income Tax (Appeals) deleted the penalty on the aforesaid amount by placing reliance on the decision of Hon'ble Supreme Court of India in the case of CIT Vs. Reliance Petro Products P. Ltd. reported as 322 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e heard the submissions made by the representatives of both the sides and have perused the orders of authorities below. In appeal the Revenue has assailed the order of Commissioner of Income Tax (Appeals) in deleting the penalty levied u/s. 271(1)(c). The penalty has been levied on account of disallowance made u/s. 40(a)(ia) and restricting the claim of deduction u/s. 80HHC. 7. The Assessing Officer made disallowance u/s. 40(a)(ia) for nondeduction of tax on the payment of sales commission amounting to ₹ 7,47,155/- to overseas entities. The said commission was paid to foreign entities for carrying out marketing activities and soliciting export orders from foreign buyers. It has not been disputed that the payments made were not for any services falling within the ambit of section 9(1)(vii) of the Act. The Hon'ble Supreme Court of India in the case of GE India Technology Centre P. Ltd. Vs. CIT reported as 327 ITR 456 (SC) has held that if the remittances are not assessable to tax under the provisions of Act, there is no question of deducting tax at source. The services were admittedly rendered outside India by the foreign entities. The said foreign entities were having n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT(A)- I, Nashik was justified in deleting the addition of ₹ 2,86,964/-on account of Management Incentive Bonus( MIPB) and Leave Travel Assistance (LTA) ? 2. Whether on the facts and in the circumstances of the case, the Ld. CIT(A)- I, Nashik was justified in deleting the addition of ₹ 98,061/- on account of Employees contribution towards PF ESIC, Ignoring the fact that they were deposited in the subsequent year? 3. Whether on the facts and in the circumstances of the case, the Ld. CIT(A)- I, Nashik was justified in deleting the addition of ₹ 16,99,760/-on account of depreciation, ignoring the fact that the assessee failed to produce documentary evidence to support it ? 4. The appellant prays the order of the Assessing Officer may be restored. 5. The appellant prays to adduce such further evidence to substantiate his case. 6. The appellant prays leave to add, alter, clarify, amend and or withdraw any grounds of appeal as and when the occasion demands. 11. In the first ground, the Revenue has impugned the order of Commissioner of Income Tax (Appeals) in deleting the addition of ₹ 2,86,964/- on account of Management Incentive Bonus (MIPB) a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovisions of respective Acts. However, the amount was deposited well before the due date of filing of return u/s. 139 of the Act. The ld. AR submitted that the issue is squarely covered in favour of the assessee by the recent decision of Bombay High Court in the case of Hindustan Organics Chemicals Ltd. reported as 366 ITR 1. 13. The Revenue has not disputed that the payment of Employees contribution towards PF and ESIC were deposited by the assessee before the due date of filing of return under the provisions of the Act. We find that this issue has already been settled by the Hon'ble Supreme Court of India in the case of Alom Extrusions Ltd. reported as 319 ITR 306. The Hon'ble jurisdictional High Court in the case of Hindustan Organics Chemicals Ltd. (supra) and in the case of CIT Vs. Ghatge Patil Transport Ltd. reported as 368 ITR 749, following the law laid down by the Hon'ble Supreme Court of India has held that the assessee would be entitled to deduction on contribution to the employee welfare funds, if the amount has been credited on or before the due date of filing of the return. We do not find any infirmity in the impugned order in deleting the addition on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee has failed to produce bills in respect of assets amounting to ₹ 94,51,713/-. Whereas, the Commissioner of Income Tax (Appeals) in his order has reduced this amount to ₹ 15,95,990/- without recording the reasons. It is not clear from the order of the appellate authority, whether some more bills/invoices were furnished by the assessee before him. The Commissioner of Income Tax (Appeals) has further erred in observing that the Assessing Officer has not brought on record that the assessee has inflated the purchase or has claimed excessive depreciation. The Assessing Officer restricted the claim of depreciation on account of failure of assessee to furnish the bills for purchase of assets and not on account of inflated purchases or excessive depreciation claim. We find that there is disparity between the bills produced by the assessee before the Assessing Officer and as recorded by the Commissioner of Income Tax (Appeals). In such circumstances, we deem it appropriate to remit this issue back to the Assessing Officer for reconsideration of the bills/invoices. The Assessing Officer shall decide this issue afresh after verification of the bills/invoices produced by the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X
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