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2015 (11) TMI 1008 - ITAT KOLKATA

2015 (11) TMI 1008 - ITAT KOLKATA - TMI - Deduction in respect of PF & ESI payments - CIT(A) allowed the claim - Held that:- Once the issue is decided by Hon’ble jurisdictional High Court in the case of Vijay Shree Ltd. [2011 (9) TMI 30 - CALCUTTA HIGH COURT] where in it is held that the PF & ESI are paid on or before the due date of filing of return u/s. 139(1) of the Act, deduction in respect to the amount on which PF &ESI is so paid, is allowable. In the present case the assessee has paid the .....

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see-company’s employees and these are for the purpose of business. Similar are the reasons for incurring temple expense. - Decided in favour of assessee.

Addition made on account of cess on green leaf - CIT(A) allowed claim - Held that:- This issue is covered by the decision of Hon’ble jurisdictional High Court in the case of AFT Industries Ltd. V. CIT (2004 (7) TMI 81 - CALCUTTA High Court ), wherein it has been decided by Hon’ble jurisdictional High Court that cess on green leaf is .....

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ctly made outside India in foreign exchange. Assessee's income does not accrue or arise in India and once income does not accrue or arise in India, the assessee is not liable to deduct TDS on foreign payments. - Decided in favour of assessee.

Deduction of wealth tax while computing book profit u/s. 115JB - Held that:- No infirmity in the order of CIT(A) as he allowed the claim of assessee - Decided in favour of assessee.

Disallowance of bad debt - CIT(A) allowed the claim .....

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or replacement of dead plants within the plantation area. This fact has not been denied by revenue before CIT(A) or before us now. The AO also noted that this is re-plantation in the existing area and replacement of dead plants but by going through the volume of expenditure he made disallowance. Hon’ble Calcutta High Court in the case of Tasati Tea Ltd. [2003 (2) TMI 42 - CALCUTTA High Court] has considered the issue and allowed the claim of replacement of plants in existing area against dead pl .....

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em Ahmed, AM For The Appellant: None For The Respondent: Shri S. M. Surana, Advocate & Shri Sunil Surana, ACA ORDER Per Shri Mahavir Singh, JM: This appeal by revenue is arising out of order of CIT(A)-IV, Kolkata in Appeal No.145/CIT(A)-VI/10-11 dated 28.12.2011. Assessment was framed by DCIT, Circle-4, Kolkata u/s. 143(3) of the Income-tax Act, 1961 (hereinafter referred to as the Act ) for Assessment Year 2008-09 vide his order dated 24.12.2010. 2. At the outset, it is noticed that this ap .....

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k adjournment is not possible and hence, the possible case, we have taken up for hearing and decided the issue by rejecting the adjournment petition. In this case also, we have rejected the adjournment petition and heard the appeal. 4. The first issue in this appeal of revenue is as regards to the order of CIT(A) allowing deduction in respect of PF & ESI payments without considering the provisions stipulated in section 36(1)(va) of the Act. For this, revenue has raised following ground no.1: .....

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that these payments are not made within the due dates as mentioned in the respective Acts. Before CIT(A) assessee has given dates of payment and due date and CIT(A) noted that the employees contribution to PF & ESI were deposited within one or two days of the due date falling under the respective Acts. The CIT(A) noted that these payments are within the due date of filing of return of income u/s. 139(1) of the Act by the assessee. Accordingly, he allowed the claim of assessee. Aggrieved, re .....

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advocate, appearing on behalf of the appellant and after going through the decision of the Supreme Court in the case of Commissioner of Income Tax vs. Alom Extrusion Ltd., we find that the Supreme Court in the aforesaid case has held that the amendment to the second proviso to the Sec. 43(B) of the Income Tax Act, as introduced by Finance Act, 2003, was curative in nature and is required to be applied retrospectively with effect from 1st April, 1988. Such being the position, the deletion of the .....

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tion in respect to the amount on which PF &ESI is so paid, is allowable. In the present case the assessee has paid the PF deducted on account of employees contribution before due date of filing of return u/s. 139(1) of the Act, hence, we dismiss this ground of appeal of revenue. 7. The second issue in this appeal of revenue is against the order of CIT(A) in allowing puja expenses and temple expenses as business expenses. For this, revenue has raised following ground no.2: 2. That on the fact .....

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re that the AO disallowed puja expenses and temple expenses for the reason that these are not for a legitimate requirement of the business. The CIT(A) allowed the claim of the assessee. Aggrieved, revenue came in second appeal before Tribunal. 9. At the outset, Ld. Counsel for the assessee relied on the decision of Coordinate Bench of this Tribunal in assessee s own case in ITA No. 589/K/2012 for AY 2007-08 dated 19.12.2013, wherein Tribunal has allowed as under: Aggrieved, now Revenue came in a .....

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ed in assessee s own case, we confirm the order of CIT(A). Accordingly, this issue of revenue s appeal is dismissed. 10. The third issue in this appeal of revenue is against the order of CIT(A) in deleting the addition made on account of cess on green leaf. For this, revenue has raised following ground no. 3: 3. That on the facts and circumstances of the case, ld. CIT(A) erred in law in deleting the addition of ₹ 59,06,928/- on account of cess on green leaf without considering the fact tha .....

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3, wherein Tribunal has allowed as under: We find that this issue is covered by the decision of Hon ble jurisdictional High Court in the case of AFT Industries Ltd. V. CIT 270 ITR 167 (Cal), wherein it has been decided by Hon ble jurisdictional High Court that cess on green leaf is a normal business expenditure and once the Hon ble jurisdictional High Court decides the issue in favour of assessee, same is covered. Hence, the order of CIT(A) is confirmed on this issue. This issue of Revenue s app .....

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s and circumstances of the case, Ld. CIT(A) erred in law in deleting the addition of ₹ 11,35,554/- on account of non deduction of TDS u/s. 40(a)(ia) in view of the judgment given by the Supreme Court in the case of M/s. Transmission Corporation of India reported in 239 ITR 587. 13. At the outset, Ld. Counsel for the assessee relied on the decision of Coordinate Bench of this Tribunal in assessee s own case in ITA No. 589/K/2012 for AY 2007-08 dated 19.12.2013, wherein Tribunal has allowed .....

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of Supreme Court decision in case of M/s. Transmission Corporation of India reported in 239 ITR 587 wherein it was held that only way to escape liability is to get no deduction certificate or lower rate deduction certificate from AO. Appellant on the other hand has submitted that this issue was further clarified by Hon ble Supreme Court in case of GE India Technology Centre P Ltd. Vs. CIT in 44 DTR Supreme Court 201,in which Supreme Court has clarified that obligation to deduct tax at source ar .....

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the country and no part of his income arises in India. In view of the circular No. 23 and 786, the company was under no obligation to deduct tax and as provision u/s. 40(a)(ia) does not apply, the disallowance made by AO is directed to be deleted. We find that assessee's claim was that the commission paid to foreign agents, who are not having permanent establishment business place in India and they are providing services outside India and even the payment is directly made outside India in f .....

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IT(A) and we confirm the same. This issue of revenue s appeal is also dismissed. As the issue is covered in assessee s own case, we confirm the order of CIT(A). Accordingly, this issue of revenue s appeal is dismissed. 14. The fifth issue in this appeal of revenue is against the order of CIT(A) in directing the AO to allow deduction of wealth tax while computing book profit u/s. 115JB of the Act. For this, revenue has raised following ground no.5: 5. That on the facts and circumstances of the ca .....

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20 lac. Aggrieved, assessee preferred appeal before CIT(A), who relying on the decision of Coordinate Bench of ITAT in the case of Usha Martin Industries Ltd. Vs. CIT (2003) 81 TTJ 158 (Cal) and allowed the claim of assessee. We find no infirmity in the order of CIT(A) as he allowed the claim of assessee by relying on the decision of ITAT in the case of Usha Martin Industries Ltd., supra. This ground of appeal of revenue is dismissed. 16. The sixth issue in this appeal of revenue is against the .....

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8377; 45,00,000/- in the normal course of business i.e. money lending. The assessee also charged interest on this loan at ₹ 59,558/- and credited the same. The assessee tried to recover the loan along with interest but Kanoi Plantation Pvt. Ltd. became sick and chances of recovery from the same company became nil. Under these circumstances, the Board of Directors in their meeting on 29.06.2007 passed a resolution to write off the above amount in the P&L Account of the assessee company .....

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ness activities such as owing tea gardens, Textile Business, Construction activities and it is also engaged in trading activities. In addition to above, the appellant has also income from House Property investment and financing activities. A composite profit & loss account and balance sheet is drawn taking into consideration overall receipt and expenditure from such composite business. There was unitary of control and same management handling the whole affairs. There are being common Directo .....

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ourt and Calcutta High Court also support even alternate view taken by appellant that expenditure incurred for advancing money to subsidiary company is allowable as bad debt and even as business loss. The claim of appellant is therefore allowable as bad debt and even as business loss. The claim of appellant is therefore allowable in view of pronouncement of jurisdictional High court and Apex court. Even now, it is very clear from the Apex Court decision in case of TRF Ltd. Vs. CIT 323 ITR 398 (S .....

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f Hon ble Supreme court in the case of TRF Ltd., Supra, we find no infirmity in the order of CIT(A) and the same is hereby confirmed. Accordingly, this issue of revenue s appeal is dismissed. 18. The seventh issue in this appeal of revenue is against the order of CIT(A) in directing the AO to delete the Nursery Expenses without appreciating the fact that nursery expenses has always been held as capital in nature. For this, revenue has raised following ground no. 7: 7. That on the facts and circu .....

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amounting to ₹ 58,93,332/- by attributing the same to be of enduring nature for long term plantation of tea gardens for growing good quality of tea. Aggrieved, assessee preferred appeal before CIT(A), who relying on the jurisdictional High Court decision in the case of CIT Vs. Tasati Tea Ltd. (2003) 262 ITR 388(Cal) deleted the disallowance of expenses by observing as under: 10.2. I have considered the facts narrated by appellant and also decision relied upon of the Hon ble jurisdictional .....

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n also remains the same, and therefore, the claim of expenditure is allowable as revenue expenditure. The addition made, therefore, by AO is directed to be deleted and claim of appellant is allowed. 20. We find that the assessee has incurred expenditure for re-plantation in the existing area and plants grown in the nursery were used for replacement of dead plants within the plantation area. This fact has not been denied by revenue before CIT(A) or before us now. The AO also noted that this is re .....

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uch as if the plants are raised and maintained in a nursery for being utilized for the purpose of re-plantation without any expansion of the plantation area or replantation in an abandoned area, then it cannot be said to be a capital expenditure. Capital expenditure involves an investment increasing the capital for higher profit. The expansion means extension of plantation to an additional area. An area already abandoned, if replanted would be an expansion of the area under cultivation for the p .....

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