TMI Blog2016 (4) TMI 1314X X X X Extracts X X X X X X X X Extracts X X X X ..... date of filing the return disallowance cannot be made by invoking the provisions of section 43B of the Act. Therefore, we hereby direct the learned Assessing Officer to verify whether these payments are made before the due date of filing of return, and if found so, delete the disallowance made by invoking the provisions of section 43B of the Act. Disallowance u/s 37 being marketing expenses - Held that:- ere is no prohibition in the Act to make payments to Doctors for the services rendered by them. In the case of the assessee, gifts were given to Doctors by way of gold coins in appreciation to their services. It can be construed as the fees paid in kind for the services rendered by the Doctors in the hospital. The presumption of the learned Assessing Officer that these payments are made to Doctors for canvassing patients cannot be accepted without any cogent evidence. Further the Revenue has not quantified the amount for which invoices, bills are not available for the expenditure incurred and the nature of unexplained expenses. Hence, it appears to be a passing remark - we hereby direct the learned Assessing Officer to delete the addition made on account of disallowance Disa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nces were made. On appeal, the learned Commissioner of Income Tax (Appeals) confirmed the order of the learned Assessing Officer against which the assessee is now in appeal before us. Ground No.1: Restricting the depreciation to 15% as against 40% claimed by the assessee on life saving equipme nts: 4. During the scrutiny assessment proceedings, the learned Assessing Officer observed that the assessee had claimed depreciation on the following equipments @ 40% stating it to fall under the category of life saving equipments as provided in the Income Tax Rules, viz., Aria PVI Upgrade, Aria PVI Upgrade (Computer), Aspire Work Station, AW 4.2 Work Station, Brainlab SRS/SRT (Computer), Endoscopy software, HCL Server, Linac with MCL (Computer), Rapid ARC IGRT Software, Software. The learned Assessing Officer opined that these items were not life saving equipments as provided under the Income Tax Rules and therefore restricted the claim of depreciation at 15% on the value of the assets acquired. On appeal, the learned Commissioner of Income Tax (Appeals) confirmed the order of the learned Assessing Officer agreeing with his view. 5. Before us, learned Authorized Representati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on in fewer (1-5) high dose treatments than traditional therapy, which can help preserve healthy tissue. 7. Computer: Computers used in the hospital for processing of medical information. 8. Endoscopy Software: Software used for capturing diagnostic and therapeutic endoscopic images wherein endoscopy is a life saving medical equipment eligible for 40% depreciation as per IT Act. 9. HCL Server: HCL server is an advanced computer used for storage of medical information. 10. Software: It is the software used in the hospital to monitor patient data. 6. The learned Authorized Representative argued by stating that all these equipments purchased by the assessee are life saving equipments even though they may slightly differ from the items specified in the Income tax Rules prescribing the rates of depreciation. He therefore pleaded that the claim of the assessee of higher depreciation may be allowed. It was further submitted that the equipments purchased by the assessee are similar to cobalt therapy unit and fiber optic endoscopes etc., as provided under Income Tax Rules Appendix-1 Part-A-III(xia)(d),(n) and the life span of the equipments are short. 7. The l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t High Court, I am of the considered opinion that the belated employee s contribution to ESI beyond the due date prescribed U/s.36(1)(va) of the Act is not eligible for deduction U/s.43B although it was paid before the due date for filing of return U/s.139(1) of the Act. Accordingly, the disallowance made by the Assessing Officer is upheld and the grounds are dismissed. 10. Before us, the learned Authorized Representative submitted that the assessee had remitted the employees contribution of ESI before the due date of filing of the return. Hence, it was pleaded that the addition made by the Revenue may be deleted. 11. The learned Departmental Representative on the other hand argued in support of the orders of the Revenue. 12. We have heard the rival submissions and carefully perused the materials available on record. Now it is an admitted fact that by the various decisions of higher judiciary the remittance of employees / employers contribution of PF/ESI etc., if remitted before the due date of filing the return disallowance cannot be made by invoking the provisions of section 43B of the Act. Therefore, we hereby direct the learned Assessing Officer to verify whether thes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the hospital. The presumption of the learned Assessing Officer that these payments are made to Doctors for canvassing patients cannot be accepted without any cogent evidence. Further the Revenue has not quantified the amount for which invoices, bills are not available for the expenditure incurred and the nature of unexplained expenses. Hence, it appears to be a passing remark. Therefore, in the interest of justice, we hereby direct the learned Assessing Officer to delete the addition made on account of disallowance of ₹ 71,62,741/-. Ground No.4: Disallowance of ₹ 3,25,000/- being expenses incurred on consumables and on repairs under section 40A(3) of the Act. 17. It was noticed by the learned Assessing Officer that the assessee had incurred cash expenditure above ₹ 20,000/- in a single day to the tune of ₹ 3,25,000/-. Since the assessee could not furnish any explanation towards the same, the learned Assessing Officer invoked the provisions of section 40A(3) of the Act and made addition of ₹ 3,25,000/-. On appeal, the learned Commissioner of Income Tax (Appeals) confirmed the order of the learned Assessing Officer agreeing to his view. 18. At ..... X X X X Extracts X X X X X X X X Extracts X X X X
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