TMI Blog2022 (4) TMI 581X X X X Extracts X X X X X X X X Extracts X X X X ..... owever, from the submissions of assessee, no such concession has been noticed. CIT(A) in the order has noted that the order of Ld. CIT(A)-1 dated 24/12/2014 for AY 2009-10, on which reliance has been placed by the assessee in support of his contention that the relief has been granted on similar facts by Ld. CIT(A)-1, is distinguishable on facts. However, on perusal of the order, it seems that the facts are quite identical with the present facts and in our view, the Ld. CIT(A) may require a closer look at the order before distinguishing the same CIT(A) has distinguished the order by simply stating that in the case of previous CIT(A)-1 order, the payee M/s Grada Textiles GmbH of Germany is an established market leader whereas in the present case, payee is not a well know entity. In our view, the Ld. CIT(A) has not brought out clearly how the earlier order on which reliance is being placed by the assessee is distinguishable on facts. Therefore, in respect of Ground No.1, we are restoring the case to the file of CIT(A) to again analyse the facts of the case in light of the above observations and pass the order accordingly. Disallowance of provident fund expenses - AO treated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : Shri Rajdeep Singh , Sr. D. R. ORDER PER : SIDDHARTHA NAUTIYAL , JUDICIAL MEMBER : - This is an appeal filed by the assessee against the order passed by Ld. CIT(A) VI/DCIT, Cir-1/52/2014-15. 2. The assessee has raised the following grounds of appeal : - 1. The Ld. CIT Appeals 1 Ahmedabad has erred in law and on facts in passing appellate order dated 28/08/2015 for A.Y. 2011-12 in the case of appellant by confirming the disallowances made in the assessment order. 2. The Ld CIT Appeals has erred in law and on facts in confirming addition of ₹ 14,13,428/- on account of design expenses. The CIT(A) has wrongly stated that the appellant has himself stated that the services rendered by the non-resident are in the nature of included services. We had clearly denied making any such claim in our submission. 3. The Ld CIT Appeals has erred in law and on facts in confirming disallowance of ₹ 3,94,192/- out of provident fund expenses. 4. The Ld CIT Appeals has erred in law and on facts in confirming disallowance of ₹ 1,08,000/- out of scholarship expenses. 5. The appellant craves leave to add, alter, amend or withdraw any of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... design and are not in the nature of technical services. The assessee submitted that designs were not specially prepared at the request of the assessee by the payee but it was a pre-prepared designs which the assessee purchased off the shelf i.e. it was a readymade design. The assessee also placed reliance on the order of ld. CIT(A) for A.Y. 2009- 10 where similar disallowance made by ld. A.O. was deleted by the CIT(A). Further, the assessee placed reliance on various judicial precedents in support of his contention. 6. The Ld. CIT(A) in appellate proceedings dismissed the assessee s appeal by holding that firstly, assessee itself in its submission has stated that the payments made to the non-residents are in the nature of fee for included services within the meaning of Article 7 of the DTAA, and no further discussion on the matter is necessary. Secondly, the ld. CIT(A), stated that the issue dealt by CIT(A)-1 vide order dated 24-12-2014 for A.Y. 2009-10 on which reliance is being placed by the assessee is different from the present case. The ld. CIT(A)-1 in his order had discussed the case of M/s. Grada Textile GMBH of Germany which is an established market leader whereas Aarn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, the Ld. AO treated the same as income of the assessee(employer) as per the provisions of section 2(24)(x) r.w.s. 36(1)(va) of the Act by placing reliance on the Gujarat High Court decision in the case of CIT v. Gujarat State Road Transport Corp 366 ITR 170 (Guj), where it has been held that PF/ESI contribution is not covered by S. 43B of the Act and is allowable as a deduction u/s 36(1)(va) if paid within the due date prescribed therein. The Ld. CITA(A) dismissed the appeal of the assessee by noting that the issue is covered against the appellant by decision of Hon ble Gujarat High Court in the case of CIT v. Gujarat State Road Transport Corp 366 ITR 170 (Guj). and upheld the disallowance made by the Ld. AO. 10. Before us none appeared on behalf of the assessee. We note that the issue has been squarely decided against the assessee by the jurisdictional Gujarat High Court in the case of CIT v. Gujarat State Road Transport Corp 366 ITR 170 (Guj). wherein the it has been held as below: In view of the above and for the reasons stated above, and considering section 36(1)(va) of the Income Tax Act, 1961 read with sub-clause (x) of clause 24 of section 2, it is held that with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve perused the facts of the case and material on record. In our view, the assessee has not been able to establish the business expediency for incurring expenses on the education / scholarship expenses on Shri Anurag Agarwal, who is the son of Director s brother. The Ld. AO as well as Ld. CIT(A) noted that the assessee has been consistently claiming the education/ scholarship expense on Shri Anurag Agarwal, one of the related parties for this year and past years as well, but these expenses are not related to the business of the assessee. The assessee has not been able to establish how the business of the assessee has been benefitting by incurring these expenses. The assessee has submitted that Shri Anurag Agarwal has been working part time with the Company, but no other details have been furnished which would substantiate the genuineness of claim of the assessee. In our considered view, therefore, we hold that Ld. CIT(A) has not erred in facts and in law in disallowing the above expenses on scholarship of Shri Anurag Agarwal. 15. In the result, Ground No. 4 of the assessee s appeal is dismissed. 16. In the result, the assessee s appeal is partly dismissed. Order pronounced ..... X X X X Extracts X X X X X X X X Extracts X X X X
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