TaxTMI 
TaxTMI 
2018 (9) TMI 1801
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....this common and consolidated order for the sake of convenience and brevity. ITA No. 419/MUM/2017 (Assessment Year: 2009-2010) 2. Brief facts of the case are that the assessee engaged in the business of wholesale trading in garments and accessories, filed its return of income for the assessment year 2009-10 declaring the nil income. Since, the case was selected for scrutiny and assessment order u/s 143 (3) read with section 92C of the Act was passed determining the nil income. Later on, it was seen that no disallowance was made u/s 43B in respect of expenses of Rs. 53,67,633/- of VAT and service tax incurred during the year but was not paid on the date of filing of return, (2) The assessee had paid employees contribution to PF of Rs. 4,85,296/- to Govt. account beyond due date, which is liable for disallowance as per the provisions of section 36(1)(va) read with section 2(24)(x) and the assessee had disallowed only Rs. 3,36,723/- (3) the assessee had claimed depreciation on electrical installation of Rs. 3,56,874/- @ 15%. Since, the depreciation on electrical installation is allowed at 10% there was excess claim of depreciation of Rs. 1,18,958/- and (4) the assessee had debited r....
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.... on account of employees contribution to PF and ESIC is not covered u/s 43B but is covered u/s 36(1)(va) r.w.s. 2(24)(x) of the Act whereby such expenditure is allowable only if the said amounts are paid within the due date under the relevant Act and not allowable even if paid before the due date for filing of return of income?" 5. Ground No. 1 of the appeal pertains to the addition of Rs. 1,24,60,604/- made by the AO on account of rent paid to M/s Tag Enterprises. The Ld. DR submitted before us that since M/s Tag Enterprises has not entered into the rent agreement dated 29.06.2007 with the assessee, the AO has rightly made addition. Moreover, the assessee has failed to submit the details on record. Hence, the Ld. CIT (A) has wrongly deleted the addition. 6. On the other hand, the Ld. counsel for the assessee relying on the order passed by the Ld. CIT (A) submitted that since the office space was shared between the appellant and its group affiliates and the said understanding was covered under clause 14 of the agreement, the Ld. CIT (A) has rightly deleted the addition made by the AO. The Ld. counsel further submitted that the ITAT has decided the identical issue in favour of the....
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....One Crore) then this agreement shall ipso facto stand terminated. Name of Affiliates 1. Murjani Retail Pvt. Ltd. 2. MK Retain Pvt. Ltd. 3. MC Retain Pvt. Ltd. The Licensee may instruct such Affiliate/s to make payment of the proportionate deposits, Monthly compensation, CAM Taxes, electricity, water and/ or other charges due under this Agreement directly to the Licenser and this shall be adjusted against the Licensee's obligations to make payments to the Licensor under this Agreement." The total rent along with the maintenance and cleaning charges paid was Rs. 4,03,90,578/- which was shared with MK Retail Pvt. Ltd. and Murjani Retail Pvt. Ltd. The breakup of which is as under: Total Rent Rs. 3,73,55,884/- Add: Maintenance & Cleaning charges Rs. 30,34,694/- Total Rs. 4,03,90,578/- However, in the assessment order and the remand report dtd. 17 October, 2016, the AO has stick to this opinion that the appellant company i.e. M/s MC Retail Pvt. Ltd. is not at all a signatory for the rent agreement dtd. 29.06.2007 entered between M/s Tag Enterprises and M/s Brand Marketing India Pvt. Ltd. and hence the rent paid is not an allowable expenditure. 8.2 I have go....
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....ounsel for the assessee submitted that the amounts not being debited to the profit and loss account were not claimed as expenditure itself, hence, cannot be added back u/s 43B of the Act. The Ld. counsel further submitted that the assessee had submitted journal vouchers which give the scheme of entries for the statutory liability break up of other liabilities in the balance sheet as on 31.03.2009 which shows the amounts of Central Sales Tax, Delhi VAT, Haryana VAT, Maharashtra VAT and Maharashtra Works Contract. 10. We have gone through the findings of the authorities below in the light of the submissions of the parties. We notice that the Ld. CIT (A) has obtained remand report during the appellate proceedings and on the basis of the report, the Ld.CIT (A) reached at the conclusion that addition in question is not justifiable. The findings of the Ld. CIT (A) read as under: 9. Ground No. 3 relates to disallowance of a sum of Rs. 53,67,633/- under provisions of section 43B of the I.T. Act on account of CST, VAT and Works Contract Tax even though the same was not passed through Profit and Loss Account. 9.1 In the written submissions, it is stated by the appellant has submitted th....
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.... or factual infirmity in the findings of the Ld. CIT (A) to interfere with. Hence, we uphold the findings of the Ld. CIT (A) and dismiss this ground of appeal of the revenue. 12. Ground No. 3 pertains to disallowance of Rs. 1,48,296/- under the provisions of section 36(1)(va) read with section 2(24)(x) of the Act on account of payment of Employees contribution to the Provident Funds beyond the prescribed date under the PF Act. The Ld. DR relied on the findings of the Assessing Officer. On the other hand, the Ld. counsel for the assessee relying on the findings of the Ld. CIT (A) submitted that since the AO has accepted in its report during the appellate proceedings that the contributions were paid before due date of filing of return. The Ld. CIT (A) has rightly directed to AO to delete the addition. 13. We have perused the material on record in the light of the rival submissions. The Ld.CIT (A) has deleted the addition in question holding as under:- 10. Ground 4 relates to disallowance of a sum of Rs. 1,48,296/- under the provision of Section 36(1)(va) r.w.s 2(24)(x) of the I.T. Act on account of payment of employees contribution to provident fund beyond the prescribed due date....