9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (1) TMI 1336 - AT - Income TaxDisallowance of provisions made in the accounts for leave salary payable - Held that - As decided in MUTHOOT VEHICLES AND ASSET FINANCE LTD., VERSUS ACIT 2013 (12) TMI 1662 - ITAT COCHIN it is made clear that as far as the outstanding interest demand as of date is concerned, it would be open to the Department to recover that amount in case Civil Appeal of the Department is allowed. We further make it clear that the assessee would, during the pendency of this Civil Appeal, pay tax as if Section 43B(f) is on the Statute Book but at the same time it would be entitled to make a claim in its returns. We set aside the order of CIT(A) on this issue and restore the same to the file of the assessing officer with the direction to examine this issue afresh in accordance with the decision rendered by Hon ble Supreme Court in the case of M/s Exide Industries Ltd COMMR. OF INCOME TAX & ORS Versus M/s EXIDE INDUSTRIES LTD. & ANR. - 2009 (5) TMI 894 - SUPREME COURT - Appeal filed by the assessee is treated as allowed for statistical purposes.
Issues:
Whether CIT(A) was justified in confirming the disallowance of provisions made for leave salary payable. Analysis: The appeals were against three orders of the CIT(A) for the assessment years 2009-2010, 2010-2011, and 2011-2012, all dated 31.03.2017. The primary issue raised in these appeals was the justification of the CIT(A) in confirming the disallowance of provisions made in the accounts for leave salary payable. The assessee, a Co-operative Society engaged in banking, had filed returns of income for the respective years, which led to subsequent assessments and disallowances related to provision for leave salary. For the assessment year 2009-2010, the original assessment was set aside by the Commissioner of Income-tax under section 263 due to the omission to disallow a sum claimed as provision for leave salary. Similar instances occurred for the assessment years 2010-2011 and 2011-2012, where provisions for leave salary were disallowed after revisions. The CIT(A) upheld the disallowances, citing the judgment of the jurisdictional High Court in a specific case. The Tribunal considered a similar issue in a prior case and referred to decisions by the Rajasthan High Court and the Kerala High Court regarding the deduction of provision for leave encashment. The Tribunal highlighted the stay orders by the Supreme Court related to the judgment of the Calcutta High Court on this matter. Ultimately, the Tribunal set aside the orders of the CIT(A) and directed the assessing officer to re-examine the issue in light of the decisions by the higher courts, specifically the Supreme Court's ruling in the case of Exide Industries Ltd. Based on the precedents and legal interpretations discussed, the Tribunal remitted the issue back to the assessing officer for fresh examination, aligning with the directions provided by the higher courts. Consequently, the appeals filed by the assessee were allowed for statistical purposes, indicating a favorable outcome for the assessee in this particular case. In conclusion, the Tribunal's detailed analysis of the legal precedents and directives from higher courts led to the decision to remit the issue back to the assessing officer for reevaluation, ultimately resulting in the appeals being allowed for statistical purposes. The judgment emphasized the importance of aligning assessments with established legal interpretations and court rulings to ensure fair and accurate determinations in tax matters.
|
