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TMI Blog2016 (5) TMI 1472X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee’s appeal on this ground. Disallowance of provisions of gratuity - Held that:- The facts of the present case and similar additions were made in A.Y. 2008-09 by the ld Assessing Officer, which has been deleted by the Coordinate Bench in assessee’s own by relying on the Hon'ble Supreme Court decision in the case of CIT Vs Textool Co. Ltd. [2009 (9) TMI 66 - SUPREME COURT ]. The assessee had applied before the ld CIT, Kota but approval of the prescribed authority is pending. Therefore, there is no lack on the part of the assessee. Accordingly, this ground of the assessee is allowed. Addition of pension, leave salary - amount allowable only as paid before due date of return - Held that:- CIT(A) wrongly concluded that amount paid on 03/2/2009 had been included in provision. However, as per paper book submitted by the assessee, this amount of 5,92,714/- was paid over and above 43,57,530/-. The ld DR has not controverted the facts and figures, therefore, we allow the assessee’s appeal on this ground. Not allowing the provision of agreement arrears - Held that:- This issue has been considered by the Coordinate Bench in assessee’s own case for A.Y. 2008-09, which is squarely appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned C.I.T.(A), Kota for the A.Y. 2009-10. The grounds of assessee's as well as revenue's are as under:- Grounds of ITA No. 515/JP/2013 (Assessee's appeal) "1 Impugned assessment order passed U/s 143(3) is bad in law and on facts being against the principle of natural justice and for many more other reasons. 2. Under the facts and circumstances, Ld. A.O. has erred by disallowing certain expenses and making addition U/s 40(a)(ia) of ₹ 6,34,114/-, further, CIT(A) erred by sustaining the same. The disallowance and addition made is unjustified, illegal or excessive. 3. Under the facts and circumstances, Ld. A.O. has erred by disallowing the provision of gratuity of ₹ 8,72,000/-, further, CIT(A) erred by sustaining the same. The disallowance made is unjustified, illegal or excessive. 4. Under the facts and circumstances, Ld. A.O. has erred by disallowing pension leave salary of ₹ 15,32,714/-, further, CIT(A) erred by confirming the disallowance to extent of ₹ 9,24,253/-. The disallowance made/confirmed is unjustified, illegal or excessive. 5. Under the facts and circumstances, Ld. A.O. has erred by disallowing Provision of Agreement Arrear of ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts made under this head at ₹ 4,08,331/- to the various parties, legal fees at ₹ 96,133/-, conveyance at ₹ 38,400/-,tent house expenses at ₹ 68,250/-, payment to Anand Pushap Bahndar at ₹ 24,000/-. Thus total payment of ₹ 6,35,114/- were made by the assessee without deducting TDS, therefore, he made the additions. 3.1 The ld CIT(A), confirmed the addition by observing that intention of TDS provision was to collect the revenue, to extend all the persons covered by the provisions, deterrent to ensure compliance, suppress the mischief and advance the remedy. This provision applicable only on both the amounts payable and paid. VAT is not a conclusive indicator for deciding whether the contract was for sale or work. Therefore, he confirmed the addition of ₹ 6,35,144/-. 3.2 Now the assessee is in appeal before us. The ld AR of the assessee has submitted that the printing and stationary expenses is for purchase of cheque books, passbooks, specimen signature cards, ledgers, fixed deposit books, withdrawal/deposit forms etc., on which VAT had been paid by the assessee on such purchases. The raw material was supplied by the supplier; therefore, expe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble. Accordingly, such payments are not covered U/s 194C of the Act. The Hon'ble Supreme Court decision in the case of CIT-XVII, Delhi Vs Silver Oak Laboratories P. Ltd. (supra) is also squarely applicable including other cited cases of the assessee. Alternatively, the assessee's claim is allowable on paid basis as relied upon in the case of CIT Vs. Vector Shipping Services (P) Ltd. (supra). These facts had not been controverted by the ld DR during the course of hearing. Therefore, we allow the assessee's appeal on this ground. 4. Ground No. 3 of the assessee's appeal is against disallowance of provisions of gratuity of ₹ 8,72,000/-. The ld Assessing Officer claimed gratuity expenses of ₹ 8.72 lacs during the year under consideration. The ld Assessing Officer disallowed this payment as prescribed authority had not approved this fund, which has been confirmed by the ld CIT(A) on similar findings. 4.1 The ld AR of the assessee has submitted that this issue has been considered by the Hon'ble Bench in assessee's own case in ITA No. 1032/JP/2011 A.Y. 2008-09 order dated 14/08/2014 and allowed the appeal in favour of the assessee. The facts and circumstances of the pres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (A) at ₹ 9,24,253/-. 5.2 At the outset, the ld DR has vehemently supported the order of the ld CIT(A). 5.3 After considering the facts of the case and paper book submitted by the assessee, the ld CIT(A) wrongly concluded that amount paid on 03/2/2009 had been included in provision. However, as per paper book submitted by the assessee, this amount of ₹ 5,92,714/- was paid over and above ₹ 43,57,530/-. The ld DR has not controverted the facts and figures, therefore, we allow the assessee's appeal on this ground. 6. Ground No. 5 of the assessee's appeal is against not allowing the provision of agreement arrear of ₹ 13,18,153/-. The ld Assessing Officer disallowed out of total salary claimed at ₹ 1.00 crore by the assessee in P&L account. As paid by the assessee at ₹ 86,81,847/- and balance amount has been shown as provision, which has been confirmed by the ld CIT(A) on the ground that which required future approval and it was contingent liability for the current year. The fact that same was paid in April, 2012 also formed the finding, therefore, he dismissed the appeal. 6.1 The ld AR of the assessee has submitted that this issue has been conside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the credit of TDS of ₹ 2,56,425/- had been given on interest payment of ₹ 24,79,563/-. However, correct figure of addition, he calculated at ₹ 78,563/-. 7.1 The assessee submitted that there was a difference in disclosing the interest by ₹ 78,563/-, which has been made part of the income for A.Y. 2010-11. The addition made during the year under consideration is will lead to double taxation. The Hon'ble Supreme Court in the case of CIT Vs. Excel Industries Ltd. Civil Appeal No. 125 of 2013 wherein it has been held that if rates of tax are remained same in both the years, no point to consider minor tax effect in the appeals. Therefore, he prayed to delete the addition. 7.2 The ld DR has vehemently supported the order of the ld CIT(A). 7.3 We have heard the rival contentions of both the parties and perused the material available on the record. The assessee had admitted this difference on the basis of 26AS and disclosed the differences of interest income of ₹ 78,563/- in A.Y. 2010-11 and there is no revenue loss if the same amount is considered in A.Y. 2010-11 by the assessee. The Hon'ble Supreme Court decision in the case of Excel Industries ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rent group of peoples. These payments were made through cheque to Ganesh Mahotasava society. The celebration of Ganesh Mahotasava gives the feeling of belongings and motivation to the staffs. Therefore, it is wholly and exclusively incurred for the business purposes. He further relied on the decision in the case of DCIT Vs Cargosol, ITA No. 4846/Mum/2010 wherein purchasing of gifts etc. during the festival is held allowable as business expenditure. In the case of Commercial Ahmedabad Mills Co. Vs CIT 204 ITR 505 (Guj) wherein the Hon'ble High Court has held that maintenance of temple with the help of Pujari, the expenditure is not a personal benefit of any person and nor of a purely religious nature, therefore, he prayed to confirm the order of the ld CIT(A). 10.3 After considering both sides and facts of the case, the Lord Ganesha is the God of Wealth as considering in Indian methodology. The assessee also deals in banking. It is a fact that all the banks generally participate in Ganesh Mahotasava, which motivates the employee as well as maintain good relation with the customers. Therefore, it is an allowable expense U/s 37 of the Act. The case laws relied upon by the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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