Itat/156/2022 Ia No: Ga/1/2023, Ga/2/2023 Principal Commissioner Of Income Tax, Central-2, Kolkata v. M/S. Salarpuria Properties Pvt. Ltd

OD–9 IN THE HIGH COURT AT CALCUTTASPECIAL JURISDICTION (INCOME TAX)ORIGINAL SIDE ITAT/156/2022IA NO: GA/1/2023, GA/2/2023PRINCIPAL COMMISSIONER OF INCOME TAX, CENTRAL-2, KOLKATAVS.M/S. SALARPURIA PROPERTIES PVT. LTD. BEFORE : THE HON’BLE CHIEF JUSTICE T.S. SIVAGNANAM AndTHE HON’BLE JUSTICE HIRANMAY BHATTACHARYYADate : 24[th] July, 2023 Appearance :Ms. Smita Das De, Adv.…for appellantMr. J.P. Khaitan, Sr. Adv.Mr. Indranil Banerjee, Adv.Mr. S.K. Debnath, Adv.… for respondent The Court :- This appeal has been filed by the revenue under Section260A of the Income Tax Act (the Act) challenging the order passed by the IncomeTax Appellate Tribunal, `A’ Bench, Kolkata, in ITA No. IT(SS)A No. 57/Kol/2019,67/Kol/2019, CO No. 45/Kol/2019, for the assessment year 2016-17. The revenue has raised the following substantial questions of law forconsideration :- a)Whether in the facts and the circumstances of the case the Tribunal wasjustified in law to delete the addition to the tune of Rs. 3,15,88,923/-made by the Assessing Officer under Section 14A read with Rule 8D(2) of the said Act by holding that no addition can be made under Section153A/143(3) of the said Act ? b)Whether in the facts and the circumstances of the case the Tribunal wasjustified in law in deleting the disallowances of the amount of sundrybalances and stock written off to the tune of Rs. 66,259/- under Section37(1) of the said Act ? We have heard Ms. Smita Das De, learned standing counsel appearing forthe appellant/revenue and Mr. J.P. Khaitan, learned senior Advocate appearingfor the respondent/assessee. There is a delay of 252 days in filing the appeal. We have perused theaffidavit filed in respect of the condone delay petition and we find sufficientcause has been shown for not preferring the appeal within the period oflimitation. Accordingly, the condone delay petition is allowed and the delay infiling the appeal is condoned. The first issue is whether the learned Tribunal rightly deleted the additionmade by the Assessing Officer under Section 14A read with Rule 8D(2). In thisregard we have perused the findings recorded by the Commissioner of IncomeTax (Appeals) [CIT(A)] as well as the finding recorded by the learned Tribunal.The learned Tribunal has made a fact finding exercise and ascertained from theaudited balance sheet that the assessee has not earned any exempt income. Thelearned Tribunal applied the law laid down by the Hon’ble Supreme Court in(2018) 402 ITR 640 (SC) and upheld the decision of the CIT(A). Thus, we findthat the learned Tribunal rightly re-appreciated the facts and applied the correct legal position and granted relief to the assessee and there are no grounds madeout to interfere with the said finding. The second substantial question of law is with regard to deleting thedisallowances of the amount of sundry balances and stock written off to the tuneof Rs.66,259/-, the learned Tribunal after hearing the parties and perusing thedetails on record noted that the sundry balances and stock written off by theassessee including unserviceable stock which were apparently arising in normalcourse of business or pertaining to amounts receivable and therefore it was heldthat the assessee is entitled to charge the same against the profits during theyear in terms of the decision of the Hon’ble Supreme Court in 323 ITR 397 (SC).Thus, we find that the learned Tribunal rightly took note of the facts in issue aswell as the law on the point and granted relief to the assessee and no groundshave been made to interfere with the said finding. Accordingly, the appeal filed by the revenue is dismissed and thesubstantial questions of law are answered against the revenue. The stay application GA/2/2023 is also dismissed. (T.S. SIVAGNANAM) CHIEF JUSTICE (HIRANMAY BHATTACHARYYA, J.)