Case Law Details
R.P. Polypacks Pvt. Limited Vs DCIT (ITAT Kolkata)
In brief, the issue according to the ld. Commissioner is that the assessee had made provision of Excise Duty, which was not an allowable expenditure and ld. Assessing Officer has erred in accepting this claim of the assessee in an assessment order passed under section 143(3) of the Income Tax Act. On the other hand, it has been demonstrated before us that though a provision of Rs.27,14,588/- was made by the assesese, which is reflecting in account as on 31.03.2013 but before filing of the due date of the return. This amount was paid actually in April, 2013. Hence, no expenditure, for which provision was made, has been allowed by the ld. Assessing Officer. A disallowance under section 43B out of Excise Duty provision could be made if it was not actually paid by the assessee. The moment assessee has actually made the payment, then there is no revenue loss, which ought to have suffered the taxes. For buttressing this contention, ld. Counsel for the assessee drew our attention to page no. 66, i.e. valuation of closing stock at the end of the year, pages no. 24, 42 exhibiting the provisions in the accounts as well as payment of this provision in the month of April, i.e. 30.04.2013, the due date of filing of the return on 30th September, 2013. In other words, when accounts are closed on 31.03.2013, a provision was reflected, which has not to be allowed to the assessee. But the moment the provision was actually paid by the assessee on 30.04.2013, nothing left for disallowance out of the Excise Duty expenditure.
On due consideration of the above facts and circumstances, we are of the view that even for argumentative sake, it is assumed that there was an error then also we find there is no prejudice to the interest of revenue. The assessee has specifically raised all these pleas in its written submission before the ld. Commissioner and had the Commissioner verified this fact from the ld. Assessing Officer or from the accounts? Then it would come that no provision made by the assessee as a Revenue expenditure. The expenditure has been allowed to the assessee under section 43B on actual payment before the due date of filing of the return. The ld. Commissioner has committed an error by not appreciating these facts in true perspective. Therefore, we find force in the contention of the assessee and the order of the ld. Commissioner is not sustainable.
FULL TEXT OF THE ORDER OF ITAT KOLKATA
The assessee is in appeal before the Tribunal against the order of ld. Principal Commissioner of Income Tax-1, Kolkata dated 22.03.2018 passed under section 263 of the Income Tax Act in assessment year 201314.
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