Case Law Details
Eastman Exports Private Limited Vs DCIT (ITAT Chandigarh)
Introduction: The case of Eastman Exports Private Limited Vs DCIT saw the Income Tax Appellate Tribunal (ITAT) in Chandigarh tackling a dispute on tax audit report’s date and its corresponding implications on tax deductions. Misinterpretation of these dates led to a disagreement over disallowed deductions worth Rs. 17,53,799/-, which had reportedly been paid before filing the return.
Analysis: Eastman Exports challenged an order passed by the Commissioner of Income Tax (Appeals), asserting the incorrect reading of the audit report date and an unjust disallowance of sums paid as bonuses, leave with wages, and leave encashment. The date of the audit report was crucial, with Eastman Exports claiming it was 09/10/2017, not 19/10/2017 as read by the CIT(A). This discrepancy resulted in a conflict over whether these sums were eligible for deduction, given they had been paid before the return’s due filing date.
The ITAT, acknowledging these disputes, decided to set aside the matter to the Assessing Officer (AO) for re-evaluation. The tribunal instructed the AO to examine the actual date of the sum’s deposit and verify the actual date of the audit report.
FULL TEXT OF THE ORDER OF ITAT CHANDIGARH
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