ACIT Vs Bata India Ltd (ITAT Kolkata)
The Revenue appealed against the order of the Commissioner of Income Tax (Appeals) dated 23.02.2017 for Assessment Year 2010-11, challenging relief granted to the assessee on multiple issues including transfer pricing adjustment relating to royalty for technical services, disallowance under Section 43B, royalty expenditure, lease rent, depreciation on river bank embankment, and warranty provision.
With respect to the disallowance under Section 43B amounting to Rs. 94,49,341, the Assessing Officer had disallowed amounts which, according to the tax audit report, were adjusted instead of actually paid. Before the Tribunal, the Revenue contended that the issue related to employees’ contribution to PF and ESI not deposited within the due dates prescribed under the respective Acts and relied upon the Supreme Court decision in Checkmate Services (P.) Ltd. v. CIT. The assessee submitted that the issue related to provisions and relied upon submissions accepted by the CIT(A). The Tribunal noted that the Assessing Officer had not examined the issue in detail and that the submissions before the CIT(A) referred to Section 2(24)(x) read with Section 36(1)(va). Observing that the Supreme Court decision in Checkmate Services (P.) Ltd. had not been considered in the earlier coordinate bench decision relied upon by the assessee, the Tribunal remitted the issue to the Assessing Officer to determine the applicable provision, decide it in accordance with the Supreme Court judgment if covered by Section 2(24)(x) read with Section 36(1)(va), and ensure that there was no double addition on the same amount.
