Case Law Details

Case Name : M/s. V. Swaminatha Iyer & Co. Vs. The Deputy Commissioner of of Income Tax (ITAT Chennai)
Appeal Number : I.T.A. No. 1592/Mds/2011
Date of Judgement/Order : 08/12/2011
Related Assessment Year :
Courts : All ITAT (4269) ITAT Chennai (215)

V.Swaminatha Iyer & Co. Vs. DCIT (ITAT Chennai) –  On going through the facts of the case and the grounds of appeal placed before us, we find that the assessee is aggrieved on two counts namely dis allowance of interest to loan creditors and dis allowance of salary paid to lady partners. The issue of interest to loan creditors is specifically reflected only in the statement of facts whereas the issue of salary paid to lady partners is reflected only in the grounds of appeal. We are also constrained to state that the amount of interest agitated by the assessee as interest to loan creditors at Rs. 49,534/- is not confirmed as the correct amount at the time of hearing. As a lot of such missing links are here, we remit back the file to assessing authority for de novo consideration after hearing the assessee. The issues agitated may be re-examined by the assessing authority specially taking into consideration the fact that loan credits are brought down from earlier assessment year on which the assessee has been claiming interest in a consistent manner.

INCOME TAX APPELLATE TRIBUNAL, CHENNAI

I.T.A. No. 1592/Mds/2011

Assessment Year : 2006-07

M/s. V. Swaminatha Iyer & Co.

Vs.

The Deputy Commissioner of of Income Tax

Date of Pronouncement : 8th December, 2011 

Online GST Certification Course by TaxGuru & MSME- Click here to Join

O R D E R

 

PER Dr.O.K.NARAYANAN, VICE-PRESIDENT:

This appeal is filed by the assessee. The relevant assessment year is 2006-07. The appeal is directed against the order of the Commissioner of Income Tax(Appeals) at Tiruchirappalli dated 19.07.2011. This appeal arises out of the assessment completed under section 143(3) read with 147 of the Income Tax Act, 1961.

2. In completing the assessment, the assessing authority has made addition of ` 49,534/- as dis allowance of interest attributable to loan creditors. The assessee’s books of accounts contained loan credits brought down from the earlier assessment year and still continuing. The assessee has provided interest thereon. It is that interest which is now disallowed by the assessing authority. The same has been confirmed by the Commissioner of Income Tax(Appeals). The assessee is aggrieved and therefore the second appeal before the Tribunal. The grounds raised by the assessee are as follows:-

“1. The order of the Commissioner of Income Tax(Appeals) is contrary to the facts and circumstances as also the legal position obtaining in the case of the appellant.

2. The Commissioner of Income Tax(Appeals) has disallowed the salary paid to lady partners since become they had not worked in the shop at that time of survey.

3. For these and other reasons that may be adduced at the time of hearing, it is prayed that the additions made as above be deleted.”

3. We heard Shri A.S. Sriraman, counsel appearing for the assessee and Shri Shaji P.Jacob, learned Commissioner of Income Tax appearing for the Revenue.

4. On going through the facts of the case and the grounds of appeal placed before us, we find that the assessee is aggrieved on two counts namely dis allowance of interest to loan creditors and dis allowance of salary paid to lady partners. The issue of interest to loan creditors is specifically reflected only in the statement of facts whereas the issue of salary paid to lady partners is reflected only in the grounds of appeal. We are also constrained to state that the amount of interest agitated by the assessee as interest to loan creditors at Rs. 49,534/- is not confirmed as the correct amount at the time of hearing. As a lot of such missing links are here, we remit back the file to assessing authority for de novo consideration after hearing the assessee. The issues agitated may be re-examined by the assessing authority specially taking into consideration the fact that loan credits are brought down from earlier assessment year on which the assessee has been claiming interest in a consistent manner.

5. In result, this appeal filed by the assessee is allowed for statistical purposes.

Order pronounced in the open court at the time of hearing on Friday, the 8th December, 2011 at Chennai.

More Under Income Tax

Posted Under

Category : Income Tax (25154)
Type : Judiciary (9976)
Tags : ITAT Judgments (4449)

0 responses to “Salary paid to lady partner as per income tax act provisions is allowable even if she is absent at that time of survey”

  1. avin says:

    lots of benefits for female partner. Can i register a company and give salary to my wife for tax benefits?

Leave a Reply

Your email address will not be published. Required fields are marked *