COMMISSIONER OF INCOME TAX Vs. GIRISH ANIL DONGARE

JUDGEMENT

(1.) THIS order shall dispose of ITA no. 200/2012 and ITA no. 8/2013. These appeals have been preferred by the Revenue under Section 260A of the Income Tax Act impugning the order dated 27.07.2012, passed in ITA no. 343(Asr)/2011 in respect of assessment year 2008 -09. The other appeal titled as CIT v. M/s Vaishno Metal & Allied Industries is directed against order dated 05.10.2012 passed by the Tribunal in ITA no. 91(Asr)/ of 2010 in respect of assessment year 2006 -07. One of the issues in both appeals is covered by the judgment of a Division Bench of this Court rendered in the case of M/s Shree Balaji Alloys v. CIT and anr. (2011) 333 ITR 335 (J&K), holding that the excise duty refund is to be treated as Capital Receipt. Thus, it would not be liable to be taxed. Therefore, the appeals on that issue are covered against revenue. Thus are liable to be dismissed.

(2.) MR . Thakur, learned senior counsel appearing for the Revenue has, however, made efforts to persuade us to admit the appeal on another question concerning disallowance made under Section 40 (ia) of the Act. It is appropriate to notice that Section 40 of the Act deals with amounts which are not deductible in computing the income chargeable under the head Profits and gains of business or profession. According to Mr. Thakur, Section 40 (ia) includes in its mischief fees for technical services payable to the residents or payable to the contractors etc. In ITA no. 200/2012 an amount of Rs.65,000/ - is stated to have been payable to the Chartered Accountant and the same was not deductible in computing the income chargeable under the head Profits and gains of business or profession and, therefore, it has been rightly included by the ITO. Likewise, in ITA no. 08/2013, a sum of Rs.35,60,372/ - was added to the income from business as it was not deductible being expenditures on freight, labour contract and interest.

(3.) FOR the aforesaid reasons, the appeals fail and the same are dismissed.