The Commissioner of Income-tax v. Mahesh Reddy - 2014-LL-0909-59

Citation	2014-LL-0909-59
Appellant Name	The Commissioner of Income-tax
Respondent Name	Mahesh Reddy
Court	HIGH COURT OF HYDERABAD FOR THE STATE OF TELANGANA AND THE STATE OF ANDHRA PRADESH
Relevant Act	Income-tax
Date of Order	09/09/2014
Assessment Year	1994-95
Judgment	View Judgment
Keyword Tags	depreciation on car • question of law • debatable issue • incentive bonus
Bot Summary:	Whether on the facts and in the circumstances of the case, the ITAT was correct in law in holding that the disallowance of 40 of the incentive bonus claimed by the assessee was a debatable issue till 8-3-95 Heard Sri J.V. Prasad, learned counsel for the appellant. The assessee is a Development Officer in LIC. In the relevant assessment year, the issue involved is whether the Assessing Officer could have added incentive bonus, H.R.A., conveyance allowance, fixed travelling allowance, additional conveyance allowance and depreciation on car, by way of prima facie adjustment under Section 143(1) of the Income Tax Act, 1961. The Tribunal allowed the appeal of the assessee and found fault with the prima facie adjustments made under Section 143(1) of the Act. As on the date of assessee filing the return, the judgment of the jurisdictional High Court in the case of COMMISSIONER OF INCOME TAX Vs. B.CHINNAIAH AND 1 OTHERS was not available. What is required to be noticed for the purpose of processing a return, the date of filing return is irrelevant and what is relevant is the date of processing of the return. As on the date of processing the return by the Assessing Officer, the judgment of the High Court of A.P. in the case of K.A. CHOUDARY Vs. COMMISSIONER OF INCOME TAX AND 2 OTHERS is already holding the field to the effect that an assessee is not entitled for a deduction of 40 incentive bonus and in that view of the matter, it is not a debatable issue. The judgment of this Court in Chowdary s case stands approved in the judgment of the Hon ble Supreme Court in the 3 case of T.K. GINARAJAN Vs. COMMISSIONER OF INCOME TAX. As a matter of fact, the issue was dealt with in detail in the order, dated 10.03.2014, passed by this Court in I.T.T.A.No.

HON BLE SRI JUSTICE L. NARASIMHA REDDY AND HON BLE SRI JUSTICE CHALLA KODANDA RAM I.T.T.A No.107 of 2002 JUDGMENT:- (Per Hon ble Sri Justice Challa Kodanda Ram) This appeal is filed by Revenue for assessment year 1994-95 and raised under mentioned question of law from orders of Tribunal. Whether on facts and in circumstances of case, ITAT was correct in law in holding that disallowance of 40% of incentive bonus claimed by assessee was debatable issue till 8-3-95? Heard Sri J.V. Prasad, learned counsel for appellant. Though notice is served upon respondent, he did not enter appearance. assessee is Development Officer in LIC. In relevant assessment year, issue involved is whether Assessing Officer could have added incentive bonus, H.R.A., conveyance allowance, fixed travelling allowance, additional conveyance allowance and depreciation on car, by way of prima facie adjustment under Section 143(1) (a) of Income Tax Act, 1961 (for short Act ). Tribunal allowed appeal of assessee and found fault with prima facie adjustments made under Section 143(1) (a) of Act. As on date of assessee filing return, judgment of jurisdictional High Court in case of COMMISSIONER OF INCOME TAX Vs. B.CHINNAIAH AND [1] OTHERS was not available. However, what is required to be noticed for purpose of processing return, date of filing return is irrelevant and what is relevant is date of processing of return. As on date of processing return by Assessing Officer, judgment of High Court of A.P. in case of K.A. CHOUDARY Vs. COMMISSIONER OF INCOME TAX AND [2] OTHERS is already holding field to effect that assessee is not entitled for deduction of 40% incentive bonus and in that view of matter, it is not debatable issue. judgment of this Court in Chowdary s case (two supra) stands approved in judgment of Hon ble Supreme Court in [3] case of T.K. GINARAJAN Vs. COMMISSIONER OF INCOME TAX . As matter of fact, issue was dealt with in detail in order, dated 10.03.2014, passed by this Court in I.T.T.A.No.75 of 2002. In that view of matter, question raised is required to be answered in favour of Revenue and against Assessee and this appeal is allowed, accordingly. There shall be no order as to costs. Miscellaneous petitions, if any, filed in this appeal shall also stand disposed of. L. NARASIMHA REDDY, J CHALLA KODANDA RAM, J Date:09.09.2014 kdl [1] 214 ITR 368 [2] 1990 (183 ITR AP 29) [3] (2013) 356 ITR 618 (SC) Commissioner of Income-tax v. Mahesh Reddy

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