M/s JKM Leathers v. The Deputy Commissioner of Income-tax, Non Corporate Circle-10(1), Chennai
[Citation -2016-LL-0915-52]

Citation 2016-LL-0915-52
Appellant Name M/s JKM Leathers
Respondent Name The Deputy Commissioner of Income-tax, Non Corporate Circle-10(1), Chennai
Court ITAT-Chennai
Relevant Act Income-tax
Date of Order 15/09/2016
Assessment Year 2010-11
Judgment View Judgment
Bot Summary: Sh. Saroj Kumar Parida, the Ld.counsel for the assessee, submitted that the assessee has paid 4,60,000/- towards partners remuneration. According to the Ld. counsel, it is only a typographical error the CIT(Appeals) is not justified in disallowing the claim of the assessee. The main claim of the assessee, according to the Ld. D.R., was that the partnership deed was amended by a supplementary deed. If the intention of the assessee is really to pay more remuneration to the partners, the partnership deed would have been amended by executing an absolute deed in a manner known to law. The assessee now created a false document to support the false claim. The assessee has now produced a copy of the so-called supplementary deed which said to be enable the assessee-firm for payment of 34,175/- per month. After the Assessing Officer disallowed the claim of the assessee by referring to original partnership deed, the assessee created this document to support the false claim.


IN INCOME TAX APPELLATE TRIBUNAL BENCH, CHENNAI BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER ITA No.1447/Mds/2016 Assessment Year : 2010-11 M/s JKM Leathers, Deputy Commissioner of Swami House, v. Income Tax, No.4, Vasantha Garden Street, Non Corporate Circle 10(1), Ayyanavaram, Chennai - 600 023 Chennai - 600 034. PAN : AAAFJ 3122 (Appellant) (Respondent) Appellant by : Sh. Saroj Kumar Parida, Advocate Respondent by : Shri Shiva Srinivas, JCIT Date of Hearing : 28.07.2016 Date of Pronouncement : 15.09.2016 ORDER PER N.R.S. GANESAN, JUDICIAL MEMBER: This appeal of assessee is directed against order of Commissioner of Income Tax (Appeals) 12, Chennai, dated 22.03.2016 and pertains to assessment year 2010-11. 2. only issue arises for consideration is with regard to disallowance of remuneration paid to partners. 2 I.T.A. No.1447/Mds/16 3. Sh. Saroj Kumar Parida, Ld.counsel for assessee, submitted that assessee has paid `4,60,000/- towards partners remuneration. As per partnership deed, remuneration was `3,60,000/-. Referring to supplementary partnership deed, Ld.counsel submitted that remuneration payable to partners was amended and assessee-firm is liable to pay remuneration to each partner at `34,175/- per month. Inspite of this amended partnership deed, according to Ld. counsel, CIT(Appeals) confirmed order of Assessing Officer. Referring to observation made by CIT(Appeals), more particularly at para 8.4, Ld.counsel submitted that CIT(Appeals) disbelieved supplementary deed on ground that it was executed on 01.04.2009 and stamp paper was dated 03.04.2009. According to Ld. counsel, it is only typographical error, therefore, CIT(Appeals) is not justified in disallowing claim of assessee. 4. On contrary, Shri Shiva Srinivas, Ld. Departmental Representative, submitted that partnership deed enables partnership firm to pay sum of `3,60,000/- towards remuneration to partners, which was in fact allowed by Assessing Officer. 3 I.T.A. No.1447/Mds/16 assessee, however, paid `8,20,000/-. In other words, assessee has paid `4,60,000/- over and above `3,60,000/-. Assessing Officer has added this amount of `4,60,000/- to total income of assessee. main claim of assessee, according to Ld. D.R., was that partnership deed was amended by supplementary deed. Referring to order of CIT(Appeals), more particularly para 8.4, Ld. D.R. submitted that supplementary deed was executed on 01.04.2009, whereas, stamp paper itself was purchased on 03.04.2009. This shows that assessee has created document for purpose of making false claim before income-tax authorities. This false document submitted by assessee for purpose of making false claim to extent of `4,60,000/- cannot be basis for granting relief to assessee. If intention of assessee is really to pay more remuneration to partners, partnership deed would have been amended by executing absolute deed in manner known to law. Unfortunately, according to Ld. D.R., assessee could not do so. assessee now created false document to support false claim. Therefore, according to Ld. D.R., CIT(Appeals) has rightly found that supplementary deed dated 01.04.2009 cannot be executed on stamp paper dated 03.04.2009. 4 I.T.A. No.1447/Mds/16 5. We have considered rival submissions on either side and perused relevant material available on record. original partnership deed enables payment of `3,60,000/- towards partners remuneration. In fact, assessee has paid `4,60,000/- over and above `3,60,000/-. assessee has now produced copy of so-called supplementary deed which said to be enable assessee-firm for payment of `34,175/- per month. We have carefully gone through copy of so-called supplementary partnership deed. stamp paper was dated 03.04.2009 and document was executed on 01.04.2009, as rightly observed by CIT(Appeals). In other words, stamp paper came into existence only on 03.04.2009, whereas document appears to have been executed on 01.04.2009. Ld.counsel for assessee now claims that it is only typographical error. This Tribunal is unable to accept submission of Ld.counsel for assessee. This is apparently document created for purpose of making false claiming before lower authorities. After Assessing Officer disallowed claim of assessee by referring to original partnership deed, assessee created this document to support false claim. It is not mere typographical error as contended by 5 I.T.A. No.1447/Mds/16 Ld.counsel for assessee. Hence, so-called supplementary deed cannot be acted upon. Therefore, this Tribunal do not find any reason to interfere with order of lower authority and accordingly same is confirmed. 6. In result, appeal filed by assessee is dismissed. Order pronounced on 15th September, 2016 at Chennai. sd/- sd/- (D.S. Sunder Singh) (N.R.S. Ganesan) Accountant Member Judicial Member Chennai, th Dated, 15 September, 2016. Kri. Copy to: 1. Appellant 2. /Respondent 3. CIT(A)-12, Chennai 4. Principal CIT-3 5. DR 6. GF. M/s JKM Leathers v. Deputy Commissioner of Income-tax, Non Corporate Circle-10(1), Chennai
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