The Principal Commissioner of Income-tax-1 v. Cytespace Research Pvt. Ltd
[Citation -2020-LL-0127-115]
Citation | 2020-LL-0127-115 |
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Appellant Name | The Principal Commissioner of Income-tax-1 |
Respondent Name | Cytespace Research Pvt. Ltd. |
Court | HIGH COURT OF GUJARAT AT AHMEDABAD |
Relevant Act | Income-tax |
Date of Order | 27/01/2020 |
Assessment Year | 2013-14 |
Judgment | View Judgment |
Keyword Tags | deduction of expenses • expenditure incurred • financial statement • double taxation • question of law • reasonableness of expenditure • employee benefit expenses • commercial expediency |
Bot Summary: | The Revenue has proposed following question of law for the consideration of this Court : Whether Appellate Tribunal has erred in law and facts in confirming the action of the CIT(A) with respect to the deletion of the disallowance made on account of employees' benefit expenses Page 1 of 4 Downloaded on : Fri Jan 31 10:46:04 IST 2020 C/TAXAP/35/2020 ORDER 3. The Tribunal while confirming the order passed by the CIT(A) and dismissing the appeal preferred by the Revenue, held as under : We find that the appellant justified that the turnover of the appellant has increased by an amount of Rs.1,10,79,362/- over the previous year which has been verified from the financial statement by the Learned CIT(A). Additionally commercial expediency/business rational of a particular expenditure incurred by an assessee for the smooth running and furtherance of its business is its prerogative and hence the same cannot be questioned by the Revenue. The question regarding tax revenue neutrality on the fact that if the income is being charged in the hands of the directors in the highest rate bracket taxing the same in the hands of the company would amount to double taxation as has been decided in the judgment of PWS Engineers Ltd.-vs-DCIT in Tax Appeal No.209 of 2015 passed by the Jurisdictional High Court has been duly taken care of by the first appellate authority. We take notice of the fact that the Tribunal relied upon the decision of the Supreme Court in the case of Sassoon J. David and Co(P) Ltd.-vs-CIT reported in 118 Page 3 of 4 Downloaded on : Fri Jan 31 10:46:04 IST 2020 C/TAXAP/35/2020 ORDER ITR, 261. We are of the view that the question as proposed by the Revenue cannot be termed as a substantial question of law. In view of the concurrent findings recorded by the two authorities, we are not inclined to justify the order passed by the Tribunal. |