HON’BLE SRI JUSTICE L. NARASIMHA REDDY AND HON’BLE SRI JUSTICE CHALLA KODANDA RAM I.T.T.A No.320 OF 2003 17-12-2014 BETWEEN The Commissioner of Income Tax, Hyderabad - I …Appellant And M/s. Hyderabad Industries Ltd., Hyderabad …..Respondent HON’BLE SRI JUSTICE L. NARASIMHA REDDY AND HON’BLE SRI JUSTICE CHALLA KODANDA RAM I.T.T.A No. 320 OF 2003
JUDGMENT: (per the Hon'ble Sri Justice L. Narasimha Reddy)
The only question that arises in this appeal is as to whether the assessing officer can disallow deduction of part of bonus paid by an assessee through an intimation under Section 143 (1) (a) of the Income Tax Act, 1961 (for short, ‘the Act’).
The respondent made provision for certain amount for bonus in its books of account. However, on the basis of the agreement with the workers union and the ordinance issued by the appropriate Government, it paid higher amount. The assessing officer disallowed the amount over and above what was mentioned in the books of account. The respondent filed appeal before the Hyderabad Bench ‘B’ of the Income Tax Appellate Tribunal and the same was allowed.
Heard the learned counsel for the appellant and the learned counsel for the respondent.
The issue is no longer res integra. On several occasions, the Courts have explained the purport of an intimation under Section 143 (1) (a) of the Act on the one hand and an order passed under Section 143 (3) of the Act on the other hand. Recently, in I.T.T.A No.111 of 2003, this Court rendered judgment on 16-09- 2014 explaining the difference between two procedures. It was held that where debatable issues exist, the procedure under Section 143 (1) (a) of the Act cannot be invoked.
Following the same, we dismiss the appeal. There shall be no order as to costs.
L. NARASIMHA REDDY, J CHALLA KODANDA RAM, J 17-12-2014 ks