Commissioner of Income Tax, Kolii Kol Vs. the General Fibre Dealier (P) Ltd. - Court Judgment

ITA No.26 of 2014 IN THE HIGH COURT AT CALCUTTA Special Jurisdiction (Income tax) ORIGINAL SIDE COMMISSIONER OF INCOME TAX, KOL-II KOL Versus THE GENERAL FIBRE DEALIER (P) LTD.BEFORE: The Hon'ble JUSTICE SOUMITRA PAL The Hon'ble JUSTICE DEBANGSU BASAK Date : 12th September, 2014.

Appearance: Md.Nizamuddin, Adv..for the appellant Mr.Debashis Mitra, Adv..for the respondent The Court : On 4th August, 2014, the appeal was admitted on the following questions: 1.

“Whether on the facts and in the circumstances of the case the Ld.

Tribunal has erred in law in holding that the Cess on green leaf amounting to Rs.3 lakh is an allowable expenditure by disregarding that it is directly attributable to core agriculture activities which is taxable under state agriculture income tax and is beyond the purview of Central Income Tax and on this issue the SLP has been admitted against the order of this Hon’ble Court in case of AFT industries-Vs-CIT (270 ITR167 and the same is pending being Appeal No.Civil 1105/2006?.”

2. Whether on the facts and in the circumstances of the case the Ld.

Tribunal has erred in law in holding that the Cess on green leaf amounting to Rs.32,68,164/- paid before furnishing of return of Income was allowable under Section 43B of the I.T.Act,, by disregarding that the Cess on green leaf which was not paid within the previous year and which is contrary to the provision of the Section 43B of the I.T.Act, 1961 under which it is allowable on actual payment basis?.”

3. Whether on the facts and in the circumstances of the case conclusion arrived at by the Ld.

Tribunal in granting the aforesaid relief to the assessee, is perverse?.” It is submitted by Mr.Mitra, learned advocate for the respondent assessee, that the fiRs.question is covered by the judgment in CIT versus AFT Industries Limited (Cal).270 ITR167(Cal) and the second question is covered by the judgment in Allied Motors (P) LTD.versus Commissioner of Income Tax; 224 ITR677(SC) both in favour of the assessee and against the revenue which is not disputed by Md.Nizamuddin, learned advocate on behalf of the appellant.

It is submitted by Md.Nizamuddin, learned advocate, that though the fiRs.question is covered against the Revenue, however, a Special Leave Petition has been preferred before the Hon’ble Supreme Court and the same is pending and the second question is related to the fiRs.question.

So far as the fiRs.question is concerned, we find that in CIT versus AFT Industries Limited (Cal) (Supra).this Hon’ble High Court had held that the “entire amount paid as cess on green leaf seems to be eligible for deduction with regard to which we do not find any confusion.” Their Lordships did not find any substantial question of law involved in that case.

Accordingly, the question no.1 is answered in the negative and in favour of the assessee and against the Revenue.

So far as the second question is concerned as it is admittedly related to the fiRs.question and since we find it is consequential and also covered by the judgement in Allied Motors (P.) Ltd ( supra ).the said question is answered in the negative and against the Revenue and in favour of the assessee.

The appeal is dismissed.

There will be no order as to costs.

Urgent certified copy of this order be supplied to the parties, if applied for, upon compliance of all requisite formalities.

(SOUMITRA PAL, J.) (DEBANGSU BASAK, J.) cs/