Whether deduction out of salary of the employees is to be treated as income of the assessee or not?

This Income Tax Appellate Tribunal case concerns whether deductions made from employee salaries should be considered income for the assessee. The assessee argued that the deduction was related to miscellaneous receipts from non-members, not salary. While an inadvertent mistake was noted in submissions to the Assessing Officer, the Tribunal restored the matter to the Assessing Officer for a thorough verification of accounts and determination of the nature of the receipts.

IN THE INCOME TAX APPELLATE TRIBUNAL
KOLKATA BENCH “SMC” KOLKATA
Before Shri SANJAY GARG, Judicial Member

ITA No.594-595/Kol/2020
Assessment Years:2016-17 & 2017-18

NCDC Staff Co-operative
Credit Society, C/o Subash
Agarwal & Associates,
Advocates Siddha Gibson,
1,Gibson Lane, Suite 213,
2nd floor, Kolkata-700069
[PAN No.AACAN 2132 R]
Appellant

V/s.

Income Tax Officer,
Ward-35(2), Aayakar
Bhawan, Poorba 110,
Shantipally, Kolkata107
Respondent
 
Hearing through video Conferencing
By Assessee Shri Avjit Dey, Advocate
By Revenue Shri Jayanta Khanra, JCIT-SR-DR
Date of Hearing 08-02-2021
Date of Pronouncement 08-02-2021

O R D E R

The present appeals have been preferred by the assessee against the separate order dated 06.08.2020 & 14.09.2020 respectively of the Commissioner of Income-tax (Appeals)-10, Kolkata [hereinafter referred to as ‘CIT(A)’].

2. The appeal is barred by limitation period of 33 days in ITA No.594/Kol/2020 whereas in ITA No.595/Kol/2020 the same is barred by limitation period of 12 days. The assessee has filed separate applications for condonation delay. Considering the submissions made in the applications as well as the shortness of the delay, the delay in  filing these appeals is hereby condoned. Cases are now taken up for adjudication on merits.

3. On merits, the Ld. counsel for the assessee has submitted that the sole issue raised by the assessee in both the appeals is as to whether the deduction out of salary of the employees is to be treated as income of the assessee or not. However, the Ld. DR has brought my attention to the assessment order to submit that no such plea was raised by the assessee before the Assessing Officer. That before the Assessing Officer it was submitted that the amount in question was out of miscellaneous receipts earned from the non-members by the assessee-society. The Ld. counsel for the assessee at this stage has submitted that certain inadvertent mistake has happened while making the submissions before the Assessing Officer. However, the factual position was narrated before the Ld. CIT(A), but, the Ld. CIT(A) has failed to consider the submissions of the assessee. The Ld. counsel for the assessee has submitted that the matter be remitted to the Assessing Officer for verification of the accounts to get the true and correct factual position in this respect. The Ld. DR has not objected to the same. Accordingly, matter in both the appeals is restored to the file of the Assessing Officer. The assessee will demonstrate before the Assessing Officer the nature of the receipts in question and the Assessing Officer after determining the nature of receipts will decide the issue in accordance with law. Needless to say that the Assessing Officer will give adequate opportunity of hearing to the assessee.

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