M/s Cheema Boilers Limited vs. The PCIT-2, Chandigarh

Parties Involved

Facts Summary

The assessee, M/s Cheema Boilers Limited, filed an income return on 29.09.2013 declaring an income of Rs.2,22,78,260/- for the Assessment Year 2013-14. The assessment was made by the Deputy Commissioner of Income Tax, Circle-6(1), at an income of Rs.2,25,23,830/-. The company is engaged in the manufacture of high-pressure boilers. The case was selected for scrutiny under CASS due to a high ratio of refund to TDS and large other expenses claimed in the P&L Account. An order under section 263 was passed by the Principal Commissioner of Income Tax (PCIT) on 27.03.2018 on two issues: (1) the wrong claim of depreciation, and (2) the expenditure of Rs. 15,73,434/- towards gratuity, retirement benefits, etc. The assessee filed a reply to these issues, and the PCIT considered the submissions and gave findings on both issues.…

Legal Issues

• 1. The assessee claims that the order passed by the PCIT is erroneous and prejudicial to the interest of revenue.
• 2. The assessee claims that the expenditure of Rs. 15,73,434/- towards gratuity, retirement benefits, etc., was wrongly allowed by the Assessing Officer.

Judgment Outcome

Decided in favour of Revenue.

Precedents Relied Upon

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