Tribunal dismisses Revenue's appeal on P&L account addition for AY 1993-94, upholds deduction.

The Revenue's appeal against the deletion of an addition in the P&L account for AY 1993-94 was dismissed. The Tribunal upheld the CIT(A)'s decision to grant the deduction, emphasizing that the recovery of expenses should not be treated as the assessee's income. The Assessee's Cross Objection related to expenses incurred by GEB was dismissed as the assessee decided not to press it during the hearing. Both the Revenue's appeal and the Assessee's Cross Objection were ultimately dismissed by the Tribunal.

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Issues Involved:
Appeal by Revenue against deletion of addition in P&L account for AY 1993-94.

Analysis:
The appeal by the Revenue and the Cross Objection by the Assessee were directed against the order of the Ld.Commissioner of Income Tax(Appeals) pertaining to Assessment Year (AY) 1993-94. The appeal and the cross objection were taken up together. The Revenue raised grounds against the deletion of an addition in the P&L account. The facts revealed that this was the second round of litigation, where the Tribunal had earlier directed the AO to grant a deduction claimed by the assessee. However, in the subsequent round, the AO confirmed the disallowance, leading to the appeal. The Revenue contended that the assessee failed to demonstrate the expenditure related to the year under appeal, justifying the disallowance. On the other hand, the assessee's counsel argued that the direction of the Tribunal in the previous litigation was clear, and the deduction should have been granted. The AO disallowed the expenses due to lack of verification, but the CIT(A) allowed the deduction, emphasizing that the recovery of expenses cannot be treated as the assessee's income.

The Tribunal analyzed the submissions, records, and orders of the authorities below. It was noted that the GEB had confirmed the recovery of expenses, but the AO did not allow the expenses as they were not correlated with the year under appeal. The Tribunal found that the recovery related to the business of the assessee, and there was no evidence to suggest otherwise. The ld.CIT(A) was deemed justified in granting the deduction, dismissing the Revenue's appeal. Consequently, the Revenue's appeal was dismissed.

Regarding the Assessee's Cross Objection, the grounds raised were related to the deduction of expenses incurred by GEB on behalf of the company. However, during the hearing, the assessee's counsel expressed the decision not to press the cross-objection, which was not objected to by the ld.Sr.DR. Consequently, the cross-objection filed by the assessee was dismissed as not pressed. In the end, both the appeal of the Revenue and the cross-objection filed by the assessee were dismissed, with the order pronounced in the Court on a specific date.

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