TaxTMI 
TaxTMI 
2013 (5) TMI 720
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....ubmitted a chart explaining ground-wise details and how the issues are covered with the earlier order of the Tribunal. The Ld. Departmental Representative submitted that wherever the issues are covered by the order of the Tribunal, he has nothing more to add. After carefully going through the chart, let us consider each grounds of appeal as under: 3. Ground No. 1 relates to disallowance of Rs. 27,78,984/- being expenditure incurred on telephones at guest house. 4. This issue has been discussed by the Ld. CIT(A) at para-5 of his appellate order. The Ld. CIT(A) confirmed the addition following the decision of his predecessor for earlier assessment year i.e. 1994-95. A perusal of the order of the Tribunal in assessee's own case for preceding assessment year 1994-95 show that a similar issue has come up for hearing and has been considered by the Tribunal at para-45 & 46 of its order wherein the Tribunal has followed the decision of Mumbai Bench in the case of M/s. Hindustan Lever Ltd Vs IAC 58 ITD 555. Facts and circumstances of the case being similar to those of earlier year, respectfully following the decision of the Tribunal in assessee's own case in ITA No. 4265/M/98, we conf....
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....on of the Tribunal in the light of the decision of the Hon'ble Supreme Court, we direct the AO to delete the additions. This ground of the assessee is accordingly allowed. 8. Ground No. 4 relates to the disallowance of Rs. 1,66,07,391/- being third party commission paid during the previous year. The Ld. CIT(A) has considered this addition made by the AO at para-15 of his order and at para-16, the Ld. CIT(A) has simply followed the finding of his predecessor in assessee's own case for A.Y. 1994-95 and confirmed the addition. 9. A perusal of the order of the Tribunal for A.Y. 1994-95 in ITA No. 4265 & 4892/M/98 show that similar issue has been considered by the Tribunal at para-55 and 56 of its order wherein the Tribunal has followed the findings of the Tribunal in assessee's own case for A.Y. 1989-90 wherein the Tribunal has rejected the contention of the assessee and confirmed the disallowances made by the Ld. CIT(A) on the ground that if details of payment of commission are not coming from the assessee, such payments made in respect of contract awarded by Public Sector companies , we have to held as expenses incurred against public policy and therefore not entitle to be dedu....
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....ture was not incurred for mining or extraction of limestone but the amount was spent for prospecting and exploration of limestone deposited at Tadpatri cement plant of the assessee company which was in the process of being set up during the previous year under consideration and has not commenced production. According to the Ld. CIT(A) such capital expenditure cannot be treated as an expenditure incurred for the purpose of carrying on of business at the relevant time. The Ld. CIT(A) not only disallowed the claim of deduction but at the same time also disallowed the claim of depreciation. 16. We find that similar issue came up before the Tribunal in assessee's own case in A.Y. 1994-95 wherein at para-22 of its order the Tribunal has followed the findings of the Bench in assessee's own case for earlier year. Facts and circumstances being identical, we find no justifiable reason to interfere with the findings of the Tribunal in assessee's own case for earlier year giving relief to the assessee on a similar issue. We accordingly direct the AO to delete the addition of Rs. 25,44,500/-. Ground No. 7 is accordingly allowed. 17. Ground No. 8 relates to disallowance of pre-operative ex....
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....penditure of Jharsuguda Cement works, amount works out to Rs. 24,94,727/- which should have been claimed in A.Y. 1994-95. Ground No. 8 is partly allowed. 22. Ground No. 9 relates to disallowance of Rs. 4,62,15,906/- being Mining Development expenditure. 23. The Ld. Senior Counsel pointed out that this expenditure is included in the expenditure claimed as pre-operative in vide ground No. 8 of this appeal. 24. As we have directed the AO to allow the claim of expenditure vide ground No. 8, accordingly we direct the AO to allow this expenditure subject to verification if any part is included in Jharsuguda Cement Works, then same deserves to be allowed in A.Y. 1993-94. Ground No. 9 is accordingly allowed. 25. Ground No. 10 relates to disallowance of Rs. 58.04 lakhs incurred on Nasik Glass Works. 26. This issue has been discussed by the Ld. CIT(A) at para-33, page- 42 of his order wherein he has decided ground of appeal Nos. 22 , 23 & 24 together. Issues relating to ground Nos. 22 & 23 of the appeal, the same has been considered by us vide ground No. 8 & 9 of this appeal. Facts relating to the claim of expenses on Nasik Glass works amounting to Rs. 58.04 lakhs are similar ....
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.... directed not to give any other benefit to the assessee and if he has excluded the value of capital component of the lease rent of the year, the same should be added back. Ground No. 11 is accordingly allowed. 29. Ground No. 12 & 13 relate to the claim of deduction u/s. 80HHC and 80HHE of the Act. Both the claims are bifurcated into 4 parts (a) inclusion of Sales tax/Excise Duty, Scrap sales as part of the total turnover (b) 90% of gross interest income and other miscellaneous receipts was included from profits of business instead of reducing 90% of net interest (c) Loss on export of trading goods was set off against profit on export of manufactured goods and (d) indirect cost attributable to trading exports were reckon inclusive of sales and administrative overheads interest & brokerage. 30. At the very outset, the Ld. Senior Counsel submitted that he is not pressing issue relating to part (d) of both the grounds i.e. ground No. 12 & 13. Part d of both the grounds are accordingly dismissed. 31. A perusal of the order of the Tribunal in assessee's own case for A.Y. 1994-95 in ITA Nos. 4265 & 4892/M/98 show that the Tribunal has allowed the claim of the assessee so far as i....
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....eal 36. Ground No. 1 relates to fees paid for entrance, life membership and corporate membership to club amounting to Rs. 41,26,745/-. 37. The Ld. CIT(A) has considered this disallowance at para-8 of his order wherein he has followed the decision of his predecessor in earlier year and allowed the claim of the assessee in A.Y. 1994-95. Similar issue has come up for hearing before the Tribunal in ITA Nos. 4265 & 4892/M/98 wherein the Tribunal at para-36 of its order has observed that in A.Y. 1991-92 in assessee's own case relief has been granted to the assessee by the Ld. CIT(A) and has dismissed revenue's appeal on this ground. As no distinguishing facts have been brought on record before us, we therefore find no justifiable reason to interfere with the impugned order of the Ld. CIT(A). Ground No. 1 is accordingly dismissed. 38. Ground No. 2 relates to disallowance made u/s. 40A(3) amounting to Rs. 5,07,281/-. 39. The Ld. CIT(A) has considered this disallowance at para-9 of his appellate order. It is noted by the Ld. CIT(A) that cash payments exceeding Rs. 10,000/- totaling to Rs. 5,41,445/- have been found to be incorrect during the year under consideration as per the T....
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.... its order wherein the Tribunal has followed the decision of the Hon'ble Jurisdictional High Court in the case of National Organic Industries ltd. Vs CIT 203 ITR 410. Facts and issues being identical, respectfully following the decision of the Tribunal (supra) in assessee's own case, order of the Ld. CIT(A) is confirmed. Ground No. 4 of Revenue's appeal is accordingly dismissed. 44. Ground No. 5 relates to claim for unforeseeable losses in computation of value of work-in-progress amounting to Rs. 9.60 crores. 45. The Ld. CIT(A) has considered this disallowance at para 21 & 22 of his appellate order. After considering the facts and the submissions of the assessee in the light of accounting standard issued by the ICAI and the fact that the practice followed by the assessee from year to year consistently recognized by the Accounting Standard should be accepted. Similar issue came up for hearing before the Tribunal in assessee's own case for A.Y. 1994-95 in ITA Nos. 4265 & 4892/M/98 wherein the Tribunal at para Nos. 53 &54 of its order has followed the decision of the Bench in assessee's own case for A.Y. 1990-91 in ITA No. 1806/M/98 has allowed the relief to the assessee. Facts ....
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....s being identical, we have no hesitation in following the order of the Tribunal in assessee's own case for earlier years. Findings of the Ld. CIT(A) are accordingly confirmed. Ground No. 7 is accordingly dismissed. 52. Ground No. 8 relates to disallowance of 25% of estate maintenance expenditure amounting to Rs. 60,02,741/-. 53. The Ld. CIT(A) has discussed this issue at para 2 & 3 of his order. Relying on the certificate issued by the auditors of the company, the ld. CIT(A) directed the AO to consider such certificates wherein it has been stated to confirm that no capital expenditure was included in the estate maintenance expenses and take a fresh decision in the matter of such adhoc disallowance. A perusal of the Paper Book shows that for A.Y. 1990-91 to 1993-94 the adhoc disallowance has been reduced to 10%. A similar view has been taken by the Tribunal in A.Y. 1994-95 in ITA Nos. 4265 & 4892/M/98 wherein while deciding in ground No. 2 raised by the assessee in that appeal wherein the Tribunal has followed the decision of the Bench relating to A.Y. 1990-91 in ITA No. 987/M/98 and reduced the disallowance from 25 to 10%. Facts and circumstances being identical, following th....
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....e of expenditure of Rs. 8,57,068/- incurred on Community Welfare and Rural Development . 60. The issue involved is identical with the issue at page-3, para-5 in ITA No. 2200/M/2000, therefore, on similar lines, similar reasons, the appeal filed by the assessee in ITA No. 2890/M/01 for assessment year 1996-97 is allowed. 61. Ground No. 3 relates to the disallowance of Rs. 2,25,42,324/- being the commission paid during the previous year. 62. The issue involved is identical with the issue at page-4, para- 8 &9 in ITA No. 2200/M/2000 for A.Y. 1995-96, therefore, on similar lines, similar reasons, the appeal filed by the assessee in ITA No. 2890/M/01 for assessment year 1996-97 is allowed. 63. Ground No. 4 relates to addition u/s. 40A(9) of the Act in respect of an amount of Rs. 6,32,187/- contributed to Marine Navy Officers Welfare Fund. 64. The issue involved is identical with the issue at page-5, para- 12 & 13 in ITA No. 2200/M/2000 for A.Y. 1995-96, therefore, on similar lines, similar reasons, the appeal filed by the assessee in ITA No. 2890/M/01 for assessment year 1996-97 is allowed. 65. Ground No. 5 relates to the disallowance of claim for depreciation of Rs. 6....
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....ses treating the same as in the nature of entertainment expenditure. 74. During the course of the scrutiny assessment proceedings, the AO observed that the assessee has claimed entertainment expenditure at Rs. 1,82,10,381/- and added back 50% after claiming deduction u/s. 37(2) of the Act. The AO further observed that the assessee has claimed conference expenses which also include expenditure in the nature of entertainment. The AO was of the view that such expenses are also covered within the ambit of Explanation 3 to Sec. 37(2) of the Act. The assessee was asked to furnish the details. The assessee explained that the expenses incurred on holding conferences are debited to sundries and shown under miscellaneous expenses in account. As the number of vouchers is very large, it was not possible to furnish the details. As no evidence was produced to explain the conference expenses, the AO was for the firm belief that such expenditure includes an element of entertainment expenditure and accordingly estimate such expenditure at Rs. 15,00,000/-. 75. The assessee carried the matter before the Ld. CIT(A) but without any success. 76. Before us, the Ld. Counsel for the assessee submi....
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....e Revenue in ITA No. 3533/M/01 for assessment year 1996-97 is dismissed. 87. Ground No. 5 relates to claim for unforeseeable losses in computation of value of work-in-progress amounting to Rs. 21,75,00,000/-. 88. The issue involved is identical with the issue at page-15, para-44 & 43 in ITA No. 2863/M/2000 for A.Y. 1995-96 in Revenue's appeal, therefore, on similar lines, similar reasons, the appeal filed by the Revenue in ITA No. 3533/M/01 for assessment year 1996-97 is dismissed. 89. Ground No. 6 , 7 & 8 relate to the claim of deduction u/s. 80HHC and 80HHE of the Act. Both the claims are bifurcated into 4 parts (a) inclusion of Sales tax/Excise Duty, Scrap sales as part of the total turnover (b) 90% of gross interest income and other miscellaneous receipts was included from profits of business instead of reducing 90% of net interest (c) Loss on export of trading goods was set off against profit on export of manufactured goods and (d) indirect cost attributable to trading exports were reckon inclusive of sales and administrative overheads interest & brokerage. 90. At the very outset, the Ld. Senior Counsel submitted that he is not pressing issue relating to part (d) o....