TaxTMI 
TaxTMI 
TaxTMI 
2019 (5) TMI 546
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.... by the order of this tribunal in ITA No. 6787 & 6489/Mum/2014 dated 27.2.2019 except with variance in figures, wherein the basic facts and conclusion drawn thereon are as under:- 2. In ground no.1, the Revenue has challenged deletion of addition of Rs. 47,92,500. 3. Brief facts are, the assessee company, as stated by the Assessing Officer, is engaged in the business of providing consultancy services relating to operations, finance, human resource and information technology. For the assessment year under dispute, the assessee filed its return of income on 6th November 2007, declaring nil income. In course of assessment proceedings, the Assessing Officer on verifying the audited financial statements of the assessee noticed that against professional fees shown of Rs. 31,84,59,835, the assessee has incurred substantial expenses on account of salary, bonus, etc., amounting to Rs. 16,37,40,274, compared to preceding years expenditure of Rs. 8,55,96,230. Being of the view that the expenditure claimed by the assessee is disproportionate to the increase in income, the Assessing Officer called upon the assessee to explain the details of income and expenses. On verifying the details furn....
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....from the income of the assessee in assessment year 2008-09. Therefore, following the decision of the Hon'ble Supreme Court in CIT v/s Excel Industries Ltd., [2013] 358 ITR 295 (SC) and the decision of the Hon'ble Delhi High Court in CIT v/s Vishnu Industrial Gasses Pvt. Ltd., ITR no.229/1988, daed 6th May 2008, as well as the decision of the Hon'ble Jurisdictional High Court in CIT v/s Nagri Mills Co. Ltd., [1958] 33 ITR 681, learned Commissioner (Appeals) deleted the addition made by the Assessing Officer. 5. The learned Departmental Representative relying upon the observations of the Assessing Officer submitted, since the major portion of the work was completed in the impugned assessment year, it should have been shown as work-in-progress in the accounts of the assessee and offered as income. He submitted, without offering the income in the assessment year wherein it accrued, the assessee has deferred it to the next assessment year. Therefore, he submitted, the Assessing Officer was justified in adding the amount to the income of the assessee. 6. The learned Authorised Representative submitted, the assessee is providing consultancy services, hence, there cannot be a....
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.... demonstrate that not only the assessee has offered the disputed amount as income in assessment year 2008-09, but has also claimed the corresponding TDS in the said assessment year. It is also a fact on record that the tax rate for assessment year 2007-08 and 2008-09 are the same. That being the case, whether the amount is taxed in the impugned assessment year or in assessment year 2008-09, will have no effect on the Revenue. On the contrary, if the amount is taxed in the impugned assessment year, it has to be excluded from the income of the assessee in assessment year 2008-09, since, it has already been assessed in that assessment year. This is due to the settled legal principle that the same income cannot be assessed in two assessment years. 8. One more interesting fact relating to the impugned addition which has come to our notice is, as per the facts narrated by the Assessing Officer in the impugned assessment order, in the month of April 2007, the assessee had raised a number of bills totaling to Rs. 84,07,964=28. Whereas, out of those bills, the Assessing Officer has picked up only one bill raised on 18th April 2007, to Diageo India Pvt. Ltd. for the amount of Rs. 47,92,500....
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....however, rejecting the explanation of the assessee, the Assessing Officer added back the amount of Rs. 80,94,715. The assessee challenged the aforesaid disallowance before the first appellate authority. 11. In course of proceedings before the learned Commissioner (Appeals), the assessee furnished some more material reconciling the differences pointed out by the Assessing Officer. On the basis of submissions made and evidences filed, learned Commissioner (Appeals) called for a remand report from the Assessing Officer. After verifying the remand report and considering the submissions of the assessee in the context of facts and materials on record, learned Commissioner (Appeals) observed that out of the difference of Rs. 80,94,715, pointed out by the Assessing Officer, the assessee could reconcile / co-relate the difference of Rs. 17,66,983 and could not co-relate / reconcile the reversal of entries for an amount of Rs. 54,00,000 in respect of Ruchi Soya Industries Ltd. Thus, he sustained disallowance to the extent of Rs. 63,28,322. 12. The learned Departmental Representative submitted, since the assessee could not reconcile the differences pointed out by the Assessing Officer, ....
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....case. 4.1. We have heard the rival submissions. Both the parties before us agreed that this issue is covered in favour of the assessee for Asst Year 2007-08 by the order of this tribunal in ITA No. 6787 & 6489/Mum/2014 dated 27.2.2019 except with variance in figures, wherein the basic facts and conclusion drawn thereon are as under:- 17. In ground no.4, the Revenue has challenged deletion of addition of Rs. 72,34,00 made on account of disallowance of Deloitte Touche Tohmatsu (DTT) subscription. 18. Brief facts are, in the course of assessment proceedings, the Assessing Officer noticed that the assessee has debited an amount of Rs. 72,34,000 to the Profit & Loss Account on account of payment towards DTT subscription. When the Assessing Officer called upon the assessee to explain the nature of expenditure and justify the claim of deduction, it was submitted by the assessee that the said amount representing DTT subscription was assessee's share in the expenses comprising of Rs. 55,75,396, being DTT subscription and Rs. 16,59,189, being DTT technology subscription. It was submitted, there are several advantages if one becomes member of the said subscription as it can use the Deloi....
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....011-12. He submitted, though, the Assessing Officer disallowed the DTT subscription in assessment year 2008-09 also, however, learned Commissioner (Appeals) deleted such disallowance. Thus, he submitted, applying rule of consistency also, assessee's claim has to be allowed. Without prejudice to the aforesaid submissions, learned Authorised Representative submitted, in any case of the matter, the assessee has not acquired any brand but has made subscription for utilizing it. Therefore, it cannot be said that the amount paid by the assessee is a capital expenditure incurred for acquiring a brand for goodwill. In support of such contention, he relied upon the following decisions:- i) DCIT, v/s Hindustan Zinc Ltd., [1972] 84 ITR 277 (SC); and ii) Harrisons Malayalam Ltd. v/s ACIT, [2008] 19 SOT 363 (Cochin) 22. We have considered rival submissions and perused material on record. It is observed that the assessee has been paying the DTT subscription annually for utilizing the Deloitte brand along with certain technology. There is nothing on record to suggest that assessee has acquired the brand or the technology for good. Therefore, it cannot be said that the assessee has incur....