TaxTMI 
TaxTMI 
2022 (7) TMI 622
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....ated 08.08.2019. Cross-objection filed by the assessee against the appeal by the Revenue was adjourned which has come up for hearing before the Bench. We note that Cross-objection is an independent appeal under Rule 22 of the Income-tax (Appellate Tribunal) Rules, 1963 (ITAT Rules) which is reproduced as under - 22. A memorandum of cross-objections filed under sub-section (4) of section 253 shall be registered and numbered as an appeal and all the rules, so far as may be, shall apply to such appeal. [emphasis supplied by us by underline] 2.1. The Cross-objection involves substantial relief which is not meant only to support order of ld. CIT(A) about the relief allowed. The Cross-objection has been admitted as an appeal which warrants its due adjudication. The grounds of cross-objection filed by the assessee were directed to be submitted in concise form which is placed on record vide letter dated 19.08.2019. Accordingly, the revised and concise grounds of cross-objection to be adjudicated upon are reproduced as under: A. Grounds to support order of CIT(A): 1. Learned CT (A) has rightly deleted addition in respect of liabilities for business exp....
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....ere is lack of clarity, Ld. A.O has not considered restored issues while giving effect to the order of Ld. CIT(A). Therefore, Ld. A.O may be directed to allow relief by way of depreciation allowable, correctly on (A) new assets and (b) on correct WDV of molasses tanks, as claimed before lower authorities. 7) For that appellant seeks kind permission of the Hon'ble Tribunal, to raise new contentions and new grounds of appeal, if required, in interest of justice. 3. Before us, Shri D.K. Kothari, AR represented the assessee and Smt. Ranu Biswas, ACIT represented the Revenue. 4. Brief facts of the case are that assessee is a limited company and is in the business of manufacturing of sugar. It has its registered office at Kolkata and factory at Sasa Musa, Dist. Gopalganj, Bihar. Assessee filed its return of income on 30.09.2014 reporting total income as 'nil'. Statutory notices were issued which were complied by the assessee. In the course of assessment proceedings, ld. AO asked the assessee to furnish working of book profit under the provisions of section 115JB of the Act, to which assessee submitted that it is not liable to pay tax on book profit and the provisions of se....
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..... 34,000/- incurred towards charity and donation, the ld. CIT(a) confirmed the addition made by the AO and dismissed the ground. 7. Aggrieved, the assessee is in appeal before the Tribunal. 8. We note that ld. counsel has submitted paper books in three volumes which are placed on record. A synopsis for each of the ground taken in the cross-objection is also placed in the paper book at page no. 194 to 196. Considering the said synopsis, we deal with each of the ground in the cross-objection as under: 8.1. Ground No. 1 is general in nature and, therefore, is not adjudicated upon. On ground no. B.2.a, in respect of non-applicability of provisions of section 115JB of the Act, ld. counsel reiterated the submissions made before the authorities below which are not reproduced for the sake of brevity. Ld. Counsel however placed reliance on the recent judgment of Co-ordinate Bench of ITAT, Kolkata in the case of The United Provinces Sugar Co. Ltd. vs ITO in ITA No. 1956/Kol/2018 for A.Y. 2013-14 dated 01.04.2021 which has dealt on the identical issue. Ld. Counsel laid emphasis on the contention that the authorities below ought to have followed the binding precedents, rule of consist....
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....ng the year 1,73,47,476 Normal Depreciation as per TAR Annex-II 11834475 Less: Depreciation on Molasses tank 125272 1,17,09,203 Additional Depreciation u/s 32(1)(iia) as per TAR 16,31,468 Loss: Being Unabsorbed depreciation kept apart c/f 4,97,27,065 -49,75,164 Gross Total Income: 0 Deduction u/s 80G could not be claimed as GTI is NIL Total Income: NIL 9.1 From the above computation, we note that there is no computation of GIT since there is loss of Rs. 49,75,164/- towards unabsorbed depreciation which is kept apart for carry forward. Therefore, there is no deduction which has been claimed to arrive at total income which is reported at Nil. From the perusal of order of Coordinate Bench of ITAT, Kolkata in assessee's own case for A.Y. 2003-04 (supra), we note that the issue is squarely covered by the said decision. The said decision is reproduced as under which is placed at page no. 116 to 117 of the paper book: "The assessee has filed this appeal against the order of the Ld. CIT(A) dated 27.12.2006 for the assessment year 2003....
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....ollowing the judgment of the Hon'ble Supreme Court in the case of Apollo Tyres Ltd. -Vs- CIT 255 ITR 273, Therefore, he completed the assessment determining income u/s. 115JB. Aggrieved by the order of the Assessing Officer the assessee preferred appeal before the Ld. CIT(A). The Ld. CIT(A) in First appeal, confirmed the action of the Assessing Officer. 3. At the time of hearing the Ld. Counsel for the assessee submitted that the issue involved in this case is covered by the order of the Hon'ble Calcutta High Court in the case of CIT Vs- Vishnu Sugar Mills Ltd. dated 20.11.2006 in IT A No. 359 of 2006 and he, therefore, did not press the alternate pica taken by him by ground nos. 3 and 4. 4. The Ld. Departmental Representative did not controvert this submission of the Ld. Authorized Representative of the assessee. 5. We have heard both the parties, perused the material available on record and judgment of the Hon'ble Calcutta High Court. We find that since there is no gross total income, no total income and -no tax payable and therefore, preconditions to apply Section115JB were hot satisfied and in view of the judgment of the Calcutta Tribunal in case of V....
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.... Bench of ITAT, Kolkata in the case of Neeraj Vanijya Pvt. Ltd. vs ITO in ITA No. 1504/Kol/2008 for A.Y. 2005-06, dated 31.10.2008. We find that the contention of the assessee is covered by the said decision and respectfully following the same, we allow this ground in favour of the assessee. 11. Ground no. B.3 relates to addition made in respect of contribution to molasses reserve while arriving at book profit u/s 115JB. Since we have already dealt with the issue relating to applicability of section 115JB in the case of assessee whereby we have held that it is not applicable, this ground become infructuous and accordingly is disposed off as infructuous. 12. For ground no. B.4, assessee has submitted it as not pressed. Accordingly, this ground is disposed off as not pressed by the assessee. 13. In respect of ground no. B.5 for addition of Rs.34,000/-, assessee claimed that these expenses includes small contributions to local people and institution on request of employees and business associates which are allowable as business expenses u/s 37(1) of the Act. Ld. Counsel submitted that inadvertently these were accounted under the head 'charity and donation' in the books of acc....
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....ersonal expenses of the assessee laid out or expended wholly and exclusively for the purpose of the business or profession shall be allowed in computing the income chargeable under the Head "Profits & Gains of Business or Profession". To our mind, ld. AO failed to appreciate the nature of business of the assessee and the surrounding social environment where it has been carrying out its business. From the details tabulated above, giving particulars for each of the payments totaling to Rs.34,000/-, we do not find any merit in the basis adopted by the authorities below to disallow the claim of the assessee. We, accordingly, delete the addition and allow the ground of cross-objection. 14. In respect of ground no. B.6 relating to claim of depreciation on molasses tanks for which the ld. CIT(a) had directed the AO to allow the depreciation after verification that the new plant & machinery were indeed put to use by the assessee. Assessee has come before the Tribunal seeking clarity on the direction given by the ld. CIT(A) to the AO. Ld. Counsel of the assessee submitted that the claim for depreciation on molasses tanks was made before the ld. AO which was not considered in proper persp....