2012 (11) TMI 1245 - AT - Income Tax

Summary

Issues involved: Appeal by Revenue against direction to reduce disallowance of expenses to 25% based on Tribunal orders for different assessment years.

Summary:

Assessment Year 2004-2005:
The Revenue appealed against the direction of the CIT(A) to reduce the disallowance of illegal expenses to 25% of the total amount, citing Tribunal orders in the assessee's case for other years. The Tribunal upheld the CIT(A)'s decision, noting the lack of evidence to show reversal or modification of the Tribunal's previous orders. Consequently, the appeal for this year was dismissed.

Assessment Year 2005-2006:
Similar to the previous year, the Revenue contested the CIT(A)'s directive to limit the disallowance of expenses to 25%, based on Tribunal precedents. The Tribunal, finding no evidence of reversal or modification of the Tribunal's earlier decisions, upheld the CIT(A)'s order. Accordingly, the appeal for this year was also dismissed.

Assessment Year 2006-2007:
In this assessment year, the Revenue raised objections against the CIT(A)'s decision to reduce the disallowance of expenses to 25% as per Tribunal rulings in the assessee's case for other years. The Tribunal, after considering the lack of material indicating any changes to the Tribunal's previous orders, affirmed the CIT(A)'s direction. Consequently, the appeal for this year was dismissed as well.

In all three appeals, the Tribunal dismissed the Revenue's appeals and upheld the CIT(A)'s decision to restrict the disallowance of expenses to 25% based on Tribunal precedents, as there was no evidence of any modifications or reversals of the Tribunal's earlier orders by the High Court.