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TMI Blog2014 (7) TMI 423X X X X Extracts X X X X X X X X Extracts X X X X ..... 0,540/-, being the provision for the post retirement medical benefits of their employees made in accordance with Accounting Standard 15 of the ICAI, by erroneously treating the same as contingent liability and not is an ascertained liability. The provision having been made based on the actuarial valuation, as an ascertained liability and is deductible in terms of Supreme Court decision in the case of Badridas Daga vs. CIT (34 ITR 10), Metal Box India Ltd. Vs. Their Workmen (73 ITR 53) as well as decision of the Tribunal in the case of ITO vs. Wanson India Ltd. (5) ITO 102 and Voltas Ltd. Vs. DCIT (61 ITJ 543). 2. The Appellants submit that on the facts and in the circumstances of the case and on a proper interpretation of the Section 37(1) read with section 35B of the Income Tax Act, the CIT(A) erred in confirming the disallowance of Rs. 2,20,16,234/- being the expenditure incurred for acquiring the right to use the know-how obtained from M/s. Exxon Research & Engg. Co., USA thereby ignoring the decision of Supreme Court in the case of Alembic Chemicals Works Co. Ltd. (177 ITR 377) and Wavin India Ltd. as well as Gujarat High Court decision in the case of CIT vs. Suhrid Geigy Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing Plants commissioned by the Appellants as new industrial units thereby disregarding the opinion given by Dept. of Legal Affairs in Appellants' own case." 2. At the outset, the ld. A.R. of the assessee has submitted that most of the issues taken by the assessee in its grounds of appeal have already been dealt with/adjudicated by the Tribunal in the own cases of the assessee for earlier assessment years. He has further produced a chart in this respect. He has further submitted that the issues involved in the above grounds of appeal are required to be looked into in the light of the decisions of the Tribunal in the own case of the assessee for earlier years. 3. The ld. D.R. has also fairly admitted that except the issue taken vide ground No.5 the other issues are covered by the earlier decisions of the Tribunal in the own cases of the assessee for earlier assessment years. 4. Now, we discuss all the grounds taken by the assessee separately as below: Ground No.1 5. Ground No.1, as reproduced above, is relating to disallowance of Rs. 4,59,90,540/- being the provision for the post retirement medical benefits of their employees. Ld. A.R. of the assessee has brought our attenti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er brought our attention to the order of the Tribunal dated 16.01.13 in ITA Nos.8575/M/04, 8576/M/04 & 5825/M/05 for assessment years 2000-01, 2001-02 & 2002-03 respectively wherein the similar issue has been accordingly decided in favour of the assessee. The ld. D.R. could not bring before us any contrary fact or case law which may justify departure from the above findings of the Tribunal given on the issue in earlier assessment years. Accordingly, the ground No.1 is allowed in favour of the assessee by way of remanding the issue back to the AO for this year also with a direction to allow the claim on the basis of actuarial report in accordance with the direction given by the Tribunal in the own cases of the assessee for earlier assessment years as discussed above. Ground No.2 7. Ground No.2, as reproduced above, is relating to the disallowance of Rs. 2,20,16,234/- being the expenditure incurred for acquiring the right to use the know-how under section 37(1) read with section 35B of the Income Tax Act. The ld. A.R. of the assessee has brought our attention to the order of the Tribunal dated 31.07.12 in the own case of the assessee in ITA No.2124/M/99 for earlier assessment year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in favour of the assessee accordingly. Ground No.4 11. Ground No.4, as reproduced above, is relating to partial disallowance of excise/custom duty paid during the year and included in closing inventory u/s 43B. The ld. A.R. of the assessee has brought our attention to the order of the Tribunal dated 03.01.05 in the own case of the assessee in ITA No.6663/M/97 and ITA No.1562/M/1996 for assessment years 1991-92 and 1992-93 respectively and submitted that in the said decision, the Tribunal, while relying upon the decision of the Hon'ble Gujarat High Court in the case of "Lakhanpal National Ltd. vs. ITO" 162 ITR 240, has held that the CIT(A) erred in confirming the partial disallowance of excise/custom duty paid during the year and included in the closing inventory under section 43B, thereby ignoring the ratio of Hon'ble Gujarat High Court in "Lakhanpal National Ltd. vs. ITO" (supra). He further submitted that the issue is now covered in favour of the assessee by Hon'ble Supreme High Court's judgment in the case of "Berger Paints India Limited vs. CIT" 266 ITR 99. 12. Accordingly, ground No.4 is allowed in favour of the assessee directing the AO to allow the claim of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... parture from the above view for the currant assessment year. 17. Accordingly, following the decision of the co-ordinate benches of the Tribunal for the earlier assessment years i.e. A.Y.2000-01, 2001-02 & 2002- 03, 1992-93, 1993-94, 1994-95 & 1995-96 in the own cases of the assessee which have been further upheld by the Hon'ble High Court, ground No.7 of the appeal is also allowed accordingly in favour of the assessee. ITA No.4436/M/2003 (A.Y 1998-99) 18. The assessee has taken the following grounds of appeal: "1. The Appellants submit that on the facts and in the circumstances of the case and on a proper interpretation of the Section 37(1) of the Income Tax Act, the CIT(A) erred in confirming the disallowance of Rs. 14,617,000, being the provision for the post retirement medical benefits of their employees made in accordance with Accounting Standard 15 of the ICAI, by erroneously treating the same as contingent liability and not is an ascertained liability. The provision having been made based on the actual valuation, as an ascertained liability and is deductible in terms of Supreme Court decision in the case of Badridas Daga vs. CIT (34 ITR 10), Metal Box India Ltd. Vs. Their ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubsequent to the fire and on reconstruction of the records, it was written off in the Financial Year 1997-98. Since the write off was pursuant to the reconstruction of the records it should be treated as the liability crystallised during the Financial Year 1997-98 and should have been allowed. 6. The Appellants submit that on the facts and in the circumstances of the case and the CIT(A) erred in confirming the disallowance of Rs. 3,35,10,000/- being the value of stores and spares written off in accordance with the consistent principle of valuation of the stores and spares. The provision was necessitated due to a major fire in the Appellants' Visakh Refinery on 14.9.97. The Respondent did not allow the deduction either in the years of making provision or in the year of actual write off, thereby causing double jeopardy. 7. The Appellants submit that on the facts and in the circumstances of the case and on a proper interpretation of the Section 80HH, 80l/80lA of the Income Tax Act, the CIT(A) erred in confirming the disallowance of Rs. 44,810,000 being the claim for deduction of profits of the new LPG Bottling Plants commissioned by the Appellants as new industrial units thereby ..... X X X X Extracts X X X X X X X X Extracts X X X X
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