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TMI Blog2015 (7) TMI 534X X X X Extracts X X X X X X X X Extracts X X X X ..... sallowances of expenses which were raised in Ground no. 6 out of which, three expenses have been dealt by the Tribunal. However, the disallowance of lunch expenses to personnel on outdoor duty have not been adjudicated. He further submitted that in the assessment year 1995-96, the Tribunal had allowed the said expense, therefore, on similar facts this issue can be decided. 5. After hearing the Ld. DR and Ld. Senior Counsel for the assessee, we find that the Tribunal while adjudicating Ground no. 6 in Para 14 had omitted to decide the said ground relating to lunch expenses to personnel on outdoor duty expense. We find that in the assessment year 1992-93, the Tribunal following earlier order for AY 1991-92 has upheld the disallowance of lunch expenses to the extent of Rs. 2 lakhs. Whereas, in the assessment year 1995-96, the Tribunal has held that lunch expenses incurred for the employees during the course of outdoor duties is to be allowed u/s 37(3) and accordingly, following the same, we direct the AO to allow the lunch expenses of the employees incurred on the outdoor duty. Thus, this issue is decided in favour of the assessee. 6. Second issue relates to Foreign Travel expenses. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vide Ground No. 4(a) wherein, the assessee had categorically stated that this issue stands squarely covered in favour of the assessee by the order of the Tribunal for the assessment year 1992-93 and 1993-94. If the said ground is allowed then Ground no. 4(b) and 4(c) would become infructuous. We find that a mistake has been crept in the order of the Tribunal, wherein, it has been noted that the said ground is not pressed, which fact is not correct. Accordingly, we rectify the same and hold that such expenses are to be allowed as similar disallowances have been deleted by the Tribunal not only in the assessment years 1992-93 and 1993-94 but also in the assessment year 1995-96. Thus, Ground No. 4(a) is treated as allowed. 11. Issue No. 4 pertains to Excess and short provision of expenditure. The Ld. Senior Counsel pointed out that the Tribunal has dealt the issue vide para and 6 and further vide para 24 to 26. The relevant observations of the Tribunal in the impugned order in this regard are as under: "4. During the year under consideration, provision was made by the assessee for certain expenses on estimated basis. As per the final position emerged in the subsequent year, the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of short provision made for certain expenses. It is also observed that a similar issue was involved in assessee's own case for assessment year 1993-94 and the Tribunal vide its order dated 29-06-2012 passed in ITA No. 334/Mum/1997 upheld the order of the learned CIT(Appeals) on this issue. As the judicial discipline warrants us to follow the order of the coordinate bench passed in assessee's own case especially when the issue involved as well as material facts relevant thereto are similar, we follow the order of the coordinate bench in assessee's own case for assessment year 1993-94 and uphold the impugned order of the learned CIT(Appeals) on this issue. Ground No. 1 of the assessee's appeal is accordingly dismissed". "24. The issue raised in ground No. 11 of the assessee's appeal relates to the disallowance of Rs. 63,93,929/- made by the AO and confirmed by the learned CIT(Appeals) on account of expenses pertaining to assessment year 1993- 94. 25. During the year under consideration, a sum of Rs. 63,93,929/- was claimed by the assessee on account of expenses pertaining to assessment year 1993-94 which were actually incurred in the year under consideration. According to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vision made in 1993-94, therefore, the excess amount was claimed as deduction for the year. Both the aforesaid claims of the assessee have been denied by the Tribunal. In this regard, assessee's case before the Tribunal was as under: a) Under mercantile system of accounting a provision for expense has to be made in respect of an service/goods received during the previous year but which bill is not received at the time of provision and payment is to be made at a later date upon receipt of actual bill. The Applicant had made provision for expenses as it was following mercantile method of accounting which has been accepted by the Revenue. b) It was a necessary incident of mercantile method of accounting and making provisions that there could be some excess provision or short provision. No disallowance can be made in the year in which the provision is made on the ground that the estimated provision is in excess of the actual payment made by the assessee in the later year. Similarly, if the provision made in year 1 is lesser than the actual payment/ expenditure incurred in year 2, no disallowance can be made in year 2 in respect of the actual expenditure claimed which was in excess of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... refore, the reliance placed by the Tribunal in its earlier order of 1993-94, which in turn is based on AY 1992-93 had no bearing, therefore, it constitutes a mistake apparent from record, which needs to be rectified. However, he admitted that in the Miscellaneous Application filed for the AY 1993-94, pointing out the similar mistake has been rejected by the Tribunal. On the other hand, Ld. DR submitted that since similar issue has been dismissed by the Tribunal in the Miscellaneous Application for the AY 1993-94, therefore, this issue needs to be dismissed. We have considered the rival submissions and also the relevant finding given by the Tribunal in the impugned order. In Ground No. 1, the assessee had mainly challenged the adding back of the amount of provisions of expenses as on year end based on estimates for which actual bills were not received. The assessee has been making the provisions for expenses in respect of services and goods received during the previous year for which bill is not received till the time of the provision is made and payment is made on later date upon the receipt of the bill. Such a claim of provision has been made as assessee was following mercantile ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ordingly, we dismiss Point No. 5 (i.e. fifth issue) raised by the assessee in the present Miscellaneous Application. 14. In view of the finding given above, the assessee's Miscellaneous Application is treated as partly allowed. 15. Now, we will come to MA No. 133/Mum/2013. In the aforesaid Miscellaneous Application the assessee has raised the issue of VRS expenses of Rs. 4,29,85,250/- in respect of Bhandup unit works and Rs. 1,05,80,000/- in respect of Head office employees. 16. In this regard, Ld. Senior Counsel submitted that the Tribunal in its order has firstly, accepted that VRS Scheme was governed by commercial reasons; secondly, rights of the employees are supported by the agreement between the assessee and the employees; and lastly, the liability is well supported by actuarial valuation. However, after holding so, the Tribunal has restored back the matter to the file of the AO following the Tribunal order for the AY 1993-94 with a direction that the AO should examine and verify the Actuarial Valuation Certificate and the agreement between the assessee and the employees. He submitted that the Ld. CIT(A) had already allowed the deduction claimed by the assessee after revi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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