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TMI Blog2020 (5) TMI 208X X X X Extracts X X X X X X X X Extracts X X X X ..... mpt income and section 14A will not apply if no exempt income is received during the relevant previous year. In view of this, we confirm the order of the ld CIT (A) and direct the ld AO to delete the disallowance u/s 14A of the Act. Ground No. 2 of the appeal is dismissed. Addition on account of balances lying in sundry creditors account - HELD THAT:- As submitted that with respect to the most of the creditors the confirmation has been received and submitted before the ld CIT (A). In case of all other creditors the specific bank account of the assessee was also produced this shows that the payments are made through account payee cheques. With respect to the one party wherein, it has been shown that certain amounts with respect to the above parties have also written back which have been offered for taxation. For all other creditors the assessee has submitted the PAN as well as ledger accounts from the books of assessee for the subsequent years. In view of the above overwhelming evidence produced by the assessee which could not be controverted by the ld DR we find no infirmity in the order of the ld CIT(A) in deleting the addition as there is neither cessation of the liability n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the mandatory procedure under Rule 46A and in view of violation of Rule 46A, matter had to be restored to the Assessing Officer for fresh to decide the matter. 3.1 In the facts and under the circumstances of the case, the Ld. CIT(A) has erred in deleting of ₹ 1108226/- on account of balances lying in sundry creditors account without waiting the report from the A.O.. Since the remand report sent within the time allowed by the CIT(A). 3.2 In the facts and under the circumstances of the case, the Ld. CIT(A) has erred in deleting the addition of ₹ 11082226/- without following the mandatory procedure under Rule 46A and matter has to be restored to the A.O. for fresh to decide the matter. 3. The assessee has raised the following grounds of appeal in cross objection:- 1. That on the facts and in the circumstances of the case, the ld Commissioner of Income-tax (Appeals) (here-in-after referred to as Ld CIT(Appeals) erred in confirming the action of the AO in making disallowance of claim leave encashment on provision basis of ₹ 73,252/-. 4. Brief facts of the case shows that the assessee is a company engaged in the business of providing mobile dr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issue is squarely covered in favour of the assessee in assessee‟s own case for Assessment Year 2007-08 and 2008-09 where ITAT has allowed the claim of the assessee of depreciation @60% on the above equipment. 10. We have carefully considered the rival contentions and perused the orders of the lower authorities. The identical issue arose in the case of the assessee for Assessment Year 2007-08 wherein, the coordinate bench in ITA No. 5709/Del/2014 dated 18.12.2018 vide para No. 7 and 8 of the order allowed the claim of the assessee following the decision of the Hon'ble Delhi High Court in HLS India Ltd (supra) against which the Special Leave Petition is also dismissed on 16.02.2012 vide SLP(E) No. 2723/2012 by the Honourable Supreme court. The ld AO also agreed that though the issue is covered by that decision but the SLP was preferred before the Hon ble Supreme Court, therefore it has not been allowed. Now, Hon SC has also dismissed SLP. Now the issue is squarely covered in favour of the assessee. Therefore, respectfully following the decision of the coordinate bench for Assessment Year 2007-08 as well as the order of the coordinate bench on identical issue for Assessme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 1108226/- on account of balances lying in sundry creditors account. The issue of the case shows that before the ld AO assessee was required to furnish details of sundry creditors with complete details viz name, address and assessment particulars. The assessee furnished the details on 05.10.2011 with a list of 22 creditors but according to the ld AO addresses were incomplete and PAN of the none of the creditors was provided. On further opportunity, assessee submitted confirmation of some creditors, thus in absence of complete information the ld AO made the addition of ₹ 11082226/- pertaining to 19 creditors. On appeal before the ld CIT (A), the assessee submitted the complete information with respect to those creditors. The ld CIT (A) asked the AO to submit the remand report, however, the ld AO did not submit the remand report and therefore, the ld CIT (A) asked the explanation of the assessee. He further held that all these creditors are existing, there is no remission or cessation of any liability with respect to them and therefore, he deleted the addition. 15. The ld DR referred to the ground No. 3 and stated that the ld CIT (A) should have waited for the rem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Therefore, the ld AO u/s 43B (f), disallowed the above sum. On appeal of the ld CIT (A), the above disallowance was confirmed. 20. The assessee submitted that the assessee has made a provision of leave encashment and the same does not fall u/s 43B (f) relying on the decision of Exide industries Vs. Union of India 292 ITR 470(Cal). The ld AR also referred to the decision of the coordinate bench in assessee‟s own case for Assessment Year 2008-09 wherein, identical disallowance is deleted. 21. The ld DR stated that the issue is squarely covered against the decision of the Hon'ble Supreme Court in Exide Industries case wherein, the decision of the Hon'ble Kolkata High Court has been stayed. 22. We have carefully considered the rival contentions and find that Special Leave petition filed before Hon'ble Supreme Court, wherein, decision of the Hon ble Kolkata High Court has been stayed. We have carefully considered rival contentions and find that in case of CIT Vs. Exide Industries Ltd in SLP No. 22889/2008 the Hon'ble Supreme Court has held that the assessee shall pay the tax as if section 43B(f) is on the statue and would be entitled to make a claim in its ..... X X X X Extracts X X X X X X X X Extracts X X X X
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