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TMI Blog2011 (8) TMI 1345X X X X Extracts X X X X X X X X Extracts X X X X ..... rder of the learned CIT(A), the Revenue is in appeal before us. 4. Ground No. 1 is general in nature and in the absence of any specific plea, the same is, therefore, rejected. 5. Ground Nos. 2 & 3 are against the deletion of disallowance of scheme expenses of ₹ 8,32,75,381/-. 6. Brief facts of the above issue are that during the course of assessment, it was, inter alia, observed by the Assessing Officer that it is seen from Schedule XVII to the Financial Statements, the assessee has debited marketing, advertisement and other expenses of ₹ 5,99,12,017/- and brokerage and incentives of ₹ 2,33,63,364/- under the head "Scheme Related Expenses". The assessee was asked to file various details of the above expenses and also asked to show cause as to why the same should not be disallowed. In response, the assessee filed its written reply dated 23.10.2009 and 30.10.2009 wherein the assessee after relying on certain decisions of the Tribunal, wherein it has been held that scheme expenses are eligible as business deduction, inter alia, submitted that the scheme expenses have been incurred wholly and exclusively for its business expenses and hence the same should be allowe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he case decided by the Tribunal (supra), therefore, the Learned CIT(A) was fully justified in deleting the disallowance made by the Assessing Officer and, therefore, the order passed by the learned CIT(A) be upheld. 10. We have carefully considered the submissions of the rival parties and perused the material available on record. We find that the facts are not in dispute. We further find that it is also not in dispute that the assessee has claimed the scheme related expenses - marketing, advertisement and other expenses of ₹ 5,99,12,017/- and brokerage and incentives of ₹ 2,33,63,364/- totaling to ₹ 8,32,75,381/- vide Schedule XVII of the Profit & Loss Account appearing at page 20 of the assessee's paper book. It was disallowed by the Assessing Officer merely on the ground that the department has not accepted the decision of the Tribunal in which the reliance was placed by the assessee. However, the learned CIT(A) has allowed the same on the ground that no such disallowance was made in earlier years and the assessee has furnished justification for allowance of the impugned deductions. 11. In the aforesaid decisions relied on by the learned counsel for the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome of ₹ 5.25 crores was assessed by him, and, accordingly, he held that the AO has wrongly added the amount of ₹ 4,06,140/- whereas the said amount should have been allowed as deduction and hence he allowed the same. 16. At the time of hearing, the learned Departmental Representative while relying on the order of the Assessing Officer submits that since the assessee has not claimed the deduction of ₹ 4,06,140/- in the return of income or in the revised return, therefore, following the decision of the Hon'ble Supreme Court in the case of Goetze (India) Ltd. (supra), the Learned CIT(A) was not justified in allowing the same and hence, the disallowance made by the Assessing Officer be restored. 17. on the other hand, learned counsel for the assessee submits that the assessee has claimed deduction of leave encashment of ₹ 4,06,140/- vide letter dated 7.7.2009 appearing at page 71-72 of the assessee's paper book, wherein the on the first page of the letter the assessee has offered additional income of ₹ 5.25 crore which has been taxed by the Assessing Officer. On the next page of the said letter the assessee has claimed deduction of leave encashment of & ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were also not referred. He further submits that the facts of the assessee's case are quite different as to the facts of the case of the Tribunal in M/s. Mahindra Engg. & Chemical Products Ltd. v. ITO (supra) inasmuch as, in the assessee's case the AO on the basis of same very letter has assessed the additional income of the assessee at ₹ 5.25 crores, therefore, the AO has considered the said letter as a valid letter in the eyes of law and hence on equity basis, it was the duty of the AO to allow the legal claim of the assessee on leave encashment of ₹ 4,06,140/-. He, therefore, submits that the order passed by the Learned CIT(A) in allowing the claim of the assessee be upheld. 19. We have carefully heard the submissions of the rival parties and perused the material available on record. We find that there is no dispute that the assessee vide letter dated 07.07.2009 has claimed the deduction of leave encashment of ₹ 4,06,140/- on the basis of actual payment made by him. It is also not in dispute that such claim was not made in the original return of income or by filing a revised return of income. It was disallowed by the AO as the assessee has not filed the revised ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eme Court in the case of Goetze (India) Ltd., (2006) 284 ITR 323(SC) has held (head note) "Held, dismissing the appeal, that the Tribunal had considered that issue and found that according to Form 10CCB filed during the assessment proceedings, the claim of the assessee was admissible. The assessee was not making any fresh claim and had duly furnished and submitted the Form for the claim under section 80-IB, there was no requirement of filing any revised return". 22. In the case of CIT v. Jai Parabolic Springs Ltd. (2008) 306 ITR 42 (Delhi) the AO disallowed the claim of the assessee on the ground that "since the claim for the deferred revenue expenditure of ₹ 15,58,500/- was not claimed by the assessee in the return of income for the assessment year 1990-91, the same is not allowed". Their Lordships after considering the decision of the Hon'ble Apex Court in the case of Goetze (India) Ltd. (supra) has held (Head note) "Held, dismissing the appeal, that there was no prohibition on the powers of the Tribunal to entertain an additional ground which according to the Tribunal arose in the matter and for the just decision of the case. There was no infirmity in the order of the Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal from entertaining any fresh claim if the same can be entertained in the light of the available material on the face of the record. Anything to the contrary of the proposition will only negate the principle laid down by the Hon'ble Supreme Court in the case of National Thermal Power Co.Ltd. (supra). We therefore confirm his order. It may be mentioned that we have taken this view after considering the fact that in all other years the department has accepted these expenses and allowed deduction as claimed by the assessee" 28. In the case of Mr. Gnanesh V. Lakhia v. Addl. CIT (ITA No. 1823Mum/2010 - A.Y. 2006-07) Order dated 8th April, 2011, in which one of us (Judicial Member) was a party, the Tribunal after considering all the decisions including the CBDT Circulars has held that merely because the assessee has made claim of short term capital gain as against correct claim of long term capital gain on sale of shares by filing belated re-revised return is not sufficient to hold that that the assessee is not entitled to the claim the sale of shares as long term capital gain. 29. In the case of Mahindra Engg. & Chemical Products Ltd. (supra) the Tribunal after considering th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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