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TMI Blog2022 (7) TMI 622X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee against the appeal by the Revenue was adjourned which has come up for hearing before the Bench. We note that Cross-objection is an independent appeal under Rule 22 of the Income-tax (Appellate Tribunal) Rules, 1963 (ITAT Rules) which is reproduced as under - 22. A memorandum of cross-objections filed under sub-section (4) of section 253 shall be registered and numbered as an appeal and all the rules, so far as may be, shall apply to such appeal. [emphasis supplied by us by underline] 2.1. The Cross-objection involves substantial relief which is not meant only to support order of ld. CIT(A) about the relief allowed. The Cross-objection has been admitted as an appeal which warrants its due adjudication. The grounds of cross-objection filed by the assessee were directed to be submitted in concise form which is placed on record vide letter dated 19.08.2019. Accordingly, the revised and concise grounds of cross-objection to be adjudicated upon are reproduced as under: A. Grounds to support order of CIT(A): 1. Learned CT (A) has rightly deleted addition in respect of liabilities for business expenses amounting to Rs.69,54,123/- , the order of Ld. CIT(A) may be confirmed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lief by way of depreciation allowable, correctly on (A) new assets and (b) on correct WDV of molasses tanks, as claimed before lower authorities. 7) For that appellant seeks kind permission of the Hon'ble Tribunal, to raise new contentions and new grounds of appeal, if required, in interest of justice. 3. Before us, Shri D.K. Kothari, AR represented the assessee and Smt. Ranu Biswas, ACIT represented the Revenue. 4. Brief facts of the case are that assessee is a limited company and is in the business of manufacturing of sugar. It has its registered office at Kolkata and factory at Sasa Musa, Dist. Gopalganj, Bihar. Assessee filed its return of income on 30.09.2014 reporting total income as 'nil'. Statutory notices were issued which were complied by the assessee. In the course of assessment proceedings, ld. AO asked the assessee to furnish working of book profit under the provisions of section 115JB of the Act, to which assessee submitted that it is not liable to pay tax on book profit and the provisions of section 115JB of the Act are not applicable in its case. Ld. AO determined the business income at Rs. 20,12,960/- after making certain additions and disallowances. Assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the Tribunal. 8. We note that ld. counsel has submitted paper books in three volumes which are placed on record. A synopsis for each of the ground taken in the cross-objection is also placed in the paper book at page no. 194 to 196. Considering the said synopsis, we deal with each of the ground in the cross-objection as under: 8.1. Ground No. 1 is general in nature and, therefore, is not adjudicated upon. On ground no. B.2.a, in respect of non-applicability of provisions of section 115JB of the Act, ld. counsel reiterated the submissions made before the authorities below which are not reproduced for the sake of brevity. Ld. Counsel however placed reliance on the recent judgment of Co-ordinate Bench of ITAT, Kolkata in the case of The United Provinces Sugar Co. Ltd. vs ITO in ITA No. 1956/Kol/2018 for A.Y. 2013-14 dated 01.04.2021 which has dealt on the identical issue. Ld. Counsel laid emphasis on the contention that the authorities below ought to have followed the binding precedents, rule of consistency and applied view in favour of the assessee to allow the claim and not to deny the relief by ignoring the binding precedents. He also submitted that there are no contrary judgme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p; 4,97,27,065 -49,75,164 Gross Total Income: 0 Deduction u/s 80G could not be claimed as GTI is NIL Total Income: NIL 9.1 From the above computation, we note that there is no computation of GIT since there is loss of Rs. 49,75,164/- towards unabsorbed depreciation which is kept apart for carry forward. Therefore, there is no deduction which has been claimed to arrive at total income which is reported at Nil. From the perusal of order of Coordinate Bench of ITAT, Kolkata in assessee's own case for A.Y. 2003-04 (supra), we note that the issue is squarely covered by the said decision. The said decision is reproduced as under which is placed at page no. 116 to 117 of the paper book: "The assessee has filed this appeal against the order of the Ld. CIT(A) dated 27.12.2006 for the assessment year 2003-04 on the following grounds: 1. For that Ld. CIT(A) was wrong in dismissing the appeal of the assessee by not following the binding judgment of the Calcutta High Court in the case of Vishnu Sugar Mills Ltd. approving order of ITAT, in which it has been held that when there is no Gross Total income, total income and any tax is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... time of hearing the Ld. Counsel for the assessee submitted that the issue involved in this case is covered by the order of the Hon'ble Calcutta High Court in the case of CIT Vs- Vishnu Sugar Mills Ltd. dated 20.11.2006 in IT A No. 359 of 2006 and he, therefore, did not press the alternate pica taken by him by ground nos. 3 and 4. 4. The Ld. Departmental Representative did not controvert this submission of the Ld. Authorized Representative of the assessee. 5. We have heard both the parties, perused the material available on record and judgment of the Hon'ble Calcutta High Court. We find that since there is no gross total income, no total income and -no tax payable and therefore, preconditions to apply Section115JB were hot satisfied and in view of the judgment of the Calcutta Tribunal in case of Vishnu Sugar Mills Ltd. which has been approved by the Hon'ble Calcutta High Court, section 115JB is not applicable in assessee's case for the year under consideration so, respectfully following the aforesaid judgment of the Hon'ble Calcutta' High Court, we do not find any merit in upholding the action of the Assessing Officer by the Ld. CIT(A) in applying section 115JB to compute t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... book profit u/s 115JB. Since we have already dealt with the issue relating to applicability of section 115JB in the case of assessee whereby we have held that it is not applicable, this ground become infructuous and accordingly is disposed off as infructuous. 12. For ground no. B.4, assessee has submitted it as not pressed. Accordingly, this ground is disposed off as not pressed by the assessee. 13. In respect of ground no. B.5 for addition of Rs.34,000/-, assessee claimed that these expenses includes small contributions to local people and institution on request of employees and business associates which are allowable as business expenses u/s 37(1) of the Act. Ld. Counsel submitted that inadvertently these were accounted under the head 'charity and donation' in the books of account which cannot be the basis for their disallowance. He also submitted that similar expenses have been allowed in the preceding years. Further, details of these expenses is placed on record at page 43 of the paper book which is reproduced as under - Particulars Amount (Rs.) 07.07.11 Amt of charity to Md. Murtuza 400.00 23.08.11 Amt paid to Moulana for leading Travi Prayer at Factory Mos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... find any merit in the basis adopted by the authorities below to disallow the claim of the assessee. We, accordingly, delete the addition and allow the ground of cross-objection. 14. In respect of ground no. B.6 relating to claim of depreciation on molasses tanks for which the ld. CIT(a) had directed the AO to allow the depreciation after verification that the new plant & machinery were indeed put to use by the assessee. Assessee has come before the Tribunal seeking clarity on the direction given by the ld. CIT(A) to the AO. Ld. Counsel of the assessee submitted that the claim for depreciation on molasses tanks was made before the ld. AO which was not considered in proper perspective. He pointed out that detailed explanation was again submitted before the ld. CIT(A) on the claim of depreciation on molasses tanks which is reproduced as under: "Depreciation on Molasses Tanks: Storage Reserve is under separate law, and it has nothing to do with cost of Molasses Tank. However, in view of past assessments we have reduced depreciation on Molasses Tanks from our depreciation claim. Please allow depreciation on correct WDV after considering only the amount of depreciation actually allowe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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