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TMI Blog2024 (9) TMI 270X X X X Extracts X X X X X X X X Extracts X X X X ..... er of the Belur unit is to be accepted and global profit cannot be applied. This principle has been upheld in the case of Delhi Press Patra Prakashan [ 2013 (6) TMI 71 - DELHI HIGH COURT] wherein under similar facts, the AO had sought to impose the overall margin of the assessee s units (9.92% in that case) against the profit rate of 62.31% of the concerned unit declared by the assessee therein. The Hon ble High Court held that the assessee was entitled to a deduction u/s 80IA and 80IB of the Act on the profits of the concerned unit. It has been informed that the decision of the Tribunal for A.Y.2002-03 partially disallowing assessee s claim u/s.80IB which has been relied upon by the ld. CIT(A) has been subsequently set aside by the Hon ble Calcutta High Court and therefore, the stand taken by the CIT(A) now gets vitiated. Accordingly, the claim made by the assessee in the return of income which is as per the certificate in Form 10CCB is allowed in full. Deduction u/s 80HHC - AO has disallowed the claim as the assessee has received money from the sale of DEPB license - AO has relied on the retrospective amendment made in section 80HHC which denied deduction to company having export ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pinning Mills (P) Ltd. [ 2007 (8) TMI 16 - SUPREME COURT] held that u/s 31(i) of the Act, needs to be seen whether the expenditure incurred by the assessee is for current repairs . It is irrelevant to consider whether the expenditure is revenue or capital in nature. If this principle is to be followed, then, what is required to be seen what is the nature of repair and maintenance which neither the AO nor CIT(A) have analysed. Thus, from the perusal of the details as in the paper book, it is seen that these are small repairs and replacement of part of plant and machinery which is to be allowed u/s. 31 of the Act irrespective whether it is a capital or Revenue in nature. Thus, AO is directed to examine the details - this ground is allowed subject to verification by the ld. AO. Claim of deduction of amount paid as service charges to BMCL - HELD THAT:-If the services have been taken in the relevant assessment year, the charges paid by BMCL on this account as per case of PCIT v. M/s Merck Ltd. [ 2019 (9) TMI 1506 - BOMBAY HIGH COURT] then same are allowable. Further here in this case, assessee not only received sundry managerial services from BMCL but also availed the services for which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Loss CIT (A) has wrongly applied provision of dividend stripping contained in 94(7) on transaction in the nature of bonus stripping covered by section 94(8) which were not in existence in previous year 2002-03 - this matter should be restored back to the ld. AO to examine whether the losses of bonus stripping should be allowed as there is no application of section 94(8) in year under appeal. So far as loss on account of dividend striping is concerned, the ld. AO will examine the holding period of units and decide the issue to examine the issue of losses because Section 94(7) is not attracted due to adequate holding period. Accordingly, this ground is partly allowed for statistical purposes. Expenditure incurred on maintenance and depreciation of aircraft - trial run of machines - HELD THAT:- As decided in Ashima Syntex Ltd. [ 2000 (8) TMI 22 - GUJARAT HIGH COURT] wherein trial run of machines was held to be being used for the purpose of business as specified u/s 32 The trial run is held as use for the purpose of business, then the maintenance expenses should also be allowed as deductible. The assessee had also furnished flight details for the year under consideration which has been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t be taxed in subsequent years, accordingly, there is no substance raised by the department and the same is dismissed. - SHRI AMIT SHUKLA, JUDICIAL MEMBER AND MS PADMAVATHY S, ACCOUNTANT MEMBER For the Assessee :Shri Mahavir Jain For the Revenue :Shri Manoj Kumar Sinha ORDER PER AMIT SHUKLA (J.M): The aforesaid cross appeals filed by the assessee as well as by the Revenue against order dated 11/12/2006 passed by CIT(A)-8, Kolkata for the quantum of assessment passed u/s.143(3) for the A.Y.2003-04. 2. We will first take up assessee s appeal (ITA 612/Kol/2007) 3. The assessee is a widely held public limited company engaged in the business of manufacture / production of aluminum and related products. The return of income was filed on 27/11/2003 declaring total income of Rs.21,36,92,350/- under the normal provisions of the Act and a book profit of Rs.1,31,31,06,388/- u/s.115JB. The ld. AO in his assessment order has computed the income of Rs.159,59,35,610/- under the normal provisions of the Act after making various additions / disallowances. 4. Ground No. 1 of the assessee reads as under:- GROUND OF APPEAL NO. 1 with respect to claim of deduction u/s 80IB of the Income Tax Act in re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Tribunal in ITA No. 1221/Kol/2006 and ITA No. 1045/Kol/2006 in its decision dated 20/10/2006. 7. We have heard both the parties at length and also perused the relevant finding given in the impugned order as well as material placed on record. The main contention of the ld. Counsel for the assessee was that the Ld. AO as well as Ld. CIT(A) have grossly erred in completely ignoring the fact that an audit certificate in Form 10CCB for the undertaking has been filed for the current AY 2003-04. This was done because of an amendment brought in Finance Act 2002 requiring furnishing of 10CCB as an audit certificate for the eligible business. The said Form 10CCB was enclosed with the return of income and has been placed at page number 26 of the paper book 1. The assessee contended that at page 18 of CIT(A) order, it has been mentioned that the auditor has duly verified the deduction u/s 80IB and certificate to this effect been issued to the assessee. It was also the contention of assessee that the profitability statement of the Belur unit, was filed before AO (which has also been filed at page 19 of paper book), is nothing but a profit and loss account only. Thereafter, ld. Counsel also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is to be accepted and global profit cannot be applied. This principle has been upheld by the Hon ble Delhi High Court in the case of Commissioner of Income Tax v. Delhi Press Patra Prakashan (2013) 355 ITR 1 (Delhi), wherein under similar facts, the AO had sought to impose the overall margin of the assessee s units (9.92% in that case) against the profit rate of 62.31% of the concerned unit declared by the assessee therein. The Hon ble High Court held that the assessee was entitled to a deduction under Section 80IA and 80IB of the Act on the profits of the concerned unit. The relevant observations of the Court are reproduced here in: 26. In the present case, there is no material to support the view that the job work charges charged by Unit No.4 from Unit No.1 were not at market rates. We are agreement with the view taken by the Tribunal that in the absence of any defect or manipulation found by the Assessing Officer in the books maintained for Unit No.4 and in the absence of any material to indicate that the amount charged by Unit No.4 from Unit No.1 was not at comparable market rates, it would not be open for the revenue to disregard the profits of Unit No.4 as disclosed by the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Ld. CIT (A) confirmed finding of the ld. AO and gave finding based on second proviso to section 80HHC(3) inserted by taxation laws (Amendment) Act, 2005 with effect from 01/04/1998. 14. We find that reliance placed by the ld. AO and ld. CIT(A) on the retrospective amendment has now been struck down by Hon ble Gujarat High Court in the case of Avani Exports v. Commissioner of Income Tax 348 ITR 391 where in the Hon ble High Court observed and held as under:- 26. On consideration of the entire materials on record, we, therefore, find substance in the contention of the learned counsel for the petitioners that the impugned amendment is violative for its retrospective operation in order to overcome the decision of the Tribunal, and at the same time, for depriving the benefit earlier granted to a class of the assessees whose assessments were still pending although such benefit will be available to the assessees whose assessments have already been concluded. In other words, in this type of substantive amendment, retrospective operation can be given only if it is for the benefit of the assessee but not in a case where it affects even a fewer section of the assessees. 27. We, accordingly, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowance was retrospective amendment which has been quashed by the constitutional Courts. 17. In view of the above, Ground No.2 raised by the assessee is allowed. 18. GROUND OF APPEAL NO. 3 with respect to the claim of deduction for commissions paid by the assessee 1. That the Commissioner of Income Tax (Appeals) erred on fact and in law in confirming the action of the assessing officer in disallowing the sum of Rs 28,49,914 being the commission paid by the appellant on the ground that confirmation was not received from the parties in this regard. 19. The assessee company has incurred Rs. 10,48,67,000/- under the head commission and claimed the same through debit in profit and loss account. During the course of assessment proceeding Assessing officer, the assessee could furnish details in respect of Rs. 6,50,34,396/- only. The ld. AO disallowed the expense of commission to the extent of Rs. 3,98,32,604/- in absence of details. During the course of appellate proceedings, the details of entire commission payment was furnished to the ld. CIT(A) by way of Additional evidence. Remand Report for additional evidence was also sought from AO. Entire commission payment details amounting to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om the parties and accordingly, deduction of amount of Rs.28,49,914/- paid as commission is allowed. 22. In the result, ground No.3 raised by the assessee is allowed. 23. GROUND OF APPEAL NO. 4 with respect to the claim of deduction of expenditure incurred on repairs and replacements of plant and machinery. 1. That the Commissioner of Income Tax (Appeals) erred on facts and in law in confirming the action of the assessing officer in disallowing the sum of Rs 66,38,184/- being the expenditure incurred on repairs and replacements of plant and machinery, holding the same to be capital expenditure. 24. The ld. AO disallowed the amount of Rs 66,38,184/- claimed as deduction by the assessee by virtue of expenditure in respect of repairs and replacement of plants and machinery on the ground that the same is capital in nature and cannot be allowed as revenue expenditure. The basis for this was the contention that the assessee itself treated this expenditure to be a capital expenditure in its books of accounts. 25. The ld. CIT (A) upheld the action of ld. AO in treating the said expenditure as capital in nature for the reason that the assessee had capitalized the same in its books of accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ove applies to cases where the assessee claims allowance under Section 31(i). In the present case, the High Court has lost sight of the test to be applied for an expenditure to fall under Section 31(i) as current repairs . It has embarked on the test which was not applicable, viz, whether the expenditure is revenue or capital in nature... 28. If this principle is to be followed, then, what is required to be seen what is the nature of repair and maintenance which neither the ld. AO nor ld. CIT(A) have analysed. Further, it has been pointed out that in assessee s own case for A.Y. 2001-02 ITAT Mumbai Bench in ITA No.1373/K/2009 and ITA No.4930/Mum/2009 remanded the matter of the claim of deduction expenditure incurred of repairs and maintenance of plants and machinery back to the ld. AO for verification. However, from the perusal of the details as in the paper book, it is seen that these are small repairs and replacement of part of plant and machinery which is to be allowed u/s. 31 of the Act irrespective whether it is a capital or Revenue in nature. Thus, ld. AO is directed to examine the details in line with the decision of the Hon ble Supreme Court in the case of IT vs. Sarvana Sp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s claim relied upon by the ld. CIT (A) has been subsequently set aside by the Hon ble Calcutta High Court. It has been contended before us that BMCL raises monthly debit notes on its member companies. The services charges payable by each company are worked out on the basis of a predetermined formula which is clearly laid down in the cost sharing agreement with BMCL. As per the cost sharing arrangement, the common expenses are shared amongst all the members on the basis of the average of the following, after considering the weighted factor for each ratio as under: Weighted Factor 1. Ratio of Cash profit 30 2. Ratio of Gross revenue 26 3. Ratio of Net worth 22 4. Ratio of Net Block 22 100 35. It has been further contended that the BMCL is only recovering the cost of services and it does not charge any mark-up which is evident from the Profit Loss account of BMCL. The assessee had also filed detailed written submission in this regard before us. 36. First of all it is not in dispute that BMCL is only recovering the cost of services and it does not charge any mark-up for providing net management and administrative services to the member companies. The assessee had submitted all the evi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f services being available under the agreement on as and when required basis. This Court by an order dated 2nd August, 2016 (CIT Vs. Merck Ltd. Writ Petition No.272 of 2014) held the fees paid for on bouquet of services as and when required, would be similar to retainer agreement. It is agreed by the Revenue that the above order dated 8th August, 2016 of this Court in the respondent s own case will equally apply to the present facts. (d) In the above view, the question as proposed does not give rise to any substantial question of law. Thus, not entertained. The assessee further contends that in present case also there is right to receive services from BMCL. Without prejudice to the stand that services has been availed from BMCL, even if no services has been taken in previous year relevant to assessment year, the charges paid to BMCL on this account is deductible as per judgment of Bombay High Court in the case of Merck India Ltd. The assessee further Contend that in present case, the assessee not only had right to receive various managerial services from BMCL but also have availed the services for which sample evidence is furnished by way of additional evidence as stated above. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lowable. Further here in this case, assessee not only received sundry managerial services from BMCL but also availed the services for which sample evidence of service has been furnished by way of additional evidence before us. Similar evidences were filed in AY 2004-05 wherein the First Appellate Authority had accepted the rendering of services and allowability of deduction after detailed examination of the evidences. Thus, for this year also, we hold that payment made to BMCL for rendering service cannot be disallowed by invoking Section 40A (2). Thus, we direct the ld.AO to allow the payment made to BMCL for rendering of services. 39. Accordingly, the ground No.5 raised by the assessee is allowed. 40. GROUND OF APPEAL NO. 6 with respect to the claim of deduction of amount spent by the assessee as community development expense. 1. That the Commissioner of Income Tax (Appeals) erred on facts and in law in disallowing an expenditure of Rs 27,88,975/- incurred by the assessee on account of community development expenses holding the same to be charitable expenditure not incurred for the purposes of the appellant s business. 41. The assessee has debited 27,88,975/- under the head commu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fold the concrete expression of care and concern for the society at large and the people of the locality in which the business is located in particular. Being known as a good corporate citizen brings goodwill of the local community, as also with the regulatory agencies and the society at large, thereby creating an atmosphere in which the business can succeed in a greater measure with the aid of such goodwill. Monies spent for bringing drinking water as also for establishing or improving the school meant for the residents of the locality in which the business is situated cannot be regarded as being wholly outside the ambit of the business concerns of the assessee, especially where the undertaking owned by the assessee is one which is to some extent a polluting industry. 45. Similarly, the Hon ble Bombay High Court in the case of Commissioner of Income Tax v. M/s Nicholas Piramal (India) Ltd. in ITA No. 1586 of 2013 has also placed reliance on Madras Refineries Ltd. (supra). The relevant extract is reproduced here in below: 6. The Tribunal while following the decision of the Madras High Court in Commissioner of Income Tax v/s. Madras Refineries Ltd., 266 ITR 170 held that the concept ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ert Asia Limited (2013) 351 ITR 196 (P H) (FB) before the Hon ble High Court of Punjab and Haryana, a similar claim of membership fees of a club paid by the assessee-company was declined by the AO on the ground that they were personal expenses of the MD and other employees. The Hon ble High Court however held that such expenses were for running the business with a view to produce benefits to the assessee- company. The relevant extract is reproduced hereinbelow: 16. In the present case, the corporate membership of Rs.6 lacs was for a limited period of 5 years. The corporate membership was obtained for running the business with a view to produce profit. Such membership does not bring into existence an asset or an advantage for the enduring benefit of the business. It is an expenditure incurred for the period of membership and is not long lasting. By subscribing to the membership of a club, no capital asset is created or comes into existence. By such membership, a privilege to use facilities of a club alone, are conferred on the assessee and that too for a limited period. Such expenses are for running the business with a view to produce the benefits to the assessee. Consequently, it c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 763/- was claimed under computation. It has been submitted that these units were purchased for Rs. 44,33,00,000/- on 13.03.2002. Subsequently a dividend of Rs. 9,60,21,660/- was received on 13.03.2002. Post receipt of dividend, NAV of the unit came down substantially. Therefore, in accounts write down of investment was made for Rs.10,19,42,996/- on this account. Because of such write down of investment, the original cost of the unit was brought down from Rs. 44,33,00,000/- to Rs. 34,13,57,004/-. The Assessee further clarified that the said write down of investment amounting to Rs. 10,19,42,996/- was offered to tax in the return of income of AY 2002-03 because write down of investment is not a permissible deduction. 56. In subsequent year (the current assessment year), the said investments were sold for Rs. 36,36,69,236/- which resulted into profit in the accounts to the tune of Rs. 2,32,12,230/-, as cost of the units as per books were brought down to Rs. 34,13,57,004/- because of provision of write down. However, as per income tax calculation, the original cost was taken as actual historical cost i.e., Rs. 44,33,00,000/- giving loss of Rs. 7,96,30,763/-. The assessee further conten ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of dividend stripping contained in 94(7) on transaction in the nature of bonus stripping covered by section 94(8) which were not in existence in previous year 2002-03. 60. After considering the aforesaid submissions we feel that this matter should be restored back to the ld. AO to examine whether the losses of bonus stripping should be allowed as there is no application of section 94(8) in year under appeal. So far as loss on account of dividend striping is concerned, the ld. AO will examine the holding period of units and decide the issue to examine the issue of losses because Section 94(7) is not attracted due to adequate holding period. Accordingly, this ground is partly allowed for statistical purposes. 61. In the result, ground No.13 is partly allowed for statistical purposes. 62. GROUND OF APPEAL NO. 14 with respect to the expenditure incurred on maintenance and depreciation of aircraft 14. That the Commissioner of Income Tax (Appeals) erred on facts and in law in sustaining the disallowance of Rs 36,00,000 and Rs 1,05,39,094 relating to expenditure on maintenance and depreciation respectively of the aircraft jointly owned by the appellant, holding that the same was not used ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be used for a particular number of days so as to entitle it to depreciation, but it requires that it should be used for the purpose of business or profession or vocation. The trial run of the machinery is obviously for the purpose of business and not for any other purposes. What is required to be seen that the machinery must be used for the purpose of the business and keeping in mind the wider meaning ascribed by various decisions of various courts to the term use , even trial production of a machinery would fall within the ambit of used for the purpose of business . Further, as the statute does not prescribe a minimum time limit for use of the machinery, the assessee cannot be denied the benefit of depreciation on the ground that the machinery was used for a very short duration for trial run. 66. Thus, the trial run is held as use for the purpose of business, then the maintenance expenses should also be allowed as deductible. The assessee had also furnished flight details for the year under consideration which has been enclosed at pages 50 to 53 of paper book which clearly shows that it was a trial run and for training of the flights. Thus, depreciation and maintenance at the air ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sted book profit. Now, this issue as noted above stands covered by the decision of the Hon ble Supreme Court which was rendered in the context of deduction u/s.80HHC wherein the Court held that deduction from book profit for the purpose of MAT should be computed based on book profit as per profit and loss account and not based on business income as per Section 28(D) to 44D. Since assessee has not given any working and neither such claim was made before the ld. AO because assessee had computed the book profit under MAT and not under normal provision of computation of income, therefore, this issue is remanded back to the ld. AO to be decided in accordance with law in line with the decision of the Hon‟ble Supreme Court in the case of Bhari Information Technology (supra). 72. Additional Ground No.2 raised by the assessee is as under:- That for calculating book profit u/s 115JB, 100% of the eligible profit is to be deductible u/s 80HHC. 73. The assessee company while calculating deduction u/s 80HHC, from book profit under MAT, only 50% of eligible profit was claimed. The assessee relied upon the judgement of Hon‟ble Supreme Court in the case of Ajanta Pharma Ltd. vs. Commiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us and it has been requested that a liberty should be given to further rectification of application u/s.154 of the Act. Thus, the additional ground Nos.3 4 are dismissed as not pressed. 78. In Revenue s appeal wherein following grounds have been raised:- 1.(a) That on the facts and in the circumstance of the case Ld. C.I.T.(A) has erred in allowing relief to the assessee by adopting the price of electricity expenses of Rs.2.63 per unit against adopted by A.O. of Rs. 0.77 per unit in calculating deduction us. 801A of 1.T. Act 1961. 1.(b) That on the fact and in the circumstance of the case Ld. C.LT.(A) has erred in accepting the sale price of power @ Rs. 2.63 per unit as against selling price of power to Grid Corporation of Orissa Ltd @ Rs. 0.77 per unit 1(c) That on the fact and in the circumstance of the case Ld. C.LT. (A) has erred in accepting assessee's determination of power price @ Rs. 2.63. per unit in the case consumption of power by it's own unit as against selling price of power to Grid Corporation of Orissa Ltd. 79. The assessee company has made a claim of deduction u/s 80IA in respect of its power plant at Hirakud, Orissa amounting to Rs. 17,86,56,581. This is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld ordinarily fetch on sale in the open market observed and held as under:- 15.6 Sub-section (8) says that where any goods held for the purposes of the eligible business are transferred to any other business carried on by the assessee or where any goods held for the purposes of any other business carried on by the assessee are transferred to the eligible business but the consideration for such transfer as recorded in the accounts of the eligible business does not correspond to the market value of such goods as on the date of the transfer. then for the purposes of deduction under section 80- IA, the profits and gains of such eligible business shall be computed as if the transfer had been made at the market value of such goods as on that date. The proviso says that if the assessing officer finds exceptional difficulties in computing the profits and gains of the eligible business in the manner specified in sub- section (8), then in such a case, the assessing officer may compute such profits and gains on such reasonable basis as he may deem fit. The explanation below the proviso defines market value for the purpose of sub-section (8) It says that market value in relation to any goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lity are determined by free competition. P Ramanatha Alyer's Advanced Law Lexicon has also defined the expression open marker to mean a market in which goods are available to be bought and sold by anyone who cares to. Prices in an open market are determined by the laws of supply and demand. 25. Therefore, the expression market value in relation to any goods as defined by the explanation below the proviso to sub- section (8) of Section 80-1A would mean the price of such goods determined in an environment of free trade or competition. Market value is an expression which denotes the price of a good arrived at between a buyer and a seller in the open market ie, where the transaction takes place in the normal course of trading. Such pricing is unfettered by any control or regulation: rather, it is determined by the economics of demand and supply 26. Under the electricity regime in force, an industrial consumer could purchase electricity from the State Electricity Board or avail electricity produced by its own captive power generating unit. No other entity could supply electricity to any consumer. A private person could set up a power generating unit having restrictions on the use of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity Board supplied to the industrial consumers i.e. Rs. 3.72 per unit. 28. Thus, market value of the power supplied by the assessee to its industrial units should be computed by considering the rate at which the State Electricity Board supplied power to the consumers in the open market and not comparing it with the rate of power when sold to a supplier le, sold by the assessee to the State Electricity Board as this was not the rate at which an industrial consumer could have purchased power in the open market. It is clear that the rate at which power was supplied to a supplier could not be the market rate of electricity purchased by a consumer in the open market. On the contrary, the rate at which the State Electricity Board supplied power to the industrial consumers has to be taken as the market value for computing deduction under section 80-IA of the Act. 29. Section 43A of the 1948 Act lays down the terms and conditions for determining the tariff for supply of electricity. The said provision makes it clear that tariff is determined on the basis of various parameters. That apart, it is only upon granting of specific consent that a private entity could set up a power generating uni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per unit as Transfer price to Aluminum unit is accepted to be at Market rate. Accordingly, ground No.1 raised by the Revenue is dismissed. 86. Ground No.2 relating to restricting the disallowance to Rs.28,49,914/- against Rs. 3,98,32,604/- made by A.O on account of commission paid to different parties. This issue has already been decided in assessee s appeal and also in the remand report, ld. AO himself has accepted the payments under the head commission which has been accepted by the ld. CIT(A), accordingly ground No.2 raised by the Revenue is dismissed. 87. Ground 3 raised by the Revenue reads as under:- 3(a) That on the fact and in the circumstance of the case Ld. C.I.T.(A) has erred in deciding appeal in favour of assessee for statistical purposes by directing the AO to allow deduction after allowing opportunity to the assessee to prove the factum of payment to the Dy. Conservator of Forest amounting to Rs.11,47,000/- when the A/R of the assessee has expressed his inability to produce any evidence of such payment before the AO. 3(b) That on the fact and in the circumstance of the case Ld. C.I.T.(A) has erred in allowing the appeal in assessee's favour for statistical purpos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the appeal in favour of assessee by directing the AO to verify the contention of the assessee that the assessee has already offered for taxation Rs.4,26,31,807/- u/s.43B of the IT Act in assessment years 1995-96 to 2002-03 on account of Sales Tax, Octroi, Bonus provison for Excise Duty without any supporting evidence. 93. The assessee company has claimed a sum of Rs. 5,19,77,835/- as amount written back in profit and loss account for statutory and other dues covered by section 43B and were not allowed in earlier years. AO made an addition of Rs. 4,26,31,807/- as amount written back on the ground that write back of an amount does not amount to payment of statutory liability. Therefore, as per the assessing officer, the same is not allowable deduction. Before the CIT(A), the assessee contended that Rs. 4,26,31,807/- had been offered for taxation in AY 1995-96 to AY 2002-03 on account of sales tax, octroi, bonus for excise duty been provided in account but not paid. CIT(A) directed AO to verify whether amount aggregating to Rs. 4,26,31,807 were offered to tax in earlier assessment year and, if yes, to allow the deduction in current year. The AO after due verification has allowed the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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