M/s. Bumi Hiway (M) SDN BHD, New Delhi V. ADIT, New Delhi

CO 107/DEL/2014

• Counselvise Citation: [2016] 112 COUNSELVISE.COM (IT) 4276 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 4 month(s) 19 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 05-09-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 16-08-2016
• Assessment Year: 2004-2005
• Appeal Filed On: 16-04-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ANIMA BARNWAL SENIOR
• Assessee Lawyers: SANJAY
• Keywords: Additional evidence; Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH A AA A: NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI BEFORE SHRI BEFORE SHRI BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT G.D. AGRAWAL, VICE PRESIDENT G.D. AGRAWAL, VICE PRESIDENT G.D. AGRAWAL, VICE PRESIDENT AND AND AND AND MS. SUCHITRA KAMBLE MS. SUCHITRA KAMBLE MS. SUCHITRA KAMBLE MS. SUCHITRA KAMBLE, JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER ITA NO ITA NO ITA NO ITA NO . .. . 1341/DEL/2012 1341/DEL/2012 1341/DEL/2012 1341/DEL/2012 ASSESSMENT YEAR : ASSESSMENT YEAR : ASSESSMENT YEAR : ASSESSMENT YEAR : 2004 2004 2004 2004 - -- - 05 0505 05 ASSISTANT DIRECTOR OF ASSISTANT DIRECTOR OF ASSISTANT DIRECTOR OF ASSISTANT DIRECTOR OF INCOME TAX, INCOME TAX, INCOME TAX, INCOME TAX, CIRCLE CIRCLE CIRCLE CIRCLE- -- -1(1), 1(1), 1(1), 1(1), INTERNA INTERNA INTERNA INTERNATIONAL TAXATION, TIONAL TAXATION, TIONAL TAXATION, TIONAL TAXATION, NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. VS. VS. VS. VS. M/S BUMI HIWAY (M) SDN BHD, M/S BUMI HIWAY (M) SDN BHD, M/S BUMI HIWAY (M) SDN BHD, M/S BUMI HIWAY (M) SDN BHD, 764 764 764 764- -- -B, JG B, JG B, JG B, JG- -- -II, VIKAS PURI, II, VIKAS PURI, II, VIKAS PURI, II, VIKAS PURI, NEW DELHI NEW DELHI NEW DELHI NEW DELHI 110 018. 110 018. 110 018. 110 018. PAN : AABCB5725B. PAN : AABCB5725B. PAN : AABCB5725B. PAN : AABCB5725B. (APPELLANT) (RESPONDENT) CROSS OBJECTION CROSS OBJECTION CROSS OBJECTION CROSS OBJECTION NO NONO NO .107/DEL/2014 .107/DEL/2014 .107/DEL/2014 .107/DEL/2014 ASSESSMENT YEAR : ASSESSMENT YEAR : ASSESSMENT YEAR : ASSESSMENT YEAR : 2004 2004 2004 2004 - -- - 05 0505 05 M/S BUMI HIWAY (M) SDN M/S BUMI HIWAY (M) SDN M/S BUMI HIWAY (M) SDN M/S BUMI HIWAY (M) SDN BH BHBH BHD, D,D, D, 764 764 764 764- -- -B, JG B, JG B, JG B, JG- -- -II, VIKAS PURI, II, VIKAS PURI, II, VIKAS PURI, II, VIKAS PURI, NEW DELHI NEW DELHI NEW DELHI NEW DELHI 110 018. 110 018. 110 018. 110 018. PAN : AABCB5725B. PAN : AABCB5725B. PAN : AABCB5725B. PAN : AABCB5725B. VS. VS. VS. VS. ASSISTANT DIRECTOR OF ASSISTANT DIRECTOR OF ASSISTANT DIRECTOR OF ASSISTANT DIRECTOR OF INCOME TAX, INCOME TAX, INCOME TAX, INCOME TAX, CIRCLE CIRCLE CIRCLE CIRCLE- -- -1(1), 1(1), 1(1), 1(1), INTERNATIONAL TAXATION, INTERNATIONAL TAXATION, INTERNATIONAL TAXATION, INTERNATIONAL TAXATION, NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. (APPELLANT) (RESPONDENT) REVENUE BY : MS. ANIMA BARNWAL, SENIOR DR. ASSESSEE BY : SHRI SANJAY, ADVOCATE. DATE OF HEARING : 16.08.2016 16.08.2016 16.08.2016 16.08.2016 DATE OF PRONOUNCEMENT : 05.09.2016 05.09.2016 05.09.2016 05.09.2016 ORDER ORDER ORDER ORDER PER G.D. AGRAWAL, VP PER G.D. AGRAWAL, VP PER G.D. AGRAWAL, VP PER G.D. AGRAWAL, VP : :: :- -- - THE APPEAL BY THE REVENUE AND THE CROSS-OBJECTION B Y THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF LEARNED CIT(A )-XXIX, NEW DELHI DATED 28 TH DECEMBER, 2011. ITA-1341/DEL/2012 & C.O.-107/DEL/2014 2 2. THE REVENUE HAS RAISED THE FOLLOWING GROUND IN ITS APPEAL :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD.CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.96,77,295/- MADE BY THE AO ON ACCOUNT OF ADHOC DISALLOWANCE OF 5% OUT OF MATERIAL CONSUMED, AFTER H AVING HELD THAT THE BOOKS OF ACCOUNTS OF THE ASSESSEE WERE RIGHTLY REJECTED AND THE ASSESSEE WITHOUT ANY SUFFICIENT CAUSE FAILED TO FURNISH THE NECESSARY DETAILS TO THE AO. 3. IN THE CROSS-OBJECTION, THE ASSESSEE HAS RAISED THE FOL LOWING GROUNDS :- 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE LD.CIT(APPEAL) ERRED IN LAW IN SUSTAINING RE JECTION OF ACCOUNTS MAINTAINED BY THE ASSESSEE. 2. THAT ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE CIT(A) ERRED IN NOT ADMITTING ADDITIONAL EVIDENCE F URNISHED BEFORE HIM BY THE RESPONDENT. (PARA 4 OF CIT(A) ORDE R) 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE CIT(A) ERRED IN UPHOLDING THE ADDITION OF RS.38,43,5 47/- AS THE 20% OF RS.1,92,17,732/- (GROUND NO.2.2 BEFORE CI T(A) PARA 4). 4. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE CIT(A) ERRED IN UPHOLDING THE ADDITION OF RS.54,09,8 79/- BEING 5% OF LABOUR CHARGES OF RS.10,8197,584/- (PARA 6 OF CIT(A) ORDER). 4. AT THE TIME OF HEARING, WE HAVE NOTICED THAT AS A GAINST THE DECLARED LOSS OF `12.44 CRORES, THE ASSESSED LOSS DETERMINED BY THE ASSESSING OFFICER WAS `10.55 CRORES. THE ASSESSING OFFICER M ADE CERTAIN ADDITIONS/DISALLOWANCES. THE ASSESSEES APPEAL WAS PARTLY ALLOWED BY THE CIT(A). HENCE, THE REVENUE, AGGRIEV ED BY RELIEF ITA-1341/DEL/2012 & C.O.-107/DEL/2014 3 ALLOWED IS IN APPEAL WHILE THE ASSESSEE, AGGRIEVED WITH THE ADDITION SUSTAINED, IS IN CROSS-OBJECTION. 5. AT THE TIME OF HEARING BEFORE US, WE ASKED A QUESTI ON THAT THE ASSESSMENT YEAR UNDER CONSIDERATION IS 2004-05. MORE THA N ELEVEN YEARS HAVE PASSED FROM THE RELEVANT ASSESSMENT YEAR AND, T HEREFORE, WHETHER THE SET OFF OF THE LOSS DETERMINED IN THIS YEAR WAS CLAIMED BY THE ASSESSEE IN ANY OF THE SUBSEQUENT YEAR. IN OUR OPINI ON, IF NO SET OFF OF LOSS IS CLAIMED BY THE ASSESSEE IN THE SUBSEQUENT YEAR, THEN THE QUANTUM OF THE LOSS, WHETHER IT IS `10.55 CRORES OR `12 .44 CRORES, BECAME ONLY OF ACADEMIC NATURE. LEARNED DR FAIRLY SUBMITTED THAT IF NO SET OFF OF LOSS IS CLAIMED IN THE SUBSEQUENT YEAR, THE APPEAL CAN BE TREATED AS OF ACADEMIC NATURE HAVING NO TAX EFFECT E ITHER FOR THE ASSESSEE OR FOR THE REVENUE. THE ASSESSEE, VIDE LETTER DAT ED 16 TH AUGUST, 2016, HAS SUBMITTED IN WRITING THAT THE ASSESSEE COMPANY HAS NOT SET OFF THE ABOVE MENTIONED LOSS INCURRED IN ASSESSMEN T YEAR 2004-05 AGAINST ANY INCOME OF THE ASSESSEE COMPANY IN TH E SUBSEQUENT YEARS. 6. ONCE NO SET OFF OF LOSS DETERMINED IN ASSESSMENT YEAR 2 004-05 IS CLAIMED BY THE ASSESSEE IN THE SUBSEQUENT YEAR, AND THE T IME LIMIT FOR CARRY FORWARD OR SET OFF OF LOSS HAS EXPIRED, IN OUR OP INION, THE AMOUNT OF LOSS DETERMINED DOES NOT HAVE ANY TAX EFFECT SO FAR AS THE ASSESSEE OR THE REVENUE IS CONCERNED. WE, THEREFORE, HOLD T HAT REVENUES APPEAL HAS EFFECTIVELY NIL TAX EFFECT. THEREFORE, T HE CBDT CIRCULAR NO. 21/2015 DATED 10 TH DECEMBER, 2015 IS SQUARELY APPLICABLE. LEARNED COUNSEL FOR THE ASSESSEE WAS ALSO FAIR ENOUGH TO SAY THAT THE ASSESSEES CROSS-OBJECTION SHOULD ALSO BE TREATED AS OF AC ADEMIC NATURE BECAUSE THE QUANTUM OF LOSS DETERMINED WILL HAV E NO CONSEQUENCE TO THE ASSESSEE ALSO. IN VIEW OF THE ABOVE, WE DEEM IT ITA-1341/DEL/2012 & C.O.-107/DEL/2014 4 PROPER TO DISMISS THE REVENUES APPEAL AS WELL AS ASSESSEES C ROSS- OBJECTION BEING OF ACADEMIC NATURE ONLY. 7. IN THE RESULT, THE APPEAL OF THE REVENUE AND THE CROSS-OBJECTION OF THE ASSESSEE BOTH ARE DISMISSED. DECISION PRONOUNCED IN THE OPEN COURT ON 05.09.2016. SD/- SD/- (SUCHITRA KAMBLE (SUCHITRA KAMBLE (SUCHITRA KAMBLE (SUCHITRA KAMBLE ) )) ) ( (( ( G.D. AGRAWAL G.D. AGRAWAL G.D. AGRAWAL G.D. AGRAWAL ) )) ) JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VK. COPY FORWARDED TO: - 1. REVENUE : ASSISTANT DIRECTOR OF INCOME TAX, ASSISTANT DIRECTOR OF INCOME TAX, ASSISTANT DIRECTOR OF INCOME TAX, ASSISTANT DIRECTOR OF INCOME TAX, CIRCLE CIRCLE CIRCLE CIRCLE- -- -1(1), INTERNATIONAL TAXATION, 1(1), INTERNATIONAL TAXATION, 1(1), INTERNATIONAL TAXATION, 1(1), INTERNATIONAL TAXATION, NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. 2. ASSESSEE : M/S BUMI HIWAY (M) SDN BHD, M/S BUMI HIWAY (M) SDN BHD, M/S BUMI HIWAY (M) SDN BHD, M/S BUMI HIWAY (M) SDN BHD, 764 764 764 764- -- -B, JG B, JG B, JG B, JG- -- -II, VIKAS PURI, NEW DELHI II, VIKAS PURI, NEW DELHI II, VIKAS PURI, NEW DELHI II, VIKAS PURI, NEW DELHI 110 018. 110 018. 110 018. 110 018. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR