ACIT, Jaipur V. RAJASTHAN FINANCIAL CORPORATION, Jaipur

ITA 1063/JPR/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 6386 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 7 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-07-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 02-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VARINDER MEHTA CIT DHK
• Assessee Lawyers: SATISH AJMERA CAS
• Keywords: Bad and doubtful debts
• Section: 115JB; 148

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKWO] U;KF;D LNL; ,OA JH FOE FLAG ;K NO ] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM AND SHRI VIKRAM SING H YADAV, AM VK;DJ VIHY LA-@ ITA NO. 354, 355, 1115 & 1116/JP/2016, 536/JP/2017, FU/KZKJ.K O'K Z@ ASSESSMENT YEARS : 2006-07, 11-12, 12-13 & 13-14. RAJASTHAN FINANCIAL CORPORATION, UDYOG BHAWAN, TILAK MARG, JAIPUR. CUKE VS. THE ACIT, CIRCLE - 6,/ THE ITO, WARD 6(2) JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. AACCR 2385 J VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT VK;DJ VIHY LA-@ ITA NO. 1063/JP/2016, FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2012-13. THE ACIT, CIRCLE-6, JAIPUR. CUKE VS. RAJASTHAN FINANCIAL CORPORATION, UDYOG BHAWAN, TILAK MARG, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. AACCR 2385 J VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI SANJEEV KUMAR MATHUR & SHRI SATISH AJMERA (CAS) JKTLO DH VKSJ LS@ REVENUE BY : SHRI VARINDER MEHTA (CIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 10.07.2018. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 16/07/2018. VKNS'K@ ORDER PER BENCH : THESE FIVE APPEALS BY THE ASSESSEE FOR THE ASSESSM ENT YEARS 2006-07, 10-11 TO 13-14 AND CROSS APPEAL BY THE REVENUE FOR THE AS SESSMENT YEAR 2012-13 ARE DIRECTED AGAINST THE RESPECTIVE ORDERS OF LD. CIT ( A). FIRST, WE TAKE UP THE ASSESSEES APPEAL FOR THE ASSESSMENT YEAR 2006-07 I N ITA NO. 354/JP/2016 WHEREIN THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS :- 2 ITA NOS. 354, 355, 1115 & 1116/JP/2016, 536/JP/2017 & 1063/JP/2017 RAJASTHAN FINANCIAL CORPORATION, JAIPUR. 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S)-II HAS ERRED IN NOT ACCEPTING THAT THE INITIATION OF THE PROCEED ING U/S 148 OF IT ACT, 1961 WAS ERRONEOUS BECAUSE THE ASSESSEE HAS SUBMITTED ALL DETAILS/INFORMATION AND NO NEW FACTS WERE AVAIL ABLE TO THE AO. 2. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) -II HAS ERRED IN HOLDING THAT THE PROVISION OF BAD DEBT WRITTEN O FF U/S 36(1)(VII)(A)(C) @ 5% OF THE INCOME (PARA 3 OF THE ORDER) SHOULD BE CALCULATED AFTER ALLOWING DEDUCTION U/S 3 6(1)(VII) OF THE INCOME TAX ACT, BY WRONGLY INTERPRETING THE ACT AND NOT HOLDING THAT THE BAD DEBTS WRITTEN OFF CAN ONLY BE SET OFF TO THE EXTENT OF THE BALANCE IN THE PROVISIONS FOR BAD DEB TS ACCOUNT (CREATED UNDER SECTION 36(1)(VII)(A)(C) ACCOUNTS WH ICH HAVE BEEN ALLOWED IN THE EARLIER ASSESSMENTS. 3. THE ASSESSEE CRAVES THE RIGHT TO ADD, ALTER OR I N ANY WAY AMEND THE GROUNDS OF APPEAL OR BEFORE THE HEARING. 2. AT THE TIME OF HEARING, THE LD. A/R OF THE ASSES SEE HAS STATED AT BAR THAT THE ASSESSEE DOES NOT PRESS GROUND NO. 2 OF THE APPEAL AND THE SAME MAY BE DISMISSED AS NOT PRESSED. THE LD. D/R HAS RAISED NO OBJECTIO N IF THE GROUND NO. 2 OF THE ASSESSEES APPEAL IS DISMISSED AS NOT PRESSED. ACC ORDINGLY, THE GROUND NO. 2 OF THE ASSESSEES APPEAL IS DISMISSED BEING NOT PRESSED. THE ONLY GROUND PRESSED IS GROUND NO. 1 REGARDING V ALIDITY OF REOPENING OF THE ASSESSMENT. 3. THE LD. A/R OF THE ASSESSEE HAS SUBMITTED THAT T HE AO HAS REOPENED THE ASSESSMENT VIDE NOTICE UNDER SECTION 148 DATED 7 TH MARCH, 2013 WHICH IS AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE ASSESSMENT YEAR. THE ORIGINAL ASSESSMENT WAS COMPLETED UNDER SECTION 143(3), THEREFORE, IN T HE ABSENCE OF ANY ALLEGATION BY THE AO THAT INCOME CHARGEABLE TO TAX HAS ESCAPED AS SESSMENT DUE TO FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY AL L MATERIAL FACTS NECESSARY FOR ITS 3 ITA NOS. 354, 355, 1115 & 1116/JP/2016, 536/JP/2017 & 1063/JP/2017 RAJASTHAN FINANCIAL CORPORATION, JAIPUR. ASSESSMENT, THE REOPENING OF THE ASSESSMENT IS NOT SUSTAINABLE. THE LD. A/R HAS FURTHER SUBMITTED THAT THE AO HAS REOPENED THE ASSE SSMENT TO DISALLOW THE CLAIM UNDER SECTION 36(1)(VII)(A)(C) OF THE ACT. THUS WH EN THE AO HAS NOT MADE ANY ALLEGATION IN THE REASONS RECORDED THAT ASSESSEE FA ILED TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR ITS ASSESSMENT, THE RE OPENING AFTER FOUR YEARS IS NOT SUSTAINABLE. IN SUPPORT OF HIS CONTENTION HE HAS R ELIED UPON VARIOUS DECISIONS OF HONBLE HIGH COURTS. 3.1. ON THE OTHER HAND, THE LD. D/R HAS OBJECTED TO THE GROUND NO. 1 OF THE ASSESSEE ON THE GROUND THAT THE ASSESSEE DID NOT PR ESS THIS GROUND BEFORE LD. CIT (A) AND, THEREFORE, ONCE THIS ISSUE HAS ATTAINED TH E FINALITY AS ASSESSEE HAS MADE A STATEMENT THAT HE DOES NOT PRESS THE GROUND OF VALI DITY OF REOPENING, THE SAME CANNOT BE RAISED BEFORE THIS TRIBUNAL. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD. AT THE OUTSET, WE NOTE THAT THE LD. CIT (A ) HAS DISMISSED THIS GROUND AGAINST THE VALIDITY OF REOPENING IN PARA 2 AND 2.1 AS UNDE R :- 2. GROUND NO.1 AS UNDER THE LD. A.O. HAS ERRED IN INITIATING THE PROCEEDING U/S 148 OF I.T. ACT, 1961 BECAUSE THE ASSESSEE HAD SUBMITTED ALL DETAILS/INFORMATION AND NO NEW FACTS WERE AVAILABLE TO THE AO. 2.1. THIS GROUND IS NOT PRESSED BY THE APPELLANT, H ENCE IS DISMISSED. 4 ITA NOS. 354, 355, 1115 & 1116/JP/2016, 536/JP/2017 & 1063/JP/2017 RAJASTHAN FINANCIAL CORPORATION, JAIPUR. THUS IT IS CLEAR THAT THOUGH THE ASSESSEE RAISED TH IS GROUND EVEN BEFORE THE LD. CIT (A), BUT THE SAME WAS NOT PRESSED BY THE ASSESSEE. THUS IT WAS DISMISSED BY THE LD. CIT (A). THE LD. A/R HAS NOT DISPUTED THIS FACT RE CORDED BY THE LD. CIT (A) THAT THE ASSESSEE DID NOT PRESS THIS GROUND BEFORE THE LD. C IT (A). THEREFORE, IN THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE WHEN THE ASSE SSEE HAS NOT RAISED ANY OTHER GROUNDS EXCEPT THE VALIDITY OF REOPENING AND THE SA ID ISSUE WAS NOT PRESSED BEFORE THE LD. CIT (A), THUS THE ASSESSEE CANNOT BE PERMIT TED TO BY-PASS THE FIRST APPELLATE AUTHORITY ON THE ISSUE OF VALIDITY OF REOPENING OF THE ASSESSMENT. ACCORDINGLY, IN THE FACTS AND CIRCUMSTANCES OF THE CASE WHEN THE ONLY I SSUE RAISED IN THIS APPEAL BY THE ASSESSEE IS VALIDITY OF REOPENING, WHICH WAS NOT PR ESSED BEFORE THE LD. CIT (A) AMOUNTS TO ABIDING THE DECISION OF THE LD. CIT (A) ON THIS ISSUE AND THEN TAKING THE SAME DIRECTLY TO THIS TRIBUNAL CANNOT BE ENTERTAINE D. ACCORDINGLY, IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WE DECLINE TO ENTERTAIN THE GROUND NO. 1 OF THE ASSESSEES APPEAL. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISS ED. ITA NO. 355/JP/2016 A.Y. 2010-11 : 6. THE ASSESSEE HAS RAISED THE SOLITARY GROUND AS U NDER :- 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S)-II HAS ERRED IN HOLDING THAT THE PROVISION OF BAD DEBT WRITTEN O FF U/S 36(1)(VII)(A)(C) @ 5% OF THE INCOME (PARA 2.2 OF TH E ORDER) SHOULD BE CALCULATED AFTER ALLOWING DEDUCTION U/S 3 6(1)(VII) OF THE INCOME TAX ACT, BY WRONGLY INTERPRETING THE ACT AND NOT HOLDING THAT THE BAD DEBTS WRITTEN OFF CAN ONLY BE SET OFF TO THE EXTENT OF THE BALANCE IN THE PROVISIONS FOR BAD DEB TS ACCOUNT 5 ITA NOS. 354, 355, 1115 & 1116/JP/2016, 536/JP/2017 & 1063/JP/2017 RAJASTHAN FINANCIAL CORPORATION, JAIPUR. (CREATED UNDER SECTION 36(1)(VII)(A)(C) ACCOUNTS WH ICH HAVE BEEN ALLOWED IN THE EARLIER ASSESSMENTS. 3. THE ASSESSEE CRAVES THE RIGHT TO ADD, ALTER OR I N ANY WAY AMEND THE GROUNDS OF APPEAL OR BEFORE THE HEARING. 7. AT THE TIME OF HEARING, THE LD. A/R OF THE ASSES SEE HAS STATED AT BAR THAT THE ASSESSEE DOES NOT PRESS THIS GROUND AND, THEREFORE, THE APPEAL OF THE ASSESSEE MAY BE DISMISSED AS NOT PRESSED. THE LD. D/R HAS NOT R AISED ANY OBJECTION IF THE GROUND OF THE ASSESSEES APPEAL IS DISMISSED AS NOT PRESSE D. ACCORDINGLY, IN VIEW OF THE STATEMENT OF LD. A/R OF THE ASSESSEE THAT THE ASSES SEE DOES NOT PRESS THIS SOLITARY GROUND RAISED IN THIS APPEAL, THE APPEAL OF THE ASS ESSEE IS DISMISSED BEING NOT PRESSED. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISSED . ITA NO. 536/JP/2017 A.Y. 2011-12 : 8. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS :- 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S)-II HAS ERRED IN HOLDING THAT THE PROVISIONS FOR BAD DEBT U/S 36( 1)(VIIA)(C) @ 5% OF THE TOTAL INCOME IS NOT ALLOWABLE AS THE CORP ORATION HAS NOT MADE PROVISION FOR BAD AND DOUBTFUL DEBTS DURIN G THE YEAR, WHEREAS THE CORPORATION HAS MADE FRESH PROVISIONS I N SOME ACCOUNTS AND WRITTEN BACK PROVISIONS IN ANOTHER ACC OUNTS AND THERE IS A BALANCE IN PROVISION FOR BAD AND DOUBTFU L DEBTS ACCOUNT AT THE YEAR END. 2. THE LEARNED CIT (APPEALS-II) HAS ERRED IN HOLDIN G THAT CONTINGENT PROVISION FOR STANDARD ASSETS IS NOT ALL OWABLE BY WRONGLY INTERPRETING THE ACT. 6 ITA NOS. 354, 355, 1115 & 1116/JP/2016, 536/JP/2017 & 1063/JP/2017 RAJASTHAN FINANCIAL CORPORATION, JAIPUR. 3. THE ASSESSEE CRAVES THE RIGHT TO ADD, ALTER OR I N ANY WAY AMEND THE GROUNDS OF APPEAL OR BEFORE THE HEARING. 9. THE LD. A/R OF THE ASSESSEE HAS SUBMITTED THAT T HE AO HAS DISALLOWED THE CLAIM OF PROVISION OF BAD DEBT WRITTEN OFF UNDER SE CTION 36(1)(VIIA)(C) OF THE IT ACT BY CONSIDERING THE CLOSING BALANCE IN THE PROVISION AS CREDIT BALANCE. THE LD. A/R HAS SUBMITTED THAT THE AO HAS IGNORED THE FACT THAT DURING THE YEAR UNDER CONSIDERATION THE ASSESSEE HAS MADE FRESH PROVISION THOUGH THERE ARE WRITTEN BACK OF PROVISION IN RESPECT OF SOME OTHER ACCOUNTS AND THE NET CLOSING BALANCE IN THE NP ACCOUNT IS CREDITED. HOWEVER, WHEN THE ASSESSEE HA S MADE NEW PROVISION DURING THE YEAR THEN THE CLAIM OF DEDUCTION UNDER SECTION 36(1)(VIIA)(C) OF THE ACT CANNOT BE DENIED. HE HAS REFERRED TO THE DETAILS OF THE P ROVISIONS MADE DURING THE YEAR AS WELL AS THE PROVISION WRITTEN BACK BY THE ASSESSEE AND SUBMITTED THAT DUE TO THE PROVISIONS WRITTEN BACK BY THE ASSESSEE IN SOME OTH ER ACCOUNTS, THE CLOSING BALANCE IN THE NP ACCOUNT COMES TO A CREDIT BALANCE. HENCE THE LD. A/R HAS SUBMITTED THAT TO THE EXTENT OF NEW PROVISION MADE BY THE ASSESSEE THE CLAIMS SHOULD BE ALLOWED. 9.1. ON THE OTHER HAND, THE LD. D/R HAS SUBMITTED T HAT THESE DETAILS AND FACTS WERE NOT BROUGHT ON RECORD BY THE ASSESSEE EITHER D URING THE ASSESSMENT PROCEEDINGS OR DURING THE PROCEEDINGS BEFORE LD. CI T (A), THEREFORE, THESE FACTS REQUIRES VERIFICATION AT THE END OF THE AO IF AT AL L THE SAME ARE TO BE CONSIDERED FOR THE PURPOSE OF DEDUCTION UNDER SECTION 36(1)(VIIA)( C) OF THE ACT. 10. HAVING CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD, WE NOTE THAT THE AO HAS DISALLOWED THE CLAI M OF THE ASSESSEE WITH THE STATEMENT THAT THE ASSESSEE HAS ALREADY TAKEN A LOT OF TIME AND THE CASE WAS TIME 7 ITA NOS. 354, 355, 1115 & 1116/JP/2016, 536/JP/2017 & 1063/JP/2017 RAJASTHAN FINANCIAL CORPORATION, JAIPUR. BARRED ON 31 ST MARCH, 2014. ACCORDINGLY A FINAL OPPORTUNITY WAS GIVEN TO THE ASSESSEE TO GIVE DETAILS BY 18.03.2014. HOWEVER, N O REPLY WAS RECEIVED BY THE AO AND ACCORDINGLY THE CLAIM OF THE ASSESSEE WAS DISAL LOWED CONSIDERING THE FACT THAT THERE WAS NO NEW PROVISION FOR BAD AND DOUBTFUL DEB TS MADE BY THE ASSESSEE. NOW THE ASSESSEE HAS FILED THE DETAILS OF PROVISION MAD E FOR BAD AND DOUBTFUL DEBTS AND SUBMITTED THAT THE ASSESSEE HAS MADE FRESH PROVISIO N TO THE EXTENT OF RS. 21,64,58,670/- THOUGH THE WRITTEN BACK OF PROVISION WAS MORE THAN THE NEW PROVISION MADE DURING THE YEAR, THEREFORE, THERE WA S A CREDIT BALANCE IN THE NP ACCOUNT. HAVING CONSIDERED THESE FACTS AND CIRCUMS TANCES OF THE CASE, AS THE ASSESSEE DID NOT FURNISH THE RELEVANT DETAILS BEFOR E THE AUTHORITIES BELOW, WE SET ASIDE THIS ISSUE TO THE RECORD OF THE AO FOR VERIFI CATION OF NECESSARY DETAILS AND PARTICULARLY THE FACT OF NEW PROVISION MADE BY THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION AND THEN DECIDE THE ISSUE AS PER LAW. NEEDLESS TO SAY, THE ASSESSEE BE GIVEN AN OPPORTUNITY OF HEARING BEFORE PASSING T HE FRESH ORDER. 11. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSE. ITA NO. 1115/JP/2016 A.Y. 2012-13 : 12. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS : - 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S)-II HAS ERRED IN HOLDING THAT THE PROVISION FOR BAD DEBT U/S 36(1 )(VII)(A)(C) @ 5% OF THE INCOME IS NOT ALLOWABLE AS THE CORPORATIO N HAS WRITTEN BACK THE PROVISION FOR BAD & DOUBTFUL DEBTS MADE IN EARLIER YEARS WITHOUT CONSIDERING THE FACT THAT FRE SH PROVISION FOR BAD & DOUBTFUL DEBTS MADE IN EARLIER YEARS WITHOUT CONSIDERING THE FACT THAT FRESH PROVISION FOR BAD & DOUBTFUL DE BTS IN SOME ACCOUNTS MADE DURING THE CURRENT YEAR. 8 ITA NOS. 354, 355, 1115 & 1116/JP/2016, 536/JP/2017 & 1063/JP/2017 RAJASTHAN FINANCIAL CORPORATION, JAIPUR. 2. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) -II HAS ERRED IN UPHOLDING THE CALCULATION OF REBATE U/S 36(1)(VI I) OF INCOME TAX ACT, 1961. 3. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) -II HAS ERRED IN HOLDING THAT THE CONTINGENT PROVISION FOR STANDA RD ASSETS IS NOT ALLOWABLE BY WRONGLY INTERPRETING THE ACT. 4. THE ASSESSEE CRAVES THE RIGHT TO ADD, ALTER OR I N ANY WAY AMEND THE GROUNDS OF APPEALS OR BEFORE THE HEARING. 13. THE ONLY ISSUE RAISED IN THIS APPEAL OF THE ASS ESSEE IS REGARDING DISALLOWANCE OF CLAIM UNDER SECTION 36(1)(VIIA)(C) OF THE ACT WH ICH IS IDENTICAL AS THE ISSUE RAISED FOR THE ASSESSMENT YEAR 2011-12. THE LD. A/R AS WE LL AS THE LD. D/R HAS REITERATED THEIR CONTENTIONS AS MADE ON THIS ISSUE FOR THE ASS ESSMENT YEAR 2011-12. BOTH THE PARTIES HAVE ADMITTED THE FACT THAT THE AO HAS DISA LLOWED THE CLAIM ON IDENTICAL GROUND AS THE ASSESSEE HAS NOT MADE ANY FRESH PROVI SION DURING THE YEAR UNDER CONSIDERATION. ACCORDINGLY, IN VIEW OF OUR FINDING ON THIS ISSUE FOR THE ASSESSMENT YEAR 2011-12 THIS ISSUE IS SET ASIDE TO THE RECORD OF THE AO FOR PROPER VERIFICATION AND EXAMINATION AND THEN DECIDE AFRESH AFTER GIVING AN OPPORTUNITY OF HEARING TO THE ASSESSEE. 14. IN THE RESULT, APPEAL IS ALLOWED FOR STATISTICA L PURPOSES. ITA NO. 1063/JP/2016 A.Y. 2012-13 : 15. IN THIS CROSS APPEAL, THE REVENUE HAS RAISED TH E FOLLOWING GROUNDS :- 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD. CIT (APPEALS) WAS JUSTIFIED IN HOLDING THAT THE ASSESSEE 9 ITA NOS. 354, 355, 1115 & 1116/JP/2016, 536/JP/2017 & 1063/JP/2017 RAJASTHAN FINANCIAL CORPORATION, JAIPUR. CAN NOT BE TERMED AS A COMPANY WITH IN THE MEANING OF SECTION 2(18)(A) OF THE I.T. ACT AND PROVISIONS OF SECTION 115JB ARE NOT APPLICABLE ON THE ASSESSEE. 2. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CA SE AND IN LAW, LD. CIT (APPEALS) WAS JUSTIFIED IN DELETING THE DIS ALLOWANCE OF RS. 3,04,000/- MADE ON ACCOUNT OF PRIOR PERIOD EXPE NSES. 3. THE APPELLANT CRAVES ITS RIGHTS TO ADD, AMEND OR ALTER ANY OF THE GROUNDS ON OR BEFORE THE HEARING. 16. GROUND NO. 1 IS REGARDING THE ADDITION MADE BY THE AO WHILE COMPUTING THE BOOK PROFIT UNDER SECTION 115JB OF THE ACT WHICH WA S DELETED BY THE LD. CIT (A) BY HOLDING THAT MAT PROVISIONS ARE NOT APPLICABLE IN T HE CASE OF THE FINANCIAL CORPORATIONS AS THE ACCOUNTS ARE NOT MAINTAINED AS PER SCHEDULE-VI OF THE COMPANIES ACT. 17. WE HAVE HEARD THE LD. D/R AS WELL AS THE LD. A/ R OF THE ASSESSEE AND CONSIDERED THE RELEVANT MATERIAL ON RECORD. AT THE OUTSET, WE NOTE THAT AN IDENTICAL ISSUE WAS DECIDED BY THE HONBLE JURISDICTIONAL HIG H COURT IN ASSESSEES OWN CASE FOR THE EARLIER ASSESSMENT YEARS VIDE DECISION DATED 6 TH JULY, 2017 IN DBIT APPEAL NOS. 593/2008, 552/2009, 157/2010 AND 261/2016. THE HON BLE HIGH COURT IN ASSESSEES OWN CASE AFTER CONSIDERING A SERIES OF DECISIONS ON THIS ISSUE HAS HELD IN PARA 9 TO 11 AS UNDER :- 9. WE HAVE HEARD COUNSEL FOR BOTH THE SIDES. 10. BEFORE PROCEEDING WITH THE MATTER, THE QUESTIO N OF LAW WHICH HAS BEEN FRAMED IS VERY CLEAR WHETHER THE RESPONDEN T ASSESSEE WILL BE GOVERNED UNDER SECTION 115JA READ WITH SECTION 2(18 )(A). ON A PLAIN 10 ITA NOS. 354, 355, 1115 & 1116/JP/2016, 536/JP/2017 & 1063/JP/2017 RAJASTHAN FINANCIAL CORPORATION, JAIPUR. READING AS REPRODUCED ABOVE AND IN VIEW OF FORGOING CONCLUSION AND EVEN AS PER STATEMENT OF MR. MATHUR, IT WILL NOT BE COVERED. HOWEVER, HE HAS TRIED TO TAKE SUPPORT OF SECTION 43 WHICH IS MISCONCEIVED. WHILE INTERPRETING THE TAXING STATUTE, THE COURT HA S TO RELY UPON THE TAXING STATUTE AND NOT ANY OTHER PROVISIONS. 11. IN THAT VIEW OF THE MATTER, THE ISSUE IS ANSWER ED IN FAVOUR OF THE ASSESSEE AGAINST THE DEPARTMENT. ACCORDINGLY, IN VIEW OF THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN ASSESSEES OWN CASE, WE FIND NO ERROR OR ILLEGALITY IN THE ORDER OF LD. CIT (A) QUA THIS ISSUE. GROUND NO. 2 IS REGARDING DELETION OF DISALLOWANCE OF EXPENDITURE MADE BY THE AO ON ACCOUNT OF PRIOR PERIOD. 18. WE HAVE HEARD THE LD. D/R AS WELL AS THE LD. A/ R AND CONSIDERED THE RELEVANT MATERIAL ON RECORD. THE AO HAS MADE A DISALLOWANCE OF RS. 3,01,764/- ON ACCOUNT OF RENT PAID OF THE EARLIER YEARS TO THE DIRECTORAT E OF ESTATE, GOVERNMENT OF RAJASTHAN FOR BIKANER HOUSE EXPENSES, NEW DELHI, ON THE GROUND THAT THESE EXPENSES PERTAIN TO THE EARLIER YEARS AND, THEREFOR E, CANNOT BE ALLOWED FOR THE YEAR UNDER CONSIDERATION. ON APPEAL, THE LD. CIT (A) HA S ALLOWED THE CLAIM OF THE ASSESSEE IN PARA 3.3 AS UNDER :- 3.3. I HAVE PERUSED THE FACTS OF THE CASE, THE AS SESSMENT ORDER AND THE SUBMISSIONS OF THE APPELLANT. THIS GROUND RELAT ES TO AN AMOUNT OF 11 ITA NOS. 354, 355, 1115 & 1116/JP/2016, 536/JP/2017 & 1063/JP/2017 RAJASTHAN FINANCIAL CORPORATION, JAIPUR. RS. 3,01,764/- ON ACCOUNT OF RENT PAID OF EARLIER Y EARS TO THE DIRECTOR ESTATES GOVERNMENT OF RAJASTHAN, FOR BIKANER HOUSE EXPENSES, IN NEW DELHI. THE ASSESSING OFFICER HELD THE SAME TO BE P RIOR PERIOD EXPENDITURE AND ALSO THAT SINCE THE ASSESSEE WAS FO LLOWING THE ACCRUAL BASIS HENCE, THE SAME SHOULD HAVE BEEN ACCOUNTED FO R IN THE RELEVANT YEAR. IN THE PRESENT PROCEEDINGS, IT HAS BEEN STAT ED THAT THIS DEMAND RAISED BY THE GOVERNMENT IN THIS YEAR AND THE SAME CRYSTALLIZED DURING THE YEAR ITSELF AND SO HAS BEEN RIGHTLY ACCOUNTED F OR. SINCE, THE DEMAND WAS RAISED BY THE GOVERNMENT OF RAJASTHAN IN THIS RELEVANT YEAR AND IN THE CASE OF GOVERNMENT CORPORATIONS AP PROVALS AND SANCTIONS HAVE TO BE TAKEN AND AS HAS BEEN CONSISTE NTLY HELD BY THE ITAT IN SUCH CASES, THE EXPENDITURE OF THIS NATURE IS ALLOWABLE IN THE YEAR IN WHICH SUCH EXPENSES ARE FINALLY SANCTIONED AND APPROVED. RELIANCE IS PLACED ON THE ORDER OF ITAT IN THE CASE OF RAJASTHAN STATE MINES & MINERALS LTD. DATED 12.02.2016 FOR THE ASSE SSMENT YEAR 2012- 13. THE GROUND OF APPEAL IS ALLOWED. THE ADDITION M ADE IS DELETED. THUS THE LD. CIT (A) HAS GIVEN THE FINDING THAT THE DEMAND WAS RAISED BY THE GOVERNMENT OF RAJASTHAN DURING THE YEAR UNDER CONSI DERATION AND, THEREFORE, THE SAME WAS CRYSTALLIZED DURING THE YEAR ITSELF. ONCE THE FACT OF RAISING THE DEMAND BY THE GOVERNMENT OF RAJASTHAN DURING THE YEAR HAS NOT BEEN DISPUTED BY THE AO, THEREFORE, WE DO NOT FIND ANY ERROR OR ILLEGALITY I N THE ORDER OF LD. CIT (A) IN ALLOWING THE CLAIM OF EXPENDITURE ON THE GROUND THAT THE SAM E IS CRYSTALLIZED DURING THE YEAR UNDER CONSIDERATION. 19. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISS ED. 12 ITA NOS. 354, 355, 1115 & 1116/JP/2016, 536/JP/2017 & 1063/JP/2017 RAJASTHAN FINANCIAL CORPORATION, JAIPUR. ITA NO. 1116/JP/2016 A.Y. 2013-14 : 20. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS : - 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S)-II HAS ERRED IN ADDING THE AMOUNT OF RS. 10,20,90,000/- WITHOUT GOING INTO THE FACTS OF MATTER AND THE FACTS OF MATTER AND THE FACT THAT THIS AMOUNT HAS BEEN WRITTEN BACK FROM THE PROVISIONS MA DE AS PER RBI DIRECTIONS AND WAS NEVER ALLOWED IN INCOME TAX ASSESSMENTS. 2. THE ASSESSEE CRAVES THE RIGHT TO ADD, ALTER OR I N ANY WAY AMEND THE GROUNDS OF APPEAL OR BEFORE THE HEARING. 21. THE AO HAS MADE AN ADDITION OF RS. 10,20,90,000 /- ON ACCOUNT OF THE PROVISION MADE AGAINST NPA WHICH WAS WRITTEN BACK D URING THE YEAR UNDER CONSIDERATION. THE ASSESSEE CHALLENGED THE ACTION OF THE AO BUT COULD NOT SUCCEED AS THE LD. CIT (A) HAS CONFIRMED THE ADDITION MADE BY THE AO ON THE GROUND THAT THE ASSESSEE HAS NOT FURNISHED THE RELEVANT YEAR-WISE D ETAILS TO SUBSTANTIATE ITS CLAIM. 22. BEFORE US, THE LD. A/R OF THE ASSESSEE HAS REFE RRED TO THE PROFIT & LOSS ACCOUNT FOR THE YEAR UNDER CONSIDERATION AND SUBMIT TED THAT THE ASSESSEE HAS DULY CREDITED THIS AMOUNT OF RS. 10,20,90,000/- IN THE P ROFIT & LOSS ACCOUNT AS WRITTEN BACK OF THE PROVISION FOR BAD AND DOUBTFUL DEBTS. HE HAS FURTHER SUBMITTED THAT SINCE THE SAID PROVISION WAS NOT ALLOWED BY THE AO IN THE EARLIER YEARS IN THE INCOME-TAX PROCEEDINGS, THEREFORE, THE ASSESSEE WHI LE COMPUTING THE INCOME HAS REDUCED TO THE SAID AMOUNT. THE AO HAS MADE THE AD DITION OF THE SAID AMOUNT ON THE GROUND THAT THE ASSESSEE HAS CLAIMED THE DEDUCT ION UNDER THE PROVISION FOR BAD AND DOUBTFUL DEBTS. THE LD. A/R HAS REFERRED TO TH E COMPUTATION OF INCOME AND SUBMITTED THAT ONCE THE AMOUNT WAS ADDED IN THE PRO FIT & LOSS ACCOUNT AND WAS NOT 13 ITA NOS. 354, 355, 1115 & 1116/JP/2016, 536/JP/2017 & 1063/JP/2017 RAJASTHAN FINANCIAL CORPORATION, JAIPUR. ALLOWED IN THE EARLIER YEARS WHEN THE PROVISION WAS MADE, THEN THE SAME CANNOT BE TAXED DURING THE YEAR UNDER CONSIDERATION WHEN IT I S WRITTEN BACK BY THE ASSESSEE. 22.1. ON THE OTHER HAND, THE LD. D/R HAS SUBMITTED THAT THE ASSESSEE HAS NOT FURNISHED THE DETAILS AS REQUIRED BY THE AUTHORITIE S BELOW TO SUPPORT AND SUBSTANTIATE ITS CLAIM. HE HAS RELIED UPON THE ORD ERS OF THE AUTHORITIES BELOW. 23. HAVING CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD, WE NOTE THAT AS PER THE PROFIT & LOSS ACCOU NT THE ASSESSEE HAS DULY CREDITED THIS AMOUNT OF RS. 10,20,90,000/- IN THE PROFIT & L OSS ACCOUNT AND THEREAFTER IN THE COMPUTATION OF TOTAL INCOME THE ASSESSEE HAS REDUCE D THE SAID AMOUNT. IT IS ALSO UNDISPUTED FACT THAT IN THE EARLIER YEARS AS WE HAV E DEALT WITH THE ISSUE FOR THE ASSESSMENT YEARS 2006-07, 10-11 TO 12-13, THE AO DI SALLOWED THE CLAIM OF PROVISION FOR BAD AND DOUBTFUL DEBTS. HOWEVER, WE HAVE ALREA DY DIRECTED THE AO TO RECONSIDER THE CLAIM OF THE ASSESSEE FOR THE ASSESS MENT YEARS 2011-12 AND 12-13 AFTER VERIFICATION OF THE NEW PROVISION MADE DURING THOSE YEARS. FURTHER, IF ANY PART OF THE AMOUNT WHICH IS WRITTEN BACK BY THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION WAS ALREADY ALLOWED IN THE EARLIER AS SESSMENT YEARS THEN TO THAT EXTENT THE WRITTEN BACK AMOUNT HAS TO BE INCLUDED I N THE INCOME OF THE ASSESSEE. THE AMOUNT OF WRITTEN BACK OF PROVISION WHICH WAS N EVER ALLOWED BY THE AO IN THE ASSESSMENT PROCEEDINGS CANNOT BE ADDED TO THE INCOM E OF THE ASSESSEE. ACCORDINGLY WE SET ASIDE THIS ISSUE TO THE RECORD O F THE AO FOR VERIFICATION OF ALL THE DETAILS RELEVANT TO THIS ISSUE AS HOW MUCH OF THE A MOUNT WRITTEN BACK DURING THE YEAR UNDER CONSIDERATION WAS ALLOWED IN THE EARLIER YEARS AND ONLY TO THAT EXTENT THE 14 ITA NOS. 354, 355, 1115 & 1116/JP/2016, 536/JP/2017 & 1063/JP/2017 RAJASTHAN FINANCIAL CORPORATION, JAIPUR. SAME HAS TO BE ADDED TO THE INCOME OF THE ASSESSEE. NEEDLESS TO SAY, THE ASSESSEE BE GIVEN AN OPPORTUNITY OF HEARING BEFORE PASSING T HE FRESH ORDER. 24. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. 25. RESULTANTLY THE APPEALS OF ASSESSEE IN ITA NO. 354 & 355/JP/2016 ARE DISMISSED, ITA NOS. 536/JP/2017, 1115/JP/2016 AND 1 116/JP/2016 ARE ALLOWED FOR STATISTICAL PURPOSES AND APPEAL OF THE REVENUE IN I TA NO. 1063 IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 16/07/2018 . SD/- SD/- ( FOE FLAG ;KNO ) ( FOT; IKY JKWO (VIKRAM SINGH YADAV ) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 16/07/2018. DAS/ VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- RAJASTHAN FINANCIAL CORPORATION, JAIPUR. 2. THE RESPONDENT THE ACIT CIRCLE-6/THE ITO WARD 6(2), JAIPUR. 3. THE CIT(A). 4. THE CIT, 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO. 354(6)/JP/2016) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR 15 ITA NOS. 354, 355, 1115 & 1116/JP/2016, 536/JP/2017 & 1063/JP/2017 RAJASTHAN FINANCIAL CORPORATION, JAIPUR.