AVT Mc Cormick Ingredients Pvt Ltd., CHENNAI V. DCIT, CHENNAI

ITA 1122/CHNY/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 7858 (ITAT-CHENNAI)
• Duration Of Justice: 7 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-12-2016
• Appeal Filed By: Assessee
• Bench Allotted: C
• Next Hearing Date: 28-09-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 25-04-2016
• Court: TRIBUNAL
• Department Lawyers: A V SREEKANTH
• Assessee Lawyers: T BANUSEKAR
• Keywords: Transfer pricing; Double taxation relief; International transaction; Services rendered outside India; Permanent establishment; Question of law
• Section: 43B; 143(3); 142(1); 147; 148

Judgement Text

, , IN THE INCOME - TAX APPELLATE TRIBUNAL C BENCH, CHENNAI . , . , BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER & SHRI DUVVURU R L REDDY , JUDICIAL MEMBER ./ I T.A. NO. 1122 /MDS/2016 / ASSESSMENT YEAR :201 1 - 1 2 AVT MC CORMICK INGREDIENTS PVT. LTD., NO. 64, RUKMANI LAKSHMIPATHY SALAI, EGMORE, CHENNAI 600 008. [PAN:A A ACA3217E ] VS. THE DEPUTY COMMISSIONER OF INCOME TAX , COMPANY CIRCLE I ( 1 ) , CHENNAI . ( / APPELLANT ) ( / RESPONDENT ) / APPELLANT BY : SHRI T. BANUSEKAR, C.A. / RESPONDENT BY : SHRI A.V. SREEKANTH , JCIT / DATE OF HEARING : 28 . 0 9 .201 6 / DATE OF P RONOUNCEMENT : 08 . 12 .201 6 / O R D E R PER DUVVURU RL REDDY , JUDICIAL MEMBER: T HE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) 1 , CHENNAI, DATED 0 2.0 2 .201 6 RELEVANT TO THE ASSESSMENT YEAR 20 1 1 - 1 2 . THE ASSESSEE HAS RAISED TWO EFFECTIVE GROUND S, VIZ., (I) THE LD. CIT(A) HAS ERRED IN CONFIRMING THE DISALLOWANCE OF .7, 22 , 5 7 0 / - MADE UNDER SECTION 40(A)(I) OF THE INCOME TAX ACT, 1961 [ AC T IN SHORT] IN RESPECT OF LAB I.T.A. NO . 1122 /M/ 16 2 ANALYSIS FEES PAID AND (II) THE LD. CIT(A) HAS ERRED IN UPHOLDING THE DISALLOWANCE OF .1,24,768/ - UNDER SECTION 36(1)(VA) IN RESPECT OF PAYMENT OF EMPLOYEE S CONTRIBUTION TO PF . 2. BRIEF FACTS OF THE CASE ARE THAT THE ASS ESSEE IS ENGAGED IN THE MANUFACTURE OF WHOLE AND GROUND SPICES AND FILED ITS RETURN OF INCOME ON 20.09.2011 ADMITTING TOTAL INCOME OF . 15,00,15,330/ - . THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND NOTICE UNDER SECTION 143(2) OF THE ACT WAS SERVE D ON THE ASSESSEE ON 07.09.2012. NOTICE UNDER SECTION 142(1) OF THE ACT WAS ALSO ISSUED CALLING FOR DETAILS. IN RESPONSE THERETO, THE ASSESSEE HAS FILED ALL THE DETAILS. THE TPO - I, CHENNAI VIDE ORDER DATED 27.08.2014 HAS HELD THAT INTERNATIONAL TRANSACTION S OF THE ASSESSEE COMPANY ARE WITHIN ARM S LENGTH PRICE AND HENCE NO ADJUSTMENT WAS CONSIDERED TO BE NECESSARY FOR THE ASSESSMENT YEAR 2011 - 12. AFTER EXAMINING THE DETAILS FILED BY THE ASSESSEE, THE ASSESSMENT UNDER SECTION 143(3) R.W.S. 92CA OF THE ACT WA S COMPLETED BY ASSESSING THE TOTAL INCOME OF THE ASSESSEE AT .16,83,65,504/ - BY MAKING DISALLOWANCES UNDER SECTION 40(A)(I) AS WELL AS UNDER SECTION 36(1)(VA) OF THE ACT. I.T.A. NO . 1122 /M/ 16 3 3. THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A). AFTER CONSIDE RING THE SUBMISSIONS OF THE ASSESSEE AND FACTS OF THE CASE, THE LD. CIT(A) PARTLY ALLOWED THE APPEAL FILED BY THE ASSESSEE. 4. ON BEING AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. WITH REGARD TO THE FIRST ISSUE OF PAYMENT OF LAB ANALYSIS F EES TO FOREIGN AGENCIES, THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE FOREIGN AGENCIES, WHO HAVE RECEIVED THE PAYMENTS HAVE NO BUSINESS CONNECTION OR PERMANENT ESTABLISHMENT IN INDIA AND THEY ARE NOT COVERED UNDER SECTION 195 OF THE ACT AND THER EFORE, THE ASSESSEE IS NOT LIABLE TO DEDUCT TDS ON THE PAYMENTS MADE BY THE ASSESSEE. HE FURTHER ARGUED THAT THE PAYMENTS FOR LAB ANALYSIS WERE NOT COVERED WITHIN THE MEANING OF FEES FOR TECHNICAL SERVICES UNDER SECTION 9(1)(VII) OF THE ACT OR UNDER DTAA W ITH THE FOREIGN COUNTRIES. THEREFORE, THE LD. COUNSEL FOR THE ASSESSEE HAS PLEADED THAT THE DISALLOWANCE MADE BY THE ASSESSING OFFICER IS LIABLE TO BE DELETED. 5. ON THE OTHER HAND, THE LD. DR HAS SUBMITTED THAT THE DECISION OF THE COORDINATE BENCH OF T HE TRIBUNAL IN ASSESSEE S OWN CASE FOR THE ASSESSMENT YEAR 2010 - 11 MAY BE FOLLOWED FOR THE ASSESSMENT YEAR UNDER CONSIDERATION . I.T.A. NO . 1122 /M/ 16 4 6. WE HAVE HEARD BOTH SIDES, PERUSED THE MATERIALS ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. ON AN IDENTICAL ISSUE IN SIMILAR FACTS AND CIRCUMSTANCES, THE COORDINATE BENCH OF THE TRIBUNAL IN ASSESSEE S OWN CASE FOR THE ASSESSMENT YEAR 2010 - 11 IN I.T.A. NO. 58/MDS/2015 VIDE CONSOLIDATED ORDER DATED 19.02.2016, THE TRIBUNAL HAS OBSERVED AND HELD AS UNDER: 10.4 WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL ON RECORD AND JUDICIAL DECISION CITED AND THE AGREEMENTS. THE LD. AUTHORISED REPRESENTATIVE HAS GIVEN AN AUTHENTIC VIEW OF LAB ANALYSIS FEES PAID TO NON RESIDENTS OF US, UK AND GERMANY AND THE REPORT WAS PREPARED OUTSIDE THE COUNTRY BASED ON THE DETAILS OF THE ASSESSEE UNIT. THE NON RESIDENTS SERVICE ARE AVAILED ONLY FOR THE OPINION OF CERTIFYING THE PROCESS. SINCE THE SERVICES RENDERED OUTSIDE INDIA AND PAYMENTS MADE OUTSIDE COUNTRY AND DOES NOT ATT RACT TDS PROVISIONS. ALTERNATIVELY U/SEC.9(1)(VII) FEES FOR TECHNICAL SERVICES, THE LAB ANALYSIS FEES WILL NOT FALL INTO CATEGORY OF TECHNICAL FEES AND ALSO THERE IS NO PERMANENT ESTABLISHMENT IN INDIA TO CHARGE SUCH INCOME TO TAX. THE LD. AUTHORISED REP RESENTATIVE DEMONSTRATED THE DTAA CLAUSES WITH USA, UK AND GERMANY AND SUCH PAYMENTS ARE OUTSIDE THE PURVIEW AND NOT CHARGEABLE AS PER PROVISIONS OF DTAA. ON THE OTHER HAND, THE LD. DEPARTMENTAL REPRESENTATIVE RELIED ON THE FINDINGS OF THE COMMISSIONER OF INCOME TAX (APPEALS) THAT THE KNOW HOW WAS AVAILABLE AND THERE WAS SITE INSPECTION AND REFERENCE WAS MADE IN AUDIT REPORT ON VERIFICATION OF TRAINING PROGRAMME. WE AFTER CONSIDERING THE MATRIX OF FACTS, JUDICIAL DECISIONS AND AUDIT REPORT OBSERVED IN ASSE SSMENT ORDER WHICH INDICATES THE SERVICES ARE RENDERED IN INDIA AND REPORT WAS OBTAINED IN INDIA. THEREFORE, WE REMIT THE ISSUE TO THE ASSESSING OFFICER FOR LIMITED PURPOSE TO VERIFY THE WORKING SYSTEM OF AUDITED AND CONSULTANCY WORK OR INSPECTION WAS CARR IED BY THE AUDITORS ON LAB ANALYSIS AND WE SET ASIDE THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) AND DIRECT THE ASSESSING OFFICER TO CONSIDER THE ISSUE AND PASS THE ORDER AFTER PROVIDING ADEQUATE OPPORTUNITY OF HEARING BEFORE PASSING THE ORDER ON MERITS. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSE. I.T.A. NO . 1122 /M/ 16 5 7. IN THE ASSESSMENT ORDER, WHILE MAKING THE DISALLOWANCE, THE ASSESSING OFFICER HAS HELD THAT THIS MATTER WAS ELABORATELY DISCUSSED IN THE EARLIER YEAR AS SESSMENT ORDER AND, THEREFORE, SHE HAS NOT ELABORATELY DISCUSSED ANYTHING ABOVE THE DISALLOWANCE MADE. SIMILARLY, BY FOLLOWING THE DECISION OF THE COORDINATE BENCH OF THE TRIBUNAL FOR THE ASSESSMENT YEAR 2010 - 11, WE ALSO REMIT THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER TO DECIDE THE ISSUE AFRESH AFTER ALLOWING AN OPPORTUNITY OF HEARING TO THE ASSESSEE. THUS, THE GROUND RAISED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 8. THE NEXT GROUND RAISED IN THE APPEAL OF THE ASSESSEE IS WITH RE GARD TO DISALLOWANCE TOWARDS DELAYED PAYMENT OF EMPLOYEES CONTRIBUTION OF PF. IN THE ASSESSMENT ORDER, THE ASSESSING OFFICER HAS OBSERVED FROM THE DETAILS FILED ALONG WITH FORM 3CD THAT THE ASSESSEE HAS FAILED TO CREDIT THE EMPLOYEE S CONTRIBUTION TO THE T UNE OF .1,24,768/ - IN RESPECT OF PROVIDENT FUND BEFORE THE DUE DATE SPECIFIED UNDER THE RELEVANT A C T. THEREFORE, THE ASSESSING OFFICER DISALLOWED THE AMOUNT OF .1,24,768/ - UNDER SECTION 36(1)(VA) OF THE ACT AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. I.T.A. NO . 1122 /M/ 16 6 9. O N APPEAL BEFORE THE LD. CIT(A) THE ASSESSEE HAS CONTESTED THAT THOUGH THE CONTRIBUTION WAS PAID BEYOND THE DUE DATE, BUT THE SAME WAS PAID WITH IN THE DUE DATE FOR FILING OF THE RETURN AND IT HAS TO BE ALLOWED BY FOLLOWING THE DECISION OF THE HON BLE APEX C OURT IN THE CASE OF CIT V. ALOM EXTRUSIONS 185 TAXMANN 416 (SC). HOWEVER, THE LD. CIT(A) HAS OBSERVED THAT THOUGH THE RATIO IN THE CASE OF CIT V. ALOM EXTRUSIONS (SUPRA) LAID DOWN BY THE HON BLE APEX COURT HAS BEEN ACCEPTED BY THE BOARD VIDE ITS CIRCULAR N O. 22/2015 DATED 17.12.2015, BUT CLARIFIED THEREIN THAT THE CIRCULAR DOES NOT APPLY TO CLAIM OF DEDUCTION RELATING TO EMPLOYEE S CONTRIBUTION TO WELFARE FUNDS WHICH ARE GOVERNED BY SECTION 36(1)(VA) OF THE ACT AND THEREFORE, HE CONFIRMED THE DISALLOWANCE M ADE BY THE ASSESSING OFFICER. 10. BEFORE US, BY RELYING ON THE DECISION IN THE CASE OF CIT V. M/S. INDUSTRIAL SECURITY & INTELLIGENCE INDIA PVT. LTD. IN TCA NOS. 585 AND 586 OF 2015 VIDE ORDER DATED 24.07.2015, THE LD. COUNSEL FOR THE ASSESSEE HAS PRAYE D THAT THE DISALLOWANCE MADE BY THE ASSESSING OFFICER SHOULD BE DELETED. 11. ON THE OTHER HAND, THE LD. DR RELIED ON THE ORDER OF THE AUTHORITIES BELOW. I.T.A. NO . 1122 /M/ 16 7 1 2 . WE HAVE HEARD BOTH SIDES, PERUSED THE MATERIALS ON RECORD AND GONE THROUGH THE ORDERS OF AUTH ORITIES BELOW. IN THIS CASE, IT IS AN ADMITTED FACT THAT THE ASSESSEE HAS FAILED TO CREDIT THE EMPLOYEE S CONTRIBUTION TO THE TUNE OF .1,24,768/ - BEFORE THE DUE DATE , BUT, THE SAME WAS PAID WITHIN THE DUE DATE FOR FILING OF THE RETURN. UNDER SIMILAR SITUATION, IN THE CASE OF CIT V. M/S. INDUSTRIAL SECURITY & INTELLIGENCE INDIA PVT. LTD. (SUPRA), THE HON BLE JURISDICTIONAL HIGH COURT HAS OBSERVED AND HELD AS UNDER: 2. THE BRIEF FACTS OF THE CASE ARE AS FOLLOWS: THE RESPONDENT/ASSESSEE FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEARS IN QUESTION. THE SAID RETURNS WERE PROCESSED AND WERE NOT SELECTED FOR SCRUTINY. SUBSEQUENTLY, THE ASSESSING OFFICER NOTICED THAT THERE WAS ESCAPEMENT OF INCOME AND HENCE REOPENED THE ASSESSMENTS UNDER SECTION 147 OF THE INCOME TAX ACT BY ISSUING NOTICE UNDER SECTION 148 OF THE INCOME TAX ACT. WHILE COMPLETING THE RE - ASSESSMENT, THE ASSESSING OFFICER DISALLOWED THE EXPENSES CLAIMED BY WAY OF EMPLOYEE'S CONTRIBUTION TO PF AND ESI HOLDING THAT THE ASSESSEE HAD NOT PAID THE EMPLOYEE'S CONTRIBUTION O F PF AND ESI WITHIN THE DUE DATES SPECIFIED UNDER THE RESPECTIVE ACT. AGGRIEVED BY THE SAID ORDER OF ASSESSMENT, THE ASSESSEE PREFERRED APPEALS BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS) CHALLENGING THE REOPENING AS WELL AS THE DISALLOWANCE. THE COM MISSIONER OF INCOME TAX (APPEALS) SUSTAINED THE ORDER OF THE ASSESSMENT, THEREBY DISMISSED THE APPEALS. AGGRIEVED BY THE SAME, THE ASSESSEE PREFERRED FURTHER APPEALS BEFORE THE TRIBUNAL. THE TRIBUNAL RELIED UPON THE DECISION OF THE SUPREME COURT IN THE C ASE OF CIT V. ALOM EXTRUSIONS LTD . REPORTED IN 319 ITR 306, DECISION OF THE DELHI HIGH COURT IN THE CASE OF CIT V. AMIL LTD . REPORTED IN 321 ITR 508 AND THAT OF THE CO - ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF M/S.VENKATESWARA ELECTRICAL INDUSTRIES P. LTD. V. DCIT IN ITA NOS.1344, 1345 AND 1636/MDS/2014 DATED 28.8.2014 HELD AS FOLLOWS: 5. HEARD BOTH SIDES. PERUSED ORDERS OF LOWER AUTHORITIE S AND THE DECISIONS RELIED ON BEFORE US. IT IS NOT IN I.T.A. NO . 1122 /M/ 16 8 DISPUTE THAT ALL THESE PAYMENTS OF PROVIDENT FUND RS.16,20,571/ - AND ESI RS.17,51,490/ - WERE MADE BEYOND THE GRACE PERIOD/DUE DATE ALLOWED UNDER PROVIDENT FUND & ESI ACTS BUT BEFORE DUE DATE FOR FILING OF INCOME - TAX RETURN. THIS ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY VARIOUS HIGH COURTS FOLLOWING THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS. ALOM EXTRUSIONS LTD. (319 ITR 306), WHEREIN THE HON'BLE SUPREME COURT HELD THAT OMISSION OF SECOND PROVISO TO SECTION 43B AND AMENDMENT OF FIRST PROVISO BY FINANCE ACT , 2003 ARE CURATIVE IN NATURE AND ARE EFFECTIVE RETROSPECTIVELY AND THUS WITH EFFECT FROM 1.4.1988 I.E. THE DATE OF INSERTION OF FIRST PROVISO. THE CO - ORDINATE BENCH OF THIS TRIBUNAL CONSIDERING A SIMILAR ISSUE IN THE CASE OF M/S.VENKATESWARA ELECTRICAL INDUSTRIES P. LTD. VS. DCIT (SUPRA) FOLLOWING THE DECISION OF HO N'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. AMIL LTD. (321 ITR 508) HELD THAT EVEN THE EMPLOYEES CONTRIBUTION TO PROVIDENT FUND IS TO BE ALLOWED AS DEDUCTION IF IT IS PAID WITHIN DUE DATE FOR FILING OF RETURN. WHILE HOLDING SO, THE TRIBUNAL OBSERVED AS UNDER: - 6. WE HAVE HEARD THE SUBMISSIONS MADE BY THE REPRESENTATIVES OF BOTH THE SIDES AND HAVE PERUSED THE ORDERS OF THE AUTHORITIES BELOW, AS WELL AS THE JUDGMENTS/DECISIONS RELIED ON BY THE LD. COUNSEL FOR THE ASSESSEE. IT IS AN UN - DISPUTED FACT TH AT THERE HAS BEEN DELAY IN REMITTANCE OF EMPLOYEES CONTRIBUTION OF ESI AND PROVIDENT FUND IN BOTH THE AYS I.E., 2008 - 09 & 2009 - 10. IT IS EQUALLY UN - DISPUTED THAT THE ASSESSEE HAS DEPOSITED THE AMOUNT TOWARDS EMPLOYEES CONTRIBUTION OF ESI AND PROVIDENT FUN D BEFORE THE DUE DATE OF FILING OF RETURN. THE HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. AMIL LTD., REPORTED AS 321 ITR 508 HAS HELD THAT IF THE ASSESSEE HAD DEPOSITED EMPLOYEES CONTRIBUTION TOWARDS PROVIDENT FUND AND ESI AFTER DUE DATE AS PRESCRIBE D UNDER THE RELEVANT ACT BUT BEFORE THE DUE DATE OF FILING OF RETURN UNDER THE INCOME TAX ACT , NO DISALLOWANCE COULD BE MADE IN VIEW OF THE PROVISIONS OF SECTION 43B AS AMENDED BY THE FINANCE ACT , 2003. THE DECISION OF THE HON'BLE DELHI HIGH COURT HAS BEEN FOLLOWED BY THE CO - ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF JCIT VS. M/S. S.M.APPARELS (P) LTD. (SUPRA). THE TRIBUNAL HAS BEEN CONSISTENTLY FOLLOWING THE VIEW TAKEN BY THE HON'BLE DELHI HIGH COURT. ACCORDINGLY, WE HOLD THAT THE ASSESSEE IS ENTITLED TO CLAIM EXPENDITURE ON EMPLOYEE'S CONTRIBUTION I.T.A. NO . 1122 /M/ 16 9 TOWARDS ESI AND PROVIDENT FUND FOR BOTH THE AYS . ACCORDINGLY, BOTH THE APPEALS OF THE ASSESSEE ARE ALLOWED. 6. RESPECTFULLY FOLLOWING THE ABOVE, DECISION, WE DIRECT THE ASSESSING OFFICER TO DELETE DISALLOWANCES MADE UNDER SECTION 43B OF THE ACT F OR BOTH THESE ASSESSMENT YEARS. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE ALLOWED.' 3. AGGRIEVED BY THE SAID ORDER OF THE TRIBUNAL, THE REVENUE IS BEFORE THIS COURT. 4. HEARD LEARNED STANDING COUNSEL APPEARING FOR THE REVENUE AND PERUSED THE MATERIALS PLACED BEFORE THIS COURT. 5. WE FIND THAT THE TRIBUNAL HAS RIGHTLY RELIED ON THE DECISION OF THE SUPREME COURT IN THE CASE OF CIT V. ALOM EXTRUSIONS LTD . REPORTED IN 319 ITR 306, WHEREBY, THE SUPREME COURT HELD THAT OMISSION OF SECOND PROVISO TO SECTION 43B AND AMENDMENT TO FIRST PROVISO BY FINANCE ACT , 2003 ARE CURATIVE IN NATURE AND ARE EFFECTIVE RETROSPECTIVELY, I.E., WITH EFFECT FROM 1.4.1988 I.E., THE DATE OF INSERTION OF FIRST PROVISO. THE DELHI HIGH COURT IN THE CASE OF CIT V. AMIL LTD . REPORTED IN 321 ITR 508 HELD THAT IF THE ASSESSEE HAD DEPOSITED EMPLOYEE'S CONTRIBUTION TOWARDS PROVIDENT FUND AND ESI AFTER DUE DATE AS PRESCRIBED UNDER THE RELEVANT ACT, BUT BEFORE THE DUE DATE OF FILING OF RETURN UN DER THE INCOME TAX ACT , NO DISALLOWANCE COULD BE MADE IN VIEW OF THE PROVISIONS OF SECTION 43B AS AMENDED BY FINANCE ACT , 2003. 6. IN THE PRESENT CASE, THE ASSESSEE HAD REMITTED THE EMPLOYEES CONTRIBUTION BEYOND THE DUE DATE FOR PAYMENT, BUT WITHIN THE DUE DATE FOR FILING THE RETURN OF INCOME. HENCE, FOLLOWING THE ABOVE - SAID DECISIONS, WE FIND NO REASON TO DIFFER WITH THE FINDINGS OF THE TRIBUNAL. ACCORDINGLY, WE FIND NO QUESTION OF LAW MUCH LESS ANY SUBSTANTIAL QUESTION OF LAW ARISES FOR CONSIDERATION IN THESE APPEALS. ACCORDINGLY, BOTH THE TAX CASE (APPEALS) STAND DISMISSED. NO COSTS. CONSEQ UENTLY, M.P.NO.1 OF 2015 IS ALSO DISMISSED. 13. THE LD. DR COULD NOT CONTROVERT THE ABOVE FINDINGS OF THE HON BLE JURISDICTIONAL HIGH COURT. THEREFORE, R ESPECTFULLY FOLLOWING THE ABOVE DECISION OF THE HON BLE HIGH COURT, WE DIRECT THE ASSESSING OFFICER T O DELETE I.T.A. NO . 1122 /M/ 16 10 THE DISALLOWANCE MADE ON THIS ACCOUNT AND ACCORDINGLY, THE GROUND RAISED BY THE ASSESSEE IS ALLOWED . 14 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED ON THE 08 TH DECEMBER , 2016 AT C HENNAI. SD/ - SD/ - (A. MOHAN ALANKAMONY ) ACCOUNTANT MEMBER ( DUVVURU RL REDDY ) JUDICIAL MEMBER CHENNAI, DATED, THE 08 . 12 .201 6 VM/ - / COPY TO: 1. / APPELLANT , 2. / RESPONDENT , 3. ( ) / CIT(A) , 4. / CIT , 5. / DR & 6. / GF.