DCIT, Alwar V. THE ALWAR CENTRAL CO-OP. BANK LTD, Alwar

ITA 143/JPR/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 5407 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-03-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 11-02-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJ MEHRA
• Assessee Lawyers: P C PARWAL CA DHK
• Section: 37(1)

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH VKJ-IH-RKSYKUH] U;KF;D LNL; ,OA JH VH-VKJ-EHUK] YS[KK LNL; DS LE{K BEFORE: SHRI R.P. TOLANI, JM & SHRI T.R. MEENA, AM VK;DJ VIHY LA-@ ITA NO. 143/JP/2015 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2011-12 THE DCIT CIRCLE- 2,ALWAR CUKE VS. THE ALWAR CENTRAL COOPERATIVE BANK LTD. HOPE CIRCUS, ALWAR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: AABAT 4891 Q VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SHRI RAJ MEHRA, JCIT - DR FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI P.C. PARWAL, CA LQUOKBZ DH RKJH[K@ DATE OF HEARING : 09/03/2016 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 10 /03/2016 VKNS'K@ ORDER PER R.P. TOLANI, JM THE REVENUE HAS FILED AN APPEAL AGAINST THE THESE IS A SET OF THREE ORDER OF THE LD. CIT(A), ALWAR DATED 04-12-2014 FO R THE ASSESSMENT YEARS 2011-12 RAISING SOLITARY GROUND AS UNDER:- THAT THE LD. CIT(A) HAS ERRED IN LAW AS WELL AS O N THE FACTS AND CIRCUMSTANCES OF THE CASE IN DELETING THE DISAL LOWANCE OF RS. 34.00 LACS MADE BY THE AO ON ACCOUNT OF CAPITA L CONTRIBUTION TO THE LIC FOR FUTURE LIABILITY OF LEA VE ENCASHMENT AT THE TIME OF RETIREMENT OF EMPLOYEES. 2.1 BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE I S ENGAGED IN THE BUSINESS OF BANKING. IT HAS TAKEN A POLICY FROM LIC UNDER THE GROUP LEAVE ITA NO. 143/JP/2015 THE DCIT , CIRCLE- 2, ALWAR VS. THE ALWAR CENTRAL COOPERATIVE BANK LTD., ALWAR 2 ENCASHMENT SCHEME FOR PAYMENT OF LEAVE ENCASHMENT A T THE TIME OF RETIREMENT OF ITS EMPLOYEES. THE TOTAL LIABILITY OF EMPLOYEES WAS AT RS. 75.00 LACS. IN THE COMPUTATION OF INCOME, THE A SSESSEE HAS DEDUCTED AN AMOUNT OF RS. 34.00 LACS FOR THE PAYMENT TO LIC FOR TAKING A POLICY FROM LIC. THE ASSESSEE HAS TREATED THIS AMOUNT AS R EVENUE EXPENDITURE AND CLAIMED THE SAME U/S 37(1) OF THE ACT WHICH WAS DISALLOWED BY THE AO BY HOLDING THAT THE EXPENSES OF CAPITAL CONTRIBU TION TO LIC FOR FUTURE LIABILITY OF LEAVE ENCASHMENT AT THE TIME OF RETIRE MENT OF THE EMPLOYEES IS CAPITAL IN NATURE. 2.2 AGGRIEVED, THE ASSESSEE BANK PREFERRED FIRST AP PEAL BEFORE THE LD. CIT(A) WHO HAS DELETED THE DISALLOWANCE BY RELYING ON HON'BLE KERALA HIGH COURT DECISION DATED 7-06-2012 IN CASE OF CIT VS. HINDUSTAN LATEX LTD., 209 TAXMAN 42 AND ITAT JODHPUR BENCH DECISION IN THE CASE OF BARMER CENTRAL COOPERATIVE BANK LTD. VS. ACIT , 36 CCH 267 WHEREIN IT WAS HELD THAT PREMIUM PAID BY THE ASSESSEE TO LIC T OWARDS LEAVE ENCASHMENT POLICY IS ALLOWABLE AS REVENUE EXPENDITU RE. 2.3 THE LD. DR RELIED ON THE ORDER OF THE AO. 2.4 THE LD. AR OF THE ASSESSEE SUPPORTED THE ORDER OF THE LD. CIT(A) ON THIS ISSUE. 2.5 WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IT EMERGES FROM THE RECORD THA T THE ISSUE IN QUESTION ITA NO. 143/JP/2015 THE DCIT , CIRCLE- 2, ALWAR VS. THE ALWAR CENTRAL COOPERATIVE BANK LTD., ALWAR 3 IS SQUARELY COVERED BY THE DECISIONS OF HON'BLE KE RALA HIGH COURT IN THE CASE OF CIT VS. HINDUSTAN LATEX LTD. (SUPRA) AND TH E ITAT JODHPUR BENCH BENCH IN THE CASE OF THE BARMER CENTRAL COOPE RATIVE BANK LTD. VS. ACIT, BARMER (SUPRA). IN VIEW THEREOF, WE FIND NO INFIRMITY IN THE ORDER OF THE LD. CIT(A) WHICH IS SUSTAINED ON THIS ISSUE. THUS THE APPEAL OF THE REVENUE IS DISMISSED. 3.0 IN THE RESULT, THE APPEAL OF THE REVENUE IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 10/03/2016 . SD/- SD/- VH-VKJ-EHUK VKJ-IH-RKSYKUH (T.R. MEENA) (R.P.TOLANI) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 10 /03/ 2016 *MISHRA VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- THE DCIT, CIRCLE- 2, ALWAR 2. IZR;FKHZ@ THE RESPONDENT- THE ALWAR CENTRAL COOPERATIVE B ANK LTD. ALWAR 3. VK;DJ VK;QDRVIHY ) @ CIT(A) 4. VK;DJ VK;QDR@ CIT 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO.143/JP/2015) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR