Simpson & Co. Ltd., CHENNAI V. DCIT, CHENNAI

ITA 1444/CHNY/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 9189 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-06-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Assessment Year: 2008-2009
• Appeal Filed On: 26-05-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: P RADHAKRISHNAN
• Assessee Lawyers: R VIJAYARAGHAVAN
• Keywords: Sale consideration of property below Jantri Value; Depreciation; Additional depreciation; Earning of tax free income; Wholly owned subsidiary
• Section: 143(3); 14A; 10

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , D B ENCH, CHENNAI . . . , . , & BEFORE SHRI N.R.S.GANESAN, JUDICIAL MEMBER AND SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ I.T.A.NO.1451/MDS/2014 ( / ASSESSMENT YEAR: 2005-06) THE DEPUTY COMMISSIONER OF INCOME TAX , LARGE TAX PAYER UNIT-II, CHENNAI-600 101. VS M/S. SIMPSON & CO.LTD., 861/862, ANNA SALAI, CHENNAI-600 002. PAN: AAACS4909F ( /APPELLANT) ( /RESPONDENT) & ./ I.T.A.NO.1443 TO 1446/MDS/2014 ( / ASSESSMENT YEAR: 2005-06, 2008-09 TO 2010-11) M/S. SIMPSON & CO.LTD., 861/862, ANNA SALAI, CHENNAI-600 002. VS THE DEPUTY COMMISSIONER OF INCOME TAX , LARGE TAX PAYER UNIT-II, CHENNAI-600 101. PAN: AAACS4909F ( /APPELLANT) ( /RESPONDENT) REVENUE BY : MR. P.RADHAKRISHNAN, JCIT ASSESSEE BY : MR.R.VIJAYARAGHAVAN, ADVOCATE /DATE OF HEARING : 17 TH MARCH, 2016 /DATE OF PRONOUNCEMENT : 6 TH JUNE, 2016 / O R D E R PER A. MOHAN ALANKAMONY, AM:- OUT OF THESE FIVE APPEALS, ITA NO.1451/MDS/2014 IS FILED BY THE REVENUE AND ITA NOS.1443 TO 1446/MDS/2 014 ARE FILED BY THE ASSESSEE AGGRIEVED BY THE SEPARATE ORDERS OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)- L TU, CHENNAI ALL DATED 20.02.2014 IN ITA NOS.15, 23, 64 & 16/10- 2 ITA NOS.1451, 1443 TO1446 /MDS/2014 11 / 11-12 / 12-13LTU(A) PASSED UNDER SECTION 143( 3) R.W.S 147 / 143(3) OF THE ACT. 2. THE ONLY GROUND RAISED BY THE REVENUE IN ITS AP PEAL FOR THE ASSESSMENT YEAR 2005-06 IS THAT THE LEARNE D COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN RESTRICTING THE DISALLOWANCE MADE BY THE LEARNED AS SESSING OFFICER UNDER SECTION 14A R.W.R 8D TO 5% OF GROSS D IVIDEND EARNED BY THE ASSESSEE. 3. THE ASSESSEE IN ITS APPEALS FOR THE ASSESSMENT YEARS 2005-06, 2008-09 TO 2010-11 HAS RAISED COMMON ELAB ORATE GROUNDS AND THEY ARE CONCISED HEREIN BELOW FOR ADJU DICATION:- I) THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN DIRECTING THE ASSESSING OFFICER TO DIS ALLOW 5% OF THE GROSS DIVIDEND RECEIVED BY THE ASSESSEE TOWARDS EXPENDITURE INCURRED FOR EARNING EXEMPT INCOME. (FOR THE ASSESSMENT YEAR 2005-06). II) THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) HAS ERRED IN MAKING ADDITION BY DISALLOWING EXPENSE S INCURRED FOR EARNING EXEMPT INCOME INVOKING THE PROVISIONS OF SECTION 14A R.W.R.8D. (FOR THE A.YS. 2008- 09, 2009-10 & 2010-11). III) THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) HAS ERRED IN CONFIRMING THE DISALLOWANCE OF THE BAL ANCE 50% OF ADDITIONAL DEPRECIATION IN THE RELEVANT ASSESSMENT YEAR IN RESPECT OF THE ASSETS ACQUIRED I N 3 ITA NOS.1451, 1443 TO1446 /MDS/2014 THE 2 ND HALF OF PRECEDING YEAR. (FOR THE A.YS. 2008-09, 2009-10 & 2010-11). IV) THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) HAS ERRED IN CONFIRMING THE DISALLOWANCE MADE BY T HE LEARNED ASSESSING OFFICER REGARDING WEIGHTED DEDUCTION UNDER SECTION 35 (2AB) OF THE ACT. (FOR T HE A.YS. 2008-09, 2009-10 & 2010-11). 4. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A COMPANY ENGAGED IN THE MANUFACTURE OF DIESEL ENGINE S FILED ITS RETURNS OF INCOME FOR THE RELEVANT ASSESSMENT Y EARS AND THE LEARNED ASSESSING OFFICER HAS COMPLETED THE ASSESSMENTS UNDER SECTION 143(3) R.W.S. 147 / 143(3 ) OF THE ACT MAKING VARIOUS ADDITIONS/DISALLOWANCES. 5. NOW THE REVENUE AS WELL AS THE ASSESSEE ARE IN APPEAL BEFORE US AGGRIEVED BY THE ORDER OF THE LEAR NED COMMISSIONER OF INCOME TAX (APPEALS):- ITA NO.1451/MDS/2014 :REVENUES APPEAL : DISALLOWANCE UNDER SECTION 14A R.W.R 8D: 6. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE LEARNED ASSESSING OFFICER OBSERVED THAT THE ASSESSE E HAS 4 ITA NOS.1451, 1443 TO1446 /MDS/2014 EARNED EXEMPT INCOME UNDER SECTION 10(34) R.W.S. 11 5O OF THE ACT BEING DIVIDEND RECEIVED FROM DOMESTIC COMPA NIES. THEREFORE THE LEARNED ASSESSING OFFICER INVOKING TH E PROVISIONS OF SECTION 14A R.W.R 8D MADE ADDITION OF RS.96,91,916/-. 7. ON APPEAL, THE LEARNED AUTHORIZED REPRESENTATIVE SUBMITTED BEFORE THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) AS FOLLOWS:- I) NO EXPENDITURE WAS INCURRED FOR EARNING DIVIDEN D INCOME; THEREFORE DISALLOWANCE U/S.14A IS NOT CALLED FOR. II) INVESTMENTS WERE OUT OF THE ASSESSEES OWN NON INTEREST BEARING FUNDS. III THE PROVISIONS OF RULE 8D HAVE COME INTO EFFEC T FROM 24.03.2008 I.E. FOR THE ASSESSMENT YEAR 2008-09 ONW ARDS AND THEREFORE IT NOT APPLICABLE FOR ASSESSMENT YEAR 2005-06. IV) THE INVESTMENTS WERE MADE IN THE SUBSIDIARY / G ROUP COMPANIES LONG BACK. NO EXPENDITURE IS INCURRED FOR SUCH INVESTMENTS. THE DIVIDEND INCOME FROM THESE INVESTM ENTS WERE RECEIVED AND DEPOSITED IN THE BANK ACCOUNT ALO NG WITH 5 ITA NOS.1451, 1443 TO1446 /MDS/2014 OTHER CHEQUES AND THERE WERE ALSO NO BANK CHARGES I NCURRED FOR EN-CASHING THESE CHEQUES. V) THAT THE INVESTMENTS MADE IN MUTUAL FUNDS ARE M ADE THOUGH THE INTERMEDIARY BASED ON THE OUTCOME OF THE ANALYSIS DONE BY THEM FOR WHICH NO CHARGE IS LEVIED AND HENCE THERE IS NO ACTUAL COST INVOLVED IN MAKING TH ESE INVESTMENTS. DIVIDENDS FROM THESE INVESTMENTS WERE EN- CASHED ALONG WITH OTHER CHEQUES FOR COLLECTIONS AND THERE ARE ALSO NO BANK CHARGES INCURRED IN EN-CASHING THESE C HEQUES. VI) THE DIVIDEND EXEMPTED U/S.10 (34) AND 10(35) AR E ON ACCOUNT OF THE DIVIDEND TAX PAID U/S.115O. SINCE TH E EXEMPTIONS ARE GIVEN TO AVOID DOUBLE TAXATION ON AC COUNT OF TAX BEING PAID BY THE COMPANY AT THE TIME OF DISTRI BUTION, THIS CANNOT BE EQUATED WITH THE EXEMPTION GIVEN IN SECTI ON 10 FOR THE PURPOSE OF SECTION 14A OF THE ACT. 7.1 THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) AFTER EXAMINING THE SUBMISSIONS OF THE LEARNED AUTH ORIZED REPRESENTATIVE AND PERUSING THE ORDER OF THE LEARNE D ASSESSING OFFICER CAME TO A CONCLUSION THAT THE PRO VISIONS OF SECTION 14A OF THE ACT WILL BE APPLICABLE IN THE CA SE OF THE 6 ITA NOS.1451, 1443 TO1446 /MDS/2014 ASSESSEE EVEN IF IT CLAIMS THAT IT HAD NOT INCURRED ANY EXPENDITURE FOR EARNING EXEMPT INCOME. THEREAFTER R ELYING ON THE VARIOUS DECISIONS OF THE HIGHER JUDICIARY AND T HE ORDERS OF THE TRIBUNAL, THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS) CAME TO A CONCLUSION THAT 5% OF THE GROSS DIVIDEND RECEIVED BY THE ASSESSEE TO BE TREATED AS THE EXP ENDITURE INCURRED FOR EARNING THE EXEMPT DIVIDEND INCOME. WH ILE DOING SO, HE OBSERVED AS UNDER:- 4.2.3 AS PER THE DECISION IN THE CASE OF DAGA CAPITAL MANAGEMENT P LTD. 117 ITO 169 (2008) THE PROVISIONS OF S.14A ARE APPLICABLE RETROSPECTIVELY SINCE THEY ARE PROCEDURAL IN NATURE . BASED ON THIS DECISION, THE BOARD HAS RELEASED A CIRCULAR NO.173 DATED 4.2.2009 HOLDING THAT THE PROVISIONS OF S.14A(2) & (3) WILL BE APPLICABLE RETROSPECTIVELY W.E.F. 1962. HOWEVER, THIS DECISION HAS BEEN REVERSED BY GODREJ & BOYCE MFG. CO. LTD V. OCIT (328 ITR 81) (2010) (BOM.) WHICH HAS COME SUBSEQUENTLY IN 2010. EVEN THOUGH THE PROVISIONS OF RULE 80 HAVE COME INTO EFFECT FROM 24.3.2008 AS PER THE DECISION OF GODREJ & BOYCE WHICH STATES THAT APPLICATION OF PROVISIONS OF 14A ARE 'CONSTITUTIONA LLY VALID' AND RULE 80 IS APPLICABLE FROM AY 08- 09, IT ALSO STATED THAT PROVISIONS OF S.14A ARE STILL APPLICABLE FOR EARLIER YEARS AND AO IS DUTY BOUND T O DETERMINE EXPENDITURE BY ADOPTING A REASONABLE BASIS OR METHOD. NOW WITH REGARD TO QUESTION OF WHAT IS THE REASONABLENESS IN ESTIMATING THE DISALLOWANCE, THE ITAT, CHENNAI HAS FOUND 5% OF THE GROSS DIVIDEND RECEIVED AS REASONABLE IN THE CASE OF CELEBRITY FASHIONS IN ITA NO.1318 AND 1319/MDS/2011 FOR AYS 2006-07 & 2007-08. RESPECTFULLY FOLLOWING THE ABOVE DECISION, I HEREBY DIRECT THE AO TO WORK OUT THE DISALLOWANCE @ 5% OF GROSS DIVIDEND RECEIVED. IN VIEW OF THE ABOVE, THE OTHER CONTENTIONS RAISED IN THIS REGARD WERE TREATE D AS ANSWERED. THE GROUND IS PARTLY ALLOWED. 7 ITA NOS.1451, 1443 TO1446 /MDS/2014 8. THE LEARNED DEPARTMENTAL REPRESENTATIVE VEHEMENT LY ARGUED IN SUPPORT OF THE ORDER OF THE LEARNED ASSES SING OFFICER AND PLEADED THAT THE ADDITION MADE BY THE L EARNED ASSESSING OFFICER BY INVOKING THE PROVISIONS OF SEC TION 14A R.W.R.8D MAY BE CONFIRMED. 9. THE LEARNED AUTHORIZED REPRESENTATIVE, ON THE OT HER HAND, SUBMITTED THAT FOR THE RELEVANT ASSESSMENT YE AR RULE 8D WILL NOT BE APPLICABLE TO THE CASE OF THE ASSESS EE AND FURTHER REITERATED THE SUBMISSIONS MADE BEFORE THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) AND THEREBY PL EADED FOR DELETING THE ADDITION MADE BY INVOKING THE PROV ISIONS OF SECTION 14A R.W.R.8D. 10. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFUL LY PERUSED THE MATERIALS AVAILABLE ON RECORD. AS POI NTED OUT BY THE LEARNED AUTHORIZED REPRESENTATIVE, RULE 8D HAS ONLY COME INTO FORCE WITH EFFECT FROM 24.03.2008 BY THE 5 TH INCOME-TAX AMENDMENT OF RULES, 2008. FURTHER, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ONLY DISAL LOWED 5% OF THE GROSS DIVIDEND RECEIVED BY THE ASSESSEE A S THE EXPENSE INCURRED FOR EARNING EXEMPT INCOME FOLLOWIN G THE 8 ITA NOS.1451, 1443 TO1446 /MDS/2014 DECISION OF THE TRIBUNAL CITED SUPRA. THEREFORE WE DO NOT FIND IT NECESSARY TO INTERFERE WITH HIS ORDERS BECAUSE H E HAS DECIDED THE ISSUE ONLY BY FOLLOWING THE ORDER OF TH E TRIBUNAL. HENCE, THE APPEAL OF THE REVENUE ON THIS ISSUE IS D ECIDED AGAINST IT. ITA NOS.1443/MDS/2014 (A.Y.2005-06): (ASSESSEES AP PEAL): - DISALLOWANCE UNDER SECTION 14A R.W.R 8D: 11. SINCE IN THE REVENUES APPEAL FOR THE ASSESSMEN T YEAR 2005-06, WE HAVE UPHELD THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) AND THEREBY SUSTAINED THE DISALLOWANCE OF 5% OF THE GROSS DIVID END RECEIVED BY THE ASSESSEE AS EXPENDITURE INCURRED FO R EARNING EXEMPT INCOME, THIS GROUND RAISED BY THE ASSESSEE I S CONSEQUENTLY DISMISSED. ITA NOS.1444 TO 1446/MDS/2014 (A.Y.2008-09 TO 2010- 11): (ASSESSEES APPEAL): DISALLOWANCE UNDER SECTION 14A R.W.R 8D: 12. DURING THE COURSE OF SCRUTINY ASSESSMENT, IT WA S OBSERVED BY THE LEARNED ASSESSING OFFICER THAT THE ASSESSEE HAS RECEIVED DIVIDEND FROM MUTUAL FUNDS AND DOMESTI C COMPANIES FOR THE RELEVANT ASSESSMENT YEARS. THERE FORE, THE 9 ITA NOS.1451, 1443 TO1446 /MDS/2014 LEARNED ASSESSING OFFICER INVOKED THE PROVISIONS OF SECTION 14A OF THE ACT AND COMPUTED THE EXPENDITURE INCURRE D FOR EARNING EXEMPT INCOME BY APPLYING RULE 8D OF THE RU LES. 13. ON APPEAL, THE LEARNED COMMISSIONER OF INCOME T AX (APPEALS) CONFIRMED THE ORDER OF THE LEARNED ASSESS ING OFFICER BY OBSERVING AS FOLLOWS IN HIS ORDER FOR TH E ASSESSMENT YEAR 2008-09 :- 5.2.6 WITH REGARD TO A.Y. 2008-09, THE I TAT , CHE NNAL, IN THE CASE OF TVS INVESTMENTS P.LTD (ITA NO.1609IMDS/2012DATED29.1~2013) HAS HELD THAT PROVISIONS OF RULE 80 ARE NOT APPLICABLE FOR AY. 2 008-09. I RESPECTFULLY SUBMIT THAT THE TRIBUNAL WHILE DISCUSS ING THE DECISION OF THE DELHI HIGH COURT AT LENGTH IN THE C ASE OF MAXOPP INVESTMENT LTD, 64 DTR 122 WHICH WAS RELATED TO A.Y. 2002-03, WHEREIN IT WAS HELD THAT THE PROVISIONS OF RULE 80 WAS NOT APPLICABLE IN THAT CASE SINCE THE PROVISIONS INTRODUCED WERE PROSPECTIVE. THE CHENNAI TRIBUNAL HAS TAKEN THE OPERATIVE PART AND CAME TO T HE CONCLUSION IN THE CASE OF TVS INVESTMENTS THAT' THE PROVISIONS OF RULE 80 ARE NOT APPLICABLE IN THAT CA SE. HOWEVER, THE BOMBAY HIGH COURT IN THE CASE OF GODRE J & BOYCE, 328 ITR ~1, WHILE HOLDING THAT THE PROVISION S OF S.14A ARE CONSTITUTIONALLY VALID, HAVE HELD THILT R ULE 80 WHICH WAS INTRODUCED ON 24.3.2008 IS APPLICABLE FRO M A.Y. 2008-09. THEREFORE, IN MY CONSIDERED OPINION THE PROVISIONS OF RULE 80 ARE APPLICABLE FOR A.Y. 2008- 09 ALSO. FURTHER, I WOULD LIKE TO MENTION THAT IN THE CASE O F SUNDARAM ASSET MANAGEMENT COMPANY LTD FOR A.Y. 2008-09, THE HON'BLE I TAT , CHENNAI C BENCH VIDE I TS ORDER IN ITA NO.1774/MDS/2012 DATED 19.07.2013 REGARDING DISALLOWANCE OF 14A MADE OBSERVATION AS UNDER:- II. GROUND NO.2 IS WITH REGARD TO DISALLOWANCE U/S 14A R.W.R.8D. THE CONTENTIONS OF THE AR IS THAT THE ASSESSEE HAS NOT INCURRED ANY EXPENDITURE TO EARN DIVIDENDS AND HENCE THE 10 ITA NOS.1451, 1443 TO1446 /MDS/2014 AUTHORITIES BELOW ARE UNJUSTIFIED IN MAKING ADDITION UNDER THE PROVISIONS OF RULE 14A R.W.R. 8D. WE ARE OF THE CONSIDERED OPINION THAT IN VIEW OF THE ORDER OF THE TRIBUNAL IN THE CASE OF CHEMINVEST LTD VS. ITO REPORTED AS 124 TTJ 577 (DEL) (SB) WHEREIN IT HAS BEEN HELD THAT IF THE EXPENDITURE IS INCURRED IN RELATION TO INCOME WHICH DOES NOT FORM PART OF TOTAL INCOME IT HAS TO SUFFER DISALLOWANCE IRRESPECTIVE OF THE FACT WHETHER ANY INCOME IS EARNED BY THE ASSESSEE OR NOT. SECTION 14A DOES NOT ENVISAGE ANY SUCH EXCEPTION. THUS, IN VIEW OF THE OBSERVATIONS MADE IN THE SPECIAL BENCH OF THE TRIBUNAL, DISALLOWANCE HAS TO BE MADE U/S.14A R.W.R. 8D. 13.1 FOR THE ASSESSMENT YEAR 2009-10 AND 2010-11 ALSO THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) FO LLOWED HIS ORDERS FOR THE ASSESSMENT YEAR 2008-09 BECAUSE THEY WERE ON THE IDENTICAL FACTS. 14. BEFORE US, THE LEARNED AUTHORIZED REPRESENTATIV E SUBMITTED A PAPER BOOK CONTAINING PAGES 1 TO 32 AND ARGUED THAT NO EXPENDITURE WAS INCURRED FOR EARNING THE AF ORESAID EXEMPT INCOME AND HENCE THE PROVISIONS OF SECTION 1 4A OF THE ACT CANNOT BE INVOKED. THE LEARNED AUTHORIZED REPRESENTATIVE FURTHER POINTED OUT THAT PREDOMINANT LY INVESTMENTS WERE MADE IN SUBSIDIARY COMPANIES AND G ROUP COMPANIES AND IN SUCH CASES THE CHENNAI BENCH OF TH E TRIBUNAL HAD HELD THAT PROVISIONS OF SECTION 14A CA NNOT BE 11 ITA NOS.1451, 1443 TO1446 /MDS/2014 INVOKED. IT WAS FURTHER SUBMITTED THAT INVESTMENT M ADE IN MUTUAL FUNDS ARE HANDLED BY OUTSOURCED INTERMEDIARY WHO DOES NOT CHARGE ANY FEE BUT RECEIVES COMMISSION FRO M THE CONCERNED MUTUAL FUNDS, THEREFORE THERE IS NO ACTUA L COST INVOLVED IN MAKING THESE INVESTMENTS. FURTHER, ALL THE INVESTMENTS WERE MADE FROM INTEREST FREE FUNDS OF T HE ASSESSEE AND THEREFORE THERE WAS NO COST FOR THE FU NDS INVESTED. 15. THE LEARNED DEPARTMENTAL REPRESENTATIVE ON THE OTHER HAND VEHEMENTLY ARGUED IN SUPPORT OF THE ORDERS OF THE REVENUE. 16. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFUL LY PERUSED THE MATERIALS AVAILABLE ON RECORD. FROM THE WRITTEN SUBMISSION FURNISHED BY THE LEARNED AUTHORIZED REPRESENTATIVE, IT IS REVEALED THAT THE ASSESSEE HA D MADE THE FOLLOWING INVESTMENTS FOR THE RELEVANT ASSESSME NT YEARS:- S.NO. BREAK-UP OF INVESTMENTS ASSESSMENT YEAR 2008-09 ASSESSMENT YEAR 2009-10 ASSESSMENT YEAR 2010-11 1. IN SHARES OF SUBSIDIARIES / GROUP COMPANIES WHICH ARE HISTORICAL 100.14 CRORES 93.81 CRORES 93.81 CRORES 2. IN SHARES OF OTHER COMPANIES 0.91 CRORES 0.91 CRORES 0.77 CRORES 3 IN MUTUAL FUNDS , 2.50CRORES 48.21 CRORES 53.51 CRORES 12 ITA NOS.1451, 1443 TO1446 /MDS/2014 INCOME FROM WHICH ARE EXEMPT 4. IN BONDS AND MUTUAL FUNDS, INCOME FROM WHICH ARE TAXABLE 35.55 CRORES 42.30 CRORES 34.30 CRORES TOTAL 139.10 CRORES 185.23 CRORES 182.39 CRORES FROM THE ABOVE, IT IS EVIDENT THAT THE ASSESSEE HAS INVESTED IN SHARES OF SUBSIDIARIES/GROUP COMPANIES, MUTUAL F UNDS AND IN BONDS AND MUTUAL FUNDS INCOME FROM WHICH ARE TAX ABLE. AS REGARDS INVESTMENTS MADE IN SUBSIDIARIES AND GRO UP COMPANIES, CHENNAI BENCH OF THE TRIBUNAL, ON THE EA RLIER OCCASION, IN THE CASE OF RANE HOLDINGS LTD. VS. ACI T IN ITA NO.115/MDS/2015 VIDE ORDER DATED 06.01.2016, EXTRAC TED HEREIN BELOW, HAS HELD THAT, WHERE INVESTMENTS ARE MADE IN SISTER CONCERNS OR GROUP CONCERNS FOR STRATEGIC REA SONS, NO EXPENSES CAN BE INFERRED TO HAVE BEEN INCURRED IF S UCH INVESTMENTS ARE MADE OUT OF NON-INTEREST BEARING FU NDS OF THE ASSESSEE. THE GIST OF THE RELEVANT ORDER IN ITA NO.115/MDS/2015 DATED 06.01.2016 OF THIS TRIBUNAL I S REPRODUCED HEREIN BELOW FOR REFERENCE:- 5. WE HAVE HEARD BOTH THE PARTIES AND CAREFULLY PE RUSED THE MATERIALS AVAILABLE ON RECORD. ON THE IDENTICAL ISSUE AS POIN TED OUT BY THE LD. A.R. THE CHENNAI BENCH OF THE TRIBUNAL IN ITA NO.156/MDS /2013 VIDE ORDER DATED 20/08/13 FOR THE ASSESSMENT YEAR 2009-10 HAS REMITTED BACK THE MATTER TO THE LD. ASSESSING OFFICER TO DECIDE THE M ATTER ONCE AGAIN AFRESH BASED ON THE FINDINGS WHETHER THE ASSESSEE H AD ACTUALLY INCURRED 13 ITA NOS.1451, 1443 TO1446 /MDS/2014 ANY EXPENDITURE IN EARNING THE DIVIDEND INCOME. THE RELEVANT PORTION OF THE ORDER IS EXTRACTED HEREIN BELOW FOR REFERENCE:- FURTHER, ON THE IDENTICAL ISSUE VARIOUS BENCHES OF THE TRIBUNAL AND THE HONBLE BOMBAY HIGH COURT HAVE HELD AS FOLLOWS:- I) GARWARE WALL ROPES LTD., VS. ACIT REPORTED IN (2 014) 65 SOT 086 (MUM.) HELD AS FOLLOWS:- II) WHEN ASSESSEE HAS PRIMA FACIE BROUGHT OUT CASE THA T NO EXPENDITURE HAS BEEN INCURRED FOR EARNING INCOME, W HICH DOES NOT FORM PART OF TOTAL INCOME, THEN IN ABSENCE OF A NY FINDING THAT EXPENDITURE HAS BEEN INCURRED FOR EARNING EXEMPT IN COME PROVISIONS 14A CANNOT BE APPLIED.. III) INTEGLOBE ENTERPRISES LTD., VS. DCIT REPORTED IN (2014) 40 CCH 0022(DEL. TRIB.) HELD AS FOLLOWS:- NO DISALLOWANCE OF INTEREST IS REQUIRED TO BE MADE UNDER RULE 8D(I) & 8D(II) WHERE NO DIRECT OR INDIRECT INT EREST EXPENDITURE WAS INCURRED FOR MAKING INVESTMENTS.WHE RE THE ASSESSEE HAD UTILIZED INTEREST FREE FUNDS FOR M AKING FRESH INVESTMENTS AND THAT TOO INTO ITS SUBSIDIARIE S, WHICH WAS NOT FOR THE PURPOSE OF EARNING EXEMPT INCOME AN D WHICH WAS FOR STRATEGIC PURPOSES ONLY, NO DISALLOWA NCE OF INTEREST WAS REQUIRED TO BE MADE UNDER RULE 8D(I) & 8D(II) AND STRATEGIC INVESTMENT HAS TO BE EXCLUDED FOR PUR POSE OF ARRIVING AT DISALLOWANCE UNDER RULE 8D(III). IV) M/S.JM FINANCIAL LTD., VS. ACIT REPORTED IN 201 4- TIOL-202-ITAT-MUM HELD AS FOLLOWS: THE DEPARTMENT HAS NOT DISPUTED THIS FACT OUT OF THE TOTAL INVESTMENT ABOUT 98% OF THE INVESTMENT ARE IN SUBSI DIARY COMPANIES OF THE ASSESSEE AND, THEREFORE, THE PURPO SE OF INVESTMENT IS NOT FOR EARNING THE DIVIDEND INCOME B UT HAVING CONTROL AND BUSINESS PURPOSE AND CONSIDERATION. THE ASSESSEE HAS BROUGHT OUT A CASE TO SHOW THAT NO EXPENDITURE HAS BEEN INCURRED FOR MAINTAINING THE 98% OF THE INVESTMENT MADE IN T HE SUBSIDIARY COMPANIES, THEREFORE, IN THE ABSENCE OF ANY FINDING THAT ANY EXPENDITURE HAS BEEN INCURRED FOR EARNING THE EXEMP T INCOME, THE DISALLOWANCE MADE BY THE ASSESSING OFFICER IS NOT J USTIFIED, ACCORDINGLY THE SAME IS DELETED. (IV) CIT VS. BHARTI TELEVENTURE LTD. REPORTED IN (2 011) 331 ITR 0502. WHERE THE ASSESSEE WAS FOUND TO BE HAVING ADEQUATE NON- INTEREST BEARING FUND BY WAY OF SHARE CAPITAL AND R ESERVES AND THERE WAS NO NEXUS BETWEEN THE BORROWALS OF ASSESSE E AND THE ADVANCES GIVEN, NO DISALLOWANCE FOR INTEREST WAS CA LLED FOR . 14 ITA NOS.1451, 1443 TO1446 /MDS/2014 (V) CIT VS. RELIANCE UTILITIES & POWER LTD., REPORT ED IN (2009) 313 ITR 0340(BOM.) HAS HELD AS FOLLOWS:- TRIBUNAL HAVING RECORDED A CLEAR FINDING THAT THE ASSESSEE POSSESSED SUFFICIENT INTEREST-FREE FUNDS OF ITS OWN WHICH WERE GENERATED IN THE COURSE OF THE RELEVANT FINANCIAL Y EAR, APART FROM SUBSTANTIAL SHAREHOLDERS FUND, PRESUMPTION STANDS E STABLISHED THAT THE INVESTMENTS IN SISTER CONCERNS WERE MADE B Y THE ASSESSEE OUT OF INTEREST FREE FUNDS AND THEREFORE NO PART OF INTEREST ON BORROWINGS CAN BE DISALLOWED ON THE BASIS THAT THE INVESTMENTS WERE MADE OUT OF INTEREST BEARING FUNDS. (VI) EIH ASSOCIATED HOTELS LTD VS. DCIT REPORTED IN 2013- TIOL-796-ITAT-MAD . THE INVESTMENTS MADE BY THE ASSESSEE IN THE SUB SIDIARY COMPANY ARE NOT ON ACCOUNT OF INVESTMENT FOR EARNIN G CAPITAL GAINS OR DIVIDEND INCOME. SUCH INVESTMENTS HAVE BEE N MADE BY THE ASSESSEE TO PROMOTE SUBSIDIARY COMPANY INTO THE HOTEL INDUSTRY. THE ASSESSEE IS NOT INTOTHE BUSINESS OF I NVESTMENT AND THE INVESTMENTS MADE BY THE ASSESSEE ARE ON ACCOUNT OF BUSINESS EXPEDIENCY. ANY DIVIDEND EARNED BY THE ASSESSEE FRO M INVESTMENT IN SUBSIDIARY COMPANY IS PURELY INCIDENTAL. THEREFO RE THE INVESTMENT MADE BY THE ASSESSEE IN ITS SUBSIDIARY I S NOT TO BE RECKONED FOR DISALLOWANCE U/S.14A R.W.R.8D. THE ASS ESSING OFFICER IS DIRECTED TO RE-COMPUTE THE AVERAGE VALUE OF INVESTMENT UNDER THE PROVISIONS OF RULE 8D AFTER DELETING INVE STMENTS MADE BY THE ASSESSEE IN SUBSIDIARY COMPANY. TAKING NOTE OF THE ABOVE DECISIONS AND THE DECISION OF THE CHENNAI BENCH OF THE TRIBUNAL IN ITA NO.156/MDS/13 CITED SUPRA, WE HEREBY REMIT THE MATTER BACK TO THE FILE OF LD. ASSESSING OFFICER TO EXAMINE THE ISSUE INVOLVED IN THIS CASE AFRESH AND PASS APPROPRIATE ORDER AS PER LAW AND ME RITS AND IN THE LIGHT OF THE DECISIONS CITED HEREIN ABOV E. WHILE DOING SO, WE ALSO DIRECT THE LD. ASSESSING OFFICER TO CONSIDER THE DECISION OF THE TRIBUNAL IN THE CASE M /S AGILE ELECTRIC SUB ASSEMBLY PVT. LTD. CITED SUPRA WHEREIN IT WAS HELD AS FOLLOWS:- 7.2 IN REGARD TO APPLICABILITY OF SECTION 14A OF THE ACT READ WITH RULE 8D ALSO; THE ABOVE VIEW WILL BE APPLICABL E. MOREOVER IN THE CASE EIH ASSOCIATED HOTELS LTD V. D CIT REPORTED IN 2013 (9) TMI 604 IN ITA NO.1503, 1624/MDS/2012 DATED 17 TH JULY, 2013, IT HAS BEEN HELD BY THE CHENNAI BENCH OF THE TRIBUNAL AS FOLLOWS:- DISALLOWANCE U/S. 14A RW RULE 8D CIT UPHELD DISAL LOWANCE HELD THAT INVESTMENTS MADE BY THE ASSESSEE IN T HE SUBSIDIARY COMPANY ARE NOT ON ACCOUNT OF INVESTMENT FOR EARNING CAPITAL GAINS OR DIVIDEND INCOME. SUCH INVE STMENTS HAVE BEEN MADE BY THE ASSESSEE TO PROMOTE SUBSIDIAR Y COMPANY INTO THE HOTEL INDUSTRY. A PERUSAL OF THE ORDER OF THE CIT(APPEALS) SHOWS THAT OUT OF TOTAL INVESTMENT OF 15 ITA NOS.1451, 1443 TO1446 /MDS/2014 RS.64,18,19,775/-, RS.63,31,25,715/- IS INVESTED IN WHOLLY OWNED SUBSIDIARY. THIS FACT SUPPORTS THE CASE OF TH E ASSESSEE THAT THE ASSESSEE IS NOT INTO THE BUSINESS OF INVES TMENT AND THE INVESTMENTS MADE BY THE ASSESSEE ARE ON ACCOUNT OF BUSINESS EXPEDIENCY. ANY DIVIDEND EARNED BY THE ASSESSEE FRO M INVESTMENT IN SUBSIDIARY COMPANY IS PURELY INCIDENT AL. THEREFORE, THE INVESTMENTS MADE BY THE ASSESSEE IN ITS SUBSIDIARY ARE NOT TO BE RECKONED FOR DISALLOWANCE U/S. 14A R.W.R. 8D. THE ASSESSING OFFICER IS DIRECTED TO RE- COMPUTE THE AVERAGE VALUE OF INVESTMENT UNDER THE PROVISIONS OF RULE 8D AFTER DELETING INVESTMENTS MADE BY THE ASSESSEE IN SUBSIDIARY COMPANY DECIDED IN FAVOUR OF ASSESSEE. FOR THE ABOVE SAID REASONS, WE HEREBY HOLD THAT IN THE CASE OF THE ASSESSEE THE PROVISIONS OF SECTION 14A READ WITH RU LE 8D WILL NOT BE APPLICABLE IN REGARD TO INVESTMENTS MADE FOR ACQUIR ING THE SHARES OF THE ASSESSEES SISTER CONCERNS. ACCORDINGLY WE REST RAIN OURSELVES FROM INTERFERING WITH THE ORDER OF THE LD.CIT(A) ON THIS REGARD. THEREFORE, FOLLOWING THE AFORESAID DECISION OF THE TRIBUNAL, WE HEREBY DIRECT THE LEARNED ASSESSING OF FICER TO DELETE THE ADDITION MADE BY INVOKING THE PROVISI ONS OF SECTION 14A R.W. RULE 8D OF THE ACT, SUBJECT TO VERIFICATION THAT INVESTMENTS ARE MADE BY THE ASSES SEE IN ITS SISTER CONCERNS ONLY AND FROM ITS INTEREST F REE FUNDS. 17. FROM THE ABOVE DECISION, IT IS CLEAR THAT PROVI SIONS OF SECTION 14A AND RULE 8D WILL NOT BE APPLICABLE, WHE RE INVESTMENTS ARE MADE IN SISTER CONCERNS OR SUBSIDIA RY COMPANIES FOR STRATEGIC PURPOSES. HOWEVER, WITH RES PECT TO INVESTMENT MADE IN MUTUAL FUNDS, THERE WILL BE CERT AIN COST INVOLVED WITH RESPECT TO THE DECISION MAKING PROCES S OF CHOOSING THE MUTUAL FUND WHERE INVESTMENT / DISINVE STMENT HAS TO BE MADE AND MONITORING SUCH INVESTMENT. THE REFORE, PROVISIONS OF SECTION 14A AND RULE 8D OF THE ACT WI LL BE 16 ITA NOS.1451, 1443 TO1446 /MDS/2014 APPLICABLE IN SUCH CASES. AND FINALLY WITH RESPECT TO INVESTMENT MADE IN MUTUAL FUNDS AND BONDS, THE INCO ME RECEIVED FROM WHICH ARE TAXABLE, THE PROVISIONS OF SECTION 14A WILL NOT BE APPLICABLE SINCE IT IS APPLICABLE ONLY IN THE CASES WHERE EXPENDITURE ARE INCURRED BY THE ASSESS EE RELATING TO INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME UNDER THE ACT. SINCE THESE ASPECTS WERE NOT EXAMINED BY THE LEARNED ASSESSING OFFICER, WE HEREB Y REMIT THE MATTER BACK TO THE FILE OF THE LEARNED ASSESSIN G OFFICER FOR FRESH CONSIDERATION IN THE LIGHT OF OUR ABOVE OBSER VATIONS, AND THEREAFTER TO PASS APPROPRIATE ORDER ON MERITS AND AS PER LAW AFTER AFFORDING SUFFICIENT OPPORTUNITY TO THE ASSES SEE OF BEING HEARD. GROUND NO (III): DISALLOWANCE FOR THE BALANCE OF 5 0% ADDITIONAL DEPRECIATION U/S.32(1)(IIA) OF THE ACT:- 18. THE ASSESSEE HAD CLAIMED ADDITIONAL DEPRECIATIO N UNDER SECTION 32(1)(IIA) OF THE ACT AMOUNTING TO RS.70,30,834/-, RS.74,81,875/-, RS.1,55,17,608/- FO R THE ASSESSMENT YEARS 2008-09, 2009-10 & 2010-11 RESPECT IVELY. THIS CLAIM OF THE ADDITIONAL DEPRECIATION OF 50% IN THE RELEVANT ASSESSMENT YEAR WAS MADE IN RESPECT OF ADD ITIONS 17 ITA NOS.1451, 1443 TO1446 /MDS/2014 MADE TO PLANT & MACHINERY DURING THE SECOND HALF OF THE PRECEDING PREVIOUS YEAR WHERE THE ASSET WAS HELD FO R LESS THAN 180 DAYS AND ONLY 50% OF THE ADDITIONAL DEPREC IATION WAS CLAIMED FOR THAT ASSESSMENT YEAR. THE LEARNED ASSESSING OFFICER OPINED THAT AS PER PROVISIONS OF SECTION 32(1)(IIA) OF THE ACT ADDITIONAL DEPRECIATION SHALL BE AVAILABLE TO THE ASSESSEE ONLY FOR THE NEW ASSETS ADDED DURIN G THE RELEVANT ASSESSMENT YEAR AND NOT FOR THE EARLIER AS SESSMENT YEAR. FURTHER, HE WAS OF THE VIEW THAT THERE ARE NO PROVISIONS IN THE ACT PERMITTING THE BALANCE DEPRECIATION TO BE ALLOWED IN THE SUCCEEDING ASSESSMENT YEAR. THEREFORE, THE L EARNED ASSESSING OFFICER DISALLOWED THE ADDITIONAL DEPRECI ATION CLAIMED BY THE ASSESSEE IN RESPECT OF THE ASSETS AC QUIRED DURING THE SECOND HALF OF THE PRECEDING PREVIOUS YE AR FOR ALL THE RELEVANT ASSESSMENT YEARS. 19. ON APPEAL, THE LEARNED COMMISSIONER OF INCOME T AX (APPEALS) CONFIRMED THE ORDER OF THE LEARNED ASSESS ING OFFICER FOR THE ASSESSMENT YEAR 2008-09 BY OBSERVIN G AS UNDER:- 18 ITA NOS.1451, 1443 TO1446 /MDS/2014 4.2 I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE AND THE SUBMISSIONS OF THE LD AR. I FIND THAT THE PROVISIO NS OF THE ACT ARE VERY CLEAR. THE SECOND PROVISO TO SEC.32(1) WHI CH RESTRICTS THE DEPRECIATION TO 50% OF THE PERCENTAGE PRESCRI BED IN RESPECT OF ASSETS USED FOR LESS THAN 180 DAYS, IS A PPLICABLE FOR ADDITIONAL DEPRECIATION ALSO. THERE IS NO PROVISION IN THE ACT TO CARRY FORWARD AND ALLOW THE BALANCE DEPRECIATION IN THE NEXT YEAR. FURTHER, ADDITIONAL. DEPRECIATION IS ALLOWABL E ONLY IN RESPECT OF NEW MACHINERY OR PLANT THAT HAS BEEN ACQ UIRED (DURING THE YEAR. IN THE SECOND YEAR, WHEN THE BALA NCE 50% OF THE ADDITIONAL DEPRECIATION IS PROPOSED TO BE CLAIM ED, THE ASSETS ARE NO MORE NEW MACHINERY OR PLANT ELIGIBLE FOR ADDITIONAL DEPRECIATION. THESE ASSETS FORM PART OF THE OPENING WRITTEN DOWN VALUE OF THE ASSETS. THEREFORE, THESE ASSETS ARE NOT ENTITLED FOR THE SAID ADDITIONAL DEPRECIATION. 4.2.1 FURTHER ,HON'BLE ITAT IN THE CASE OF BRAKES I NDIA LTD IN ITA NO. 1069/MDS/2010 FOR A.Y. 2006-07 DATED 06;01. 2012 DECIDED THE ISSUE AGAINST THE ASSESSEE. THE HON'BLE I TAT, D BENCH, CHENNAI IN THE CASE OF ABI SHOWATECH INDIA L TD IN ITA NOS.39 TO 42 /MDS/12 DATED 2.1.2013 FOR THE AYS. 20 04-05 TO 2007-08 ALSO CONFIRMED THE ORDER OF THE CIT(A) FOLL OWING THE DECISION OF JURISDICTIONAL HIGH COURT IN THE CASE O F MM FORGINGS VS. ADDL CIT (349 ITR 673) HOLDING THAT T HE ASSESSEE IS NOT ENTITLED FOR 50% ADDITIONAL DEPRECI ATION IN THE SUBSEQUENT YEAR. 19.1 FOR THE ASSESSMENT YEARS 2009-10 AND 2010-11 ALSO, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) FO LLOWING HIS ORDER FOR THE ASSESSMENT YEAR 2008-09, CONFIRME D THE ORDER OF THE LEARNED ASSESSING OFFICER. 20. BEFORE US, THE LEARNED AUTHORIZED REPRESENTATIV E SUBMITTED THAT THE ISSUE IS SQUARELY COVERED BY THE ORDER OF THE CHENNAI BENCH OF THE TRIBUNAL IN THE CASE OF M/ S. AUTOMOTIVE COACHES & COMPONENTS VS. DCIT IN ITA TH E 19 ITA NOS.1451, 1443 TO1446 /MDS/2014 ASSET WAS HELD FOR LESS THAN 180 DAYS NO. 1789/MDS /2014 VIDE ORDER DATED 12.02.2016, WHEREIN IT IS HELD AS FOLLOWS:- 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EI THER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECO RD. SECTION 32(1)(IIA) PROVIDES FOR ADDITIONAL DEPRECIATION AT THE RATE OF 20%. THE ASSESSING OFFICER ALLOWED 10% OF ADDITIONAL DEP RECIATION IN RESPECT OF THE PLANT AND MACHINERY PURCHASED DURING THE YEAR UNDER CONSIDERATION. THE ASSESSING OFFICER FOUND T HAT THE ADDITIONS TO FIXED ASSETS WERE MADE IN THE SECOND H ALF OF THE FINANCIAL YEAR, THEREFORE, 50% OF ADDITIONAL DEPREC IATION HAS BEEN CLAIMED. THE BALANCE 50% WAS CARRIED FORWARD IN TH E NEXT YEAR. THE ASSESSING OFFICER FOUND THAT THE ADDITIONAL DEP RECIATION IS ALLOWABLE ONLY DURING THE YEAR IN WHICH THE MACHINE RY WAS INSTALLED AND USED FOR BUSINESS OF THE ASSESSEE. T HERE IS NO PROVISION IN THE INCOME-TAX ACT FOR CARRY FORWARD O F THE ADDITIONAL DEPRECIATION TO THE SUBSEQUENT ASSESSMENT YEAR. TH IS ISSUE WAS EXAMINED BY THE COCHIN BENCH OF THIS TRIBUNAL IN AP OLLO TYRES LTD. V. ACIT (SUPRA). THE COCHIN BENCH FOUND THAT IF AD DITIONAL DEPRECIATION COULD NOT BE ALLOWED AT THE RATE OF 20 % DURING THE YEAR IN WHICH THE MACHINERY WAS INSTALLED, THE BALA NCE 50% HAS TO BE ALLOWED IN THE SUBSEQUENT YEAR. IN FACT, THE CO CHIN BENCH OF THIS TRIBUNAL HAS OBSERVED AS FOLLOWS:- 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. SECTION 32(1)(IIA) READS AS FOLLOWS: '32(1)(IIA) IN THE CASE OF ANY NEW MACHINERY OR PLA NT (OTHER THAN SHIPS AND AIRCRAFT), WHICH HAS BEEN ACQ UIRED AND INSTALLED AFTER THE 31ST DAY OF MARCH, 2005, BY AN ASSESSEE ENGAGED IN THE BUSINESS OF MANUFACTURE OR PRODUCTION OF ANY ARTICLE OR THING, A FURTHER SUM E QUAL TO TWENTY PER CENT OF THE ACTUAL COST OF SUCH MACHI NERY OR PLANT SHALL BE ALLOWED AS DEDUCTION UNDER CLAUSE (II): PROVIDED THAT NO DEDUCTION SHALL BE ALLOWED IN RESP ECT OF (A) ANY MACHINERY OR PLANT WHICH, BEFORE ITS INSTALLATI ON BY THE ASSESSEE, WAS USED EITHER WITHIN OR OUTSIDE INDIA B Y ANY OTHER PERSON; OR 20 ITA NOS.1451, 1443 TO1446 /MDS/2014 (B) ANY MACHINERY OR PLANT INSTALLED IN ANY OFFICE PREM ISES OR ANY RESIDENTIAL ACCOMMODATION, INCLUDING ACCOMMODATION IN THE NATURE OF A GUEST-HOUSE; OR (C) ANY OFFICE APPLIANCES OR ROAD TRANSPORT VEHICLES; O R (D) ANY MACHINERY OR PLANT, THE WHOLE OF THE ACTUAL COS T OF WHICH IS ALLOWED AS A DEDUCTION (WHETHER BY WAY OF DEPRECIAT ION OR OTHERWISE) IN COMPUTING THE INCOME CHARGEABLE UNDER THE HEAD 'PROFITS AND GAINS OF BUSINESS OR PROFESSION' OF AN Y ONE PREVIOUS YEAR.' 10. WE HAVE ALSO CAREFULLY GONE THROUGH THE SECOND PROVISO TO SECTION 32(1)(II) OF THE ACT, WHICH READS AS FOL LOWS: 'PROVIDED FURTHER THAT WHERE AN ASSET REFERRED TO CLAUSE (I) OR CLAUSE (II) OR CLAUSE (IIA), AS THE C ASE MAY BE, IS ACQUIRED BY THE ASSESSEE DURING THE PREVIOUS YEAR AND IS PUT TO USE FOR THE PURPOSE OF BUSINESS OR PROFESSION FOR A PERIOD OF LESS THAN ONE HUNDRED AN D EIGHTY DAYS IN THAT PREVIOUS YEAR, THE DEDUCTION UN DER THIS SUB-SECTION IN RESPECT OF SUCH ASSET SHALL BE RESTRICTED TO FIFTY PER CENT OF THE AMOUNT CALCULAT ED AT THE PERCENTAGE PRESCRIBED FOR AN ASSET UNDER CLAUSE (I) OR CLAUSE (II) OR CLAUSE (IIA) AS THE CASE MAY BE.' 11. A BARE READING OF THIS SECTION 32(1)(IIA) CLEAR LY SAYS THAT IN CASE A NEW MACHINERY OR PLANT WAS ACQUIRED AND I NSTALLED AFTER 31-03-2005 BY AN ASSESSEE, WHO IS ENGAGED IN THE BUSINESS OF MANUFACTURE OR PRODUCE OF ARTICLE OR TH ING, THEN, A SUM EQUAL TO 20% OF THE ACTUAL COST OF THE MACHINERY AND PLANT SHALL BE ALLOWED AS A DEDUCTION . IT IS NOT IN DISPUTE THAT THE ASSESSEE HAS ACQUIRED AND INSTA LLED THE MACHINERY AFTER 31-03- 2005. IT IS ALSO NOT IN DISP UTE THAT THE ASSESSEE IS ENGAGED IN THE MANUFACTURE OF ARTIC LE OR THING. THEREFORE, THE ASSESSEE IS ELIGIBLE FOR ADDI TIONAL DEPRECIATION WHICH IS EQUIVALENT TO 20% OF THE ACTU AL COST OF SUCH MACHINERY. THE DISPUTE IS THE YEAR IN WHICH THE 21 ITA NOS.1451, 1443 TO1446 /MDS/2014 DEPRECIATION HAS TO BE ALLOWED. THE ASSESSEE HAS AL READY CLAIMED 10% OF THE DEPRECIATION IN THE EARLIER ASSE SSMENT YEAR SINCE THE MACHINERY WAS USED FOR LESS THAN 180 DAYS AND CLAIMING THE BALANCE 10% IN THE YEAR UNDER CONSIDERATION. SECTION 32(1)(IIA) DOES NOT SAY THAT THE YEAR IN WHICH THE ADDITIONAL DEPRECIATION HAS TO BE ALLO WED. IT SIMPLY SAYS THAT THE ASSESSEE IS ELIGIBLE FOR ADDIT IONAL DEPRECIATION EQUAL TO 20% OF THE COST OF THE MACHIN ERY PROVIDED THE MACHINERY OR PLANT IS ACQUIRED AND INS TALLED AFTER 31-03-2005. PROVISO TO SECTION 32(1)(IIA) SAY S THAT IF THE MACHINERY WAS ACQUIRED BY THE ASSESSING DURING THE PREVIOUS YEAR AND HAS PUT TO USE FOR THE PURPOSE OF BUSINESS LESS THAN 180 DAYS, THE DEDUCTION SHALL BE RESTRICT ED TO 50% OF THE AMOUNT CALCULATED AT THE PRESCRIBED RATE. TH EREFORE, IF THE MACHINERY IS PUT TO USE IN ANY PARTICULAR YE AR, THE ASSESSEE IS ENTITLED FOR 50% OF THE PRESCRIBED RATE OF ADDITIONAL DEPRECIATION. THE INCOME-TAX ACT IS SILE NT ABOUT THE ALLOWANCE OF THE BALANCE 10% ADDITIONAL DEPRECI ATION IN THE SUBSEQUENT YEAR. TAKING ADVANTAGE OF THIS POSIT ION, THE ASSESSEE NOW CLAIMS THAT THE YEAR IN WHICH THE MACH INERY WAS PUT TO USE THE ASSESSEE IS ENTITLED FOR 50% ADD ITIONAL DEPRECIATION SINCE THE MACHINERY WAS PUT TO USE FOR LESS THAN 180 DAYS AND THE BALANCE 50% SHALL BE ALLOWED IN THE NEXT YEAR SINCE THE ELIGIBILITY OF THE ASSESSEE FOR CLAIMING 20% OF THE ADDITIONAL DEPRECIATION CANNOT BE DENIED BY INVOKING SECOND PROVISO TO SECTION 32(1)(II) OF THE ACT. 12. THIS ISSUE WAS CONSIDERED BY THE DELHI BENCH OF THIS TRIBUNAL IN THE CASE OF COSMO FILMS LTD (SUPRA). TH E REVENUE HAS TAKEN A SIMILAR GROUND AS TAKEN BEFORE THIS TRI BUNAL THAT THE ASSESSEE CANNOT CARRY FORWARD THE ADDITION AL DEPRECIATION TO BE ALLOWED IN THE SUBSEQUENT ASSESS MENT YEAR. THE DELHI BENCH OF THIS TRIBUNAL AFTER CONSID ERING THE PROVISIONS OF SECTION 32(1)(IIA) AND PROVISO TO SEC TION 321)(II) OF THE ACT FOUND THAT WHEN THERE IS NO RESTRICTION IN THE ACT TO DENY THE BENEFIT OF BALANCE 50%, THE ASSESSE E IS ENTITLED FOR THE BALANCE ADDITIONAL DEPRECIATION IN THE SUBSEQUENT ASSESSMENT YEAR. IN FACT, THE DELHI BENC H OF THIS TRIBUNAL HAS OBSERVED AS FOLLOWS AT PAGES 641 AND 642 OF THE ITD: ' THUS, THE INTENTION WAS NOT TO DENY THE BENEFIT T O THE ASSESSEES WHO HAVE ACQUIRED OR INSTALLED NEW MACHIN ERY 22 ITA NOS.1451, 1443 TO1446 /MDS/2014 OR PLANT. THE SECOND PROVISO TO SECTION 32(1)(II) RESTRICTS THE ALLOWANCES ONLY TO 50% WHERE THE ASSE TS HAVE BEEN ACQUIRED AND PUT TO USE FOR A PERIOD LESS THAN 180 DAYS IN THE YEAR OF ACQUISITION. THIS RESTRICTI ON IS ONLY ON THE BASIS OF PERIOD OF USE. THERE I NO RESTRICTION THAT BALANCE OF ONE TIME INCENTIVE IN T HE FORM OF ADDITIONAL SUM OF DEPRECIATION SHALL NOT BE AVAILABLE IN THE SUBSEQUENT YEAR. SECTION 32(2) PRO VIDES FOR A CARRY FORWARD SET UP OF UNABSORBED DEPRECIATI ON. THIS ADDITIONAL BENEFIT IN THE FORM OF ADDITIONAL ALLOWANCE U/S 32(1)(IIA) IS ONE TIME BENEFIT TO ENC OURAGE THE INDUSTRIALIZATION AND IN VIEW OF THE DECISION O F HON'BLE SUPREME COURT IN THE CASE OF BAJAJ TEMPO LT D. V. CIT [1992] 196 ITR 188 , THE PROVISIONS RELATED TO IT HAVE TO BE CONSTRUED REASONABLY, LIBERALLY AND PURP OSIVE TO MAKE THE PROVISION MEANINGFUL WHILE GRANTING THE ADDITIONAL ALLOWANCE. THIS ADDITIONAL BENEFIT IS TO GIVE IMPETUS TO INDUSTRIALIZATION AND THE BASIC INTENTIO N AND PURPOSE OF THESE PROVISIONS CAN BE REASONABLY AND LIBERALLY HELD THAT THE ASSESSEE DESERVES TO GET TH E BENEFIT IN FULL WHEN THERE IS NO RESTRICTION IN THE STATUTE TO DENY THE BENEFIT OF BALANCE OF 50% WHEN THE NEW MACHINERY AND PLANT WERE ACQUIRED AND USED FOR LESS THAN 180 DAYS. ONE TIME BENEFIT EXTENDED TO ASSESSEE HAS BEEN EARNED IN THE YEAR OF ACQUISITION OF NEW MACHINERY AND PLANT . IT HAS BEEN CALCULATED @1 5% BUT RESTRICTED TO 50% ONLY ON ACCOUNT OF USAGE OF T HESE PLANT & MACHINERY IN THE YEAR OF ACQUISITION. IN SE CTION 32(1)(IIA), THE EXPRESSION USED I 'SHALL BE ALLOWED '. THUS, THE ASSESSEE HAD EARNED THE BENEFIT AS SOON A S HE HAD PURCHASED THE NEW MACHINERY AND PLANT IN FULL B UT IT IS RESTRICTED TO 50% IN THAT PARTICULAR YEAR ON ACC OUNT OF PERIOD USAGES. SUCH RESTRICTIONS CANNOT DIVEST T HE STATUTORY RIGHT. LAW DOES NOT PROHIBIT THAT BALANCE 50% WILL NOT BE ALLOWED IN SUCCEEDING YEAR. THE EXTRA DEPRECIATION ALLOWABLE U/S 32(1)(IIA) IN AN EXTRA INCENTIVE WHICH HAS BEEN EARNED AND CALCULATED IN T HE YEAR OF ACQUISITION BUT RESTRICTED FOR THAT YEAR TO 50% ON ACCOUNT OF USAGE. THE SO EARNED INCENTIVE MUST B E MADE AVAILABLE IN THE SUBSEQUENT YEAR. THE OVERALL DEDUCTION OF DEPRECIATION U/S 32 SHALL DEFINITELY N OT EXCEED THE TOTAL COST OF MACHINERY AND PLANT . IN V IEW OF THIS MATTER, WE SET ASIDE THE ORDERS OF THE 23 ITA NOS.1451, 1443 TO1446 /MDS/2014 AUTHORITIES BELOW AND DIRECT TO EXTEND THE BENEFIT. WE ALLOW GROUND NO.2 OF THE ASSESSEE'S APPEAL. SINCE W E HAVE DECIDED GROUND NO.2 IN FAVOUR OF ASSESSEE, THE RE IS NO NEED TO DECIDE THE ALTERNATE CLAIM RAISED IN GRO UND NO.3. THE SAME IS DISMISSED.' 13. THIS ISSUE WAS ALSO CONSIDERED BY ANOTHER BENCH OF THIS TRIBUNAL AT DELHI IN SIL INVESTMENT LTD (SUPRA). AT PAGE 233 OF THE TTJ, THE TRIBUNAL HAS OBSERVED AS FOLLOW S: '40. THERE IS NOTHING ON RECORD TO SHOW THAT THE DIRECTIONS GIVEN BY THE LEARNED CIT(A) ARE NOT PROP ER. THE ELIGIBILITY FOR DEDUCTION OF ADDITIONAL DEPRECI ATION STANDS ADMITTED, SINCE 50 PER CENT THEREOF HAD ALRE ADY BEEN ALLOWED BY THE AO IN THE ASST.YR.2005-06, I.E. THE IMMEDIATELY PRECEDING ASSESSMENT YEAR. THEREFORE, OBVIOUSLY, THE BALANCE 50 PER CENT OF THE DEDUCTION IS TO BE ALLOWED IN THE CURRENT YEAR, I.E. ASST. YR. 2006 -07. THE LEARNED CIT(A) HAS MERELY DIRECTED THE VERIFICA TION OF THE CONTENTIONS OF THE ASSESSEE AND TO ALLOW THE BALANCE ADDITIONAL DEPRECIATION AFTER SUCH FACTUAL VERIFICATION. ACCORDINGLY, FINDING NO MERIT THEREIN , GROUND NO.3 RAISED BY THE DEPARTMENT IS REJECTED.' 14. A SIMILAR VIEW WAS TAKEN BY MUMBAI BENCH OF THI S TRIBUNAL IN MITC ROLLING MILLS (P.) LTD. (SUPRA). I N VIEW OF THE ABOVE DECISIONS OF THE CO-ORDINATE BENCHES OF T HIS TRIBUNAL ON IDENTICAL SET OF FACTS THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE BALANCE 50% OF THE DEPR ECIATION HAS TO BE ALLOWED IN THE SUBSEQUENT YEAR, THEREFORE , THE ORDERS OF THE LOWER AUTHORITIES ON THIS ISSUE ARE S ET SIDE AND THE ASSESSING OFFICER IS DIRECTED TO ALLOW THE CLAIM OF BALANCE 50% ADDITIONAL DEPRECIATION IN THE YEAR UND ER CONSIDERATION. WE HAVE ALSO CAREFULLY GONE THROUGH THE JUDGMENT OF KARNATAKA HIGH COURT IN RITTAL INDIA PVT. LTD. (SUPRA). THE KARNATAKA HIGH COURT, AFTER EXTRACTING THE PROVISIONS OF SECTION 3 2(1)(IIA) OF THE ACT, FOUND THAT BENEFICIAL LEGISLATION HAS TO BE IN TERPRETED LIBERALLY SO AS TO BENEFIT THE ASSESSEE. KARNATAKA HIGH COUR T HAS ALSO FOUND THAT THE INTENTION OF THE LEGISLATION IS TO A LLOW ADDITIONAL BENEFIT. THE KARNATAKA HIGH COURT OPINED THAT THE PROVISO WOULD NOT RESTRAIN THE ASSESSEE FROM CLAIMING THE BALANCE OF THE BENEFIT OF ADDITIONAL DEPRECIATION IN THE SUBSEQUENT ASSESS MENT YEAR. ACCORDINGLY, CONFIRMED THE ORDER OF THE BANGALORE B ENCH OF THIS 24 ITA NOS.1451, 1443 TO1446 /MDS/2014 TRIBUNAL. IN FACT, THE KARNATAKA HIGH COURT HAS OB SERVED AS FOLLOWS:- 7. CLAUSE (IIA) OF SECTION 32(1) OF THE ACT, AS IT NOW STANDS, WAS SUBSTITUTED BY THE FINANCE ACT, 2005, APPLICABLE WITH EFFECT FROM 0L.04.2006. PRIOR TO THAT, A PROVISO TO THE SAID CLAUSE WAS THERE, WHICH PROVIDED FOR THE BENEFIT TO BE GIVEN ONLY TO A NEW INDUSTRIAL UNDERTAKING, OR ONLY WHERE A NEW INDUSTRIAL UNDERTAKING BEGINS TO MANUFACTURE OR PRODUCE DURING ANY YEAR PREVIOUS TO THE RELEVANT ASSESSMENT YEAR. 8. THE AFORESAID TWO CONDITIONS, I.E., THE UNDERTAKING ACQUIRING NEW PLANT AND MACHINERY SHOULD BE A NEW INDUSTRIAL UNDERTAKING, OF THAT IT SHOULD BE CLAIMED IN ONE YEAR, HAVE BEEN DONE AWAY BY SUBSTITUTING CLAUSE (IIA) WITH EFFECT FROM 01.0.2006. THE GRANT OF ADDITIONAL DEPRECIATION, UNDER THE AFORESAID PROVISION, IS FOR THE BENEFIT O F THE ASSESSEE AND WITH THE PURPOSE OF ENCOURAGING INDUSTRIALIZATION, BY EITHER SETTING UP A NEW INDUSTRIAL UNIT OR BY EXPANDING THE EXISTING UNIT BY PURCHASE OF NEW PLANT AND MACHINERY, AND PUTTING IT TO USE FOR THE PURPOSE OF BUSINESS. THE PROVISO TO CLAUSE [II] OF THE SAID SECTION MAKES IT CLEAR THAT ONLY 50% OF THE 20% WOULD BE ALLOWABLE, IF THE NEW PLANT AND MACHINERY SO ACQUIRED IS PUT TO USE FOR LESS THAN 180 DAYS IN A FINANCIAL YEAR. HOWEVER, IT NOWHERE RESTRICTS THAT THE BALANCE 10% WOULD NOT BE ALLOWED TO BE CLAIMED BY THE ASSESSEE IN THE NEXT ASSESSEMENT YEAR. 9. THE LANGUAGE USED IN CLAUSE (IIA) OF THE SAID SECTION CLEARLY PROVIDES THAT 'A FURTHER SUM EQUAL TO 20% OF THE ACTUAL COST OF SUCH MACHINERY OR PLANT SHALL BE ALLOWED AS DEDUCTION UNDER CLAUSE (II)'. THE WORD 'SHALL' USED IN THE SAID CLAUSE IS VERY SIGNIFICANT. THE BENEFIT WHICH IS TO BE GRANTED IS 20% ADDITIONAL DEPRECIATION. BY VIRTUE OF THE PROVISO REFERRED TO ABOVE, ONLY 10% CAN. BE CLAIMED IN ONE YEAR, IF PLANT AND MACHINERY IS PUT TO USE FOR LESS THAN 180 DAYS SAID FINANCIAL YEAR. VERY PURPOSE OF INSERTION OF CLAUSE (IIA) WOULD BE DEFEATED BECAUSE IT PROVIDES FOR 20% 25 ITA NOS.1451, 1443 TO1446 /MDS/2014 DEDUCTION WHICH SHALL BE ALLOWED. 10. IT HAS BEEN CONSISTENTLY HELD BY THIS COURT, AS WELL AS THE APEX COURT, THAT BENEFICIAL LEGISLATION , AS IN THE PRESENT CASE, SHOULD BE GIVEN LIBERAL INTERPRETATION SO AS TO BENEFIT THE ASSESSEE. IN THIS CASE, THE INTENTION OF THE LEGISLATION IS ABSOLUTELY CLEAR, THAT THE ASSESSEE SHALL BE ALLOWE D CERTAIN ADDITIONAL BENEFIT, WHICH WAS RESTRICTED BY THE PROVISO TO ONLY HALF OF THE SAME BEING GRANTED IN ONE ASSESSMENT YEAR, IF CERTAIN CONDITION WAS NOT FULFILLED. BUT, THAT, IN OUR CONSIDERED VIEW, WOULD NOT RESTRAIN THE ASSESSEE FROM CLAIMING THE BALANCE OF THE BENEFIT IN THE SUBSEQUENT ASSESSMENT YEAR. THE TRIBUNAL, IN OUR VIEW, HAS RIGHLY HELD, THAT ADDITIONAL DEPRECIATION ALLOWED UNDER SECTION 32(1)(IIA) OF THE ACT IS A ONE TIME BENEFIT TO ENCOURAGE INDUSTRIALIZATION, AND PROVISIONS RELATED TO IT HAVE TO BE CONSTRUED REASONABLY, LIBERALLY AND PURPOSIVELY, TO MAKE THE PROVISION MEANINGFUL WHILE GRANTING ADDITIONAL ALLOWANCE. WE ARE IN FULL AGREEMENT WITH SUCH OBSERVATIONS MADE BY THE TRIBUNAL. 6. IN VIEW OF THE ABOVE, THIS TRIBUNAL IS OF THE CO NSIDERED OPINION THAT THE ASSESSEE IS ENTITLED FOR REMAINING 10% OF THE DEPRECIATION DURING THE YEAR UNDER CONSIDERATION. ACCORDINGLY, THE ORDERS OF THE LOWER AUTHORITIES ARE SET ASIDE AND T HE ASSESSING OFFICER IS DIRECTED TO ALLOW BALANCE 50% OF DEPRECI ATION, NAMELY, 10% OF ADDITIONAL DEPRECIATION DURING THE YEAR UNDE R CONSIDERATION. 21. THE LEARNED DEPARTMENTAL REPRESENTATIVE COULD N OT CONTROVERT TO THE SUBMISSIONS OF THE LEARNED AUTHOR IZED REPRESENTATIVE. 22. AFTER HEARING BOTH SIDES, WE FIND MERIT IN THE SUBMISSIONS OF THE LEARNED AUTHORIZED REPRESENTATIV E. ON 26 ITA NOS.1451, 1443 TO1446 /MDS/2014 THE EARLIER OCCASION, AS STATED BY THE LEARNED AUTH ORIZED REPRESENTATIVE, THE CHENNAI BENCH OF THE TRIBUNAL I N THE CASE OF M/S. AUTOMOTIVE COACHES & COMPONENTS VS. DC IT CITED SUPRA HELD THAT THE ASSESSEE IS ENTITLED FOR CLAIMING THE REMAINING DEPRECIATION WHICH COULD NOT BE CLAIMED I N THE PRECEDING ASSESSMENT YEAR IN THE RELEVANT ASSESSMEN T YEAR. THEREFORE, WE HEREBY DIRECT THE LEARNED ASSESSING O FFICER TO ALLOW THE BENEFIT OF ADDITIONAL DEPRECIATION @ 10% WITH RESPECT TO THE ADDITION MADE TO PLANT & MACHINERY B Y THE ASSESSEE DURING THE SECOND HALF OF THE PRECEDING ASSESSMENT YEARS IN THE RELEVANT ASSESSMENT YEARS. THUS, THIS ISSUE IS DECIDED IN FAVOUR OF THE ASSESSEE FOR THE ASSESSMENT YEARS 2008-09 TO 2010-11. GROUND NO (IV): DISALLOWANCE MADE UNDER SECTION UND ER SECTION 35 (2AB) REGARDING WEIGHTED DEDUCTION: 23. IT WAS OBSERVED BY THE LEARNED ASSESSING OFFICE R THAT THE ASSESSEE HAD CLAIMED DEDUCTION UNDER SECTION 35 (2AB) OF THE ACT FOR RS.8,91,74,947/-, RS.1,67,22,438/- A ND RS.4,82,94,007/- FOR THE ASSESSMENT YEARS 2008-09, 2009-10 & 2010-11 RESPECTIVELY. THE LEARNED ASSESSING OFFIC ER FURTHER 27 ITA NOS.1451, 1443 TO1446 /MDS/2014 OBSERVED FROM THE FORM 3CL SUBMITTED BY THE ASSESSE E, THAT THE DEPARTMENT OF SCIENTIFIC AND INDUSTRIAL RESEAR CH HAD NOT GIVEN ITS APPROVAL ON THE EXPENDITURE INCURRED TOWA RDS R & D ACTIVITY FOR RS.22.695 LAKHS, RS.25.20 LAKHS AND RS .20.22 LAKHS FOR THE ASSESSMENT YEARS 2008-09, 2009-10 & 2 010-11 RESPECTIVELY. THE ASSESSEE ALSO CONCEDED SAME VIDE ITS LETTER DATED 23.07.2010 FOR THE ASSESSMENT YEAR 200 8-09 AND 01.11.2011 FOR THE ASSESSMENT YEAR 2009-10 & 2010-1 1 BY STATING THAT THERE EXISTS CLAIM OF WEIGHTED DEDUCTI ON UNDER SECTION 35(2AB) OF THE ACT WHICH MAY BE DISALLOWED. ACCORDINGLY, THE LEARNED ASSESSING OFFICER DISALLOW ED THE AMOUNT OF EXCESS CLAIM OF WEIGHTED DEDUCTION UNDER SECTION 35(2AB) OF THE ACT OF RS.22,69,500/-, RS.12,60,000/ - AND RS.10,11,000/- FOR THE ASSESSMENT YEARS 2008-09, 2 009-10 AND 2010-11 RESPECTIVELY. BEFORE THE LEARNED COMMI SSIONER OF INCOME TAX (APPEALS), THE ASSESSEE HAD PLEADED T HAT THEY HAVE TAKEN UP THE MATTER BEFORE THE DEPARTMENT OF S CIENTIFIC & INDUSTRIAL RESEARCH (DSIR) SEEKING CLARIFICATION FOR RESTRICTING THE CLAIM AND THEREFORE IT WAS PLEADED THAT THE CLAIM MAY BE ALLOWED. HOWEVER, THE LEARNED COMMISSI ONER OF INCOME TAX (APPEALS) FOR THE ASSESSMENT YEAR 200 8-09 28 ITA NOS.1451, 1443 TO1446 /MDS/2014 CONFIRMED THE ORDER OF THE LEARNED ASSESSING OFFICE R BY OBSERVING AS UNDER:- 6.2 I HAVE CAREFULLY CONSIDERED THE FACTS OF THE C ASE AND THE SUBMISSIONS OF THELD.AR. I HAVE ALSO GONE THROU GH THE CERTIFICATE ISSUED BY DSIR. AS PER THE PROVISIONS O F SEE 35(2AB) NO ALLOWANCE SHOULD BE GIVEN IF IT IS NOT A PPROVED BY PRESCRIBED AUTHORITY. THEREFORE, THE AO IS RIGHT IN DISALLOWING THE AMOUNT TO THE EXTENT DISAPPROVED BY THE PRESCRIBED AUTHORITY. THE AO NEED NOT HAVE TO WAIT TILL THE APPELLANT'S GRIEVANCE BEFORE THE DSIR IS ADDRESSED, SINCE THE AO IS BOUND BY THE LIMITATION OF TIME IN PASSI NG THE ASSESSMENT ORDERS. THE GROUND RAISED IS UNCALLED FO R. THE GROUND IS DISMISSED. THEREAFTER, FOLLOWING HIS ORDER FOR THE ASSESSMENT YEAR 2008- 09, HE DISMISSED THE APPEAL OF THE ASSESSEE FOR THE ASSESSMENT YEARS 2009-10 & 2010-11 ALSO. 24. BEFORE US, THE LEARNED AUTHORIZED REPRESENTATIV E REITERATED HIS SUBMISSIONS BEFORE THE LEARNED COMMI SSIONER OF INCOME TAX (APPEALS) BUT COULD NOT ADVANCE ANY ARGUMENT IN SUPPORT OF ITS CASE. IN THIS SITUATION, WE DO NOT HAVE ANY OTHER ALTERNATIVE BUT TO CONFIRM THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) BECAUS E THE ASSESSEE ITSELF HAD CONCEDED FOR THE ADDITION. ACC ORDINGLY, THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IS HEREBY CONFIRMED WITH RESPECT TO THE 29 ITA NOS.1451, 1443 TO1446 /MDS/2014 DISALLOWANCE OF WEIGHTED DEDUCTION UNDER SECTION 35 (2AB) OF RS.22,69,500/-, RS.12,60,000/- AND RS.10,11,000/- FOR THE ASSESSMENT YEARS 2008-09, 2009-10 AND 2010-11 RESPECTIVELY. 25. IN THE RESULT, REVENUES APPEAL AS WELL AS THE APPEAL OF THE ASSESSEE FOR THE ASSESSMENT 2005-06 IS DISMISSE D AND THE ASSESSEES APPEALS FOR THE ASSESSMENT YEARS 200 8- 09, 2009-10, & 2010-11 ARE PARTLY ALLOWED FOR STATISTIC AL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THE 6 TH JUNE, 2016 SD/- SD/- ( . . . ) ( . ) (N.R.S.GANESAN) ( A.M OHAN ALANKAMONY ) ! # / JUDICIAL MEMBER # / ACCOUNTANT MEMBER ! /CHENNAI, ' /DATED 6 TH JUNE, 2016 SOMU )* +* /COPY TO: 1. APPELLANT 2. RESPONDENT 3. , () /CIT(A) 4. , /CIT 5. * 0 /DR 6. /GF