ACIT, CHENNAI V. Shri T M Abdul Rahman & Sons, CHENNAI

ITA 1451/CHNY/2011

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 52029 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-11-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2007-2008
• Appeal Filed On: 19-08-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A C JOSEPH
• Assessee Lawyers: B K MOORTHYFCA
• Keywords: Revenue expenditure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BENCH C CHENN AI BEFORE DR.O.K.NARAYANAN, VICE PRESIDENT AND SHRI HARI OM MARATHA, JUDICIAL MEMBER .. ITA NO.1451/MDS./2011 ASSESSMENT YEAR:2007-08 THE ASSISTANT COMMISSIONER OF INCOME TAX, BUSIENSS CIRCLE XII, CHENNAI 600 006. VS. SHRI T.M.ABDUL RAHMAN & SONS, NO.49, WUTHUCATTAN STREET, PERIAMET, CHENNAI 600003. PAN AABFT 2029 F (APPELLANT) (RESPONDENT) DEPARTMENT BY : SHRI A.C.JOSEPH, DR ASSESSEE BY : SHRI B.K.MOORTHY,FCA DATE OF HEARING : 17.11.11 DATE OF PRONOUNCEMENT : 17.11 .11 O R D E R PER HARI OM MARATHA, JUDICIAL MEMBER : THIS APPEAL OF THE REVENUE FOR ASSESSMENT YEAR 2 007- 08 IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX(A) DATED 26.05.2011. 2. THE ONLY ISSUE INVOLVED IN THIS APPEAL IS AS TO WHETHER THE CONTRIBUTION MADE BY THE ASSESSEE TOWARDS TAL CO RANIPET EFFLUENT TREATMENT CO. LIMITED IS A CAPITAL EXPENDI TURE OR A PAGE OF 4 ITA. 1451/MDS/11 2 REVENUE EXPENDITURE. IN SIMILAR CIRCUMSTANCES AND UNDER IDENTICAL FACTS, THE HONBLE TRIBUNAL, IN ASSESSEE S OWN CASE HAS ALLOWED THIS CLAIM OF THE ASSESSEE BY HOLDING T HAT THIS IS A REVENUE EXPENDITURE. IN DOING SO, THE TRIBUNAL HAS FOLLOWED THE JUDGMENT OF HONBLE JURISDICTIONAL HIGH COURT I N THE CASE OF C.I.T. VS VELMANICKAM LODGE REPORTED IN 317 ITR 33 8, A COPY OF THE TRIBUNALS ORDER PASSED FOR ASSESSMENT YEAR 2006-07 IN ITA NO.1841/MDS./09 DT.30 TH APRIL, 2010 IN ASSESSEE'S OWN CASE HAS BEEN PRODUCED BEFORE US. PARA-7 OF THIS O RDER IS BEING EXTRACTED FOR READY REFERENCE:- 7. AFTER HEARING BOTH SIDES, WE ARE CONVINCED THA T THE RATIO OF THE DECISION OF HONBLE RAJASTHAN HIGH COURT IN THE CASE OF JASWANT TRADING CO. VS. C.I.T. (SUPRA) IS NOT APPLICABLE TO THE FACTS OF THE PRESE NT CASE. THE RATIO OF OTHER DECISIONS, A COPY OF WHIC H HAS BEEN FILED BEFORE US RENDERED IN THE CASE OF JT . COMMISSIONER OF INCOME TAX VS. DEVERSONS INDUSTRIES LTD.104 ITD 171 AND THAT OF HONBLE MADRAS HIGH IN THE CASE OF C.IT. VS. VELUMANICKAM LODGE, 317 ITR 338, ARE DIRECTLY ON THE ISSUE. SINC E THE TANNERY UNIT SITUATED AT RANIPET HAS JUST COMPL IED WITH THE DIRECTIONS OF TAMIL NADU POLLUTION CONTROL BOARD SO AS TO RUN THE UNIT AND THEREBY ON CONTRIBUTING ITS SHARE TO RANITEC WOULD AMOUNT TO REVENUE EXPENDITURE ONLY BECAUSE IT IS NECESSARY FO R PAGE OF 4 ITA. 1451/MDS/11 3 THE SURVIVAL OF THE BUSINESS OF THE ASSESSEE COMPANY. WE ARE IN AGREEMENT WITH THE LD. C.I.T.(A) THAT THIS CAN BE TREATED AS AN EXPENDITURE INCURRED ON ACCOUNT OF BUSINESS EXIGENCY. WE, THEREFORE, CONFIRM THE IMPUGNED DELETION. THEREFORE, BY RESPECTFULLY FOLLOWING THE TRIBUNAL O RDER SUPRA, WE CANNOT ALLOW REVENUES APPEAL. ACCORDINGLY, THE SAME STANDS DISMISSED. 3. IN RESULT, THE APPEAL OF THE REVENUE STANDS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT AFTER CONCLUSI ON OF HEARING ON 17 TH NOVEMBER, 2011. SD/- SD/- (DR.O.K.NARAYANAN ) ( HARI OM MARATHA ) VICE PRESIDENT JUDICIAL MEMBER CHENNAI, DATED THE 17 TH NOVEMBER, 2011 K S SUNDARAM COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE PAGE OF 4 ITA. 1451/MDS/11 4 DATE INITIALS 1. DRAFT DICTATED ON 17.11.11 2. DRAFT PLACED BEFORE AUTHORITY 18.11.1 3. DRAFT PLACED BEFORE THE SECOND MEMBER 22.11.11 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 5. APPROVED DRAFT COMES TO P.S. 28.11.11 6. KEEP FOR PRONOUNCEMENT ON 7. FILE SENT TO THE BENCH CLERK 28.11.11 8. DATE ON WHICH FILE GOES TO THE 9. DATE OF DISPATCH OF ORDER