M/s Bharat Gears Ltd., New Delhi V. DCIT, New Delhi

ITA 1523/DEL/2011

• Counselvise Citation: 152320114 RSA 2011
• Duration Of Justice: 1 year(s) 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-09-2012
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 13-09-2012
• Assessment Year: 2008-2009
• Appeal Filed On: 29-03-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: PIRTHI LAL
• Assessee Lawyers: VM JHA
• Section: 143(3); 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES: A NEW DELHI BEFORE SHRI AD JAIN, JM AND SHRI J.SUDHAKAR REDDY, A.M. ITA NO: 1523/DEL/2011 ASSESSMENT YEAR : - 2008-09 M/S BHARAT GEARS LTD. VS. DCIT, CENTRAL CIRCLE 11 1009, SURYA KIRAN BLDG. NEW DELHI 19, K.G.MARG, NEW DELHI (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI VM JHA, ADV. RESPONDENT BY : SHRI PIRTHI LAL, SR.D.R. O R D E R PER J.SUDHAKAR REDDY, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER DT. 8.2.2011 PASSED UNDER SECTION 263 OF THE INCOME TAX ACT, 1961 BY THE LD.CIT, NEW DELHI FOR ASSESSMENT YEAR 2008-09. 2. FACTS OF THE CASE:- THE ASSESSEE IN THIS CASE H AS FILED ITS RETURN OF INCOME FOR THE AY 2008-09 ON 25.9.2008. ORDER U/S 143(3) WAS PASSED BY THE AO ON 20.4.2010. IN THE ORDER REPORT IN FOR M 3CD, THE AUDITOR HAS NOT SUGGESTED ANY DISALLOWANCE OF PROVISION FOR LEAVE ENCASHMENT U/S 43B(F) OF THE INCOME TAX ACT, 1961 BY GIVING A NOTE THAT THIS SECTION WAS STRUCK DOWN AS ARBITRARY AND UNCONSCIONABLE BY THE HONBLE HIGH COURT. THE AO IN HIS ORDER U/S 143(3), HAS NOT DIS CUSSED THIS ISSUE. THE CIT PASSED AN ORDER U/S 263, DIRECTED THE AO TO DISALLOW THE CLAIM 2 OF THE ASSESSEE AND MODIFY THE ASSESSMENT. AGGRIEV ED THE ASSESSEE IS IN APPEAL BEFORE US. 3. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE HONBLE SUPREME COURT WHILE ADMITTING A SPECIAL LEAVE PETITION IN SLP 22889/2000 JUDGEMENT DT. 8 TH MAY,2009 IN THE CASE OF M/S EXIDE INDUSTRIES LTD. AND ANOTHER (SUPRA) HAS OBSERVED AS FOLLOWS:- WE FURTHER MAKE IT CLEAR THAT THE ASSESSEE WOULD, DURING THE PENDENCY OF THE CIVIL APPEAL. PAY TAX AS IF S.43B(F ) IS ON THE STATUTE BOOK BUT AT THE SAME TIME IT WOULD BE ENTIT LED TO MAKE A CLAIM IN ITS RETURNS. 4. AS THE AO HAS NOT APPLIED HIS MIND TO THIS ISSUE DURING ASSESSMENT PROCEEDINGS, IT CANNOT BE SAID THAT THE A.O. HAS TAKEN A POSSIBLE VIEW. NON APPLICATION OF MIND WARRANTS EX ERCISE OF POWER U/S 263 OF THE ACT BY THE CIT. THUS THE CASE LAWS RELI ED UPON BY THE ASSESSEE ARE NOT APPLICABLE. 5. THUS WE UPHOLD THE ORDER U/S 263 OF THE ACT. 6. COMING TO THE DIRECTION OF THE CIT(A) THAT THE A O HAS TO DISALLOW THE CLAIM OF ALLOWANCE OF PROVISION FOR LEAVE ENCAS HMENT, WE VACATE THESE DIRECTIONS IN VIEW OF THE INTERIM ORDERS OF THE HON BLE SPUME COURT EXTRACTED ABOVE. THE AO IS DIRECTED TO FOLLOW THE DIRECTIONS OF THE 3 HONBLE SUPREME COURT AND DISPOSE OF THE MATTER DE NOVO IN ACCORDANCE WITH LAW, WITHOUT BEING INFLUENCED BY THE ORDER OF THE C.I.T. 7. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLO WED IN PART. ORDER PRONOUNCED IN THE OPEN COURT ON 21 ST SEPTEMBER, 2012. SD/- SD/- (AD JAIN) (J.SUDHAKAR REDDY) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: THE 21 ST SEPTEMBER, 2012 *MANGA COPY OF THE ORDER FORWARDED TO: 1. APPELLANT; 2.RESPONDENT; 3.CIT; 4.CIT (A); 5.DR; 6.GUARD FILE BY ORDER DY. REGISTRAR 1. DATE OF DICTATION:14/09/2012 2. DRAFT PLACED BEFORE THE AUTHOR ON: 18/09/2012 3. DRAFT PROPOSED AND PLACED BEFORE SECOND MEMBER ON: 4. DRAFT DISCUSSED/APPROVED BY THE SECOND MEMBER ON : 5. APPROVED DRAFT CAME TO SR.P.S. ON: 21/09/2012 6. DATE OF PRONOUNCEMENT : 21/09/2012 7. FILE SENT TO BENCH CLERK ON : 21/09/2012 8. DATE ON WHICH FILE GIVEN TO HEAD CLERK ON: 9. DATE OF DISPATCHING THE ORDER ON :