Appeal Details
Counselvise Citation
16120314 RSA 2013
Assessee PAN
Bench
Appeal Number
Duration Of Justice
2 month(s) 29 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
14-08-2013
Appeal Filed By
Department
Order Result
Dismissed
Bench Allotted
DB
Next Hearing Date
08-08-2013
Assessment Year
2006-2007
Appeal Filed On
16-05-2013
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE : SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI A.L. GEHLOT, ACCOUNTANT MEMBER ITA NO. 161/AGRA/2013 ASSTT. YEAR : 2006-07 INCOME-TAX OFFICER, VS. SMT. LAXMI GUPTA, 2(2), GWALIOR. PROP. M/S. SWASTIK GRAH NIRMAN CO., 247, MADHAV NAGAR, GWALIOR. (PAN : ACLPG 9284 L) ITA NO. 168/AGRA/2013 ASSTT. YEAR : 2006-07 SMT. LAXMI GUPTA, VS. INCOME-TAX OFFICER, PROP. M/S. SWASTIK GRAH NIRMAN CO., 2(2), GWALIOR . 247, MADHAV NAGAR, GWALIOR. (APPELLANT) (RESPONDENT) REVENUE BY : SHRI ANIRUDH KUMAR, CIT/DR ASSESSEE BY : SHRI K.C. AGARWAL, ADVOCATE DATE OF HEARING : 08.08.2013 DATE OF PRONOUNCEMENT OF ORDER : 14.08.2013 ORDER PER BHAVNESH SAINI, J.M.: BOTH THE CROSS APPEALS ARE DIRECTED AGAINST THE OR DER OF LD. CIT(A), GWALIOR DATED 26.02.2013 FOR THE ASSESSMENT YEAR 2006-07. ITA NO. 161 & 168/AGRA/2013 2 2. THE LD. COUNSEL FOR THE ASSESSEE DID NOT PRESS G ROUND NO. 1 IN THE APPEAL OF THE ASSESSEE. THE SAME IS ACCORDINGLY DISMISSED AS WITHDRAWN. GROUND NO. 2 TO 7 IN APPEAL OF THE ASSESSEE READ AS UNDER : 2. THAT THE LD. ASSESSING OFFICER AND LD. CIT(APPE ALS) ERRED IN NOT CONSIDERING THE SUBMISSION MADE BY THE APPEL LANT DURING THE COURSE OF ASSESSMENT PROCEEDINGS WHEREAS THE APPELL ANT SUBMITTED ALL THE FACTS AND CIRCUMSTANCES OF THE CASE IN DETAIL. HENCE THE LD. ASSESSING OFFICER DISALLOWED THE CLAIM U/S 80IB(10) OF THE ACT ONLY ON BASIS OF DIRECTION ISSUED BY THE COMMISSIONER OF IN COME TAX, GWALIOR IN ORDER U/S 263 OF THE ACT WHICH IS AGAINST THE LA W AND DESERVES TO BE ALLOWED. 3. THAT THE LD. CIT(APPEALS) ERRED IN CONFIRMING TH E DISALLOWANCE OF THE CLAIM U/S 80IB(10) WITHOUT ANY BASIS AND ENQUIR Y THAT EITHER THE ASSESSEE IS A CONTRACTOR OR BUILDERS AND DEVELOPER OF THE HOUSING PROJECT WHEREAS ALL THE FACTS REGARDING THE ASSESSE E WAS A BUILDER AND DEVELOPER WERE DISCLOSED DURING THE COURSE OF ASSES SMENT PROCEEDINGS. HENCE THE DEDUCTION U/S 80IB(10) MAY K INDLY BE ALLOWED. 4. THAT THE LD. CIT (APPEALS) ERRED IN CONFIRMING T HE DISALLOWANCE OF THE CLAIM U/S 80IB(10) WITHOUT CONSIDERING THE FACT THAT THE LAND FOR THE CONSTRUCTION OF THE PROJECT WAS IN THE NAME SWA STIK GRAH NIRMAN SAHAKARI SAMITI MARYADIT, 31-SHRI RAM COLONY, JHANS I ROAD, GWALIOR AND AGREEMENT WAS DONE BETWEEN THE SAHAKARI SAMITI AND THE ASSESSEE UNDER WHICH THE ASSESSEE DEVELOP AND B UILT THE HOUSING PROJECT. AFTER THE AGREEMENT BETWEEN THE ASSESSEE A ND LAND OWNER SOCIETY THE ASSESSEE TOOK OVER THE COMPLETE POSSESS ION OF THE LAND. THE ASSESSEE HAD FULL AUTHORITY AND ALSO RESPONSIBILITY TO DEVELOP THE HOUSING PROJECT BY NOT ONLY PUTTING UP THE CONSTRUC TION BUT BY CARRYING OUT VARIOUS OTHER ACTIVITIES LIKE ENGAGING PROFESSIONALS ARCHITECT ENGINEERS , SUPERVISORY STAFF AND CONTRAC TS FOR CONSTRUCTIONS AND OTHER ACTIVITIES AND BOOKING FOR SALE OF FLATS AND DUPLEXES ETC .. THE ASSESSEE IS ALSO SOLELY LIABLE FOR PROFIT AND L OSS OF THE PROJECT. THE LAND OWNER SOCIETY WAS ENTITLED ONLY FOR THE AMOUNT OF LAND AS PER TERMS AND CONDITIONS MUTUALLY AGREED BETWEEN THEM. THE ASSESSEE INVESTED HER OWN FUNDS IN COST OF CONSTRUCTION AND ENGAGEMENT OF SEVERAL AGENCIES. THERE WOULD BE NO INTERFERENCE OF THE LAND OWNER ITA NO. 161 & 168/AGRA/2013 3 DURING THE DEVELOPMENT AND CONSTRUCTION OF THE HOUS ING PROJECT. THEREFORE, THE ASSESSEE WAS NOT WORKING AS A WORKS CONTRACTOR, SHE WAS ONLY A BUILDER AND DEVELOPER. HENCE THE DEDUCTI ON U/S 80IB(10) MAY KINDLY BE ALLOWED. 5. THAT THE LD. CIT (APPEALS) ERRED IN CONFIRMING T HE DISALLOWANCE OF THE CLAIM U/S 80IB(10) WITHOUT CONSIDERING THE FACT THAT THE ASSESSEE WAS NOT CARRIED OUT THE WORK OF CONSTRUCTION AND DE VELOPMENT FOR A FIXED REMUNERATION. THE ASSESSEE HAD FULL RIGHTS TO DEVELOP THE LAND BY PUTTING UP THE HOUSING PROJECT AT ITS OWN RISK AND COST AND NOT THAT OF THE LAND OWNER. THE ASSESSEE THUS WAS NOT WORKING A S WORKS CONTRACTOR. HENCE THE DEDUCTION U/S 80IB(10) MAY KI NDLY BE ALLOWED. 6. THAT THE LD. CIT(APPEALS) ERRED IN CONFIRMING TH E DISALLOWANCE OF RS.512168/OUT OF ADDITION RS.1 034366/- OUT OF MATE RIAL PURCHASES EXPENSES RS.5121683/- WITHOUT ANY BASIS AND POINTED OUT ANY SPECIFIC DEFECT. HENCE THE ADDITION MADE BY THE LD. ASSESSIN G OFFICER IS AGAINST THE LAW AND DESERVES TO BE DELETED. 7 THAT THE LD. CIT(APPEALS) ERRED IN CONFIRMING THE DISALLOWANCE OF RS.477640/OUT OF ADDITION OF RS.955280/- OUT OF CON TRACT WITH MATERIAL EXPENSES RS.4776400/WITHOUT ANY BASIS AND POINTED OUT ANY SPECIFIC DEFECT. HENCE THE ADDITION MADE BY THE LD. ASSESSING OFFICER IS AGAINST THE LAW AND DESERVES TO BE DELETED. 3. THE DEPARTMENTAL APPEAL IS FILED ON THE FOLLOWIN G GROUND : ON FACTS AND CIRCUMSTANCES OF THE CASE, LD. CIT(A) , GWALIOR HAS ERRED IN REDUCING THE DISALLOWANCES FROM 20% TO 10% THEREBY REDUCING DISALLOWANCES MADE BY THE AO ON ACCOUNT OF MATERIAL PURCHASE EXPENSES BY RS.5,12,165/- AND CONTRACT WIT H MATERIAL EXPENSES BY RS.4,77,640/-. 4. BRIEFLY, THE FACTS OF THE CASE ARE THAT IN THIS CASE, THE ASSESSEE WAS EARLIER ASSESSED U/S. 143(3) VIDE ASSESSMENT ORDER DATED 26 .11.2008 FOR THE ASSESSMENT YEAR UNDER APPEAL, I.E., 2006-07. THE ASSESSEE IS C ARRYING ON THE BUSINESS OF ITA NO. 161 & 168/AGRA/2013 4 DEVELOPMENT, CONSTRUCTION OF HOUSING PROJECTS IN TH E NAME AND STYLE OF M/S. SWASTIK GRAH NIRMAN COMPANY, WHICH IS PROPRIETORSHI P CONCERN OF THE ASSESSEE. THE ASSESSEE WAS BUILDING A HOUSING PROJECT IN THE NAME OF CITY GARDEN, GWALIOR IN ASSESSMENT YEAR UNDER APPEAL. PLAN WAS APPROVED FROM MUNICIPAL CORPORATION, GWALIOR. HOWEVER, THE LAND FOR CONSTRUCTION FOR THI S PROJECT IS IN THE NAME OF SWASTIK GRIH NIRMAN SAHKARI SAMITI MARYADIT AS PER AGREEMENT BETWEEN THE ASSESSEE AND SAHKARI SAMITI ON 10.12.2004 FOR DEVEL OPMENT AND CONSTRUCTION OF THE HOUSING PROJECT AND THE CONSTRUCTION WAS RAISED . THE ASSESSEE CLAIMED DEDUCTION U/S. 80IB(10) OF THE IT ACT WHICH WAS ALL OWED BY THE AO. THE LD. CIT, GWALIOR, HOWEVER, ISSUED SHOW CAUSE NOTICE U/S. 263 OF THE IT ACT BECAUSE THE ASSESSMENT ORDER DATED 26.11.2008 WAS ERRONEOUS IN SO FAR AS PREJUDICIAL TO THE INTEREST OF REVENUE AND PROPOSED TO CANCEL THE ASSE SSMENT ORDER ON DEDUCTION GRANTED U/S. 80IB(10) OF THE IT ACT. THE LD. CIT, G WALIOR AFTER PROVIDING OPPORTUNITY OF BEING HEARD PASSED THE ORDER U/S. 26 3 OF THE IT ACT ON DATED 24.03.2011 AND CANCELLED THE ASSESSMENT ORDER DATED 26.11.2008 WITH THE DIRECTION TO THE AO TO EXAMINE THE ISSUE OF DEDUCTION U/S. 80 IB(10) AND PASS ASSESSMENT ORDER AFRESH. THE AO IN PURSUANCE TO THE DIRECTIONS ISSUED U/S. 263 OF THE IT ACT, PASSED FRESH ASSESSMENT DATED 21.12.2011 U/S. 143(3 ) READ WITH SECTION 263 OF THE IT ACT AND AFTER EXAMINING THE WHOLE ISSUE HELD THA T THE AGREEMENT BETWEEN THE ASSESSEE AND THE SOCIETY WAS IN THE NATURE OF AGREE MENT BETWEEN TWO PARTIES AS CONTRACT. IT WAS HELD THAT IN VIEW OF THE FACT THAT THE ASSESSEE WAS ONLY AWARDED THE ITA NO. 161 & 168/AGRA/2013 5 CONTRACT BY SAHKARI SAMITI, THE ASSESSEE WAS NOT EN TITLED FOR DEDUCTION U/S. 80IB(10) OF THE IT ACT. THE ADDITION OF RS.44,45,50 2/- WAS MADE. THE AO APART FROM ISSUE OF DEDUCTION U/S. 80IB(10) ALSO CONSIDER ED THE ISSUE OF MATERIAL PURCHASE EXPENSES AND MATERIAL EXPENSES AND DISALLO WED 20% OUT OF THE SAME EXPENSES IN A SUM OF RS.10,34,366/- AND RS.9,55,280 /-. THESE ADDITIONS WERE CHALLENGED BEFORE THE LD. CIT(A). THE LD. CIT(A) CO NSIDERED THE ISSUE IN DETAIL AND FOUND THAT THE DECISION IN THE CASE OF RADHEY DEVEL OPERS, 341 ITR 403 (GUJ.) WILL APPLY AGAINST THE ASSESSEE BECAUSE IN THAT CASE, TH E LAND OWNERS ENTERED INTO AN AGREEMENT WITH THE ASSESSEE TO SELL THE LAND BUT IN THE CASE OF ASSESSEE, THE LAND WAS NEVER SOLD TO THE ASSESSEE AND THE ASSESSEE WAS SHOWN MERELY A CONSTRUCTION CONTRACTOR. IT WAS, THEREFORE, HELD THAT ASSESSEES CLAIM OF DEDUCTION U/S. 80IB(10) CANNOT BE ALLOWED. THE APPEAL OF THE ASSESSEE WAS A CCORDINGLY DISMISSED. AS REGARDS THE ADDITION ON ACCOUNT OF DISALLOWANCE OF EXPENSES, THE ASSESSEE SUBMITTED THAT THE ISSUE OF DISALLOWANCE OF EXPENSE S WAS NOT SUBJECT MATTER OF REVISION ORDER U/S. 263 OF THE IT ACT. THEREFORE, D ISALLOWANCE OF EXPENSES COULD NOT HAVE BEEN MADE. THE LD. CIT(A) CONSIDERING THE FACTS OF THE CASE CONFIRMED THE ADDITION IN PRINCIPLE, BUT REDUCED BOTH THE ADD ITIONS TO 10% AS AGAINST 20% DISALLOWANCE OF EXPENSES MADE BY THE AO. THE DISALL OWANCES WERE THEREFORE REDUCED TO RS.5,12,168/- AND RS.4,77,640/-. ITA NO. 161 & 168/AGRA/2013 6 5. THE ASSESSEE RAISED GROUND NO. 2 TO 5 FOR DISALL OWANCE OF CLAIM OF DEDUCTION U/S. 80IB(10) OF THE IT ACT. ON GROUND NO. 6 & 7, T HE ASSESSEE CHALLENGED THE DISALLOWANCE OF EXPENSES AT 10% AND REVENUE IS IN A PPEAL CHALLENGING THE REDUCTION OF DISALLOWANCE OF THESE EXPENSES. 6. WE HAVE HEARD THE LD. REPRESENTATIVES OF BOTH TH E PARTIES, PERUSED THE FINDINGS OF THE AUTHORITIES BELOW AND CONSIDERED TH E MATERIAL AVAILABLE ON RECORD. AS REGARDS THE DEDUCTION CLAIMED U/S. 80IB(10) OF T HE IT ACT, THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND SUBMITTED THAT THE ASSESSEE IS ENTITLED FOR DEDUCTI ON U/S. 80IB(10) OF THE IT ACT. ON THE OTHER HAND, THE LD. DR RELIED UPON THE ORDERS O F THE AUTHORITIES BELOW AND SUBMITTED THAT THE ASSESSEE WAS MERELY A CONTRACTOR AS PER THE AGREEMENT WITH SAHKARI SAMITI. THEREFORE, THE ASSESSEE IS NOT ENTI TLED FOR DEDUCTION U/S. 80IB(10) OF THE IT ACT. THE LD. COUNSEL FOR THE ASSESSEE ALS O STATED THAT THE ASSESSEE PREFERRED APPEAL BEFORE THE TRIBUNAL AGAINST THE OR DER U/S. 263 OF THE IT ACT DATED 24.03.2011 AND THE APPEAL OF THE ASSESSEE HAS BEEN DISMISSED VIDE ORDER DATED 23.10.2012 (PB-23). HE HAS ALSO ADMITTED THAT THE A SSESSEE FURTHER FILED APPEAL BEFORE THE HONBLE M.P. HIGH COURT AGAINST THE DECI SION OF TRIBUNAL AND THE APPEAL OF THE ASSESSEE IN INCOME-TAX APPEAL NO. 4/2 013 HAS BEEN DISMISSED BY THE HIGH COURT VIDE ORDER DATED 17.05.2013 (PB-17). THE LD. COUNSEL FOR THE ASSESSEE, HOWEVER, SUBMITTED THAT THE ASSESSEE HAS FURTHER FI LED SLP BEFORE THE HONBLE ITA NO. 161 & 168/AGRA/2013 7 SUPREME COURT AGAINST THE DECISION OF M.P. HIGH COU RT, WHICH IS STILL PENDING. THE LD. DR SUBMITTED THAT ONCE THE CLAIM OF ASSESSEE HA S BEEN DENIED BY THE HONBLE M.P. HIGH COURT, THE APPEAL OF THE ASSESSEE ON GROU ND NO. 2 TO 5 MAY BE DISMISSED. 7. IN VIEW OF THE ABOVE FACTS AND IN THE BACKGROUND OF VARIOUS ORDERS REFERRED TO ABOVE, WE ARE NOT INCLINED TO INTERFERE WITH THE ORDER OF THE LD. CIT(A) IN DISMISSING THE APPEAL OF THE ASSESSEE ON GROUND NO. 2 TO 5. IT IS ADMITTED FACT THAT THE LD. CIT, GWALIOR IN THE SAME ASSESSMENT YEAR UN DER APPEAL, SET ASIDE THE ORIGINAL ASSESSMENT ORDER U/S. 263 OF THE IT ACT DA TED 24.03.2011. THE ORDER OF THE LD. CIT, GWALIOR DATED 24.03.2011 U/S. 263 OF THE I T ACT HAS BEEN CONFIRMED BY ITAT, AGRA BENCH BY DISMISSING THE APPEAL OF THE AS SESSEE IN ITA NO. 113/2011 DATED 23.10.2012 FOR THE ASSESSMENT YEAR 2006-07. T HE ASSESSEE FURTHER PREFERRED APPEAL AGAINST THE DECISION OF TRIBUNAL BEFORE THE M.P. HIGH COURT, GWALIOR BENCH AND THE APPEAL OF THE ASSESSEE IN INCOME TAX APPEAL NO. 04/2013 FOR THE SAME ASSESSMENT YEAR WAS ADMITTED ON THE FOLLOWING QUEST ION OF LAW : WHETHER THE AUTHORITY AND ITA HAVE ERRED IN HOLDIN G THAT THE ASSESSEE/APPELLANT IS NOT ENTITLED DEDUCTION UNDER SECTION 80IB(10) OF THE ACT BECAUSE HE WAS DEVELOPING AND CONSTRUCTING THE HOUSING PROJECT ON THE LAND OWNED BY A SAMITI UNDER AN AGRE EMENT ? 7.1 HONBLE M.P. HIGH COURT VIDE JUDGMENT DATED 17. 05.2013 IN THE ABOVE APPEAL OF THE ASSESSEE IN PARA 14 HELD AS UNDER : ITA NO. 161 & 168/AGRA/2013 8 CONSEQUENTLY, WE ANSWER THE QUESTION OF LAW NO. 1 T HAT THE CIT HAS RIGHTLY HELD THAT THE APPELLANT IS NOT ENTI TLED THE DEDUCTION UNDER SECTION 80IB(10) OF THE INCOME TAX ACT. IT IS NOT NECESSARY TO CONSIDER THE EXPLANATION WHICH WAS INSERTED INTO TH E ACT IN THE YEAR 2009 BECAUSE WITHOUT READING THE EXPLANATION, THE B ENEFIT COULD NOT BE ALLOWED TO THE APPELLANT. WE FURTHER ANSWER THE QUESTION NO. 3 THAT IT IS NOT NECESSARY TO TAKE INTO ACCOUNT THE ADDITI ONAL GROUND RAISED BY THE APPELLANT BEFORE THE APPELLATE AUTHORITY. CONSE QUENTLY, WE DO NOT FIND ANY MERIT IN THIS APPEAL. IT IS HEREBY DISMISS ED. NO ORDER AS TO COSTS. 7.2. CONSIDERING THE FACTS OF THE CASE IN THE LIGHT OF DECISION OF HONBLE M.P. HIGH COURT HOLDING THAT THE ASSESSEE IS NOT ENTITLE D FOR DEDUCTION U/S. 80IB(10) OF THE IT ACT, WE ARE OF THE VIEW THAT THE ISSUE IS CO VERED AGAINST THE ASSESSEE BY THE JUDGMENT OF HONBLE M.P. HIGH COURT FOR THE SAME AS SESSMENT YEAR 2006-07. THEREFORE, THE SUBMISSIONS OF THE LD. COUNSEL FOR T HE ASSESSEE ON MERITS HAVE NO RELEVANCE AND ARE ACCORDINGLY REJECTED. IN THE RESU LT, GROUNDS NOS. 2 TO 5 OF APPEAL OF THE ASSESSEE ARE DISMISSED. 8. AS REGARDS THE DISALLOWANCE OF THE EXPENSES UNDE R THE HEAD MATERIAL PURCHASE AND MATERIAL EXPENSES ARE CONCERNED, THE A O DISALLOWED 20% OF THE EXPENSES. THE LD. CIT(A) REDUCED THE EXPENSES TO 10 %. IT IS ADMITTED FACT THAT THE LD. CIT, GWALIOR ISSUING NOTICE U/S. 263 OF THE IT ACT DATED 09.03.2011 (PB-32A), DIRECTED TO WITHDRAW DEDUCTION U/S. 80IB(10) OF THE IT ACT IN A SUM OF RS.44,45,502/-. THE LD. CIT, GWALIOR VIDE ORDER DAT ED 24.03.2011 U/S. 263 OF THE IT ACT CANCELLED THE ORIGINAL ASSESSMENT ORDER DATE D 26.11.2008 WITH THE DIRECTION ITA NO. 161 & 168/AGRA/2013 9 TO EXAMINE THE ISSUE OF DEDUCTION U/S. 80IB(10) AND COMPLETE THE ASSESSMENT AFRESH ACCORDINGLY. THEREFORE, IT IS CLEAR THAT THE ORIGINAL ASSESSMENT ORDER WAS CANCELLED WITH REGARD TO THE DEDUCTION GRANTED U/S. 80IB(10) OF THE IT ACT ONLY. NO OTHER ISSUE WAS DIRECTED TO BE RECONSIDERED IN SET ASIDE PROCEEDINGS. HONBLE GUJRAT HIGH COURT IN THE CASE OF SAHELI SYNTHETICS PVT. LTD. VS. CIT, 302 ITR 126 HELD THAT THE ASSESSING OFFICER CANNOT PROCESS NEW SOURCE OF INCOME. SIMILARLY, HONBLE GUJRAT HIGH COURT IN THE CASE OF CIT VS. D. N. DOSANI, 280 ITR 275 HELD THAT ASSESSING OFFICER CANNOT CONSIDER THE ITEMS NO T COVERED BY REVISION. HONBLE M.P. HIGH COURT IN THE CASE OF CIT VS. LATE JAWAHAR LAL NAGPAL, 171 ITR 136 HELD THAT ITO HAS NO JURISDICTION TO ADD NEW SOURCE OF I NCOME IN FRESH ASSESSMENT. HONBLE ALLAHABAD HIGH COURT IN THE CASE OF S.P. KO CHAR VS. ITO, 145 ITR 255 HELD THAT WHEN THE TRIBUNAL SET ASIDE THE ASSESSMEN T AND REMANDS THE CASE FOR MAKING A FRESH ASSESSMENT, THE POWER OF ITO IS CONF INED TO THE SUBJECT MATTER OF APPEAL BEFORE THE TRIBUNAL. HE CANNOT TAKE UP THE Q UESTION WHICH WAS NOT THE SUBJECT MATTER OF APPEAL BEFORE TRIBUNAL, EVEN THOU GH NO SPECIFIC DIRECTION HAS BEEN GIVEN BY THE TRIBUNAL. CONSIDERING THE ISSUE I N THE LIGHT OF ABOVE DECISIONS, IT IS CLEAR THAT THE LD. CIT, GWALIOR SET ASIDE THE OR IGINAL ASSESSMENT ORDER DATED 26.11.2008 IN THE ORDER U/S. 263 ONLY ON THE QUESTI ON OF EXAMINATION OF DEDUCTION U/S. 80IB(10) OF THE IT ACT. THEREFORE, THE AO IN T HIS CASE SOULD NOT HAVE CONSIDERED THE ISSUE OF DISALLOWANCE OF OTHER EXPEN SES LIKE MATERIAL PURCHASE EXPENSES AND MATERIAL EXPENSES. THUS, THE AO EXCEED ED HIS JURISDICTION IN THE ITA NO. 161 & 168/AGRA/2013 10 FRESH ASSESSMENT PROCEEDINGS AND SHOULD NOT HAVE MA DE DISALLOWANCE OF OTHER EXPENSES. DISALLOWANCE MADE BY THE AO IS, THEREFORE , WHOLLY UNJUSTIFIED, ILLEGAL AND WITHOUT ANY AUTHORITY. WE ACCORDINGLY SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND DELETE THE ENTIRE DISALLOWANCE OF EXPENSE S UNDER THE HEAD MATERIAL PURCHASE EXPENSES AND CONTRACT WITH MATERIAL EXPENS ES. IN THE RESULT, GROUNDS NOS. 6 & 7 OF THE APPEAL OF ASSESSEE ARE ALLOWED AND DEP ARTMENTAL APPEAL IS DISMISSED. 9. IN THE RESULT, THE DEPARTMENTAL APPEAL IS DISMIS SED AND THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (A.L. GEHLOT) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER *AKS/- COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A), CONCERNED BY ORDER 4. CIT, CONCERNED 5. DR, ITAT, AGRA 6. GUARD FILE SR. PRIVATE SECRETARY TRUE COPY
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