M/s Rexcel Pharmaceutical Ltd., New Delhi V. ITO, New Delhi

ITA 1625/DEL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 90916 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 1 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 19-02-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 20-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIKRAM SAHAY
• Assessee Lawyers: SUBIRSARS
• Keywords: Opportunity of being heard; Earning of tax free income; Bad and doubtful debts; Scheme of amalgamation
• Section: 14A

Judgement Text

IN TH E INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F : NEW DELHI BEFORE SHRI B.C. MEENA , ACCOUNTANT MEMBER AND SHRI C.M. GARG , JUDICIAL MEMBER ITA NO. 16 25 /DEL/201 3 ASSESSMENT YEAR 200 9 - 10 M/S. REXCEL PHARMACEUTICALS LTD. VS. THE CIT(APPEALS) - XVIII, 1 2 TH FLOOR, DEVIKA TOWERS, NEW DELHI. 6, NEHRU PLACE, NEW DELHI - 110 019 (PAN AA A C R 5708 F ) ( APPELLANT) (RESPONDENT) DATE OF HEARING : 19 .0 2 .2015 DATE OF PRONOUNCEMENT : 29 . 0 4 .2015 APPELLANT BY : S RI V.P. GUPTA & A N U R AV KUMAR , ADVOCATE SH. AMERESH CHAUDHARY & SH. SUBIRS,ARS. RESPONDENT BY : SHRI VIKRAM SAHAY , SR. DR ORDER PER SHRI C.M. GARG , A M : 1. THIS APPEAL HAS BEEN PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) - XVII I, NEW DELHI DATED 04.01.2013 IN APPEAL NO.315/11 - 12 FOR AY 2009 - 10. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS IN THIS APPEAL: - 1 . THAT THE CIT(A) ERRED IN NOT CORRECTLY APPRECIATING THE FACTS AND THE DOCUMENTS SUBMITTED BY THE APPELLANT IN RESPE CT OF EMPLOYMENT AS WELL AS AGGREGATE PAYMENT OF RS. 12,60,194/ - MADE TO THE EX - EMPLOYEES, NAMELY, MS. CHRISTEN D'MELLO AND MR. CHETAN MADAN AND UPHOLDING THE IT A NO. 1625 /DEL /201 3 2 DISALLOWANCE BY WRONGLY OBSERVING THAT APPOINTMENT LETTER HAD BEEN FILED FOR DIFFERENT PERSON AND NO EVIDENCE FOR PAYMENT HAD BEEN FILED. 2. THAT THE CIT(A) ALSO ERRED IN DISCUSSING THE ALLOWABILITY OF SUM OF RS. 2,42,543/ - WRITTEN OFF IN THE BOOKS OF ACCOUNT IN RESPECT OF WHICH AMOUNT THERE WAS NOT EVEN A GROUND BEFORE HER AS THE DEDUCTION HAD BEEN ALLOWED BY THE ASSESSING OFFICER HIMSELF. 3.1 THAT THE CIT(A) ALSO FAILED TO APPRECIATE THE LEGAL AND FACTUAL POSITION IN RESPECT OF DISALLOWANCE MADE BY THE ASSESSING OFFICER OF RS. 63,74,000/ - UNDER CLAUSE (III) OF RULE 80(2) OF THE INCOME TAX RULES ON ACCOUNT OF ADMINISTRATIVE EXPENSES @ 0.5% OF AVERAGE INVESTMENT OF RS. 127.48 CRORES IN THE PARTNERSHIP FIRM AND UPHOLDING THE DISALLOWANCE TO THE EXTENT OF FULL AMOUNT OF RS . 63,74,000/ - , WHICH AMOUNT WAS IN EXCESS OF ACTUAL EXPENSES DEBITED TO PROFIT & LO SS ACCOUNT ON ACCOUNT OF ADMINISTRATIVE ACTIVITIES. 3.2 THAT THE CIT(A) ALSO FAILED TO APPRECIATE THAT TOTAL EXPENSES DEBITED TO PROFIT & LOSS ACCOUNT ON ACCOUNT OF PERSONAL COST AND ADMINI STRATIVE EXPENSES WERE ONLY RS. 17,99,167/ - AND A. AMOUNT OF RS. 12,60,194/ - BEING THE EX - GRATIA DEBITED AS PERSONAL COST HAD BEEN ALREADY' DISALLOWED BY THE ASSESSING OFFICER AND DISALLOWANCE HAS ALSO BEEN SEPARATELY UPHELD BY CIT(A); B. AMOUNT OF RS.3,25,315/ - WAS DEBITED ON ACCOUNT OF BAD DEBT WRITTEN OFF WHICH IN A NY CASE CANNOT BE SAID TO BE THE EXPENDITURE INCURRED DURING THE YEAR IN RELATION TO INVESTMENT ACTIVITIES AND OUT OF THE SAME AN AMOUNT OF RS. 82,722/ - HAD ALSO BEEN SEPARATELY DISALLOWED BY THE ASSESSING OFFICER AND DISALLOWANCE HAS ALSO BEEN UPHELD BY CI T(A); AND C. AFTER EXCLUDING THE AMOUNT OF EX - GRATIA PAYMENT AND BAD DEBTS WRITTEN OFF THERE WAS ONLY AN AMOUNT OF RS. 2,13,668/ - DEBITED TO PROFIT & LOSS A CCOUNT, WHICH WAS ON ACCOUNT OF LEGAL COMPLIANCES AND COULD NOT BE SAID TO BE RELATED TO INVESTMENT ACTIVITIES AND, THEREFORE, NO DISALLOWANCE IN RESPECT THEREOF WAS ALSO CALLED FOR. 3.3 THAT KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE CASE NO DISALLOWANCE UNDER CLAUSE (III) OF RULE 80(2) OF INCOME TAX RULES WAS CALLED FOR IN THE FACTS AND CIRC UMSTANCES OF THE CASE OF THE APPELLANT. 3.4 THAT CIT(A) ALSO ERRED IN HOLDING THAT THE RULE 80 DOES NOT PROVIDE FOR LIMITING THE AMOUNT OF DISALLOWANCE COMPUTED BY APPLYING THE FORMULA S PECIFIED IN THE SAID RULE TO THE EXTENT OF TOTAL EXPENSES CLAIMED BY THE APPELLANT AS DEDUCTION. 4. THAT THE CIT(A) ALSO ERRED IN UPHOLDING THE DISALLOWANCE MADE BY THE ASSESSING OFFICER FOR AMOUNT OF RS. 82,772/ - BEING THE DEPOSITS OF RS. 10,000/ - EACH WITH FOUR GOVERNMENT DEPARTMENTS AND OF RS. 5,000/ - EACH WITH TWO GOVE RNMENT DEPARTMENTS AGGREGATING TO RS. 50,000/ - AND INTEREST THEREON ACCRUED OF RS. 32,722/ - WHICH COULD NOT BE RECOVERED WITHOUT APPRECIATING THAT THE AMOUNTS HAD BEEN WRITTEN OFF BY THE COMPANY IN THE BOOKS OF ACCOUNT FOR THE REASON THAT THE SAME COULD NOT BE RECOVERED IT A NO. 1625 /DEL /201 3 3 FOR QUITE LONG PERIOD AND THE COST OF FOLLOWING UP THE RECOVERY THEREOF WOULD HAVE BEEN MORE THAN THE AMOUNT OF DEPOSITS WITH EACH OF THE DEPARTMENT AND ACCORDINGLY DEDUCTION FOR THE SAME IS ALLOWABLE EITHER AS BAD DEBTS OR BUSINESS LOSS. 3. APROPOS GROUND NO.1, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE CIT(A) HAS ERRED IN NOT CORRECTLY APPRECIATING THE FACTS AND THE DOCUMENTS SUBMITTED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER AS WELL AS FIRST APPELLATE AUTHORITY IN RESPECT OF EMPLOYMENT AS WELL AS AGGREGATE PAYMENT OF RS.12,60,194/ - MADE TO EX - EMPLOYEES MS. CHRISTEN D MELLO AND MR. CHETAN MADAN. LD. COUNSEL FURTHER POINTED OUT THAT THE CIT(A) WRONGLY OBSERVED THAT THE APPOINTMENT LETTER HAD BEEN FILED RELATED DIFFERENT PERSONS AND NO EVIDENCE FOR PAYMENT HAD BEEN FILED. LD. COUNSEL POINTED OUT THAT BEFORE THE AO THE ASSESSEE SUBMITTED A COPY OF THE LETTER DATED 15.11.2011 AND ALSO SUBMITTED THAT THE ASSESSEE COMPANY HAD PAID EX - GRATIA PAYMENT TO MR. CHETAN MADAN AND MS. CHRISTE N D MELLO AMOUNTING TO RS. 12,59,591/ - AND RS.603/ - WAS THE CONTRIBUTION TO THE PROVIDENT FUND AND OTHER FUNDS AND THE SAID AMOUNT IS RELATED TO DEDUCTION MADE OUT OF AMOUNT PAID TO MR. CHETAN MADAN . LD. COUNSEL FURTHER POINTED OUT THAT THE ASSESSEE COMPANY FILED COPIES OF APPOINTMENT LETTERS OF THESE EMPLOYEES VIDE WRITTEN SUBMISSION DATED 28.11.2011 BEFORE THE AO BUT THE SAME WERE NOT CONSIDERED PROPERLY. LD. COUNSEL ALSO POINTED OUT PB. PAGES 33 TO 36 AND SUBMITTED THAT MS. CHRISTEN D MELLO WAS APPOINTED AS SECRETARY W.E.F. 6.10.1999 AND ON HER DEATH EX - GRATIA PAYMENT WAS MADE TO HER LEGAL HEIR/SUCCESSOR MR. TRE V OR D MELLO AMOUNTING TO RS.5,28,427/ - BY WAY OF CHEQUE DATED 23.07.2008. IT A NO. 1625 /DEL /201 3 4 4. LD. COUNSEL FURTHER POINTED OUT PB . PAGES 37 TO 40 AND SUBMITTED THAT MR. CHETAN MADAN WAS APPOINTED AS MARKETING EXECUTIVE TO BE POSTED AT RATLAM, MADHYA PRADESH W.E.F. 01.4.1997 AND A PAYMENT OF EX - GRATIA WAS MADE TO HIM OF RS.7,02,832/ - WHICH CANNOT BE DOUBTED IN ANY MANNER. LD. COUNSEL ALSO POINTED OUT THAT THE ASSESSIN G OFFICER DISALLOWED THESE AMOUNTS WITHOUT ANY BASIS WRONGLY HOLDING THAT THE ASSESSEE COMPANY BORE EX - GRATIA LIABILITY EITHER ON BEHALF OF M/S RANBAXY LABORATORIES OR M/S SOLREX PHARMACEUTICALS COMPANY BECAUSE APPOINTMENT LETTERS ISSUED BY THE COMPANIES W ERE PLACED BEFORE THE AO WHICH WERE NOT PROPERLY CONSIDERED. 5 . REPLYING TO THE ABOVE, LD. DEPARTMENTAL REPRESENTATIVE (DR) POINTED OUT THAT THE ASSESSEE COMPANY CLAIMING THE PAYMENT OF EX - GRATIA TO THE HEIRS OF LATE MS. CHRISTEN D MELLO AND APPOINTMENT L ETTER HAS BEEN ADDRESSED TO MS. CHRISTEN D S O UZA WHICH CREATED SUSPICION AND THEREFORE, THE SAME WAS RIGHTLY DISALLOWED BY THE AO. LD. DR FURTHER POINTED OUT THAT NO EVIDENCE WAS PLACED BY THE ASSESSEE IN REGARD TO PAYMENT MADE TO MR. CHETAN MADAN AND APPO INTMENT LETTER FILED BY THE ASSESSEE IN REGARD TO MS. CHRISTEN D MELLO WAS IN RESPECT OF DIFFERENTLY NAMED PERSONS I.E. MR. CHRISTEN D S O UZA , THEREFORE, THESE EX - GRATIA PAYMENTS WERE RIGHTLY DISALLOWED. 6 . ON CAREFUL CONSIDERATION OF ABOVE SUBMISSIONS, WE CLEARLY OBSERVED THAT THE ASSESSEE COMPANY FILED APPOINTMENT LETTERS OF MS. CHRISTEN D S O UZA AND MR. CHETAN MADAN BEFORE THE AO AND EX - GRATIA PAYMENT WAS MADE TO THE HEIRS OF LATE IT A NO. 1625 /DEL /201 3 5 MS. CHRISTEN D MELLO AND NO EVIDENCE REGARDING PAYMENT TO MR. CHETAN MADAN HAS BEEN FURNISHED BEFORE THE AUTHORITIES BELOW. HOWEVER, WE ARE OF THE CONSIDERED VIEW THAT THE ASSESSING OFFICER HAS RAISED ALLEGATION AGAINST THE ASSESSEE THAT NO EMPLOYEE WAS ON THE ROLE OF ASSESSEE COMPANY AND IMPUGNED PAYMENT HAS BEEN MADE EITHER ON BEHALF OF M/S RANBAXY LABORATORIES LTD. OR M/S SOLREX PHARMACETUICALS COMPANY BUT THIS ALLEGATION HAS BEEN MADE ON THE BASIS OF DOUBT WITHOUT BRINGING OUT ANY SUFFICIENT MATERIAL OR EVIDENCE. IN THIS SITUATION , WHEN THE QUANTUM OF PAYMENT HAS NOT BEEN DOUB TED AND THE ASSESSEE COMPANY IS CONTENDED THAT MS. CHRISTEN D S O UZA W ORKED AS A SECRETARY FROM 6.10.1999 AND MR. CHETAN MADAN WORKED AS MARKETING EXECUTIVE POSTED AT RATLAM FROM 01.04.1997 . WE, THEREFORE , ARE OF THE CONSIDERED VIEW THAT IT WOULD BE JUST AN D PROPER TO ALLOW ASSESSEE TO SHOW EVIDENCE OF SERVICES RENDERED BY THEM AND EVIDENCE PAYMENT OF EX - GRATIA PAYMENT AS CLAIMED BY THE ASSESSEE FOR THE ASSESSMENT YEAR UNDER CONSIDERATION. ACCORDINGLY , THIS ISSUE REQUIRES EXAMINATION AND VERIFICATION AT THE END OF AO AND THEREFORE, THE SAME IS RESTORED TO THE FILE OF AO FOR PROPER VERIFICATION AND EXAMINATION IN THE MANNER AS INDICATED ABOVE AND AFTER AFFORDING DUE OPPORTUNITY OF HEARING TO THE ASSESSEE AND WITHOUT BEING PREJUDICE WITH THE EARLIER ASSESSMENT ORDER AND OBSERVATION IN THE IMPUGNED ORDER. ACCORDINGLY, GROUND NO.1 OF THE ASSESSEE IS DEEMED TO BE ALLOWED FOR STATISTICAL PURPOSES. IT A NO. 1625 /DEL /201 3 6 GROUND NOS. 2 & 4 7 . APROPOS GROUND NOS. 2 &4, LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSING OFFICER WAS NOT JUSTIFIED IN DISALLOWING THE AMOUNT OF RS.82,772/ - DEBITED TO THE P&L ACCOUNT AS IRRECOVERABLE DUES FROM GOVERNMENT DEPARTMENT CANNOT BE ASCERTAINED UNRECOVERABLE. LD. COUNSEL POINTED OUT THAT ASSESSEE COMPANY DEPOSITED RS.10,000/ - EACH WITH FOUR GOVE RNMENT DEPARTMENT AND RS.5000/ - EACH WITH TWO GOVERNMENT DEPARTMENT S AGGREGATING TO RS.50,000/ - AND INTEREST THEREON ACCRUED OF RS.32,722/ - COULD NOT BE RECOVERED DUE TO BAD MECHANISM OF WORKING OF THE RELEVANT GOVERNMENT DEPARTMENTS. ACCORDINGLY, DEDUCTIO N FOR THE SAME IS ALLOWABLE EITHER AS BAD DEBTS OR AS BUSINESS LOSS. LD. COUNSEL FURTHER POINTED OUT THAT THE ASSESSING OFFICER IN PARA 5 OF THE ASSESSMENT ORDER H AS NOTED PAST DUES TO THEIR EMPLOYEES AMOUNTING TO RS.2,42,543/ - BUT THE SAME WAS NOT DISALLO WED AND NOT ADDED TO THE TAXABLE INCOME OF THE ASSESSEE AND CIT(A) WITHOUT ANY BASIS PICKED THIS FIGURE FOR ALSO UPHOLDING AND MAKING DISALLOWANCE IN THIS REGARD. LD. COUNSEL FURTHER CONTENDED THAT THE ASSESSING OFFICER DID NOT ASK ANY DETAILS/EXPLANATION OF EVIDENCE IN THIS REGARD AND THE CIT(A) WAS NOT CORRECT IN HOLDING THAT ASSESSEE HAS NOT SUBMITTED ANY DETAIL LIKE NAME OF THE ASSESSEE OR AMOUNT DUES FROM THE EMPLOYEE FOR THE CLAIM OF EXPENSES. LD. COUNSEL VEHEMENTLY CONTENDED THAT WITHOUT ANY EXAMINAT ION AND VERIFICATION BY THE AO OR BY THE CIT(A) HERSELF , THE IMPUGNED AMOUNT CANNOT BE DISALLOWED AND HENCE, THE CIT(A) WAS NOT JUSTIFIED IN HOLDING THAT THE AMOUNT DOES NOT IT A NO. 1625 /DEL /201 3 7 REPRESENTED A BAD DEBT S AS THE SAME AMOUNTS WERE NEVER BEEN CLAIMED AS BUSINESS AS SETS AND T H EREFORE, ON THE BASIS OF PRINCIPAL ACCOUNTANCY THE SAME CANNOT BE CLAIMED AS BAD DEBTS. LD. COUNSEL ALSO POINTED OUT THAT THE ASSESSEE IS PREPARED TO SUBMIT ALL REQUIRED DETAILS AND EVIDENCE TO SUPPORT HIS CLAIM. 8 . LD. DR REPLIED THAT THE ASSE SSING OFFICER DID NOT ASK ANY DETAIL OR EXPLANATION ABOUT THE AMOUNT OF BAD DEBT SHOWN BY THE ASSESSEE AND THE ASSESSING OFFICER ALSO DID NOT MAKE ANY DISALLOWANCE IN THIS REGARD BUT THE CIT(A) ENJOYING CO TERMINUS POWER S WITH THE AO , RIGHTLY DISALLOWED TH E CLAIM IN ABSENCE OF DETAILS OR EXPENDITURE, NAMES OF EMPLOYEES AND AMOUNT DUES TO THEM FOR THE CLAIM OF BAD DEBTS, THEREFORE, THE IMPUGNED DISALLOWANCE IS SUSTAINABLE. LD. DR VEHEMENTLY CONTENDED THAT THE DEPOSIT AND INTEREST RECOVERABLE FROM GOVERNMENT DEPARTMENT CANNOT BE HELD AS BAD DEBT IF THE ASSESSEE IS NOT MAKING ANY EFFORT TO RECOVER THIS AMOUNT FROM THE RELEVANT GOVERNMENT DEPARTMENT. 9 . IN THIS REGARD TO ISSUE OF ALLOWABILITY OF RS.2,42,543/ - , WE CLEARLY OBSERVED THAT THE ASSESSING OFFICER HAS POINTED OUT THIS AMOUNT BUT HAS NOT MADE ANY ADDITION OR DISALLOWANCE IN THIS REGARD. BUT THE CIT(A) PICKED UP THIS ISSUE AND MADE A DISALLOWANCE BY HOLDING THAT THE REQUIRES DETAILS NAMES OF THE EMPLOYEES AND AMOUNT DUES IS NOT ASCERTAINABLE. IT WAS CONTE NDED BY THE LD. DR THAT THERE WAS NO ISSUE BEFORE THE CIT(A) IN REGARD TO GROUND NO.2 BUT FORM NO.35, WE CLEARLY OBSERVE THAT THIS ISSUE HAS BEEN RAISED BY THE ASSESSEE BEFORE THE CIT(A) AS GROUND NO.1. WE FURTHER NOTE THAT THE ASSESSING OFFICER IGNORED TO ADJUDI CATE THE IT A NO. 1625 /DEL /201 3 8 ALLOWABILITY AMOUNT OF BAD DEBT TO THE EMPLOYEES AND THE CIT(A) MADE THE ADDITION BY HOLDING THAT NO DETAILS AND EVIDENCE HAVE BEEN FILED IN THIS REGARD WITHOUT PROVIDING ANY OPPORTUNITY OF BEING HEARD FOR THE ASSESSEE . THEREFORE, THIS ISSUE WAS N OT PROPERLY ADJUDICATED BY THE REVENUE AUTHORITIES BELOW AND THE DISALLOWANCE AND ADDITION HAS BEEN MADE IN A CASUAL MANNER. WE MAY POINT OUT THAT IF THE ASSESSING OFFICER HAS RAISED SAME ISSUE IT HAS NOT MADE ANY ADDITION THEN THE CIT(A) CANNOT PICKED UP THIS ISSUE MAKING FURTHER DISALLOWANCE AND ENHANCEMENT WITHOUT ADOPTING DUE OPPORTUNITY OF HEARING OF THE ASSESSEE BY SIMPLY HOLDING THAT NO DETAILS OR EVIDENCE HAVE BEEN FILED. IN THIS SITUATION, WE HAVE NO ALTERNATE TO RESTORE TO THE FILE OF THE AO FOR P ROPER EXAMINATION AND VERIFICATION AND AFFORDING DUE OPPORTUNITY OF HEARING FOR THE ASSESSEE AND WITHOUT BEING PREJUDICE BY THE EARLIER ASSESSMENT ORDER OR IMPUGNED ORDER. ACCORDINGLY, GROUND NO.2 OF THE ASSESSEE IS DEEMED TO BE ALLOWED FOR STATISTICAL PUR POSES AS INDICATED ABOVE. 10 . IN RESPECT TO DISALLOWANCE OF RS.82,722/ - , LD. COUNSEL FOR THE ASSESSEE HAS PLACED RELIANCE ON THE DECISION OF ITAT CHENNAI C BENCH IN THE CASE OF Q UINTEGRA SOLUTIONS (P) LTD. VS. ITO REPORTED IN (2012) 75 DTR (CHENNAI) (TR IB.) 302 AND SUBMITTED THAT THERE IS NO DISTINCTION BETWEEN PRIVATE DEBTS AND GOVERNMENT DEBTS FOR THE PURPOSE OF SECTION 36(1) OF THE ACT AND IF DESPITE OF SEVERAL APPLICATION THE ASSESSEE IS NOT ABLE TO RECOVER DEPOSIT AND INTEREST FROM THE GOVERNMENT DE PARTMENTS THEN THE SAME SHOULD BE ALLOWED AS BAD DEBTS AND THE IT A NO. 1625 /DEL /201 3 9 SAME CANNOT BE DISALLOWED. LD. DR SUPPORTED THE ORDER OF THE AUTHORITIES BELOW AND SUBMITTED THAT WITHOUT SHOWING ANY EFFORTS FOR RECOVERY IT CANNOT BE ASCERTAINED THAT THE AMOUNT DUES FROM GOV ERNMENT DEPARTMENT S HA VE BECOME IRRECOVERABLE. 1 1 . ON CAREFUL CONSIDERATION OF ABOVE SUBMISSION, WE NOTE THAT THE ORDER OF THE ITAT, CHENNAI BENCH IN THE CASE OF Q UINTEGRA SOLUTIONS (P) LTD. (SUPRA) HAS OBSERVED AS UNDER: - 7.1. THE FIRST GROUND RAI SED BY THE REVENUE IN THE PRESENT APPEAL IS THAT THE CIT(A) HAS ERRED IN DELETING THE ADDITION MADE BY THE AO OF 70,54,506/ - AGAINST BAD DEBTS WRITTEN OFF. THE MAIN GRIEVANCE OF THE REVENUE IS THAT THE ASSESSEE HAS WRITTEN OFF EVEN THE AMOUNTS RECEIVABLE FROM THE GOVERNMENT OF INDIA. THE ASSESSEE HAS SATISFIED ALL THE CONDITIONS FOR WRITING OFF OF THE DEBTS AS PROVIDED UNDER S . 36(1) OF THE INCOME - TAX ACT, 1961. WHEN THE DEBTS ARE SO WRITTEN OFF, IT HAS BEEN HELD BY THE HON BLE BOMBAY HIGH COURT IN THE CASE OF DIRECTOR OF I T (INTERNATIONAL TAXATION) VS. OMAN INTERNATIONAL BANK SAOG (2009) 223 CTR (BOM) 382 : (2009) 21 DTR (BOM) 193 : (2009) 313 ITR 128 (BOM) , THAT THE BAD DEBTS ARE DEDUCTIBLE. THIS JUDGMENT OF THE HON BLE BOMBAY HIGH COURT HAS BEEN UPHELD BY THE HON BLE SUPREME COURT BY DISMISSING THE SLP FILED BY THE REVENUE [(2009) 313 ITR (ST.) 3 ] . THERE IS NO DISTINCTION BETWEEN PRIVATE DEBTS AND GOVERNMENT DEBTS F OR THE PURPOSE OF S . 36(1) OF THE ACT. SO ALSO THERE IS NO GUARANTEE THAT THE ASSESSEE MAY GET THE PAYMENT FROM THE GOVERNMENT COMPANIES WITHIN A REASONABLE TIME. THEREFORE, GOVERNMENT DEBTS AS SUCH DO NOT MAKE ANY DIFFERENC E IN THE PRESENT CASE. THE C IT(A) ) HAS RIGHTLY DELETED THE ADDITION. 1 2 . IN VIEW OF ABOVE, WE ARE INCLINED TO HOLD THAT THE CIT(A) WAS NOT JUSTIFIED IN HOLDING THAT THE GOVERNMENT DEPARTMENTAL DUES CANNOT BE CLAIMED AS IRRECOVERABLE , UNTIL AND UNLESS SUCH A DECISION IS TAKEN BY THE RESPECTIVE GOVERNMENT DEPARTMENT AND A LETTER TO THIS EFFECT ISSUED BY IT. HOWEVER, WE ARE OF THE CONSIDERED VIEW NEITHER THE ASSESSING OFFICER NOR THE CIT(A) HAS EXAMINED THE ISSUE PROPERLY AS THEY HAVE NO T ASKED AN Y EXPLANATION FROM THE ASSESSEE TO SHOW THAT THE CLAIM AMOUNT OF DEPOSIT AND INTEREST IS DUE FROM WHICH DEPARTMENT , FROM WHICH DATE AND IT A NO. 1625 /DEL /201 3 10 WHAT EFFORTS HAVE BEEN MADE BY THE ASSESSEE COMPANY TO RECOVER THIS AMOUNT. EVEN THE DETAILS OF DEPARTMENT S AND THE DATE S OF DEPOSIT AND INTEREST ACCRUED THEREON HAS NOT BEEN GIVEN , THEREFORE , WE AGAIN FIND I T APPROPRIATE , JUST AND PROPER TO RESTORE THIS ISSUE TO THE FILE OF THE AO FOR PROPER VERIFICATION AND EXAMINATION IN THE LIGHT OF OBSERVATION MADE BY THE COORDINATE BE NCH OF THE TRIBUNAL IN THE CASE OF QUINTEGRA SOLUTIONS (P) LTD. (SUPRA). ACCORDINGLY GROUND NO.4 OF THE ASSESSEE IS DEEMED TO BE ALLOWED FOR STATISTICAL PURPOSES AS INDICATED ABOVE. GROUND NO.3 1 3 . APROPOS THIS GROUND, LD. COUNSEL FOR THE ASSESSEE DRAWN O UR ATTENTION TO PB . PAGE 79 , THE P&L ACCOUNT FOR THE YEAR ENDED ON 31.03.2009 , AND SUBMITTED THAT THE ASSESSEE HAS CLAIMED PERSONAL COST OF RS.12,60,194/ - BEING EX - GRATIA DEBITED AS PERSONAL COST AND AMOUNT OF RS.3,25,315/ - ON ACCOUNT OF BAD DEBT WRITTEN O FF AND AFTER EXCLUDING AMOUNT OF EX - GRATIA PAYMENT AND BAD DEBTS WRITTEN OFF THERE WAS ONLY AN AMOUNT OF RS.2,13,668/ - DEBITED TO P&L ACCOUNT , ON ACCOUNT OF LEGAL COMPLIANCES AND THE SAME COULD NOT BE SAID TO BE RELATED TO INVESTMENT ACTIVITIES AND THEREFO RE , NO DISALLOWANCE IN RESPECT THEREOF CAN BE MADE U/S 14A OF THE ACT R.W.C.(III) OF RULE 8D(2) OF IT RULES, 1962. LD. DR FAIRLY ACCEPTED THAT THE ASSESSEE HAS SHOWN PERSONAL COST OF RS.12,60,194/ - AND GENERAL AND ADMINISTRATIVE EXPENSES AMOUNTING TO RS.5, 38,983/ - AS PER SCHEDULE 15 TO THE STATEMENT OF THE ACCOUNT , WHICH INCLUDE AMOUNT OF BAD DEBTS WRITTEN OFF RS.3,25,315/ - EXPENDITURE ON IT A NO. 1625 /DEL /201 3 11 GENERAL AND ADMINISTRATIVE REMAINED OF RS.2,13,668/ - ACTUALLY DEBITED TO THE PROFIT AND LOSS ACCOUNT. 14. LD. COUNSEL F OR THE ASSESSEE PLACING REJOINDER TO THE ABOVE SUBMISSION SUBMITTED THAT THE DISALLOWANCE CANNOT EXCEED THE EXPENDITURE ACTUALLY CLAIMED BY THE ASSESSEE. HE PLACED RELIANCE ON THE DECISION OF ITAT C BENCH DATED 23.03.2012 IN THE CASE OF M/S GILLETTE GROU P INDIA PVT. LTD. VS. ACIT REPORTED IN 2012 - (ID1) - GJX - 0207 - TDEL . 1 5 . ON CAREFUL CONSIDERATION OF RIVAL SUBMISSION S AND CONTENTION, AT THE VERY OUTSET, WE NOTE THAT THE HON BLE JURISDICTIONAL DELHI HIGH COURT IN COMPANY PETITION NO.385 OF 2012 JUDGMENT DAT ED 07.12.2012 HAS SANCTIONED THE CLAIM OF AMALGAMATION U/S 391 & 394 OF THE COMPANIES ACT 1956 BETWEEN THE ASSESSEE COMPANY AND OTH ER FOUR COMPANIES IN T O RANBAXY DRUG LTD. LYING THEIR RESPECTIVE SHARE HOLDERS AND CREDITORS. FROM THE ORDER OF THE HON BLE P UNJAB & HARYANA HIGH COURT DATED 06.0.2013 IN COMPANY PETITION NO.80 OF 2012 (O&M) CONNECTED WITH COMPANY PETITION NO. 57 OF 2012 , WE ALSO OBSERVED THAT THE SCHEME OF AMALGAMATION OF THE ASSESSEE COMPANY AND SOLREX PHARMACEUTICALS COMPANY LTD. HAS BEEN SAN CTIONED. IN THE LIGHT OF THESE JUDGMENTS, WE IN SAFELY NOTED THAT THE ASSESSEE COMPANY AND M/S SOLREX PHARMACEUTICALS LTD. HAVE BEEN AMALGAMATED WITH RANBAXY DRUG LTD. SUBSEQUENTLY. 1 6 . IN VIEW OF DECISION OF ITAT BENCH IN THE CASE OF M/S GILLETTE GROUP I NDIA PVT. LTD. (SUPRA) , WE RESPECTFULLY ACCEPT THIS PREPOSITION THAT THE DISALLOWANCE U/S IT A NO. 1625 /DEL /201 3 12 14A R.W.R. 8D OF THE IT RULES CANNOT EXCEED THE AMOUNT WHICH HAS BEEN ACTUALLY CLAIMED BY THE ASSESSEE IN THE P&L A CCOUNT ON GENERAL AND ADMINISTRATIVE EXPENSES. IN T HE PRESENT CASE, THE ASSESSING OFFICER HAS MADE DISALLOWANCE OF RS.64,23,249/ - . FROM THE IMPUGNED ORDER OF THE CIT(A) , WE NOTE THAT THE ADDITION WAS UPHELD THE DISALLOWANCE MADE BY THE AO WAS CONFIRMED BY THE FIRST APPELLATE AUTHORITY WITH THE FOLLOWING OB SERVATION AND CONCLUSION: - 5.2 I HAVE CAREFULLY CONSIDERED THE ASSESSMENT ORDER AND THE SUBMISSIONS FILED BY THE APPELLANT. THE FACTS OF THE CASE AS PER ASSESSMENT ORDER ARE THAT THE ASSESSEE COMPANY HAS INVESTED INTEREST BEARING FUNDS BORROWED FROM M/S. RANBAXY LABORATORIES LTD. IN ITS PARTNERSHIP FIRM M/S. SOLREX PHARMACEUTICALS COMPANY FROM WHICH IT HAS EARNED EXEMPT INCOME. THE ASSESSING OFFICER COMPUTED A DISALLOWANCE OF RS. 49,249/ - UNDER CLAUSE (I) AND RS.63,74,000/ - UNDER CLAUSE (III). THE APPELLAN T HAS MAINLY SUBMITTED THAT THE AMOUNT OF DISALLOWANCE UNDER CLAUSE (III) ARE MORE THAN THE TOTAL EXPENSES DEBITED BY IT TO THE PROFIT & LOSS ACCOUNT. PERUSAL OF THE ASSESSMENT ORDER SHOWS THAT THE ASSESSING OFFICER HAS EXPRESSED HIS SATISFACTION BEFORE T AKING RECOURSE TO RULE 8 D . ON CAREFUL EXAMINATION OF THE MATTER, I FIND THAT ANY INCOME, WHETHER EXEMPT OR NOT, CAN ONLY BE EARNED AFTER INCURRING SOME EXPENDITURE. HOWEVER, USUALLY SUCH EXPENDITURE IS NOT SEGREGATED IN THE ACCOUNTS OF THE ASSESSEE AND REM AINS CLUBBED WITH OVERALL ADMINISTRATIVE FINANCIAL AND OTHER EXPENSES OF THE BUSINESS AS A WHOLE. IF ANY INCOME IS EXEMPT FROM TAX BECAUSE IT IS NOT INCLUDED IN THE TOTAL INCOME BY VIRTUE OF SECTION 10 OF THE INCOME - TAX ACT, 1961, SECTION 14A OF THE ACT PR OHIBITS ALLOWANCE OF ANY EXPENDITURE INCURRED IN RELATION THERETO. INCOME FROM DEPLOYMENT OF FUNDS IN SHARES EARNED BY WAY OF DIVIDEND IS NOT INCLUDED IN TOTAL INCOME BY VIRTUE OF THE PROVISIONS CONTAINED IN SECTION 10(34) OF THE ACT, WHETHER THE SHARES AR E HELD AS STOCK - IN - TRADE OR AS INVESTMENT. AS DIVIDEND INCOME DOES NOT FORM PART OF TOTAL INCOME UNDER THE ACT, THE PROVISIONS OF SECTION 14A ARE APPLICABLE. THE ALLOWANCE OF EXPENDITURE IN RELATION TO DIVIDEND INCOME IS THUS NOT ADMISSIBLE IN COMPUTING TH E INCOME OF AN ASSESSEE WHETHER THE SHARES ARE HELD AS INVESTMENT OR THEY ARE HELD ON TRADING ACCOUNT AS STOCK - IN - TRADE. WHEN THE EXPENDITURE OF INTEREST IS INCURRED IN RELATION TO INCOME WHICH DOES NOT FORM PART OF TOTAL INCOME, DISALLOWANCE IS MADE IRRE SPECTIVE OF THE FACT WHETHER ANY INCOME IS EARNED BY THE ASSESSEE OR NOT AS SECTION 14A DOES NOT ENVISAGE ANY SUCH EXCEPTION. THE PROVISIONS OF SECTION 14A, CONTROLS THE COMPUTATION OF INCOME UNDER THE PROVISIONS OF THE ACT AND HAS OVERRIDING EFFECT OVER O THER PROVISIONS. THEREFORE, EVEN IF THE EXPENDITURE IS ALLOWABLE UNDER ANY OTHER PROVISION OF THE ACT, DISALLOWANCE IS MADE BECAUSE OF THE OVERRIDING EFFECT OF SECTION 14A OF THE ACT. 5.3 THE LEGISLATURE BY USING THE EXPRESSION 'EXPENDITURE IN RELATION TO INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME' IN SECTION 14A OF THE ACT, IN NO WAY IT A NO. 1625 /DEL /201 3 13 INDICATES THAT IT DOES NOT ENCOMPASS DISALLOWANCE OF EXPENDITURE INCURRED IN RELATION TO THE INCOME IN THE ABSENCE OF ACTUAL RECEIPT OF INCOME DURING THE RELEVANT PRE VIOUS YEAR. ON THE CONTRARY, THE TERM 'IN RELATION TO' IS WIDE ENOUGH TO INCLUDE IN ITS SWEEP EXPENDITURE BOTH 'FOR MAKING OR EARNING INCOME' AND 'INCURRED WHOLLY AND EXCLUSIVELY FOR THE PURPOSES OF BUSINESS CARRIED ON BY THE ASSESSEE'. WHEN THERE IS NO I NCOME, IT CANNOT FORM PART OF ANYTHING AND CERTAINLY IT DOES NOT, IN ANY CASE FORM PART OF TOTAL INCOME. WHEN DIVIDEND IS NOT TAXABLE AT ALL, THE INTEREST PERTAINING TO THAT WOULD ALSO NOT BE ALLOWABLE BECAUSE THERE IS NO TAXABLE INCOME OF THE ASSESSEE AGA INST WHICH SUCH INTEREST CAN BE ALLOWED. 5.4 FURTHER, SUB - SECTION (2) OF SECTION 14A EMPOWERS THE AO TO DETERMINE THE AMOUNT OF EXPENDITURE INCURRED IN RELATION TO EXEMPT INCOME IN ACCORDANCE WITH THE METHOD AS MAY BE PRESCRIBED. THE METHOD HAS SINCE BEEN PRESCRIBED BY INSERTION OF RULE 80 OF THE LT. RULES, 1962 W.E.F. 24.03.2008. SUB - SECTION (3) OF SECTION 14A MANDATES THAT THE ABOVE PROVISIONS OF SUB - SECTION (2) SHALL ALSO APPLY TO A CASE WHERE AN ASSESSEE CLAIMS THAT NO EXPENDITURE HAS BEEN INCURRED BY HIM IN RELATION TO EXEMPT INCOME. THE CONSTITUTIONAL VALIDITY OF SECTION 14A READ WITH SUB - SECTIONS (1), (2) AND (3) THEREOF HAS SINCE BEEN UPHELD BY THE HON'BLE BOMBAY HIGH COURT VIDE ITS ORDER DATED 12.08.2010 IN THE CASE OF GODREJ & BOYEE MFG. CO. LTD. VS. DCIT IN ITA NO. 626 OF 2010 AND WRIT PETITION NO. 758 OF 2010 AFTER DWELLING ON THE ABOVE ISSUE IN GREAT DETAILS AND CONSIDERING DECISIONS OF VARIOUS COURTS AND TRIBUNALS ON THE MATTER INCLUDING THAT OF HON'BLE ITAT, MUMBAI (SPECIAL BENCH) IN THE CASE OF ITO VS. OAGA CAPITAL MANAGEMENT PVT. LTD. (2009) 117 ITO 169. THE HON'BLE HIGH COURT HAS ALSO UPHELD THE VALIDITY OF RULE 80, W.E.F. AY 2008 - 09. THE RELEVANT PORTION OF THE AFORESAID ORDER OF THE HON'BLE HIGH COURT IS REPRODUCED HEREUNDER: 74. OUR CO NCLUSIONS IN THIS JUDGMENT ARE AS FOLLOWS: I. DIVIDEND INCOME AND INCOME FROM MUTUAL FUNDS FALLING WITHIN THE AMBIT OF SECTION 10(33) OF THE INCOME TAX ACT 1961, AS WAS APPLICABLE FOR ASSESSMENT YEAR 2002 - 03 IS NOT INCLUDIBLE IN COMPUTING THE TOTAL INCO ME OF THE ASSESSEE. CONSEQUENTLY, NO DEDUCTION SHALL BE ALLOWED IN RESPECT OF EXPENDITURE INCURRED BY THE ASSESSEE IN RELATION TO SUCH INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME UNDER THE ACT, BY VIRTUE OF THE PROVISIONS OF SECTION 14A(1); II) TH E PAYMENT BY A DOMESTIC COMPANY UNDER SECTION 1150(1) OF ADDITIONAL INCOME TAX ON PROFITS DECLARED, DISTRIBUTED OR PAID IS A CHARGE ON A COMPONENT OF THE PROFITS OF THE COMPANY. THE COMPANY IS CHARGEABLE TO TAX ON ITS PROFITS AS A DISTINCT TAXABLE ENTITY A ND IT PAYS TAX IN DISCHARGE OF ITS OWN LIABILITY AND NOT ON BEHALF OF OR AS AN AGENT FOR ITS SHAREHOLDERS. IN THE HANDS OF THE SHAREHOLDER AS THE RECIPIENT OF DIVIDEND, INCOME BY WAY OF DIVIDEND DOES NOT FORM PART OF THE TOTAL INCOME BY VIRTUE OF THE PROVI SIONS OF SECTION 10(33). INCOME FROM MUTUAL FUNDS STANDS ON THE SAME BASIS; III) THE PROVISIONS OF SUB SECTION (2) AND (3) OF SECTION 14A OF THE INCOME TAX ACT 1961 ARE CONSTITUTIONALLY VALID; IV) THE PROVISIONS OF RULE 80 OF THE INCOME TAX RULES AS IN SERTED BY THE INCOME TAX (FIFTH AMENDMENT) RULES 2008 ARE NOT ULTRA VIRES THE PROVISIONS OF IT A NO. 1625 /DEL /201 3 14 SECTION 14A, MORE PARTICULARLY SUB SECTION (2) AND DO NOT OFFEND ARTICLE 14 OF THE CONSTITUTION; V) THE PROVISIONS OF RULE 80 OF THE INCOME TAX RULES WHICH HAVE BEEN NOTIFIED WITH EFFECT FROM 24 MARCH 2008 SHALL APPLY WITH EFFECT FROM ASSESSMENT YEAR 2008 - 09;' IN ACIT V CITICORP FINANCE (INDIA) LIMITED [300 ITR 398(AT MUM)) IT WAS HELD THAT THE PROVISIONS OF SUB SECTIONS (2) & (3) ARE PROCEDURAL IN NATURE AND THE REFORE SECTION 14A WILL APPLY TO ALL PENDING MATTERS. THE HON'BLE CALCUTTA HIGH COURT IN DHANUKA & SONS VS. CIT 12 TAXMANN.COM 227 (CAL.) HELD THAT: 'IN OUR OPINION, THE MERE FACT THAT THOSE SHARES WERE OLD ONES AND NOT ACQUIRED RECENTLY IS IMMATERIAL. IT IS FOR THE ASSESSEE TO SHOW THE SOURCE OF ACQUISITION OF THOSE SHARES BY PRODUCTION OF MATERIALS THAT THOSE WERE ACQUIRED FROM THE FUNDS AVAILABLE IN THE HANDS OF THE ASSESSEE AT THE RELEVANT POINT OF TIME WITHOUT TAKING BENEFIT OF ANY LOAN. IF THOSE SH ARES WERE PURCHASED FROM THE AMOUNT TAKEN IN LOAN, EVEN FOR INSTANCE, FIVE OR TEN YEARS AGO, IT IS FOR THE ASSESSEE TO SHOW BY THE PRODUCTION OF DOCUMENTARY EVIDENCE THAT SUCH LOANED AMOUNT HAD ALREADY BEEN PAID BACK AND FOR THE RELEVANT ASSESSMENT YEAR, N O INTEREST IS PAYABLE BY THE ASSESSEE FOR ACQUIRING THOSE OLD SHARES. IN THE ABSENCE OF ANY SUCH MATERIALS PLACED BY THE ASSESSEE, IN OUR OPINION, THE AUTHORITIES BELOW RIGHTLY HELD THAT PROPORTIONATE AMOUNT SHOULD BE DISALLOWED HAVING REGARD TO THE TOTAL INCOME AND THE INCOME FROM THE EXEMPT SOURCE. IN THE ABSENCE OF ANY MATERIAL DISCLOSING THE SOURCE OF ACQUISITION OF SHARES WHICH IS WITHIN THE SPECIAL KNOWLEDGE OF THE ASSESSEE, THE ASSESSING AUTHORITY TOOK A MOST REASONABLE APPROACH IN ASSESSMENT.' THE C LAIM OF THE APPELLANT THAT THE AMOUNT OF DISALLOWANCE UNDER CLAUSE (III) IS MORE THAN THE TOTAL EXPENSE CLAIMED BY IT IS NOT ACCEPTED AS SECTION 14A IS A OVERRIDING SECTION AND RULE 80 DOES NOT PROVIDE A LIMIT TO THE AMOUNT OF DISALLOWANCE TO BE COMPUTED A FTER APPLYING THE FORMULA SPECIFIED IN THE SAID RULE. CONSIDERING THE ABOVE, THE IMPUGNED ADDITION OF RS. 64,23,249/ - MADE BY THE AO BY APPLYING RULE 80 READ WITH SECTION 14A OF THE ACT IS CONFIRMED. THIS GROUND OF APPEAL IS DISMISSED. 1 7 . IN VIEW OF ABOV E, WE OBSERVED THAT THE CIT(A) HAS REJECTED THE CONTENTION OF THE ASSESSEE THAT THE DISALLOWANCE U/S 14A OF THE ACT R.W.R. 8D OF THE IT RULES CANNOT EXCEED THE AMOUNT OF ACTUAL GENERAL AND ADMINISTRATIVE EXPENSES CLAIMED BY THE ASSESSEE. THIS IS NOT A PROP ER JUSTIFIABLE APPROACH AND CONTRARY TO THE BASIC PRINCIPAL VIVID FROM THE ORDER OF THE TRIBUNAL IN THE CASE OF GILLETTE INDIA PVT. LTD. IT A NO. 1625 /DEL /201 3 15 (SUPRA) . WE MAY FURTHER POINT OUT THAT THE ASSESSING OFFICER HAS NOTED THAT THE EXCESS AMOUNT OF RS.64,23,249/ - DEBITED TO P&L ACCOUNT IS BEING ADDED BACK TO THE NET PROFIT BUT WE ARE UNABLE TO SEE ANY BASIS FOR THIS SEGREGATION BY THE ASSESSING OFFICER FOR CALCULATING AND MAKING AND DISALLOWANCE U/S 14A OF THE ACT R.W.R. 8D(2) OF THE IT RULES 1962. 1 8 . AT THIS JUNCTURE, WE RESPECTFULLY TAKE COGNIZANCE ON THE DECISION OF HON BLE JURISDICTIONAL HIGH COURT OF DELHI IN THE CASE OF CIT VS. TAIKISHA ENGINEERING INDIA LTD. REPORTED IN (2015) 370 ITR 338 (DELHI) WHEREIN A CLEAR MODE OF CALCULATION OF DISALLOWANCE HAS BEEN GIVEN. UNDER THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND IT APPROPRIATE THAT THE ISSUE OF DISALLOWANCE U/S 14A OF THE ACT R.W.R. 8D OF THE IT RULES 1962 REQUIRES PROPER EXAMINATION AND VERIFICATION AT THE END OF AO AND WE RESTORE THE SAME TO THE FILE OF AO WITH A DIRECTION THAT THE ISSUE SHOULD BE DECIDED AFRESH. IN THE LIGHT OF DECISION OF HON BLE JURISDICTIONAL HIGH COURT OF DELHI IN THE CASE OF TAIKISHA ENGINEERING INDIA LTD.(SUPRA) AND DECISION OF COORDINATE BENCH OF THE ITAT DELHI IN THE CASE OF M/S GILLETTE GROUP INDIA PVT. LTD. (SUPRA) . A CCORDINGLY GROUND NO.3 & 3.1 TO 3.4 ARE ALSO RESTORE TO THE FILE OF THE AO FOR AFRESH ADJUDICATION AS PER OUR AFORESAID DIRECTIONS AND AFTER AFFORDING DUE OPPORTUNITY OF HEARING FOR THE ASSESSEE AND WITHOUT BEIN G PREJUDICED FROM THE EARLIER ASSESSMENT AND IMPUGNED ORDER . ACCORDINGLY, GROUND NOS. 3 & 3.1 TO 3.4 OF THE ASSESSEE ARE DEEMED TO BE ALLOWED FOR STATISTICAL PURPOSES AS INDICATED ABOVE. IT A NO. 1625 /DEL /201 3 16 19 . IN THE RESULT, APPEAL OF THE ASSESSEE IS DEEMED TO BE ALLOWED IN THE MANNER AS MENTIONED AND STATED ABOVE. TH E ORDER PRONOUNCED IN THE OPEN COURT ON 2 9 TH APRIL , 201 5 . SD/ - SD/ - (B.C. MEENA) ( C.M. GARG ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 2 9 TH APRIL , 201 5 . AKS/ - COPY FORWARDED TO 1 . APPELLANT 2 . RESPONDENT 3 . CIT 4 . CIT(A) 5 . DR ASST . REGISTRAR, ITAT, NEW DELHI