DCIT Circle 1, Tirupur V. Eastman Exports Global Clothing (P) Limited, Tirupur

ITA 1677/CHNY/2019

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 0429 (ITAT-CHENNAI)
• Duration Of Justice: 3 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-09-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2016-2017
• Appeal Filed On: 28-05-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Capital asset; Capital receipt; Revenue expenditure; Capital expenditure; Set aside
• Section: 10; 20

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI . . . , ! ' , $ '% BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER ./ ITA NOS.1676 & 1677/CHNY/2019 ( )( / ASSESSMENT YEARS : 2013-14 & 2016-17 THE JOINT COMMISSIONER OF INCOME TAX, (OSD), CIRCLE 1, NO.121, ADAMS PLAZA, 60 FEET ROAD, NAGAR SOUTH, TIRUPPUR 641 602. V. M/S EASTMAN EXPORTS GLOBAL CLOTHING PVT. LTD., NO.1012, 2 ND STREET, KUMAR NAGAR SOUTH, TIRUPUR 641 603. PAN : AACCC 0952 E (+,/ APPELLANT) (-.+,/ RESPONDENT) +, / 0 / APPELLANT BY : SHRI AR.V. SREENIVASAN, JCIT -.+, / 0 / RESPONDENT BY : SH. T. BANUSEKAR, CA 1 / 2$ / DATE OF HEARING : 31.07.2019 34) / 2$ / DATE OF PRONOUNCEMENT : 12.09.2019 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER : BOTH THE APPEALS OF THE REVENUE ARE DIRECTED AGAI NST THE RESPECTIVE ORDERS OF THE COMMISSIONER OF INCOME TAX (APPEALS) -3, COIMBATORE, DATED 12.03.2019 AND PERTAIN TO ASSESSM ENT YEARS 2013-14 AND 2016-17. WE HEARD BOTH THE APPEALS TOGETHER AN D DISPOSING THE SAME BY THIS COMMON ORDER. 2 I.T.A. NOS.1676 & 1677/CHNY/19 2. LETS FIRST TAKE ASSESSMENT YEAR 2013-14. THE O NLY ISSUE ARISES FOR CONSIDERATION IS DISALLOWANCE OF COST OF CONSTR UCTION OF THE BUILDING ON THE LEASEHOLD LAND. 3. SHRI AR.V. SREENIVASAN, THE LD. DEPARTMENTAL REP RESENTATIVE, SUBMITTED THAT THIS IS THE SECOND ROUND OF LITIGATI ON BEFORE THIS TRIBUNAL. IN THE FIRST ROUND OF LITIGATION, THIS TRIBUNAL BY AN ORDER DATED 09.11.2017, REMITTED BACK THE MATTER TO THE FILE OF THE ASSESSI NG OFFICER TO CONSIDER THE JUDGMENT OF MADRAS HIGH COURT IN CIT V. TVS LEA N LOGISTICS LTD. (2007) 293 ITR 432 AND THE JUDGMENT OF SUPREME COUR T IN CIT V. MADRAS AUTO SERVICE (P.) LTD. (1998) 233 ITR 468. ACCORDI NG TO THE LD. D.R., THE ASSESSING OFFICER, CONSEQUENT TO THE ORDER OF THIS TRIBUNAL REMITTING BACK FOR RE-EXAMINATION, FOUND THAT THE EXPENDITURE INCU RRED BY THE ASSESSEE IS CAPITAL IN NATURE. ACCORDING TO THE LD. D.R., T HE JUDGMENT OF MADRAS HIGH COURT AND THE APEX COURT MAY NOT BE APPLICABLE TO THE FACTS OF THE CASE. THE ASSESSING OFFICER DISTINGUISHED THE CASE AS THAT OF THE CASES BEFORE THE MADRAS HIGH COURT AND APEX COURT. THERE FORE, ACCORDING TO THE LD. D.R., THE CIT(APPEALS) IS NOT JUSTIFIED IN ALLOWING THE CLAIM OF THE ASSESSEE AS REVENUE IN NATURE. 4. ON THE CONTRARY, SH. T. BANUSEKAR, THE LD. REPRE SENTATIVE FOR THE ASSESSEE, REFERRING TO THE ORDER OF THE ASSESSING O FFICER, MORE PARTICULARLY AT PAGE 5, SUBMITTED THAT THE DISTINCT ION MADE BY THE ASSESSING OFFICER WITH REGARD TO THE CASE OF THE AS SESSEE AND THAT OF THE 3 I.T.A. NOS.1676 & 1677/CHNY/19 CASE BEFORE THE APEX COURT AND MADRAS HIGH COURT IN MADRAS AUTO SERVICE (P.) LTD. AND TVS LEAN LOGISTICS LTD. (SUPR A) RESPECTIVELY IS NOT CORRECT. AS IN THE CASE OF THE ASSESSEE, THE ASSES SEE BEFORE THE HIGH COURT AS WELL AS THE APEX COURT, TOOK THE VACANT LA ND AND CONSTRUCTED THE BUILDING. AFTER EXPIRY OF LEASE PERIOD, THE AS SESSEE IN BOTH THE CASES EITHER HAD TO DEMOLISH THE BUILDING OR LEAVE THE BU ILDING AS SUCH AND HANDED OVER THE POSSESSION TO THE LESSOR. ACCORDIN G TO THE LD. REPRESENTATIVE, SINCE THE CONSTRUCTION WAS MADE BY THE ASSESSEE AND NOMINAL RENT WAS PAID COMPARABLE TO THE MARKET RATE , THE DISTINCTION MADE BY THE ASSESSING OFFICER WITH REGARD TO THE CA SE OF THE ASSESSEE AND THAT OF THE CASE BEFORE THE APEX COURT AND MADR AS HIGH COURT IS FACTUALLY NOT CORRECT. HENCE, IN VIEW OF THE JUDGM ENT OF MADRAS HIGH COURT AS WELL AS THE APEX COURT, ACCORDING TO THE L D. REPRESENTATIVE, THE EXPENDITURE INCURRED BY THE ASSESSEE HAS TO BE ALLO WED AS REVENUE IN NATURE. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IN THE EARLIER ROUND OF LITIGATION, THIS TRIBUNAL IN I.T.A. NO.291/MDS/2017 , EXAMINED THIS ISSUE AND REMITTED BACK THE MATTER TO THE FILE OF THE ASS ESSING OFFICER WITH A DIRECTION TO RE-EXAMINE THE MATTER IN THE LIGHT OF THE JUDGMENT OF APEX COURT IN MADRAS AUTO SERVICE (P.) LTD. (SUPRA) AND THE JUDGMENT OF MADRAS HIGH COURT IN TVS LEAN LOGISTICS LTD. (SUPRA ). NOW, THE 4 I.T.A. NOS.1676 & 1677/CHNY/19 ASSESSING OFFICER HAS MADE A DISTINCTION BETWEEN TH E CASES BEFORE THE APEX COURT AND MADRAS HIGH COURT ON THE ONE HAND AN D THE CASE OF THE ASSESSEE ON THE OTHER HAND. THIS DISTINCTION MADE BY THE ASSESSING OFFICER, ACCORDING TO THE LD. REPRESENTATIVE, IS NO T CORRECT. WE HAVE GONE THROUGH THE ORDERS OF THE ASSESSING OFFICER AND BOT H THE CASES BEFORE THE APEX COURT AND THE HIGH COURT. IN THE CASE OF THE ASSESSEE BEFORE THE HIGH COURT AND APEX COURT, THE VACANT PROPERTY WAS TAKEN ON LEASE AND THE COST OF CONSTRUCTION WAS CLAIMED BY INCURRING H EAVY EXPENDITURE. IN BOTH THE CASES, THE ASSESSEE WAS PAYING A NOMINAL R ATE OF RENT WHEN COMPARED TO THE MARKET RATE OF LEASE. WE MAY SAY T HAT THE RENT PAID BY THE ASSESSEE MAY PERTAIN TO THE LAND SINCE THE SUPE RSTRUCTURE BELONGS TO THE ASSESSEE. AFTER EXPIRY OF LEASE, THE ASSESSEE HAS TO DEMOLISH OR MAY LEAVE THE CONSTRUCTION AS SUCH AND VACATE THE P REMISES. IN BOTH THE CASES, THE ASSESSEE HAS TO LOSE THE INVESTMENT MADE FOR CONSTRUCTION. THEREFORE, AS RIGHTLY SUBMITTED BY THE LD. REPRESEN TATIVE FOR THE ASSESSEE, THE DISTINCTION MADE BY THE ASSESSING OFF ICER BETWEEN THE CASE OF THE ASSESSEE AND THE CASES BEFORE THE APEX COURT AND THE MADRAS HIGH COURT IS NOT CORRECT. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE FACTS OF THE CASE ARE IDENTICAL TO THAT OF THE MADRAS HIGH COURT AND APEX COURT. 5 I.T.A. NOS.1676 & 1677/CHNY/19 6. WE HAVE CAREFULLY GONE THROUGH THE JUDGMENT OF A PEX COURT IN THE CASE OF MADRAS AUTO SERVICE (P) LTD. (SUPRA). THE APEX COURT AT PARA 6 OF ITS JUDGMENT OBSERVED AS FOLLOWS:- 6. THE TEST FOR DISTINGUISHING BETWEEN CAPITAL EXPENDIT URE AND REVENUE EXPENDITURE IN OUR COUNTRY WAS LAID DOWN BY THIS COURT IN ASSAM BENGAL CEMENT CO. LTD. V. CIT [1955] 27 ITR 34 . IN THAT CASE, THE APPELLANT-COMPANY HAD ACQUIRED FROM THE G OVERNMENT OF ASSAM LEASE OF CERTAIN LIMESTONE QUARRIES FOR A PER IOD OF 20 YEARS FOR THE PURPOSE OF MANUFACTURE OF CEMENT. THE LESSE E HAD, INTER ALIA, AGREED TO PAY AN ANNUAL SUM DURING THE WHOLE PERIOD OF THE LEASE AS A PROTECTION FEE AND IN CONSIDERATION OF T HAT PAYMENT, THE LESSOR UNDERTOOK NOT TO GRANT TO ANY PERSON ANY LEA SE, PERMIT OR PROSPECTING LICENCE FOR LIMESTONE. THIS COURT EXAMIN ED TESTS LAID DOWN IN VARIOUS CASES FOR DISTINGUISHING BETWEEN CA PITAL EXPENDITURE AND REVENUE EXPENDITURE. ONE OF THE STAND ARD TESTS NOW IN USE WAS LAID DOWN IN THE CASE OF ATHERTON V. BRITISH INSULATED AND HELSBY CABLES LTD. [1925] 10 TC 155. IT SA ID (PAGE 40 OF 27 ITR) : WHEN AN EXPENDITURE IS MADE, NOT ONLY ON CE AND FOR ALL BUT WITH A VIEW TO BRINGING INTO EXISTENCE AN AS SET OR AN ADVANTAGE FOR THE ENDURING BENEFIT OF A TRADE, I TH INK THAT THERE IS VERY GOOD REASON (IN THE ABSENCE OF SPECIAL CIRCUMS TANCES LEADING TO AN OPPOSITE CONCLUSION) FOR TREATING SUCH AN EXPE NDITURE AS PROPERLY ATTRIBUTABLE NOT TO REVENUE BUT TO CAPITAL . WHETHER BY SPENDING THE MONEY ANY ADVANTAGE OF AN ENDURING NAT URE HAS BEEN OBTAINED OR NOT WILL DEPEND UPON THE FACTS OF EACH CASE. MOREOVER, AS THE ABOVE PASSAGE ITSELF PROVIDES, THIS TEST WOU LD NOT APPLY IF THERE ARE SPECIAL CIRCUMSTANCES POINTING TO THE CON TRARY. THIS COURT IN THE ABOVE CASE SUMMARISED THE TESTS AS FOL LOWS (PAGE 44) : 1. OUTLAY IS DEEMED TO BE CAPITAL WHEN IT IS MADE FOR THE INITIATION OF A BUSINESS, FOR EXTENSION OF A BUSINESS, OR FOR A SUBSTANTIAL REPLACEMENT OF EQUIPMENT. 2. EXPENDITURE MAY BE TREATED AS PROPERLY ATTRIBUTABL E TO CAPITAL WHEN IT IS MADE NOT ONLY ONCE AND FOR ALL, BUT WITH A VIEW TO BRINGING INTO EXISTENCE AN ASSET OR AN ADVANTAGE FOR THE ENDU RING BENEFIT OF A TRADE. . . IF WHAT IS GOT RID OF BY A LUMP SUM PA YMENT IS AN ANNUAL 6 I.T.A. NOS.1676 & 1677/CHNY/19 BUSINESS EXPENSE CHARGEABLE AGAINST REVENUE, THE LUM P SUM PAYMENT SHOULD EQUALLY BE REGARDED AS A BUSINESS EXP ENSE, BUT IF THE LUMP SUM PAYMENT BRINGS IN A CAPITAL ASSET, THE N THAT PUTS THE BUSINESS ON ANOTHER FOOTING ALTOGETHER. 3. WHETHER FOR THE PURPOSE OF THE EXPENDITURE, ANY CA PITAL WAS WITHDRAWN, OR, IN OTHER WORDS, WHETHER THE OBJECT O F INCURRING THE EXPENDITURE WAS TO EMPLOY WHAT WAS TAKEN IN AS CAPIT AL OF THE BUSINESS. AGAIN, IT IS TO BE SEEN WHETHER THE EXPEND ITURE INCURRED WAS PART OF THE FIXED CAPITAL OF THE BUSINESS OR PAR T OF ITS CIRCULATING CAPITAL. (UNDERLINING OURS) RELYING UPON THE SECOND TEST ENUMERATED ABOVE, LEAR NED COUNSEL FOR THE APPELLANT HAD SUBMITTED THAT THE ASSESSEE GOT E NDURING BENEFIT OF A CAPITAL NATURE BY SPENDING THE AMOUNT BECAUSE THE ASSESSEE OBTAINED A NEW BUILDING FOR A PERIOD OF 39 YEARS. THE DIFFICULTY, HOWEVER, IN THE PRESENT CASE, ARISES FROM THE FACT THAT THIS BUILDING WAS NEVER TO BELONG TO THE ASSESSEE. RIGHT FROM INCEPTION, THE BUILDING WAS OF THE OWNERSHIP OF THE LESSOR. TH EREFORE, BY SPENDING THIS MONEY, THE ASSESSEE DID NOT ACQUIRE A NY CAPITAL ASSET. THE ONLY ADVANTAGE WHICH THE ASSESSEE DERIVED BY SP ENDING THE MONEY WAS THAT IT GOT THE LEASE OF A NEW BUILDING A T A LOW RENT. FROM THE BUSINESS POINT OF VIEW, THEREFORE, THE ASS ESSEE GOT THE BENEFIT OF REDUCED RENT. THE HIGH COURT HAS, THEREF ORE, RIGHTLY CONSIDERED THIS AS OBTAINING A BUSINESS ADVANTAGE. THE EXPENDITURE IS, THEREFORE, TO BE TREATED AS REVENUE EXPENDITURE . 7. WE HAVE GONE THROUGH THE JUDGMENT OF MADRAS HIGH COURT IN TVS LEAN LOGISTICS LTD. (SUPRA). THE MADRAS HIGH C OURT AFTER CONSIDERING EXPLANATION 1 TO SECTION 32(1) OF THE A CT AND THE JUDGMENTS OF APEX COURT IN NASIRUDDIN V. SITA RAM AGARWAL (20 03) 2 SCC 577 AND RAGHUNATH RAI BAREJA V. PUNJAB NATIONAL BANK (2007) 2 SCC 230, FOUND THAT SIMILAR EXPENDITURE IS REVENUE IN NATURE. IN FACT, THE MADRAS HIGH COURT HAS OBSERVED AS FOLLOWS:- 7 I.T.A. NOS.1676 & 1677/CHNY/19 7. SIMILARLY, THERE SHOULD BE A LITERAL RULE OF INT ERPRETATION OF A STATUTE, WHICH IS THE FIRST AND FOREMOST PRINCIPLE OF INTERPRETATION AND WHERE THE WORDS OF A STATUTE ARE ABSOLUTELY CLE AR AND UNAMBIGUOUS, RECOURSE CANNOT BE HAD TO THE PRINCIPL ES OF INTERPRETATION OTHER THAN THE LITERAL RULE AND EVEN IF THE LITERAL INTERPRETATION RESULTS IN HARDSHIP OR INCONVENIENCE , IT HAS TO BE FOLLOWED. THE LANGUAGE EMPLOYED IN A STATUTE IS THE DETERMINATIVE FACTOR OF THE LEGISLATIVE EVENT AND EVEN ASSUMING T HERE IS A DEFECT OR ANY OMISSION IN THE WORDS USED IN THE LEGISLATIO N, THE COURT CANNOT CORRECT OR MAKE UP THE DEFICIENCY, ESPECIALL Y WHEN A LITERAL READING THEREOF PRODUCES AN INTELLIGIBLE RESULT AND ANY DEPARTURE FROM THE LITERAL RULE WOULD REALLY BE AMENDING THE LAW IN THE GARB OF INTERPRETATION, WHICH IS NOT PERMISSIBLE AND WHICH WOULD BE DESTRUCTIVE OF JUDICIAL DISCIPLINE, VIDE RAGHUNATH RAI BAREJA V. PUNJAB NATIONAL BANK [2007] 135 COMP CAS 163 (SC) ; [2007] 2 SCC 230. 8. WHAT CONSTITUTES A CAPITAL EXPENDITURE AND WHAT DO ES NOT, TO ATTRACT EXPLANATION 1 TO SECTION 32(1) OF THE ACT DEPE NDS UPON THE CONSTRUCTION OF ANY STRUCTURE OR DOING ANY WORK OR IN RELATION TO AND BY WAY OF RENOVATION, EXTENSION OR IMPROVEMENT T O THE BUILDING WHICH IS PUT UP IN A BUILDING TAKEN ON LEASE BY HIM FOR CARRYING ON HIS BUSINESS AND PROFESSION OF THE ASSESSEE, BUT NO T IN A CASE OF CONSTRUCTION OF ANY STRUCTURE OR DOING ANY WORK OR RELATION TO WHERE SUCH BUILDING IS PUT UP/CONSTRUCTED FOR THE P URPOSE OF BUSINESS OR THE PROFESSION OF THE ASSESSEE IN A LAN D TAKEN ON LEASE BY THE ASSESSEE. BECAUSE THE ASSESSEE DID NOT ACQUIR E A CAPITAL ASSET, VIZ., THE LAND IN THE INSTANT CASE, BUT HAS PUT UP A CONSTRUCTION OF THE BUILDING ONLY FOR THE BUSINESS ADVANTAGE, WITH THE RESULT THE ENTIRE CONSTRUCTION COST IS ADMISSIB LE AS THE REVENUE EXPENDITURE. 9. THE APEX COURT IN L. H. SUGAR FACTORY AND OIL MILL S P. LTD. V. CIT [1980] 125 ITR 293 HELD THAT THE CONSTRUCTION OF ROADS IN THE CASE OF SUGAR MILL IS REVENUE EXPENDITURE. SIMILARLY, CON TRIBUTION TO THE STATE HOUSING BOARD FOR CONSTRUCTION OF TENEMENTS FO R THE WORKERS WAS ALSO HELD TO BE REVENUE EXPENDITURE BY T HE APEX COURT IN THE CASE OF CIT V. BOMBAY DYEING AND MANUFACTURIN G CO. LTD. [1996] 219 ITR 521 . 8 I.T.A. NOS.1676 & 1677/CHNY/19 8. IN VIEW OF THE ABOVE JUDGMENT OF APEX COURT AND THE JUDGMENT OF MADRAS HIGH COURT, THIS TRIBUNAL DO NOT FIND ANY RE ASON TO INTERFERE WITH THE ORDER OF THE LOWER AUTHORITY AND ACCORDINGLY TH E SAME IS CONFIRMED. 9. NOW COMING TO ASSESSMENT YEAR 2016-17. THE ONLY ISSUE ARISES FOR CONSIDERATION IS WHETHER THE INCENTIVE RECEIVED FROM THE GOVERNMENT FOR EXPLORING NEW MARKET IS CAPITAL RECEIPT OR REVE NUE RECEIPT. 10. WE HEARD THE LD. D.R. AND THE LD. REPRESENTATIV E FOR THE ASSESSEE. ADMITTEDLY, THIS ISSUE WAS EXAMINED BY T HIS TRIBUNAL IN THE ASSESSEE'S OWN CASE FOR THE ASSESSMENT YEARS 2011-1 2 AND 2012-13 IN I.T.A. NOS.47 & 48/MDS/2016 BY ORDER DATED 17.05.20 16. THIS TRIBUNAL AFTER CONSIDERING THE VERY SAME FACTS AND CIRCULAR ISSUED BY THE CBDT IN CIRCULAR NO.564 DATED 05.07.1990, OBSERVED AS FOLLO WS AT PARA 9 OF ITS ORDER:- 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON REC ORD. THE MARKET LINKED FOCUS PRODUCT SCHEME IS A SCHEME PROMOTED BY THE DIRECTOR GENERAL OF FOREIGN TRADE WHEREIN INCENTIVE @ 2% ON THE FOB VALUE OF THE TOTAL EXPORT WAS ALLOWED. AS PER TH E SCHEME, THE INCENTIVE WAS GIVEN TO EXPORT PRODUCTS IN A SPECIFIE D MARKET. THE EXPORT OF PRODUCTS WHICH ARE COVERED UNDER FPS LIST WOULD BE GIVEN INCENTIVE OF 2% ON FOB VALUE OF THE EXPORT. IN OTHER WORDS, IT IS AN INCENTIVE GIVEN BY THE GOVERNMENT FOR EXPLORING T HE NEW MARKETS ACROSS THE GLOBE. THE QUESTION ARISES FOR CONSIDERATION IS WHEN THE ASSESSEE WAS GIVEN INCENTIVE FOR EXPLORING THE NEW MARKETS ACROSS THE GLOBE, WHETHER SUCH INCENTIVE WO ULD BE A CAPITAL RECEIPT OR REVENUE RECEIPT? THE APEX COURT IN THE C ASE OF PONNI SUGARS & CHEMICALS LTD. (SUPRA) HAD AN OCCASION TO EXAMINE AN 9 I.T.A. NOS.1676 & 1677/CHNY/19 IDENTICAL SITUATION AND OBSERVED THAT IF THE OBJECT OF THE SUBSIDY WAS TO ENABLE THE ASSESSEE TO CARRY ON THE BUSINESS MORE PROFITABLY, THEN THE RECEIPT IS ON THE REVENUE ACCO UNT. ON THE OTHER HAND, IF THE OBJECT OF ASSISTANCE WAS TO ENAB LE THE ASSESSEE TO SET UP A NEW UNIT OR EXPAND THE EXISTING UNIT, THE N THE RECEIPT IS ON THE CAPITAL ACCOUNT. IN THE CASE BEFORE US, THE GOVERNMENT OF INDIA PROVIDED THE INCENTIVE FOR EXPLORING THE NEW M ARKETS ACROSS THE GLOBE. EXPLORING A NEW MARKET FOR A SPECIFIED A REA WOULD NATURALLY EXPAND THE MARKET AREA OF THE ASSESSEE. T HE INCENTIVE GIVEN TO THE ASSESSEE IS NOT FOR RUNNING THE BUSINE SS PROFITABLY BUT FOR EXPANDING THE MARKET AREA. THEREFORE, THIS TRIB UNAL IS OF THE CONSIDERED OPINION THAT THE INCENTIVE GIVEN BY THE GOVERNMENT TO THE ASSESSEE FOR EXPLORING THE NEW MARKET IS A CAPI TAL RECEIPT, HENCE IT CANNOT BE TREATED AS INCOME EITHER UNDER S ECTION 2(24) OR 28 OF THE ACT. IN VIEW OF THE ABOVE, WE ARE UNABLE T O UPHOLD THE ORDER OF THE LOWER AUTHORITY. ACCORDINGLY, THE ORD ERS OF THE LOWER AUTHORITIES ARE SET ASIDE AND THE ADDITION MADE BY THE ASSESSING OFFICER IS DELETED. 11. THIS ORDER OF THE TRIBUNAL WAS FOLLOWED BY THE CIT(APPEALS). THEREFORE, THIS TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE LOWER AUTHORITY AND ACCORDINGLY THE SAME IS CONFIRMED. 12. IN THE RESULT, BOTH THE APPEALS FILED BY THE RE VENUE STAND DISMISSED. ORDER PRONOUNCED IN THE COURT ON 12 TH SEPTEMBER, 2019 AT CHENNAI. SD/- SD/- ( ! ' ) ( . . . ) (INTURI RAMA RAO) (N.R.S. GANESAN) $ / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 6 /DATED, THE 12 TH SEPTEMBER, 2019. 10 I.T.A. NOS.1676 & 1677/CHNY/19 KRI. / -278 98)2 /COPY TO: 1. +, /APPELLANT 2. -.+, /RESPONDENT 3. 1 :2 () /CIT(A)-3, COIMBATORE 4. PRINCIPAL CIT- 3, COIMBATORE 5. 8; -2 /DR 6. <( = /GF.