M/s. Sintex-BAPL Limited, Ahmedabad V. DCIT, Circle-1 (1) (1), Ahmedabad

ITA 1857/AHD/2017

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 6368 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 2 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-10-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 30-07-2019
• Assessment Year: 2014-2015
• Appeal Filed On: 09-08-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AHD MS SINTEX
• Keywords: Depreciation; Question of law; Corroborative evidences; Set aside
• Section: 43B; 143(3); 250; 201; 32; 154; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND MS MADHUMITA ROY, JUDICIAL MEMBER SL. NOS. ITA NO(S) ASSESSMENT YEAR (S) APPEAL(S) BY APPELLANT VS. RESPONDENT APPELLANT RESPONDENT 1. 1936 /AHD/201 7 2013 - 14 DCIT, CIRLE1(1)(1), AHMEDABAD. ( REVENUE ) BRIGHT AUTOPLAST LTD. (PREVIOUSLY KNOWN AS BRIGHT AUTOPLAST PVT.LTD.) 7 TH FLOOR, ABHIJEET BUILDING MITHAKALI SIX ROADS ELLISBRIDGE AHMEDABAD - 380 007 PAN: AADCB 1921F (ASSESSEE) 2 1856/AHD/2017 2013 - 14 M/S SINTEX - BAPL LTD. (PREVIOUSLY KNOWN AS BRIGHT AUTOPLAST PVT.LTD.) 7 TH FLOOR, ABHIJEET BUILDING MITHAKALI SIX ROADS ELLISBRIDGE AHMEDABAD - 380 007 PAN: AADCB 1921F ITO, WARD - 1(1)(4). AHMEDABAD. 3 1937/AHD/2017 2014 - 15 BY REVENUE BY ASSESSEE 4. 1857/AHD/2017 2014 - 15 M/S SINTEX - BAPL LTD. (PREVIOUSLY KNOWN AS BRIGHT AUTOPLAST PVT.LTD.) 7 TH FLOOR, ABHIJEET BUILDING MITHAKALI SIX ROADS ELLISBRIDGE AHMEDABAD - 380 007 PAN: AADCB 1921F DCIT, CIRLE1(1)(1), AHMEDABAD. I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 2 - REVENUE BY : SHRI VINOD TANWANI , SR. D.R ASSESSEE BY : SHRI BHAVIN MARFATIA, A.R / DATE OF HEARING 30/07 /2019 / DATE OF PRONOUNCEMENT 16 / 10 /201 9 / O R D E R PER WASEEM AHMED ACCOUNTANT MEMBER : THE CAPTIONED APPEAL S HA VE BEEN FILED AT THE INSTANCE OF THE ASSESSEE AS WELL AS REVENUE AGAINST THE SEPARATE ORDER S OF THE COMMIS SIONER OF INCOME TAX (APPEALS) 1 , A HMEDABAD [CIT (A) IN SHORT] ARISING IN THE A SSESSMENT ORDER PASSED UNDER S. 143(3) OF THE INCOME TAX ACT, 1961 ( REFERRED TO AS 'THE ACT') DATED RELEVANT TO ASSESSMENT YEAR S (A . Y S ) 2013 - 14 & 2014 - 15 . THE REVENUE IN ITS APPEAL BEARING NO. 1936/AHD/2017 HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: THAT THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN PARTLY ALLOWING THE DISALLOWANCE OF DEPRECIATION ON TECHNICAL KNOW HOW OF RS.88,85,878/ - ON THE FACTS AND THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE ASSESSING OFFICER TO THE EXTENT MENTIONED ABOVE SINCE THE ASSESSEE HAS FAILED TO DISCLOSE HIS TRUE INCOME/BOOK PROFIT. THE APPELLANT PRAYS THAT THE ORDER OF CIT(A) ON THE ABOVE GROUNDS BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED TO THE ABOVE EXTENT. THE APPELLANT CRAVES, TO LEAVE, TO AMEND OR ALTER OR ADD A NEW GROUND WHICH MAY BE NECESSARY. I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 3 - THE ASSESSEE IN ITS APPEAL BEARING NO. 1856/AHD /2017 HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: ALL THE GROUNDS OF APPEAL IN THIS APPEAL ARE MUTUALLY EXCLUSIVE AND WITHOUT PREJUDICE TO EACH OTHER. 1. THE LEARNED CIT(A) ERRED IN PASSING THE ORDER U/S. 154 OF THE INCOME TAX ACT, 1961 RECTIFYING THE EARL IER ORDER PASSED BY THE LEARNED CIT(A) DATED 30 LH AUGUST 2016. THE LEARNED C1T(A) IS NOT AUTHORIZED TO REVIEW HIS OWN ORDER AND ACCORDINGLY THE SAID ORDER NEEDS TO BE QUASHED. DEPRECIATION ON TECHNICAL KNOW - HOW: 2. THE LEARNED CIT(A) ERRED IN FACT AND IN LAW IN CONFIRMING THE ACTION OF THE AO IN VALUING THE TECHNICAL KNOW - HOW AT RS.4,02,89,018 INSTEAD OF RS. 12,83,82,923 CONSIDERED BY THE APPELLANT. 3. THE LEARNED C1T(A) ERRED IN FACT AND IN LAW IN RESTRICTING THE CLAIM OF DEPRECIATION ON TECHNICAL KNOW - HOW AT RS.27,88,559 INSTEAD OF RS.88,85,878 AS CLAIMED BY THE APPELLANT IN THE RETURN OF INCOME AND THEREBY CONFIRMING THE ADDITION TO THE EXTENT OF RS.60,97,319 (RS.88,85,878 - RS. 27,88,559) TO THE INCOME OF THE APPELLANT. 4. YOUR APPELLANT CRAVES THE RIGHT TO ADD TO OR ALTER, AMEND, SUBSTITUTE, DELETE OR MODIFY ALL OR ANY OF THE ABOVE GROUNDS OF APPEAL. THE ISSUE INVOLVED IN THE APPEAL OF THE REVENUE AND THE ASSESSEE IS INTERCONNECTED AND THEREFORE, WE DECIDED TO ADJUDICATE THE ISSUE BY WAY OF THIS CONSOLIDA TED ORDER. THE INTERCONNECTED ISSUE IS REGARDING THE DEPRECIATION ON THE TECHNICAL KNOW - HOW. 2. THE FACTS IN BRIEF ARE THAT THE ASSESSEE IN THE PRESENT CASE IS A LIMITED COMPANY AND ENGAGED IN THE MANUFACTURING BUSINESS OF AUTO MOTIVE COMPONENTS. THE ASS ESSEE IN THE YEAR UNDER CONSIDERATION CLAIMED DEPRECIATION AMOUNTING TO RS. 88,85,878.00 ON THE TECHNICAL KNOW - HOW I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 4 - ACQUIRED IN THE ASSESSMENT 2008 - 09. HOWEVER, THE AO IN THE 1 ST YEAR OF ACQUISITION OF TECHNICAL KNOW - HOW TREATED ITS VALUE AT NIL THOUGH THE ASSESSEE CLAIMED TO HAVE ACQUIRED AT 12,83,83,923.00 ONLY. ACCORDINGLY THE AO IN THE 1 ST YEAR ITSELF I.E. AY 2008 - 09 HAS DISALLOWED THE DEPRECIATION CLAIMED BY THE ASSESSEE ON SUCH TECHNICAL KNOW - HOW. CONSEQUENTLY, THE AO ALSO DISALLOWED THE DEPRECIATION CLAIMED BY THE ASSESSEE ON SUCH TECHNICAL KNOW - HOW FOR 88,85,878.00 IN THE YEAR UNDER CONSIDERATION FOLLOWING THE ORDER OF HIS PREDECESSOR AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 3. AGGRIEVED ASSESSEE PREFERRED AN APPEAL TO THE LEARNED CIT (A) WHO HAS DELETED THE DISALLOWANCE MADE BY THE AO VIDE ORDER DATED 30 TH AUGUST 2016 AFTER HAVING RELIANCE ON THE ORDER OF HIS PREDECESSOR PERTAINING TO THE ASSESSMENT YEAR 2012 - 13. 4. HOWEVER, THE LEARNED CIT (A) SUBSEQUENTLY NOTICED THAT HIS PREDECESSOR HAS ALLOWED THE RELIEF TO THE ASSESSEE IN PART PERTAINING TO THE ASSESSMENT YEAR 2012 - 13 ON SUCH TECHNICAL KNOW - HOW WHEREAS HE HAS WRONGLY ALLOWED THE RELIEF OF THE FULL AMOUNT TO THE A SSESSEE. 4.1 ACCORDINGLY THE LEARNED CIT (A) RECTIFIED HIS ORDER UNDER SECTION 154 R.W.S. 250 OF THE ACT DATED 14 JUNE 2017 BY OBSERVING AS UNDER: 5. ACCORDINGLY, THE SAME IS RECTIFIED AND PARTIAL RELIED IS ALLOWED FOR GROUND OF APPEAL RAISED BY APPELLA NT COMPANY FOR DISALLOWANCE OF DEPRECIATION ON TECHNICAL KNOWHOW FOR THE ASSESSMENT YEAR 2013 - 14 AFTER CONSIDERING THE DECISION OF MY PREDECESSOR FOR ASSESSMENT YEAR 2008 - 09, 2009 - 10, 2010 - 11 & 2011 - 12 AND MY DECISION FOR THE ASSESSMENT YEAR 2012 - 13. CONSE QUENTLY, THE ASSESSING OFFICER IS DIRECTED TO GRANT RELIED OF RS.27,88,559/ - (@ 25% OF OPENING EDV OF RS.1,11,54,235/ - ) TOWARDS DEPRECIATION ON TECHNICAL KNOWHOW AND I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 5 - BALANCE RS.60,97,319/ - (RS.88,85,878/ - 27,88,559/ - ) IS CONFIRMED ON THE GROUND OF DEPRECIA TION ON TECHNICAL KNOWHOW. THIS GROUND OF APPEAL IS PARTLY ALLOWED. IN VIEW OF THE ABOVE, THE LEARNED CIT (A) ALLOWED THE APPEAL OF THE ASSESSEE IN PART. AS SUCH THE LEARNED CIT (A) DELETED THE DISALLOWANCE AMOUNTING TO 60,97,319.00 AND CONFIRMED THE AD DITION TO THE EXTENT OF 27,88,559.00. 5. BEING AGGRIEVED BY THE ORDER OF THE LEARNED CIT (A) BOTH THE REVENUE AND THE ASSESSEE ARE IN APPEAL BEFORE US. THE REVENUE IS IN APPEAL AGAINST PARTLY RELIEF GRANTED BY THE LEARNED CIT (A) VIDE ORDER DATED 14 TH JUNE 2017 PASSED UNDER SECTION 154 R.W.S. 250 OF THE ACT AMOUNTING TO RS. 60,97,319.00. 5.1 ON THE OTHER HAND, THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF THE LEARNED CIT (A) DATED 14 TH JUNE 2017 PASSED UNDER SECTION 154 R.W.S. 250 OF THE ACT WHEREBY HE PARTLY CONFIRMED THE ADDITION MADE BY THE AO FOR 27,88,559.00. 6.1 THE LEARNED AR AT THE OUTSET SUBMITTED THAT THE IMPUGNED ISSUE IS ARISING SINCE THE YEAR (FY 2007 - 08) IN WHICH THE TECHNICAL KNOW - HOW WAS ACQUIRED BY THE ASSESSEE. 6. 2 THE LEARNED AR FURTHER BROUGHT TO A NOTICE THAT THIS HON BLE TRIBUNAL IN THE EARLIER ASSESSMENT YEAR 2008 - 09 (BEING THE LEAD ASSESSMENT YEAR) IN THE OWN CASE OF THE ASSESSEE BEARING ITA NO. 1990/AHD/2015 HAS RESTORED THE ISSUE TO THE FILE OF THE LEARNED CIT (A) FOR FR ESH ADJUDICATION WHICH WAS I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 6 - FOLLOWED IN THE OTHER ASSESSMENTS YEARS UP TO THE ASSESSMENT YEAR 2013 - 14 BEARING ITA NO. 2774/AHD/2016 VIDE CONSOLIDATED ORDER DATED 28 - 06 - 2019. THE LEARNED AR IN SUPPORT OF HIS CONTENTION FILED THE COPY OF THE ITAT ORDER WHICH IS PLACED ON RECORD. IN VIEW OF THE ABOVE, THE LEARNED AR PRAYED BEFORE US TO RESTORE THE MATTER TO THE FILE OF THE LEARNED CIT (A) FOR FRESH ADJUDICATION AS THE IMPUGNED ISSUE BEING IDENTICAL TO THE ISSUE OF THE EARLIER ASSESSMENT YEARS WHICH HAVE BEEN RESTORED FOR FRESH ADJUDICATION TO THE LEARNED CIT (A) BY THE ORDER OF THIS TRIBUNAL. 7. ON THE OTHER HAND, THE LEARNED DR DID NOT RAISE ANY OBJECTION IF THE MATTER IS SET ASIDE TO THE FILE OF THE LEARNED CIT (A) FOR FRESH ADJUDICATION AS PER THE PROVISI ONS OF LAW. 8. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. AT THE OUTSET WE NOTE THAT THE IDENTICAL ISSUE IN THE OWN CASE OF THE ASSESSEE (SUPRA) HAS BEEN RESTORED FOR THE FRESH ADJUDICATION AS P ER THE PROVISIONS OF LAW. THE RELEVANT EXTRACT OF THE ORDER IS REPRODUCED AS UNDER: 8. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE ISSUE IN THE INSTANT CASE RELATES WHETHER THE ASSESSEE HAS ACQUIRED ANY TECHNICAL KNOW - HOW FROM BBL OR NOT. IF THERE IS NO ACQUISITION OF TECH NICAL KNOW - HOW, THEN THERE IS NO QUESTION OF CLAIMING THE DEPRECIATION ON THE TECHNICAL KNOW - HOW AS DISCUSSED ABOVE. 8.1 FROM THE PRECEDING DISCUSSION, WE NOTE THAT THE TOTAL CONSIDERATION PAID BY THE ASSESSEE ON THE ACQUISITION OF THE BUSINESS OF BBL AS GOING CONCERN ON SLUMP SALE BASIS HAS NOT BEEN DISPUTED BY THE AUTHORITIES BELOW. THUS IT CAN BE INFERRED THAT THE ASSESSEE IS ENTITLED TO THE DEDUCTION OF THE PAYMENT MADE BY IT ON I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 7 - THE ACQUISITION OF THE BUSINESS OF BBL AS DISCUSSED ABOVE AS PER THE PROV ISIONS OF LAW. IT IS AN UNDISPUTED FACT THAT THE ASSESSEE HAS MADE THE PAYMENT FOR 12.84 AROSE WHICH IS IN DISPUTE WHETHER IT REPRESENTS THE PAYMENT TOWARDS TECHNICAL KNOW - HOW. IN OUR CONSIDERED VIEW ONCE THE PAYMENT HAS BEEN ADMITTED BY THE AUTHORITIES B ELOW, THEN THE ASSESSEE IS ENTITLED TO THE DEDUCTION FOR THE SAME BY WAY OF THE DEPRECIATION EITHER ON THE TECHNICAL KNOW - HOW OR THE GOODWILL IN THE GIVEN FACTS & CIRCUMSTANCES. BUT THIS ASPECT HAS NOT BEEN ADJUDICATED BY THE LEARNED CIT (A). THEREFORE IN THE INTEREST OF JUSTICE AND FAIR PLAY, WE ARE RESTORING THIS ISSUE TO THE FILE OF THE LEARNED CIT (A) FOR FRESH ADJUDICATION AS PER THE PROVISIONS OF LAW. 8.2 SIMILARLY, WE NOTE THAT THE GROUND OF APPEAL RAISED BY THE REVENUE IS INTER - CONNECTED TO THE GR OUND OF APPEAL RAISED BY THE ASSESSEE AS DISCUSSED ABOVE. THEREFORE THE ISSUE RAISED BY THE REVENUE ALSO NEEDS TO BE RESTORED BACK TO THE FILE OF THE LEARNED CIT (A) FOR FRESH ADJUDICATION AS PER THE PROVISIONS OF LAW. HENCE, THE GROUND OF APPEAL OF THE AS SESSEE AND THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES. 8 .1 RESPECTFULLY FOLLOWING THE SAME, WE R ESTORE THE ISSUE RAISED BY THE R EVENUE AND THE ASSESSEE IN THE RESPECTIVE APPEALS TO THE FILE OF THE LEARNED CIT (A) FOR THE FRESH ADJUDICATION AS PER T HE PROVISIONS OF LAW AND IN THE LIGHT OF THE DIRECTION ISSUED BY THE ITAT IN THE OWN CASE OF THE ASSESSEE AS DISCUSSED ABOVE. HENCE THE GROUND OF APPEAL OF THE REVENUE AND THE ASSESSEE ARE ALLOWED FOR THE STATISTICAL PURPOSES IN THE RESULT, THE APPEAL OF THE REVENUE AND THE ASSESSEE ARE ALLOWED FOR THE STATISTICAL PURPOSES. COMING T O REVENUE S APPEAL BEARING NO.1937/AHD/2017 AND THE ASSESSEE S APPEAL BEARING NO .1857/AHD/2017 FOR A.Y. 2014 - 15 THE RE VENUE HAS RAISED THE FOLLOWI NG GROUNDS OF APPEAL: 1. THAT THE CIT(A) HAS ERRED IN LAW AND IN FACTS IN DELETING THE DISALLOWANCE OF DEPRECIATION OF TECHNICAL KNOW HOW OF RS.66,64,409/ - I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 8 - 2. THAT THE CIT(A) HAS ERRED IN LAW AND IN FACTS IN DELETING THE DISALLOWANCE OF DEPRECIATION ON NON - C OMPETE FESS OF RS.25,95,520/ - 3. THAT THE CIT(A) HAS ERRED IN LAW AND IN FACTS IN DELETING THE DISALLOWANCE OF UNUTILIZED CENVAT CREDIT OF RS.36,33,921/ - 4. THAT THE CIT(A) HAS ERRED IN LAW AND IN FACTS IN DELETING THE DISALLOWANCE OF INTEREST OF RS.5,26,000/ - IN RESPECT OF CAPITAL WORK IN PROGRESS. 5. THAT THE CIT(A) HAS ERRED IN LAW AND IN FACTS IN DELETING THE DISALLOWANCE OF INTEREST EXPENSES U/S.43B OF RS.52,19,830/ - 6. THAT THE CIT(A) HAS ERRED IN LAW BY IGNORING THAT DEDUCTION U/S.43B IS ALLOWABLE ONLY IN RESPECT OF A DEDUCTION OTHERWISE ALLOWABLE UNDER THIS ACT. ON THE FACT AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE ASSESSING OFFICER TO THE EXTENT MENTIONED ABOVE SINCE THE ASSESSEE HAS FAILED TO DIS CLOSURE HIS TRUE INCOME/BOOK PROFIT. THE APPELLANT PRAYS THAT THE ORDER OF CIT(A) ON THE ABOVE GROUNDS BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED TO THE ABOVE EXTENT. THE APPELLANT CRAVES, TO LEAVE, TO AMEND OR ALTER ANY GROUND OR ADD A NE W GROUND WHICH MAY BE NECESSARY. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: ALL THE GROUNDS OF APPEAL ARE MUTUALLY EXCLUSIVE AND WITHOUT PREJUDICE TO EACH OTHER. 1. THE LEARNED CIT(A) ERRED IN FACT IN CONFIRMING THE ACTION OF THE AOIN VALUIN G THE TECHNICAL KNOW - HOW AT RS.4,02,89,018/ - INSTEAD OF RS.12,83,82,923/ - CONSIDERED BY THE APPELLANT. 2. THE LEARNED CIT(A) ERRED IN FACT AND IN LAW IN RESTRICTING THE CLAIM OF DEPRECIATION ON TECHNICAL KNOW - HOW AT RS.20,91,419/ - INSTEAD OF RS.66,64,409/ - AS CLAIMED BY THE APPELLANT IN THE RETURN OF INCOME AND THEREBY CONFIRMING THE ADDITION TO THE EXTENT OF RS.45,72,990 (RS.66,64,409 RS.20,91,419) TO THE INCOME OF THE APPELLANT. 3. YOUR APPELLANT CRAVES THE RIGHT TO ADD TO ALTER, AMEND, SUBSTITUTE, DELETE OR MODIFY ALL OR ANY OF THE ABOVE GROUNDS OF APPEAL. I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 9 - 9. THE FIRST ISSUE RAISED BY THE REVENUE AND ASSESSEE IN GROUND NO.1 AND 1 & 2 IN THEIR RESPECTIVE APPEAL S ARE RELATED TO THE DEPRECIATION ON THE TECHNICAL KNOWHOW. 10. AT THE OUTSET WE NOTE THAT THE IDENTICAL ISSUE IN THE OWN CASE OF THE ASSESSEE HAS ALREADY BEEN ADJUDICATED BY US IN ASSESSEE S APPEAL AND REVENUE S APPEAL BEARING ITA NO. 1936/AHD/2017 AND ITA NO.1856/AHD/2017 FOR A.Y. 2013 - 14 BY RESTORING THE ISSUE TO THE FILE OF THE ''LD.CIT (A)'' FO R FRESH ADJUDICATION A PER THE PROVISION OF LAW . F OR THE DETAILED DISCUSSION PLEASE R EFER TO PARAGRAPH BEARING NO.8 OF THIS ORDER. RESPECTFULLY FOLLOWING THE SAME THE ISSUE RAISED BY THE REVENUE AND THE ASSESSEE ARE RESTORED BACK TO THE FILE OF ''LD.CIT (A)'' FOR FRESH ADJUDICATION AS PER THE PROVISION OF LAW. IN THE RESULT , THE GROUND OF APPEAL OF R EVENUE AND THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. THE SECOND ISSUE RAISED BY THE R EVENUE IS THAT THE ''LD.CIT (A)'' ERRED IN DELETING THE DISAL LOWANCE FOR THE DEPRECIATION AMOUNTING TO RS. 25,95,520/ - ON ACCOUNT OF DEPRECIATION OF NON - COMPETE FEES. 11. THE ASSESSEE IN THE YEAR UNDER CONSIDERATION HAS CLAIMED DEPRECIATION ON NON - COMPETE FEES PAID BY IT TO M/S BRIGHT BROTHERS LIMITED VI DE AGREEME NT DATED 06/09/2007 BY TREATING THE SAME AS INTANGIBLE ASSET . I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 10 - 11.1 HOWEVER, THE AO FOUND THAT T HE ISSUE OF DEPRECIATION ON NON - COMPETE FEES IS EMANATING FROM THE A.Y. 2008 - 09 AND HIS PREDECESSOR H AS MADE THE DISALLOWANCE OF THE DEPRECIATION CLAIMED BY TH E ASSESSEE IN ALL THE ASSESSMENT YEARS UP TO ASSESSMENT YEAR 2013 - 14. THUS THE AO AFTER PUTTING RELIANCE UPON THE ORDER OF HIS PREDECESSOR H AS DISALLOWED THE DEPRECIATION CLAIMED ON THE NON - COMPETE FEES AT RS. 25,95,520/ - AND ADDED TO THE TOTAL INCOME OF T HE ASSESSEE. 12. AGGRIEVED ASSESSEE PREFERRED AN APPEAL TO THE ''LD.CIT (A)'' WHO HAS DELETED THE DISALLOWANCE MADE BY THE AO. BEING AGGRIEVED BY THE ORDER OF THE ''LD.CIT (A)'' THE R EVENUE IS IN APPEAL BEFORE US. 13. BOTH THE LD. DR AND LD.AR, BEFORE US RELIED ON THE ORDER OF THE AUTHORITIES BELOW AS FAVORABLE TO THEM. 14. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. AT THE OUTSET WE NOTE THAT THE IMPUGNED ISSUE FIRST AROS E IN T HE A.Y. 2008 - 09 WHICH HAS BEEN DECIDED BY THE ITAT IN FAVOUR OF THE ASSESSEE BEARING ITA NO.1990/AHD/2015 & OTHERS VIDE CONSOLIDATED ORDER DATED 28/06/2019. THE RELEVANT EXTRACT OF THE ORDER IS REPRODUCED AS UNDER: 17. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. AT THE OUTSET, WE NOTE THAT THE HON BLE GUJARAT HIGH COURT HAS SETTLED THE ISSUE RAISED BY THE REVENUE IN THE CASE OF PCIT VS. I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 11 - PIRAMAL GLASS LIMITE D IN TAX APPEAL NO. 556 OF 2017 WHEREIN IT WAS HELD AS UNDER: 2. WE NOTICE THAT BEFORE THE TRIBUNAL THERE WAS CROSS APPEAL FILED BY THE REVENUE. FROM THE REVENUE'S APPEAL DISPOSED OF BY THE TRIBUNAL, FOLLOWING TWO ADDITIONAL QUESTIONS ARE FRAMED IN THIS APPEAL: '(I) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE ITAT WAS JUSTIFIED IN DELETING THE GROUND RAISED BY THE REVENUE ON WRITE OFF OF NON COMPETE FEES OFRS.18 CRORES OVER A PERIOD OF 18 YEARS WITHOUT DISCUSSING TH E ISSUE ON MERITS ? (II) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, NON - COMPETE FEE OFRS.18 CRORES PAID BY THE ASSESSEE CAN BE WRITTEN OFF IN 18 YEARS IN A MANNER GRANTED BY THE CIT(A) ? ' 3. QUESTION NO. (A) NOTED ABOVE PERTAINS TO THE DECISION OF THE TRIBUNAL TO GRANT DEPRECIATION ON THE ASSESSEE'S PAYMENT OF NON - COMPETE FEES. ACCORDING TO THE REVENUE, THIS BEING AN INTANGIBLE ASSET, NO DEPRECIATION UNDER SECTION 32 OF THE INCOME TAX ACT, 1961 ('THE ACT' FOR SHORT) WAS A VAILABLE. 4. WE HOWEVER NOTICE THAT SIMILAR ISSUE HAS BEEN CONSIDERED BY THE DIFFERENT HIGH COURTS AND HELD IN FAVOUR OF THE ASSESSEE. A REFERENCE CAN BE MADE TO THE 1 DECISION OF THE DIVISION BENCH OF THE GUJARAT HIGH COURT IN THE CASE OF PRINCIPAL COMMI SSIONER OF INCOME TAX V. FERROMATICE MILACRON INDIA (P.) LIMITED. IT WAS ALSO THE CASE WHERE THE ASSESSEE HAD INCURRED EXPENDITURE PURSUANT TO THE NON - COMPETE AGREEMENT AND CLAIMED DEPRECIATION ON SUCH ASSET. WHILE DISMISSING THE REVENUE'S APPEAL AGAINST THE JUDGMENT OF THE TRIBUNAL, FOLLOWING OBSERVATIONS WERE MADE: 'WE MAY RECALL THE ASSESSING OFFICER DOES NOT DISPUTE THAT THE EXPENDITURE WAS CAPITAL IN NATURE SINCE BY MAKING SUCH EXPENDITURE, THE ASSESSEE HAD ACQUIRED CERTAIN ENDURING BENEFITS. HE WAS, HOWEVER, OF THE OPINION THAT TO CLAIM DEPRECIATION, THE ASSESSEE MUST SATISFY THE REQUIREMENT OF SECTION 32(1)(II) OF THE ACT, IN WHICH EXPLANATION 3 PROVIDES THAT FOR THE PURPOSE OF THE SAID SUB - SECTION THE EXPRESSION 'ASSETS' WOULD MEAN ( AS PER CLAUSE (B) ) INTANGIBLE ASSETS, BEING KNOWN - HOW, PATENTS, COPYRIGHTS, TRADE MARKS, LICENSES, FRANCHISES OR ANY OTHER BUSINESS OR COMMERCIAL RIGHTS, OF SIMILAR NATURE. IN THE OPINION OF THE ASSESSING OFFICER, THE NON - COMPETE FEE WOULD NOT SATISFY THIS DISCRIMINATI ON. GOING BY HIS OPINION, NO MATTER WHAT THE RIGHTS ACQUIRED BY THE ASSESSEE THROUGH SUCH NON - COMPETE AGREEMENT, THE SAME WOULD NEVER QUALIFY FOR DEPRECIATION IN SECTION 32(L)(II) OF THE ACT AS BEING DEPRECIABLE INTANGIBLE ASSET. THIS VIEW WAS PLAINLY OPPO SED TO THE WELL SETTLED PRINCIPLES. IN CASE OF TECHNO SHARES & STOCKS LIMITED (SUPRA) THE SUPREME COURT HELD THAT PAYMENT FOR ACQUIRING M EMBERSHIP CARD OF BOMBAY STOCK EXCHANGE WAS INTANGIBLE ASSETS ON WHICH THE DEPRECIATION I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 12 - CAN BE CLAIMED. IT WAS OBSERVED THAT THE RIGHT OF SUCH MEMBERSHIP INCLUDED RIGHT OF NOMINATION AS A LICENSE WHICH WAS ONE OF THE ITEMS WHICH WOULD FALL UNDER SECTION 32(1)(II). THE RIGHT TO PARTICIPATE IN THE MARKET HAD AN ECONOMIC AND MONEY VALUE. THE EXPENSES INCURRED B Y THE ASSESSEE WHICH SATISFIED THE TEST OF BEING A LICENSE OR ANY OTHER BUSINESS OR COMMERCIAL RIGHT OF SIMILAR NATURE IN CASE OF AREVA T & D INDIA LIMITED (SUPRA) DIVISION BENCH OF DELHI HIGH COURT HAD AN OCCASION TO INTERPRET THE MEANING OF INTANGIBLE A SSETS IN CONTEXT OF SECTION 32(L)(II) OF THE ACT. IT WAS OBSERVED THAT ON PERUSAL OF THE MEANING OF THE CATEGORIES OF SPECIFIC INTANGIBLE ASSETS REFERRED TO IN SECTION 32(L)(II) OF THE ACT PRECEDING THE TERM 'BUSINESS OR COMMERCIAL RIGHTS OF SIMILAR NATURE ' IT IS SEEN THAT INTANGIBLE ASSETS ARE NOT OF THE SAME KIND AND ARE CLEARLY DISTINCT FROM ONE ANOTHER. THE LEGISLATURE THUS DID NOT INTEND TO PROVIDE FOR DEPRECIATION ONLY IN RESPECT OF THE SPECIFIED INTANGIBLE ASSETS BUT ALSO TO OTHER CATEGORIES OF INTAN GIBLE ASSETS WHICH MAY NOT BE POSSIBLE TO EXHAUSTIVELY ENUMERATE. IT WAS CONCLUDED THAT THE ASSESSEE WHO HAD ACQUIRED COMMERCIAL RIGHTS TO SELL PRODUCTS UNDER THE TRADE NAME AND THROUGH THE NETWORK CREATED BY THE SELLER FOR SALE IN INDIA WERE ENTITLED TO D EPRECATION. IN THE PRESENT CASE, MR.PATEL WAS ERSTWHILE PARTNER OF THE ASSESSEE. THE ASSESSEE HAD MADE PAYMENTS TO HIM TO WARD OFF COMPETENCE AND TO PROTECT ITS EXISTING BUSINESS. MR.PATEL, IN TURN, HAD AGREED NOT TO SOLICIT CONTRACT OR SEEK BUSINESS FROM OR TO A PERSON WHOSE BUSINESS RELATIONSHIP IS WITH THE ASSESSEE. MR. PATEL WOULD NOT SOLICIT DIRECTLY OR INDIRECTLY ANY EMPLOYEE OF THE ASSESSEE. HE WOULD NOT DISCLOSE ANY CONFIDENTIAL INFORMATION WHICH WOULD INCLUDE THE PAST AND CURRENT PLAN, OPERATIO N OF THE EXISTING BUSINESS, TRADE SECRETES LISTS ETC. IT CAN THUS BE SEEN THAT THE RIGHTS ACQUIRED BY THE ASSESSEE UNDER THE SAID AGREEMENT NOT ONLY GIVE ENDURING BENEFIT, PROTECTED THE ASSESSEE S BUSINESS AGAINST COMPETENCE, THAT TOO FROM A PERSON WHO HA D CLOSELY WORKED WITH THE ASSESSEE IN THE SAME BUSINESS. THE EXPRESSION 'OR ANY OTHER BUSINESS OR COMMERCIAL RIGHTS OF SIMILAR NATURE' USED IN EXPLANATION 3 TO SUB - SECTION 32(1)(II) IS WIDE ENOUGH TO INCLUDE THE PRESENT SITUATION.' 5. NO QUESTION OF LAW I N THIS RESPECT THEREFORE ARISES. IN VIEW OF THE ABOVE, WE HOLD THAT THE ASSESSEE IS ENTITLED TO THE DEPRECIATION ON THE PAYMENT OF A NON - COMPETE FEE TO THE PARTY. ACCORDINGLY, WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF THE LEARNED CIT (A). TH E GROUND OF APPEAL OF THE REVENUE IS DISMISSED. 14.1 AS THE IMPUGNED ISSUE HAS ALREADY BEEN DECIDED BY THIS TRIBUNAL IN THE OWN CASE OF THE ASSESSEE (SUPRA) IN ITS FAVOR , RESPECTFULLY FOLLOWING THE I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 13 - SAME WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF THE ''LD.CIT (A)''. HENCE, THE GROUND OF APPEAL OF THE REVENUE IS DISMISSED. THE THIRD ISSUE RAISED BY THE REVENUE IS THAT ''LD.CIT (A)'' ERRED IN DELETING THE ADDITION MADE BY THE AO FOR RS. 36,33,921/ - ON ACCOUNT OF UNUTILIZED CENVAT CRED I T. 15. T HE AO DURING THE ASSESSMENT PROCEEDING S FOUND THAT THE ASSESSEE HAS BEEN FOLLOWING EXCLUSIVE METHOD OF ACCOUNTING. THE AO WAS OF THE VIEW THAT UN UTILIZED CENVAT CREDIT SHOWN BY THE ASSESSEE IN ITS BALANCE SHEET NEEDS TO BE INCLUDED IN THE CLOSING STOCK OF RAW MATERIAL. ACCORDINGLY THE AO MADE THE ADDITION OF RS. 36,33,921/ - BEING UNUTILIZED CENVAT CREDIT TO THE TOTAL INCOME OF THE ASSESSEE. 16. AGGRIEVED ASSESSEE PREFERRED AN APPEAL TO THE ''LD.CIT (A)'' WHO HAS DELETED THE ADDITION MADE BY THE AO BEING A GGRIEVED BY THE ORDER OF THE ''LD.CIT (A)'' THE REVENUE IS IN APPEAL BEFORE US. 17. BOTH THE LD. DR AND LD. AR, BEFORE US RELIED ON THE ORDER OF THE AUTHORITIES BELOW AS FAVORABLE TO THEM. 1 8 . WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND P ERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. AT THE OUTSET WE NOTE THAT THE IMPUGNED ISSU E FIRST AROSE IN THE A.Y. 2011 - 12 WHICH HAS BEEN DECIDED BY I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 14 - THE ITAT IN FAVOUR OF THE ASSESSEE BEARING ITA NO. 2168 /AHD/2015 VIDE ORDER DATED 28/06/2019. THE RELE VANT EXTRACT OF THE ORDER IS REPRODUCED AS UNDER: 36. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE ALLEGATION OF THE ASSESSING OFFICER IN THE INSTANT CASE IS THAT THE ASSESSEE WHILE VALUING THE CLOSING STOCK OF ITS GOODS AS ON 31/03/2011 HAS NOT INCLUDED THE AMOUNT OF CENVAT WHICH IS CONTRARY TO THE PROVISIONS OF SECTION 145A OF THE ACT. THEREFORE, THE CLOSING STOCK OF THE ASSESSEE WAS ENHANCED BY THE AMOUNT OF CENVAT CREDIT OF RS.13,26,163/ - AS ATTRIBUTABLE TO THE CLOSING STOCK OF THE ASSESSEE. 36.1 HOWEVER, THE LD. CIT(A) DELETED THE ADDITION MADE BY THE ASSESSING OFFICER BY OBSERVING THAT THE ASSESSEE HAS BEEN FOLLOWING ITS METHOD OF VALUATION CONSISTENTLY AND THERE WAS NO DISSATISFACTION OF THE ASSESSING OF FICER ABOUT THE CORRECTNESS/COMPLETENESS OF THE BOOKS OF ACCOUNTS OF THE ASSESSEE. 36.2 FROM THE PRECEDING DISCUSSION, WE NOTE THAT THE ASSESSEE HAS BEEN RECORDING ITS TRANSACTIONS OF PURCHASE, SALES, AND VALUATION OF INVENTORIES, NET OF CENVAT CONSISTENTLY. THUS, IF THE INVENTORY OF CLOSING STOCK IS ENHANCED BY THE AMOUNT OF CENVAT CREDIT ATTRIBUTABLE TO IT, THEN THE AMOUNT OF CORRESPONDING PURCHASES SHOULD ALSO BE INCREASED BY THE SAID AMOUNT WHICH WILL RESULT IN TAX NEUTRAL EXERCISE. THUS, IN OUR CONSIDERED VIEW, THE ASSESSING OFFICER ERRED IN ENHANCING THE VALUE OF THE CLOSING STOCK WITHOUT GIVING EFFECT TO THE PURCHASES. IN THIS REGARD, WE FIND SUPPORT AND GUIDANCE FROM THE JUDGMENT OF HON BLE GUJAR AT HIGH COURT IN THE CASE OF PR.CIT VS. GUJARAT GAS COMPANY LTD. IN TAX APPEAL NO.90 OF 2017 VIDE ORDER DATED 07/02/2017, WHEREIN IT WAS HELD AS UNDER: - 3.03. NOW, SO FAR AS QUESTION NO. [B] I.E. WITH RESPECT TO ADDITION MADE BY THE A.O. ON ACCOUNT OF UNUTILIZED MODVAT / CENVAT CREDIT OF RS. 56,08,089/ - IS CONNECTED, IT IS REQUIRED TO BE NOTED THAT THE LEARNED TRIBUNAL HAS TAKEN NOTE THAT WITH RESPECT TO MODVAT RECEIVABLE ACCOUNT, THERE IS CORRESPONDING LESS DEBIT TO THE PU RCHASE ACCOUNT AND HENCE TO THAT EXTENT THERE IS ALREADY INCOME OFFERED FOR TAX. IF THAT BE SO, THERE WAS NO QUESTION OF FURTHER ADDING MODVAT / CENVAT CREDIT TO THE INCOME OF THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION. UNDER THE CIRCUMSTANCES, WE SEE NO REASON TO INTERFERE WITH THE IMPUGNED JUDGEMENT AND ORDER PASSED BY THE LEARNED TRIBUNAL SO FAR AS CONFIRMING THE ORDER PASSED BY THE LEARNED CIT(A) DELETING THE ADDITION MADE BY THE A.O. ON ACCOUNT OF UNUTILISED MODVAT / CENVAT CREDIT OF RS. 56,08,089/ - . WE ARE IN COMPLETE AGREEMENT WITH THE VIEW TAKEN BY THE LEARNED TRIBUNAL. I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 15 - 36.3 THERE IS NO AMBIGUITY THAT THE ASSESSEE HAS BEEN FOLLOWING THE EXCLUSIVE METHOD OF ACCOUNTING. IN VIEW OF THE ABOVE, WE CONCUR WITH THE VIEW OF THE LD. CIT(A) AND ACCORDINGLY DECLINE TO INTERFERE IN HIS ORDER. HENCE, THE GROUND OF APPEAL OF THE REVENUE IS DISMISSED . AS THE IMPUGNED ISSUE HAS ALREADY BEEN DECIDED BY THIS TRIBUNAL IN THE OWN CASE OF THE ASSESSEE (SUPRA) IN ITS FAVOR, RESPECTFULLY FOLLOWING THE SAME WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER O F THE ''LD.CIT (A)''. HENCE, THIS GROUND OF APPEAL OF THE REVENUE IS DISMISSED. THE FOURTH ISSUE RAISED BY THE REVENUE IN GROUND NO. 4 IS THAT THE ''LD.CIT (A)'' ERRED IN DELETING THE DISALLOWANCE MADE BY THE AO FOR RS . 5,26,000/ - ON ACCOUNT OF INTEREST WITH RESPECT TO CAPITAL WORKING IN PROGRESS. 1 9 . THE ASSESSEE DURING THE YEAR HAS CAPITALIZED THE AMOUNT OF INTEREST FOR RS. 4 4 5. 76 LACS BEING ATTRIBUTABLE TO THE CAPITAL WORK IN PROGRESS. HOWEVER, T HE AO DURING T HE ASSESSMENT PROCEEDING OBSERVED THAT THE ASSESSEE H A S NOT CAPITALIZED ENTIRE AMOUNT OF INTEREST EXPENSES INCURRED BY IT WHICH ATTRIBUTABLE TO THE CAPITAL WORK IN PROGRESS. THE AO ACCORDINGLY WORK ED OUT AMOUNT OF INTEREST IN THE FOLLOWING MANNER. IT HAS SHOWN CAPITAL WORK IN PROGRESS TO THE TUNE OF RS.7439.51 LACS. IT HAS ALSO CAPITALIZED INTEREST TO THE TUNE OF RS.778.84 LACS. THE ACTUAL AMOUNT OF INTEREST REQUIRED TO BE CAPITALIZED IS WORKED OUT AS UNDER: - RS. IN LACS SR. NO. OPENING BALANCE AS ON APRIL 2013 ADDITION TO CWIP AMT. TRANSFERRED TO ASSETS NET BALANCE BEFORE INTEREST COST 1 6519.06 0 3049.71 3469.35 INTEREST @ 13% 451.02 OPTION - 1 LESS INTEREST EXPENSES ALREADY CAPITALIZED 445.76 BALANCE REQUIRED 5.26 I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 16 - IN VIEW OF THE ABOVE THE AO TREATED AMOUNT OF INTEREST EXPENSES OF RS.5.26 LACKS AS CAPITAL IN NATURE. THEREFORE HE DISALLOWED THE SAME AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 20 . AGGRIEVED ASSESSEE PREFERRED APPEAL TO THE ''LD.CIT (A)'' WHO HAS DELETED THE ADDITION MADE BY THE AO. BEING AGGRIEVED BY THE ORDER OF THE ''LD.CIT (A)'' THE REVENUE IS IN APPEAL BEFORE US. 2 1. BOTH THE LD. DR AND LD.AR, BEFORE US RELIED ON THE ORDER OF THE AUTHORITIES BELOW AS FAVORABLE TO THEM. 22. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE RELEVANT MATERIAL S AVAILABLE ON RECORD. AT THE OUTSET WE NOTE THAT THE IMPUGNED ISSUE FIRST AROUSED IN THE A.Y. 2013 - 14 WHICH HAS BEEN DECIDED BY THE ITAT IN FAVOUR OF THE ASSESSEE BEARING ITA NO. 2774/AHD/2016 VIDE ORDER DATED 28/06/2019. THE RELEVANT EXTRACT OF T HE ORDER IS REPRODUCED AS UNDER: 48. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. AT THE OUTSET, WE NOTE THAT THERE WAS NO APPEAL PREFERRED BY THE REVENUE IN RESPECT OF THE DELETION MADE BY THE LEARNED CIT (A) FOR THE YEAR PERTAINING TO THE ASSESSMENT YEAR 2012 - 13. THEREFORE, WE HOLD THAT THE ORDER OF THE LEARNED CIT (A) HAS REACHED ITS FINALITY FOR THE ASSESSMENT YEAR 2012 - 13. I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 17 - 48.1 SIMILARLY, WE ALSO NOTE THAT THE ASSESSEE HAS FURNISHED THE NE CESSARY DETAILS OF THE CAPITAL WORK IN PROGRESS AND THE AMOUNT OF INTEREST CAPITALIZED THEREIN. BUT THE LEARNED DR BEFORE US HAS NOT BROUGHT ANY IOTA OF EVIDENCE CONTRARY TO THE FINDING OF THE LEARNED CIT - A. HENCE WE DO NOT FIND A REASON TO INTERFERE IN TH E ORDER OF THE LEARNED ITA. HENCE THE GROUND OF APPEAL OF THE REVENUE IS DISMISSED. 23 . AS THE IMPUGNED ISSUE HAS ALREADY BEEN DECIDED BY THIS TRIBUNAL IN THE OWN CASE OF THE ASSESSEE (SUPRA) IN ITS FAVOR, RESPECTFULLY FOLLOWING THE SAME WE DO NOT FIND A NY REASON TO INTERFERE IN THE ORDER OF THE ''LD.CIT (A)''. HENCE, THIS GROUND OF APPEAL OF THE REVENUE IS DISMISSED. THE FIFTH ISSUE RAISED BY THE REVENUE IN GROUND NO.5 AND 6 IS THAT ''LD.CIT (A)'' ERRED IN DELETING DISALLOWANCE MADE BY THE AO FOR RS.52 , 1 9 , 830/ - ON ACCOUNT OF INTEREST EXPENSES U/S 43B OF THE ACT. 24 . THE ASSESSEE IN THE YEAR UNDER CONSIDERATION HAS INCURRED IN TEREST EXPENSES AMOUNTING TO 1, 18 , 32 , 304 .00 ON THE TERM LOAN TAKEN FROM EXIM BANK. THE ASSESSEE CLAIMED THAT OUT OF SUCH INTEREST EXPENSES IT HAS PAID A SUM OF 1 , 16 , 50 , 958.90 BEFORE THE END OF THE FINANCIAL YEAR UNDER CONSIDERATION. THE BALANCE AMOUNT OF 1 81345.10 WAS PAID AFTER THE E ND OF THE F INANCIAL YEAR BUT BEFORE THE DUE DATE OF FILING OF INCOME TAX RETURN AS SPECIFIED UNDER SECTION 139 ( 1 ) OF THE ACT. 24 . 1 THE ASSESSEE ALSO SUBMITTED THAT OUT OF THE INTEREST EXPENDITURE OF 1 , 18 , 32 , 304 .00, A SUM OF 52 , 19 , 830 .00 WAS NOT DEBITED IN THE PR OFIT AND LOSS ACCOUNT AS THE SAME WAS ADJUSTED AGAINST THE INTEREST PAYABLE ACCOUNT. I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 18 - 24 .2 ACCORDINGLY, THE ASSESSEE CLAIMED THAT IT IS ELIGIBLE FOR DEDUCTION OF ENTIRE INTEREST EXPENDITURE UNDER THE PROVISIONS OF SECTION 43B OF THE ACT. 24 .3 HOWEVER, THE AO FOUND THAT THE ASSESSEE HAS NOT FURNISHED ANY EVIDENCE SUGGESTING THAT THE AM OUNT OF INTEREST EXPENSES OF 5 2 , 19 , 830 .00 REPRESENTS THE PAYMENT MADE TO THE EXIM BANK. THEREFORE, THE AO IN THE ABSENCE OF DOCUMENTARY EVIDENCE HAS DISALLOWED THE INTEREST E XPENSES CLAIMED BY IT FOR 52 , 19 , 830 .00 OUT OF THE TOTAL INTEREST CLAIM OF THE ASSESSEE OF 1 , 18 , 32 , 304 .00 AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 25 . AGGRIEVED ASSESSEE PREFERRED AN APPEAL TO THE LEARNED CIT (A) WHO HAS DELETED THE ADDITION MADE B Y THE AO BY OBSERVING AS UNDER: 7.4 ON CAREFUL CONSIDERATION OF OBSERVATION OF ASSESSING OFFICER AND CONTENTION OF APPELLANT, IT IS OBSERVED THAT A.O. HAS MADE DISALLOWANCE ON THE GROUND THAT APPELLANT HAS NOT FURNISHED ANY SUPPORTING EVIDENCES THAT THE SAID AMOUNT OF RS.52,19,830/ - WAS PAID TO EXIM BANK WAS PART OF THE ENTIRE INTEREST EXPENSES INCURRED OF RS.1,18,32,304/ - . THE APPELLANT HAS NEGATED THE WHOLE THEORY OF THE A.O. AND HAS STATED THAT AO DID NOT MAKE PROPER ENQUIRY IN RESPECT OF APPLICABILITY OF PROVISIONS OF SECTION 43B OF THE ACT. IT IS SEEN FROM THE FACTS OF THE CASE THAT THE APPELLANT HAS SUBMITTED THE CHART BEFORE THE PAYMENT OF INTEREST TO EXIM BANK AT THE TIME OF ASSESSMENT PROCEEDINGS ALONG WITH THE NECESSARY DETAILS IN THIS REGARD (PAGE 43 OF THE A.O. ORDER). THE APPELLANT HAS SUBMITTED THE SAME BEFORE ME AT THE TIME OF APPELLATE PROCEEDINGS. FROM THE ABOVE STATEMENT THAT INTEREST EXPENSES OF RS.1,16,50,958/ - (RS.1,18,32,304/ - - RS.1,81,345/ - ) WAS PAID DURING THE FINANCIAL YEAR 201 3 - 14 AND RS.1,81,345/ - UNPAID INTEREST EXPENSES AS ON 31.03.2014 WAS ALSO PAID ON 05.05.2014. IT IS PERTINENT TO NOTE THAT ENTIRE INTEREST EXPENSES AMOUNTING TO RS.1,18,32,304/ - WAS PAID ON OR BEFORE DUE DATE OF FILLING INCOME TAX RETURN AND INTEREST EXPEN SES OF RS.52,19,830/ - WHICH WAS NOT DEBITED TO PROFIT AND LOSS ACCOUNT WAS ALSO PART OF INTEREST AMOUNTING TO RS.1,18,32,304/ - , THEREFORE THE ASSESSEE COMPANY HAS CORRECTLY CLAIMED SAID EXPENSES IN STATEMENT OF TOTAL INCOME. IN VIEW OF THE ABOVE, THE ADDIT ION MADE BY THE A.O. U/S.43B OF THE ACT IS NOT ATTRACTED AND THE ADDITION WAS HEREBY DELETED. THE GROUND OF APPELLANT IS ALLOWED. I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 19 - B EING AGGRIEVED BY THE ORD ER OF THE LEARNED CIT (A), THE R EVENUE IS IN APPEAL BEFORE US. 26 . BOTH THE LEARNED DR AND THE AR BEFORE US RELIED ON THE ORDER OF THE AUTHORITIES BELOW AS FAVOURABLE TO THEM. 27 . WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. FROM THE PRECEDING DISCUSSION, WE NOTE THAT THE DISALLOWANCE WAS MADE BY THE AO ON THE REASONING THAT THE ASSESSEE FAILED TO FURNISH THE DETAILS SUGGESTING THAT THE A MOUNT OF INTEREST PAYMENT OF 5 2 , 19 , 830 .00 REPRESENTS THE AMOUNT PAID TO EXIM BANK. IN THIS REGARD WE NOTE THAT THE ASSESSEE DUR ING THE ASSESSMENT PROCEEDINGS HAS FURNISHED A CHART OF THE INTEREST PAYMENT TO THE EXIM BANK AS EVIDENT FROM THE SUBMISSION OF THE ASSESSEE RECORDED ON PAGE 42 AND 43 OF THE ASSESSMENT ORDER. 27 .1 BESIDES THIS, WE ALSO NOTE THAT THE ASSESSEE HAS ALSO FU RNISHED THE BANK STATEMENT OF THE EXIM BANK IN SUPPORT OF THE IMPUGNED INTEREST EXPENSES. THE SUBMISSION OF THE ASSESSEE RECORDED IN THE ORDER OF THE AO IS EXTRACTED BELOW: COPY OF BANK STATEMENT OF EXIM BANK LOAN IS SUBMITTING HEREWITH AS ANNEXURE - 1 FO R YOUR KIND PERUSAL. I N VIEW OF THE ABOVE, THE LEARNED CIT (A) HAS GRANTED RELIEF TO THE ASSESSEE. THE LEARNED DR BEFORE US HAS NOT BROUGHT ANYTHING ON RECORD I TA NOS.1936/AHD/2017 & THREE OTHERS ASST.YEAR S 2013 - 14 & 2014 - 15 . - 20 - CONTRARY TO THE FINDING OF THE LEARNED CIT - A AND TO THE SUBMISSION MADE BY THE ASSESSEE BEFORE T HE AO DURING THE ASSESSMENT PROCEEDINGS. 2 7 .2 AFTER CONSIDERING THE FACTS IN DETAIL, WE NOTE THAT THE ASSESSEE HAS FURNISHED SUFFICIENT DETAILS BEFORE THE AO SUGGESTING THAT THE IMPUGNED INTEREST OF 52 , 19 , 830 .00 REPRESENTS THE AMOUNT PAID TO EXIM BANK WHICH HAVE ALSO NOT BEEN DISPUTED BY THE REVENUE. HENCE, WE DO NOT FIND ANY REASON TO INTERFERE IN THE FINDING OF THE LEARNED CIT (A). HENCE THE GROUND OF APPEAL OF THE REVENUE IS DISMISSED. IN THE RESULT, THE AP PEAL OF THE REVENUE IS PARTLY ALLOWED FOR THE STATISTICAL PURPOSES WHEREAS THE APPEAL OF THE ASSESSEE IS ALLOWED FOR THE STATISTICAL PURPOSES. 2 8 . IN THE COMBINED RESULTS, THE APPEALS OF THE ASSESSEE BEARING NOS.1856 - 1857/AHD/2017 FOR A.YS 2013 - 14 & 20 14 - 15 A ND APPEAL OF REVENUE BEARING N O.1936/AHD/2017 FOR A.Y. 2013 - 14 ARE ALLOWED FOR STATISTICAL PURPOSES WHEREAS APPEAL OF REVENUE BEARING NO. 1937/A HD /2017 FOR A.Y. 2014 - 15 IS PARTLY ALLOWED FOR THE STATISTICAL PURPOSES . THIS ORDER PRONOUNCED IN OPEN COURT ON 16 / 10 /201 9 - SD - - SD - ( MS MADHUMITA ROY ) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER (TRUE COPY) A HMEDABAD; DATED 16 / 10 /20 19