ACIT, Bangalore V. M/s Karnataka Global Ltd., Bangalore

ITA 198/BANG/2012

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 0452 (ITAT-BANGALORE)
• Duration Of Justice: 4 year(s) 2 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-04-2016
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 15-03-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 07-02-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: K R PRADEEP
• Keywords: Transfer pricing; Search and seizure; International transaction; Wholly owned subsidiary; Procedural lapse
• Section: 92E

Judgement Text

ITA.198/BANG/2012 PAGE - 1 IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH 'C', BANGALORE BEFORE SHRI. ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI. VIJAYPAL RAO, JUDICIAL MEMBER I.T.A NO.198/BANG/2012 (ASSESSMENT YEAR : 2006-07) ASST. COMMISSIONER OF INCOME TAX, CIRCLE -11(5), BENGALURU .. APPELLANT V. M/S. KARATURI GLOBAL LTD, NO.204, EMBASSY CENTRE, NO.11, CRESCENT ROAD, BANGALORE 560 025 .. RESPOND ENT PAN : AAACK8275A ASSESSEE BY : SHRI. K. R. PRADEEP, CA REVENUE BY : SHRI. SANJAY KUMAR, CIT -III HEARD ON : 15.03.2016 PRONOUNCED ON : 12.04.2016 O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER : IN THIS APPEAL FILED BY THE REVENUE DIRECTED AGAINS T AN ORDER DT.25.11.2011 OF CIT (A)-I, BANGALORE, IT HAS ALTO GETHER RAISED EIGHT GROUNDS OF WHICH GROUNDS 1, 7 AND 8 ARE GENERAL NEE DING NO SPECIFIC ADJUDICATION. GROUNDS 2 TO 6 ARE DIFFERENT FACETS OF THE ARGUMENTS TAKEN BY ITA.198/BANG/2012 PAGE - 2 THE REVENUE AGAINST DELETION OF ADDITION OF RS.17,8 4,37,105/- BY THE CIT (A). 2. FACTS APROPOS ARE THAT ASSESSEE ENGAGED IN THE BUSI NESS OF FLORICULTURE, ISP SERVICES, PROJECT SERVICES AND SO FTWARE DEVELOPMENT, HAD FILED ITS RETURN OF INCOME DECLARING INCOME FOR THE IMPUGNED YEAR AT NIL AFTER CLAIMING EXEMPTION FOR AGRICULTURAL INCOME OF RS.10,71,09,148/-. DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS ASS ESSEE WAS REQUIRED TO EXPLAIN THE CLAIM WITH REGARD TO THE AGRICULTURAL I NCOME. AS PER THE ASSESSEE, ITS TOTAL AGRICULTURAL INCOME AROSE OUT O F THE SALE OF MOTHER PLANTS AND OTHER FLORICULTURE ITEMS. THE SALES CLAIMED BY THE ASSESSEE CONSISTED OF THE FOLLOWING : DOMESTIC SALES RS. 1,79,33,098/- EXPORT SALES TO SUBSIDIARY RS.22,74,57,820/- EXPORT SALES TO OTHER PARTIES RS. 7,26,162/- 3. OF THE ABOVE, THE SUM OF RS.22,74,57,820/- WERE EXP ORT SALES WERE TO A WHOLLY OWNED SUBSIDIARY OF THE ASSESSEE CALLED M/ S. ETHIOPIAN MEADOWS IN ETHIOPIA. ASSESSEE HAD ALSO FILED AN AUDIT REPO RT IN FORM 3 CEB RELATING TO THE INTERNATIONAL TRANSACTIONS AS REQUIRED U/S.9 2 CA OF THE INCOME-TAX ACT, 1961 (' THE ACT' IN SHORT). AS PER SUCH AUDI T REPORT, ALP OF THE ITA.198/BANG/2012 PAGE - 3 INTERNATIONAL TRANSACTIONS ON SALES EFFECTED BY THE ASSESSEE TO ITS SUBSIDIARY IN ETHIOPIA WERE AS UNDER 4. AS PER THE AO IT WAS CLEAR FROM THE ABOVE AUDIT REP ORT THAT FOR EVERY SALE EFFECTED TO THE SUBSIDIARY, ASSESSEE WAS RAISI NG TWO INVOICES. ALP FOR THE SUPPLEMENTARY INVOICE WAS CERTIFIED BY THE AUDI TOR AS ZERO IN EACH CASE. AO AFTER VERIFICATION FOUND THAT ONLY THE PRIMARY I NVOICE WAS ROUTED THROUGH THE CUSTOMS AND NOT THE SUPPLEMENTARY ONE. IN HIS OPINION THERE ITA.198/BANG/2012 PAGE - 4 WERE NO UNDERLYING GOODS TO SUPPORT SUCH SUPPLEMENT ARY INVOICES. EXPLANATION OF THE ASSESSEE WAS SOUGHT, ESPECIALLY WITH REGARD TO THE SUPPLEMENTARY INVOICE. IN REPLY ASSESSEE STATED TH AT THE PLANTS WHICH WERE SOLD WERE PERISHABLE IN NATURE. ACCORDING TO THE A SSESSEE THE SALE PRICE WAS SPLIT INTO TWO AND ONLY IF THE BUYER, WHICH WAS THE SUBSIDIARY OF THE ASSESSEE COULD USE THE PLANTS, THE SUPPLEMENTARY IN VOICE WAS RAISED. 5. HOWEVER AO WAS NOT IMPRESSED BY THE ABOVE REPLY. A CCORDING TO HIM ASSESSEE HAD NOT PAID THE MANDATORY CESS OF 0.5 % TO THE CUSTOMS STATION AND THERE WERE NO GR FORMS WHICH WOULD ENAB LE THE BANK TO AUTHORISE RECEIPT OF THE EXPORT PROCEEDS, ARISING OUT OF SUPPLEMENTARY INVOICE. AO ALSO NOTED THAT DESPITE SEVERAL OPPORT UNITIES BEING GIVEN, ASSESSEE HAD NOT SUBSTANTIATED ITS CLAIM OF AGRICUL TURAL INCOME ARISING OUT OF THE SUPPLEMENTARY INVOICES. FURTHER AS PER THE AO AGAINST THE PURPORTED HORTICULTURE SALE OF RS.22,74,57,819/-, WHAT WAS AC TUALLY RECEIVED FROM THE SUBSIDIARY WAS ONLY RS.3,62,72,680/-. SUM OF RS.1 2 CRORES WAS SQUARED UP VIDE A JOURNAL ENTRY DT.30.01.2006 TRANSFERRING SUCH SUM TO A HEAD CALLED ADVANCE TO EHIOPIAN MEADOWS PLC. BALANCE SHOWN AS RECEIVABLE FROM THE SUBSIDIARY AT THE END OF YEAR WAS RS.7,11,85,13 8/-. THUS AS PER THE AO AGAINST THE CLAIMED SALE OF RS.22,74,57,826/-, TO THE SUBSIDIARY WHAT WAS ITA.198/BANG/2012 PAGE - 5 BROUGHT IN BY THE ASSESSEE WAS ONLY RS.3,62,72,680/ -. EVEN THESE PROCEEDS, AS PER THE AO WERE LOWER THAN THE TOTAL AMOUNT OF P RIMARY INVOICES, WHICH CAME TO RS.4,90,20,714/-. THUS AS PER THE AO THERE WAS AN ARTIFICIAL BOOSTING OF INCOME BY THE ASSESSEE. HE HELD THAT A CTUAL AGRICULTURAL INCOME AGAINST THE ALLEGED SALE OF RS.22,74,57,819/-, THE SUBSIDIARY WAS RS.4,90,20,714/- ONLY. BALANCE SUM WAS CONSIDERED AS INFLATION OF AGRICULTURAL INCOME BY THE ASSESSEE AND HELD AS NOT ELIGIBLE FOR EXEMPTION FROM INCOME-TAX. ADDITION OF RS.17,84,37,105/- WAS MADE. 6. AGGRIEVED ASSESSEE MOVED IN APPEAL BEFORE THE CIT ( A). ARGUMENT OF THE ASSESSEE WAS THAT COMPUTATION OF AGRICULTURA L INCOME WAS NOT IN THE DOMAIN OF THE AO. AS PER THE ASSESSEE, PROCEDURAL IRREGULARITY POINTED OUT BY THE AO WITH REFERENCE TO ROUTING OF THE INVOICES THROUGH CUSTOMS AUTHORITIES WOULD NOT DISCREDIT ITSCLAIM. ASSESSEE POINTED OUT THAT THE SUM OF RS.12 CRORES WAS NOT A CONTRA ENTRY BUT WERE CON VERSION OF A PART OF THE DUES TO SHARE CAPITAL. FURTHER AS PER THE ASSESSE E CONTENTION OF THE AO THAT AGRICULTURAL INCOME WAS INFLATED AND ARTIFICIAL, WA S ONLY A SURMISE WITHOUT ANY EVIDENCE IN SUPPORT. ARGUMENT OF THE ASSESSEE WAS THAT THERE WAS A LEGITIMATE REASON FOR RAISING TWO INVOICES FOR EACH TRANSACTION. AS PER THE ASSESSEE EVEN IF THE AGRICULTURAL INCOME WAS FROM D OMESTIC TRANSACTIONS IT ITA.198/BANG/2012 PAGE - 6 STILL REMAINED EXEMPT. THUS ACCORDING TO THE ASSESS EE ADDITION MADE BY THE AO WAS NOT JUSTIFIED. 7. CIT (A) WAS APPRECIATIVE OF THE ABOVE CONTENTIONS. ACCORDING TO HIM, CLAIM OF THE ASSESSEE THAT FIRST INVOICE WAS A T A NOTIONAL VALUE AND THE SECOND INVOICE WAS RAISED BASED ON ULTIMATE REALISA TION WAS AN ACCEPTABLE ONE. AS PER THE LD. CIT (A), THIS WAS A GENERAL PR ACTICE FOLLOWED IN FLORICULTURE EXPORTS. FURTHER AS PER THE CIT (A) O NCE THERE WAS AN EXPORT OF AGRICULTURAL PRODUCE AND REALISATION, EXEMPTION CLA IMED FOR AGRICULTURAL INCOME COULD NOT BE DENIED FOR NON ADHERENCE TO PRO CEDURES AND MINOR ERRORS IN DOCUMENTATION. HE ACCEPTED THE CONTENTIO N OF THE ASSESSEE THAT AGRICULTURAL INCOME ARISING OUT OF THE SALES WHETHE R IN INDIA OR OUTSIDE INDIA WAS ELIGIBLE FOR EXEMPTION. HE DELETED THE A DDITION MADE BY THE AO. 8. NOW BEFORE US, LD. DR STRONGLY ASSAILING THE ORDER OF CIT (A) SUBMITTED THAT THERE WAS NO PROCEDURE LIKE THE ONE FOLLOWED BY THE ASSESSEE WHERE TWO INVOICES COULD BE RAISED FOR SALE OF PERI SHABLE GOODS. AS PER THE LD. DR SECOND INVOICE WAS NEVER ROUTED THROUGH THE CUSTOMS. ASSESSEES OWN AUDITORS HAD CERTIFIED THE ALP VALUE OF SUCH SE COND INVOICES AS NIL. AS PER THE LD. DR ASSESSEE HAD DISCONTINUED THIS PRACT ICE IN LATER YEARS. EVEN THE AMOUNTS AS PER THE PRIMARY INVOICE WERE NOT REA LISED BY THE ASSESSEE. ITA.198/BANG/2012 PAGE - 7 JUST BECAUSE A PART OF THE DUES WERE TRANSFERRED TO CAPITAL OR TRANSFERRED TO SHARE APPLICATION MONEY WOULD NOT CONVERT THE CLAIM OF EXCESSIVE AGRICULTURAL INCOME, A LEGITIMATE ONE. AS PER THE LD. DR, MOTHER PLANTS CLAIMED TO HAVE BEEN EXPORTED BY THE ASSESSEE TO IT S SUBSIDIARY M/S. ETHIOPIAN MEADOWS AT ETHIOPIA TOTALED TO 9,42,020 NUMBERS FROM ABOUT 10 HECTARES OF LAND WHERE SIX GREEN HOUSES WERE ERECTE D COVERING 5 HECTARES, OUT OF THE BALANCE FIVE HECTARES OF LAND HELD, AS P ER THE LD. DR, TWO HECTARES, WERE OPEN FIELD USED FOR GROWING ROOTSTOC K / BUDWOOD, ONE HECTARE WAS USED FOR PROPAGATION AND TWO HECTARES W ERE BUILDINGS, PATHWAYS, ETC., FURTHER AS PER THE LD. DR YIELD OF PLANTS PER HECTARE OF GREEN HOUSE, AS PER INDIAN STANDARD WAS 60,000 NUMB ERS PER ANNUM. THEREFORE THE MAXIMUM YIELD FROM 5 HECTARES, ACCORD ING TO LD. DR COULD HAVE BEEN AT THE BEST 3 LAKH NUMBERS. ADDING ANOTH ER 30,000 FOR OPEN FARM YIELD, ASSESSEE COULD HAVE PRODUCED 3,30,000 P LANTS PER ANNUM AT THE BEST, AGAINST THE CLAIM OF MORE THAN 9,00,000 PLANT S/SAPLINGS SUPPLIED TO M/S ETHIOPIAN MEADOWS. THUS AS PER THE LD. DR, ASS ESSEE HAD INFLATED ITS CLAIM OF AGRICULTURAL INCOME. AGAIN AS PER THE LD. DR IF THE CLAIM OF THE ASSESSEE WAS THAT BALANCE OF THE SEEDLINGS WERE PUR CHASED IN THE OPEN MARKET AND SOLD, THEN INCOME THEREFROM WOULD NOT BE AGRICULTURAL INCOME. ITA.198/BANG/2012 PAGE - 8 9. PER CONTRA, LD. AR SUBMITTED THAT AO HIMSELF HAD ST ATED THAT ASSESSEE WAS NOT DOING ANY TRADING. AS PER THE LD. AR, ETHIOPIAN MEADOWS, A SUBSIDIARY OF THE ASSESSEE WAS SELLING T HE PLANTS AND SAPLINGS IN THE DUTCH AUCTION HOUSE AND THE ACTUAL REALISATI ON WOULD BE KNOWN ONLY ON THE AUCTION FLOOR. AS PER THE LD. AR AT THE TIM E OF SENDING THE SAPLINGS TO THE SUBSIDIARY, A NOTIONAL AMOUNT WAS SHOWN IN T HE INVOICE SINCE THE ACTUAL AMOUNT THAT COULD BE REALIZED WOULD BE KNOWN ONLY AFTER THE AUCTION. AS PER THE LD. AR THIS WAS THE REASON WHY SUPPLEMENTARY INVOICE WAS RAISED. SUCH SUPPLEMENTARY INVOICE WAS RAISED ONCE THE REALISATION FROM AUCTION WERE KNOWN. LD. AR SUBMITTED THAT EVE N IF THE AGRICULTURAL INCOME SHOWN BY THE ASSESSEE WAS DISBELIEVED, THERE WAS NO CASE FOR AN ADDITION, SINCE THERE WAS NOTHING ON RECORD TO SHOW THAT ASSESSEE HAD DERIVED ANY TAXABLE INCOME TO THAT EXTENT. JUST BE CAUSE THE SUPPLEMENTARY INVOICE WAS NOT ROUTED THROUGH RBI OR BECAUSE CESS WAS NOT PAID ON THE FIGURES SHOWN IN THE SUPPLEMENTARY INVOICE, COULD N OT DISCREDIT THE CLAIM OF THE ASSESSEE. AS PER THE LD. AR SUPPLEMENTARY I NVOICES WERE MADE AVAILABLE TO THE CUSTOMS AUTHORITIES. IN ANY CASE ACCORDING TO HIM, NO COMPARABLE CASE WAS SHOWN BY THE AO FOR COMING TO A CONCLUSION THAT THE YIELD OF THE ASSESSEE WAS MUCH HIGHER THAN THE ACCE PTED STANDARDS. ACCORDING TO THE LD. AR, INFLATION OF AGRICULTURAL INCOME BY ITSELF WOULD ITA.198/BANG/2012 PAGE - 9 NOT GET CONVERTED TO UNDISCLOSED INCOME. 10. WE HAVE PERUSED THE ORDERS AND HEARD THE RIVAL CONT ENTIONS. LD. AR OF THE ASSESSEE HAS NOT DISPUTED THE CONTENTION OF THE DEPARTMENT THAT THE TOTAL AREA UNDER CULTIVATION WAS 10 HECTARES WHERE THERE WERE SIX NUMBERS OF GREEN HOUSES COVERING 5 HECTARES. IT IS ALSO NO T DISPUTED THAT TWO HECTARES OF OPEN FIELD WERE USED FOR GROWING ROOT S TOCK / BUD WOOD. ONE HECTARE WAS USED FOR PROPAGATION AND TWO HECTARES W ERE USED FOR BUILDING AND PATHWAYS. CLAIM OF THE ASSESSEE IS THAT IT HAD SOLD MORE THAN 9,00,000 MOTHER PLANTS TO ITS SUBSIDIARY IN ETHIOPIA FROM TH E ABOVE HOLDING. AS PER THE DEPARTMENT, ASSESSEE COULD NOT HAVE RAISED MORE THAN 3,30,000 PLANT SAPLINGS FROM THE ABOVE HOLDING. 11. LEAVING THIS APART, WHAT WE FIND IS THAT ASSESSEE H AD ALONG WITH ITS RETURN FILED AUDIT REPORT IN FORM 3 CEB WHICH IS RE QUIRED TO BE FURNISHED U/S.92 E FOR INTERNATIONAL TRANSACTIONS WITH AES. AO HAD COMPILED THE FIGURES GIVEN AT PARA THREE ABOVE FROM SUCH REPORT. IT IS CLEAR FROM THE SAID REPORT THAT AGAINST THE CLAIMED SALE OF RS.22,74,57 ,819/-, ALP WAS ONLY RS.4,20,20,714/-. THIS IS NOT THE OPINION OF THE A O / TPO, BUT IT IS THE OPINION OF THE AUDITORS OF THE ASSESSEE. WHAT THE AO DID WAS TO ACCEPT THE ALP DETERMINED BY THE AUDITORS OF THE ASSESSEE IN A CCORDANCE WITH SECTION ITA.198/BANG/2012 PAGE - 10 92E OF THE ACT. A READING OF THE TABLE WOULD CLEAR LY SHOW THAT THE DETERMINATION OF ALP WITH REGARD TO SUPPLEMENTARY I NVOICES WERE ZERO. IT IS CLEAR THAT THERE WAS NO UNDER LYNG OF AGRICULTUR AL GOODS OR ANY GOODS FOR THAT MATTER WHICH WERE SOLD. CONTENTION OF THE ASS ESSEE THAT SUPPLEMENTARY INVOICE WAS BASED ON PRICES FETCHED ON AUCTION SALE S BY ITS SUBSIDIARY WHEN THE GOODS WERE ULTIMATELY SOLD AT THE AUCTION FLOOR S IN DUTCH AUCTION, FALLS FLAT WHEN WE CONSIDER THE DATES ON WHICH SUPPLEMENT ARY INVOICES RAISED ON ETHIOPIAN MEADOWS WERE ACCOUNTED BY THE ASSESSEE IN ITS BOOKS. BOTH THE INVOICES VIZ., THE ORIGINAL INVOICE AND SUPPLEMENTA RY INVOICE, IN EACH CASE WAS ACCOUNTED ON THE SAME DAY. IF THE VERSION OF T HE ASSESSEE THAT SUPPLEMENTARY INVOICE WAS RAISED BASED ON FINAL AUC TION FIGURES WAS CORRECT, THEN DEFINITELY THE ACCOUNTING FOR SUCH SU PPLEMENTARY INVOICE, EVEN IF WE CONSIDER IT TO HAVE BEEN PRE-DATED COULD HAVE HAPPENED ONLY ON A DATE SUBSEQUENT TO THE AUCTION. 12. COMING TO THE CLAIM OF THE ASSESSEE THAT COMPUTATIO N OF AGRICULTURAL INCOME IS NOT WITHIN THE PURVIEW OF THE AO, A LOOK AT SECTION 10(1) AND SECTION 2(1A)OF THE ACT, CAN SOLVE THIS ISSUE. SEC TION 10(1) OF THE ACT SPECIFICALLY STATES THAT AGRICULTURAL INCOME CANNOT BE INCLUDED IN THE TOTAL INCOME OF THE ASSESSEE. IT IS THEREFORE NECESSARY FOR AN AO TO DETERMINE ITA.198/BANG/2012 PAGE - 11 WHETHER THE AGRICULTURAL INCOME CLAIMED BY AN ASSES SEE IS CORRECT OR NOT, AND WHETHER IT FALLS WITHIN THE DEFINITION OF THAT TERM GIVEN IN SECTION 2(1A). WHEN AN ASSESSEE ASSERTS THAT THE INCOME RA ISED BY IT IS ON ACCOUNT OF SALE OF AGRICULTURAL PRODUCES, ONUS IS ON THE AS SESSEE TO PROVE SUCH AGRICULTURAL INCOME. IN OUR OPINION, ASSESSEE BEFO RE US HAS FAILED TO DISCHARGE THIS ONUS. DESPITE NUMBER OF OPPORTUNITI ES GIVEN BY THE AO ASSESSEE WAS UNABLE TO ESTABLISH HOW IT COULD RAISE SO MUCH PLANTS AND SAPLINGS FROM FIVE HECTARES OF GREEN HOUSE AREA. 13. AS FOR THE CLAIM OF THE LD. AR THAT EVEN IF THE AGR ICULTURAL INCOME IS FOUND TO BE INCORRECT, IT WOULD NOT WARRANT ADDITIO N SINCE THERE WAS NO REAL INCOME, WE ARE AFRAID WE CANNOT ACCEPT. THIS FOR T HE REASON THAT A SUM OF RS.12 CRORES OUT OF THE DUES SHOWN BY THE ASSESSEE AS RECEIVABLE FROM ITS SUBSIDIARY HAS BEEN CONVERTED BY THE ASSESSEE TO SH ARE CAPITAL OR TREATED AS SHARE APPLICATION MONEY. WHETHER CONVERTED TO SHAR E CAPITAL OR TO TRANSFERRED TO SHARE APPLICATION MONEY, THERE IS AN INFUSION OF CAPITAL WHICH IS NOT A FICTITIOUS, BUT A REAL ONE. 14. CIT (A) IN OUR OPINION WAS OBLIVIOUS TO THE DATE OF ACCOUNTING OF THE SUPPLEMENTARY INVOICE BY THE ASSESSEE WHICH WAS ON THE VERY SAME DAY WHEN IT HAD RAISED ORIGINAL INVOICE. HE WAS ALSO O BLIVIOUS TO THE ALP OF ITA.198/BANG/2012 PAGE - 12 THE GOODS RELATING TO THE SUPPLEMENTARY INVOICE FIX ED BY THE AUDITORS AT ZERO. HE CONSIDERED THE RAISING OF BOGUS INVOICES TO INFLATE THE AGRICULTURAL INCOME AS MERE NON-COMPLIANCE WITH PROCEDURES OF T HE RBI OR CUSTOMS. WHAT WE OBSERVE IS THAT ASSESSEE HAD CLAIMED AGRICU LTURAL INCOME WHICH WAS NOT POSSIBLE FROM THE TYPE OF HOLDING IT HAD, A ND HAD ADOPTED DUBIOUS METHODS FOR THIS. NOTHING WAS BROUGHT ON RECORD TO SHOW THAT THERE WAS ANY INDUSTRIAL PRACTICE IN FLORICULTURE WHERE TWO I NVOICES WERE RAISED ON THE SAME DAY, ON PURPORTEDLY FOR A NOTIONAL VALUE AND O THER PURPORTEDLY BASED ON SUBSEQUENT REALIZATION. TO BE PRECISE THERE CAN NOT BE ANY INDUSTRIAL PRACTICE OF THAT SORT AT ALL. WE ARE OF THE OPINIO N THAT CIT (A) FELL IN ERROR IN DELETING THE ADDITION MADE BY THE AO. WE REVERS E THE ORDER OF CIT (A) AND REINSTATE THE ADDITION. 15. IN THE RESULT, APPEAL OF THE REVENUE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 12TH DAY OF A PRIL, 2016. SD/- SD/- (VIJAY PAL RAO) (ABRA HAM P GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER MCN ITA.198/BANG/2012 PAGE - 13 COPY TO: 1. THE ASSESSEE 2. THE ASSESSING OFFICER 3. THE COMMISSIONER OF INCOME-TAX 4. COMMISSIONER OF INCOME-TAX(A) 5. DR 6. GF, ITAT, BANGALORE BY ORDER ASSISTANT REGISTRAR