ACIT, V. M/s Balakrishna & Co.,

ITA 203/RAN/2014

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 7794 (ITAT-RANCHI)
• Duration Of Justice: 3 year(s) 11 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-05-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 03-06-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P K MONDAL
• Keywords: Depreciation; Question of law
• Section: 44AD; 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RANCHI BENCH, RANCHI BEFORE SHRI J.SUDHAKAR REDDY, ACCOUNTANT MEMBER AND SHRI S.S.VISWANETHRA RAVI, JUDICIAL MEMBER I.T.A. NO. 203/RAN/2014 ASSESSMENT YEAR: 2007-08 ACIT, CIR - 1................................. ........................................... ..APPELLANT 47, C.H. AREA, JAMSHEDPUR 831 001. M/S. BALAKRISHNA & CO........ .................RESPONDENT FIRST FLOOR, MATRI BHAWAN, NEW KALIMATI ROAD, SAKCHI, JAMSHEDPUR -831 001. [PAN: AAEFB 6265E] I.T.A. NO. 195/RAN/2014 ASSESSMENT YEAR: 2007-08 M/S. BALAKRISHNA & CO........ ....................APPELLANT FIRST FLOOR, MATRI BHAWAN, NEW KALIMATI ROAD, SAKCHI, JAMSHEDPUR -831 001. [PAN: AAEFB 6265E] ACIT, CIR - 1................................. .........................................RE SPONDENT 47, C.H. AREA, JAMSHEDPUR 831 001 APPEARANCES BY: SHRI P.K. MONDAL, JCIT APPEARING ON BEHALF OF THE REVE NUE. SHRI DEVESH PODDAR, ADVOCATE APPEARING ON BEHALF OF T HE ASSESSEE. DATE OF CONCLUDING THE HEARING : FEBRUARY 22 , 2018 DATE OF PRONOUNCING THE ORDER : MAY 4 TH , 2018 ORDER PER BENCH THE ABOVE SAID TWO APPEALS BY THE REVENUE AND THE ASSESSEE ARE DIRECTED AGAINST THE ORDER BOTH DATED 11.03.2014 PA SSED BY THE LD. CIT(APPEALS) JAMSHEDPUR FOR A.Y. 2007-08. 2. WE SHALL TAKE UP THE APPEAL IN ITA 203/RAN/2014 BY THE REVENUE. 2 I.T.A. NOS. 203 & 195/RAN/2014 ASSESSMENT YEAR: 2007-08 BALAKRISHNA & C O. 3. GROUND NO. 1 RAISED BY THE REVENUE IS IN RESPECT OF RESTRICTION OF ADDITION OF NET PROFIT BY THE LD. CIT(A). DURING TH E COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE CLAIMED TOTAL PROFIT OF RS. 32,33,563/-. THE A.O. EXAMINING THE PROFIT AND LOSS ACCOUNT IN RESPECT OF DJIBOUTI PROJECT FOUND THAT THE CREDIT ENTRIES A GGREGATING TO A SUM OF RS. 9,29,48,245/- AND ESTIMATED THE PROFIT AT 7% OF THIS AGGREGATE. THE A.O. ADDED THE DIFFERENCE OF PROFIT I.E. (RS. 5 5,76,895/- - RS. 32,33,563/-) RS. 23,43,322/- TO THE TOTAL INCOME OF THE ASSESSEE. 4. THE LD. CIT(A) CONSIDERED THE SUBMISSIONS OF THE ASSESSEE IN RESPECT OF ALLOWING THE DEDUCTION OF RS. 16,85,940/ - BEING A SALARY PAID TO PARTNERS OF THE ASSESSEE BY PLACING RELIANC E ON THE DECISION OF HIGH COURT OF RAJASTHAN IN THE CASE OF CIT VS JAIN CONSTRUCTION CO. REPORTED 245 ITR 527 AND RESTRICTED THE NET PROFIT OF RS. 16,83,331/-. 5. THE CONTENTION OF THE LEARNED AR IS THAT WHILE E STIMATING THE PROFIT A SEPARATE DEDUCTION IS TO BE GIVEN FOR INTE REST AND SALARY PAID TO THE PARTNERS OF THE ASSESSEE. THE PROVISION OF S ECTION 44AD IS APPLICABLE FROM 01.04.2011 WHEREIN THE LEGISLATURE HAS GIVEN BENEFIT OF ALLOWANCE IN RESPECT OF INTEREST AND SALARY SEPA RATELY WHILE COMPUTING INCOME. THE LEARNED AR PLACED RELIANCE TH E DECISION OF CO- ORDINATE BENCH OF ITAT HYDERABAD AND PLACED ON RECO RD THE SAID ORDER AND REFERRED TO PARA NO 8 AND ARGUED THE CIT( A) HAS RIGHTLY GIVEN DEDUCTIONS IN RESPECT OF INTEREST AND SALARY PAID TO THE PARTNERS FROM THE NET PROFIT ESTIMATED. THE LEARNED AR SUPPO RTED THE ORDER OF THE CIT(A). 6. THE LEARNED DR SUPPORTED THE ORDER OF A.O. 3 I.T.A. NOS. 203 & 195/RAN/2014 ASSESSMENT YEAR: 2007-08 BALAKRISHNA & C O. 7. HEARD BOTH PARTIES AND PERUSED THE RECORD. WE FI ND THAT THE CO- ORDINATE BENCH OF THE ITAT HYDERABAD WHILE DEALING IN THE CASE OF M/S. ADARSH CONSTRUCTION DISCUSSED THE RATIO LAID D OWN BY THE HONBLE HIGH COURT OF ANDHRA PRADESH IN THE CASE OF INDWELL CONSTRUCTION REPORTED IN 232 ITR 776 FOR THE ASSESS MENT YEAR 1981- 82 AS RELIED ON BY THE REVENUE THEREIN WHICH HELD T HAT NO DEDUCTION IS AVAILABLE TOWARDS PAYMENTS OF INTEREST ON CAPITA L AND REMUNERATION TO PARTNERS. THE CO-ORDINATE BENCH HEL D THAT THE RATIO LAID DOWN BY THE HONBLE HIGH COURT OF ANDHRA PRADE SH IS NOT APPLICABLE TO THE FACTS AND CIRCUMSTANCES THEREIN I N VIEW OF THE AMENDMENT TO STATUTORY PROVISIONS OF SECTION 40(B) OF THE ACT W.E.F. 1993-94. THE RELEVANT PORTION OF WHICH IS REPRODUCE D HEREIN BELOW: 8. THE NEXT CONTENTION IS WITH REFERENCE TO ALLOWANC E OF INTEREST ON PARTNERS CAPITALS AND PARTNERS REMUNERATION. ASSE SSEE HAS CLAIMED : 5 : ITA NO. 164/HYD/2013 M/S. ADARSH CONSTRUCTIONS AN A MOUNT OF RS. 4,95,401/- AS INTEREST ON PARTNERS CAPITALS AND RS . 84,000/- AS REMUNERATION TO THE PARTNERS AND ARRIVED AT NET PRO FIT OF RS. 8,87,273/-. DUE TO VARIATION IN THE DEPRECIATION CLAIMS ETC., T HE INCOME OFFERED BY ASSESSEE AS CAN BE SEEN FROM THE ASSESSMENT ORDER W AS AT RS. 6,36,055/-. ONE OF THE DEDUCTIONS ALLOWED BY THE CIT(A) IS WITH RE FERENCE TO REMUNERATION AND INTEREST TO THE PARTNERS WHICH WAS CO NTESTED BY THE REVENUE AS NOT ALLOWABLE U/S 40(B) RELYING ON THE DE CISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF INDWELL CON STRUCTIONS VS. CIT (232 ITR 776). IT WAS THE CONTENTION OF THE REVENUE THAT ON CE THE BOOKS OF ACCOUNTS WERE REJECTED AND PROFIT WAS ESTIMATED, AL L EXPENDITURES ARE DEEMED TO HAVE BEEN ALLOWED, THEREFORE, THERE IS NO N EED FOR ALLOWING DEPRECIATION, INTEREST AND SALARY TO PARTNERS. REVEN UE IS NOT CONTESTING THE ISSUE OF DEPRECIATION IN THIS CASE AS THE CIT(A)S ORDER CONSIDERED IT AS DEEMED ALLOWANCE. THE ISSUE IS ONLY RESTRICTED TO THE STATUTORY ALLOWANCE OF DEDUCTION U/S 40(B). EVEN THOUGH IN THE ABOVE REFER RED CASE, THE HONBLE A.P. HIGH COURT CONSIDERED THE PROVISIONS AND HELD THAT NO FURTHER DISALLOWANCE ARE REQUIRED TO BE MADE ONCE INCOME IS ESTIMATED, THE SAID JUDGMENT RELATES TO A.Y. 1981-82. THE PROVISIONS OF SECTION 40(B) THEN EXISTING PROVIDES FOR DISALLOWANCE OF PAYMENT OF IN TEREST, SALARY, BONUS COMMISSION OR REMUNERATION MADE BY THE FIRM TO THE P ARTNER. THESE AMOUNTS ARE NOT ALLOWABLE AS DEDUCTION IN THE ASSESS MENT OF A 4 I.T.A. NOS. 203 & 195/RAN/2014 ASSESSMENT YEAR: 2007-08 BALAKRISHNA & C O. PARTNERSHIP FIRM THEN EXISTING. AT THE RELEVANT POINT OF TIME UP TO THE CHANGE OF PROVISIONS WITH EFFECT FROM 01.04.1993, THE FIRMS ARE CLASSIFIED AS REGISTERED FIRMS U/S 185 OR AS UN-REGISTERED FIR MS. THE INCOME OF THE REGISTERED FIRM WAS NOT TAXED AT THE NORMAL RATES AN D THE SAME WAS DISTRIBUTED AMONG THE PARTNERS IN ACCORDANCE WITH THE PROVISIONS OF SECTION 67 OF THE ACT. WHILE DISTRIBUTING THE INCOME AMONG THE PARTNERS INTEREST, SALARY, COMMISSION OR REMUNERATION PAID T O PARTNERS ARE TO BE REDUCED FROM THE GROSS INCOME OF THE PARTNERSIP FIRM. THE BALANCE IS DIVIDED AMONG THE : 6 : ITA NO. 164/HYD/2013 M/S. AD ARSH CONSTRUCTIONS PARTNERS IN THEIR PROFIT SHARING RATIO, THE AMOUNTS PA ID TO PARTNERS I.E. INTEREST SALARY, BONUS, COMMISSION OR REMUNERATION ARE ADDED TO THE INCOME OF THE INDIVIDUAL PARTNER. THE PROFITS DISTRIB UTED WERE ASSESSED IN THE ASSESSMENT OF THE PARTNERS. HOWEVER, THE PROVISION S WITH REGARD TO THE ASSESSMENT OF PARTNERSHIP FIRMS HAVE UNDERGONE CHANGE FROM 01.04.1993 I.E. FOR THE A.Y. 1993-94 ONWARDS. NOW, ALL FIRMS AR E UNIFORMLY ASSESSABLE AS FIRMS ONLY AND THERE IS NO DIFFERENCE IN TAX RATE S. THE PROFIT DERIVED FROM THE PARTNERSHIP FIRM IS EXEMPT IN THE ASSESSMENT OF THE PARTNERS AS THE SAME IS BEING TAXED AT NORMAL RATES IN THE ASSESS MENT OF THE PARTNERSHIP FIRM ITSELF. ONLY SALARY OR INTEREST PAI D TO THE PARTNERS IS SUBJECT TO TAX IN THE ASSESSMENT OF THE PARTNERS AS THE SAME IS EXCLUDED FROM THE ASSESSMENT OF THE PARTNERSHIP FIRM. PROVISION S OF SECTION 40(B) ALLOWS INTEREST PAID TO PARTNERS AND REMUNERATION P AID TO THE PARTNERS AS AN ALLOWABLE DEDUCTION, SUBJECT TO CERTAIN CONDITIO NS MENTIONED IN SECTION 40(B) OF THE ACT. THEREFORE, THERE IS A CHANGE IN THE PR OVISIONS ITSELF FROM A DISALLOWANCE PROVISIONS TO ALLOWANCE PROVISIONS SUB JECT TO RESTRICTIONS. THUS, W.E.F. 1993-94, SECTION 40(B) IS ENABLING A DE DUCTION TOWARDS INTEREST AND REMUNERATION PAID TO THE PARTNERS BY WA Y OF STATUTORY DEDUCTION. THEREFORE, JURISDICTIONAL HIGH COURT JUDGM ENT GIVEN FOR A.Y. 1981-82 IN THE CONTEXT OF THE PROVISIONS THEN EXIST ING IS NO LONGER APPLICABLE TO THE REVISED ASSESSMENT PROCEDURE. THIS SAME VIEW WAS HELD BY VARIOUS CO-ORDINATE BENCHES. IN THE CASE OF M/S. C . ESWARA REDDY AND CO. IN ITA NO. 668 & 670/HYD/2009 AND CROSS APPEALS IN ITA NO. 685 & 686/HYD/2009 FOR A.Y.S 2003-04 & 2004-05, THE CO-OR DINATE BENCH VIDE ORDER DATED 31.01.2011 HELD AS UNDER: 15. WE HAVE CAREFULLY GONE THROUGH THE JUDGEMENT OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF INDWELL CONS TRUCTION (SUPRA). THE ASSESSMENT YEAR UNDER CONSIDERATION BEFORE THE JU RISDICTIONAL HIGH COURT WAS ASSESSMENT YEAR 1981-82. SECTION 44AD WAS INTRODUCED IN THE STATUTE BOOK WITH EFFECT FROM 01.04 .1994. THEREFORE : 7 : ITA NO. 164/HYD/2013 M/S. ADARSH CONS TRUCTIONS THE JURISDICTIONAL HIGH COURT HAD NO OCCASION TO CONSIDER THE PROVISIONS 5 I.T.A. NOS. 203 & 195/RAN/2014 ASSESSMENT YEAR: 2007-08 BALAKRISHNA & C O. OF SECTION 44AD AS IT IS APPLICABLE FOR THE ASSESSM ENT YEAR UNDER CONSIDERATION AND AS IT WOULD BE APPLICABLE WITH EFF ECT FROM 1.4.2011. IN VIEW OF THE PROVISIONS OF SECTION 44AD AS IT IS APPLICABLE FOR THE ASSESSMENT YEAR UNDER CONSIDERATION AND THE A MENDMENT MADE WITH EFFECT FROM 1.4.2011 IT IS OBVIOUS THAT THE LEGISLATURE INTENDED TO ALLOW THE INTEREST AND SALARY SEPARATEL Y FROM THE ESTIMATED INCOME. THEREFORE, THE JUDGEMENT OF THE JURI SDICTIONAL HIGH COURT IN THE CASE OF INDWELL CONSTRUCTION (SUPRA ) MAY NOT BE OF ANY ASSISTANCE TO THE REVENUE IN THIS CASE. ACCORDING LY, WE DIRECT THE ASSESSING OFFICER TO ALLOW THE SALARY AND INTEREST P AID TO THE PARTNER SUBJECT TO THE LIMITATION PROVIDED IN SECTION 40(B) OF THE ACT. 9. SIMILAR VIEW WAS ALSO TAKEN IN THE CASE OF CO-O RDINATE BENCH DECISION IN THE CASE OF MARUTHI CONSTRUCTIONS, VIJAYAWADA VS ACIT IN ITA NO. 67 & 373/VIZAG/12 DTD. 03.03.2014. THE VIEW EXPRESSED BY THE CO-ORDINATE BENCHES IS ALSO CONSISTENT WITH THE JUDGEMENTS OF THE H ONBLE HIGH COURT OF ALLAHABAD IN THE CASE OF CIT VS VIJAY CONSTRUCTION S (213 CTR 105) WHEREIN ON SIMILAR FACTS OF REJECTION OF BOOKS OF AC COUNTS, IT WAS HELD THAT STATUTORY DEDUCTIONS ALLOWABLE U/S 40(B) CANNOT BE DENIED MERELY BECAUSE ITS BOOKS OF ACCOUNTS HAVE BEEN REJECTED AND BEST JUDGMENT ASSESSMENT HAS BEEN MADE. IT WAS HELD: THE PROCEDURE FOR MAKING ASSESSMENT IN A MATTER WHER E VOLUNTARY RETURN SUBMITTED BY THE ASSESSEE UNDER SECTION 139(1 ) IS NOT ACCEPTED BY THE A.O. HAS BEEN GIVEN UNDER SECTION 143 (3) WHEREAS PROCEDURE FOR GIVING BEST JUDGMENT ASSESSMENT IS GI VEN UNDER SECTION 144. MERELY BECAUSE THE PROCEDURES FOR SUCH ASSESSMENTS HAVE BEEN SEPARATELY PROVIDED IN THE AFORESAID TWO SE CTION RELATING TO AN ASSESSEE WHERE THE VOLUNTARY RETURN HAS NOT BEEN FOUND AS ACCEPTABLE BY THE A.O. AND WHERE THE BOOKS OF ACCOUNT HAVE BEEN REJECTED AND BEST JUDGMENT ASSESSMENT HAS BEEN MADE , IT WOULD NOT IN ITSELF BE SUFFICIENT TO HOLD THAT THE STATUTORY DE DUCTIONS WHICH ARE OTHERWISE AVAILABLE TO THE ASSESSEE, WOULD NOT BE AVA ILABLE TO THE ASSESSEE WHO HAS BEEN ASSESSED UNDER BEST JUDGMENT AS SESSMENT BY THE AO, UNLESS, OF COURSE, ANY RULE OR PROVISION OF THE ACT EXPRESSLY EXCLUDES THE BENEFIT OF STATUTORY DEDUCTIONS TO SUCH AN ASSESSEE. IF THE INTERPRETATION GIVEN BY : 8 : ITA NO. 164/HYD/20 13 M/S. ADARSH CONSTRUCTIONS THE REVENUE IS ACCEPTED, IT WOULD MEAN THAT IN A CASE WHERE THE ASSESSEES BOOKS OF ACCOUNT HAVE BEEN REJEC TED OR FOR ANY OTHER REASONS, WHATSOEVER, BEST JUDGMENT ASSESSMENT H AS BEEN MADE THAT WOULD ENTAIL PENALTY OR ADVERSE CIVIL CONS EQUENCES OF DEPRIVING THE ASSESSEE FROM HAVING THE STATUTORY DEDU CTIONS, WHICH 6 I.T.A. NOS. 203 & 195/RAN/2014 ASSESSMENT YEAR: 2007-08 BALAKRISHNA & C O. WOULD HAVE BEEN OTHERWISE AVAILABLE TO HIM IN CASE HIS VOLUNTARY RETURN FILED UNDER SECTION 139(1) HAS BEEN ACCEPTED OR REGULAR PROCEEDINGS UNDER SECTION 143(3) WERE TAKEN. THIS IN TERPRETATION WOULD LEAD TO AN ANOMALOUS SITUATION, BESIDES THE SA ME DOES NOT FLOW FROM THE SCHEME OF ASSESSMENT UNDER THE ACT. IT IS ONLY THE METHOD OF ASSESSING THE INCOME OF THE ASSESSEE FIRM W HICH EITHER HAS TO BE DONE BY ACCEPTING THE VOLUNTARY RETURN FILED U NDER SECTION 139(1) OR IT HAS TO BE REGULARLY ASSESSED UNDER SECT ION 143(3) OR BEST JUDGMENT ASSESSMENT IS TO BE MADE UNDER SECTIO N 144. THE FINAL OUTCOME OF THE ASSESSMENT OF THE INCOME OF THE ASSES SEE FIRM CALLS FOR CONSEQUENTIAL IMPOSITION OF TAX AND REALISATION THEREOF. THE STATUTORY DEDUCTIONS THUS WHICH ARE AVAILABLE TO THE A SSESSEE FIRM CANNOT BE TAKEN AWAY OF SNATCHED AWAY FROM THE FIRM M ERELY BECAUSE THEIR BOOKS OF ACCOUNT HAVE BEEN REJECTED AND BEST JUDGMENT ASSESSMENT HAS BEEN MADE SALARY AND INTEREST, WHICH IS GIVEN TO THE PARTNERS IN TERMS OF THE PARTNERSHIP DEED, THE TAX LIABILITY OF THE SAID AMOUNT SHIFTS UPON THE PARTNERS AND CANNOT BE TAKEN AS TAX LIABILITY OF THE FIRM. THE APPLICABILITY OF SECTION 28(V) CANNOT BE EXCLUDED IN THE MATTER OF BEST JUDGEMENT ASSESSMENT IN RESPECT OF AN ASSESSEE FIRM. IT WAS T HE SPECIFIC CASE OF THE ASSESSEE THAT THE PARTNERS WERE WORKING PARTNERS AND THEY WERE ENTITLED TO SALARY AND INTEREST, AS PER TERMS OF THE DEED IN ACCORDANCE WITH SECTION 40(B). IN THE ABSENCE OF ANY MATERIAL HAVING BROUGHT B Y THE REVENUE IN REBUTTAL AND MORE SO WHEN NO SUCH PLEA WAS EVER TAKEN OR RAISED IN THE APPEAL, AS ALSO NO SUBSTANTIAL QUESTION OF LAW HAS B EEN FRAMED IN THIS REGARD, THE PLEA IS BOUND TO FAIL. 8. IN VIEW OF THE ABOVE PROPOSITIONS OF LAW LAID DO WN BY THE CO- ORDINATE BENCH OF ITAT WE FIND NO INFIRMITY IN THE ORDER OF CIT(A). THUS GROUND NO 1 RAISED BY THE REVENUE FAILS AND DI SMISSED. 9. GROUND NO. 2 IS REGARDING THE DELETION OF ADDITI ON MADE ON ACCOUNT OF PAYMENT OF EPF BEYOND SPECIFIED DUE DATE . THE AO ADDED AN AMOUNT OF RS. 1,30,475/- FOR NON-PAYMENT OF EMPL OYEES CONTRIBUTION TO THE ACCOUNT OF GOVERNMENT WITHIN DU E DATE. THE CIT(A) CONSIDERING THE SUBMISSIONS OF THE ASSESSEE RESTRICTED THE 7 I.T.A. NOS. 203 & 195/RAN/2014 ASSESSMENT YEAR: 2007-08 BALAKRISHNA & C O. ADDITION, UPTO RS. 20,498/- AND ALLOWED THE REMAINI NG PORTION OF THE ADDITION ON BEING SATISFIED THE SAID CONTRIBUTION W AS PAID BEFORE THE DUE DATE OF FILING OF THE RETURN OF INCOME IN TERMS OF THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF ALOM EXTRU SION LTD. REPORTED IN 319 ITR 306 (SC), WE FIND THE CIT(A) RI GHTLY RESTRICTED THE ADDITION TO RS. 20,498/-. THEREFORE, WE FIND NO INFIRMITY IN THE ORDER OF CIT(A) AND ACCORDINGLY GROUND NO 2 RAISED BY THE REVENUE IS DISMISSED. 10. NOW, WE SHALL TAKE UP THE APPEAL IN ITA 195/RAN /2014 BY THE ASSESSEE. 11. GROUND NO. 2 TO 4 ARE RELATING TO ALLOWANCE OF INTEREST AND SALARY PAID TO THE PARTNERS. WE FIND THAT THE SIMIL AR ISSUE WAS DECIDED IN THE APPEAL OF THE REVENUE IN THE ABOVE-MENTIONED PARAGRAPH. WE HELD THAT THOUGH THE NET PROFIT OF THE ASSESSEE IS ESTIMATED, THE SALARY AND INTEREST PAID TO THE PARTNERS HAVE TO BE SEPARA TELY COMPUTED IN ESTIMATING THE INCOME IN TERMS OF THE DECISION IN T HE CASE OF M/S. ADARSH CONSTRUCTION OF CO-ORDINATE BENCH OF ITAT HY DERABAD. IN VIEW OF THE SAME, WE DELETE THE ADDITION MADE BY TH E AO AND CONFIRMED BY THE CIT(A). THUS GROUND NO 2 TO 4 ARE ALLOWED. 12. GROUND NO. 5 IS RELATING TO DELAYED PAYMENT OF RS. 20,498/-. THE ISSUE IS SIMILAR AND IDENTICAL TO THE GROUND NO 2 RAISED BY THE REVENUE IN THEIR APPEAL. WE HELD THAT IN THE SAID A PPEAL, THE CIT(A) IS JUSTIFIED IN RESTRICTING THE ADDITION TO THE AMOUNT RAISED IN GROUND NO 5 IN ASSESSEES APPEAL. THEREFORE, WE ADOPT THE SAM E VIEW AS 8 I.T.A. NOS. 203 & 195/RAN/2014 ASSESSMENT YEAR: 2007-08 BALAKRISHNA & C O. EXPRESSED IN REVENUES APPEAL. THEREFORE, GROUND NO 5 RAISED BY THE ASSESSEE FAILS AND IS DISMISSED. 13. IN THE RESULT, THE APPEAL OF THE REVENUE IS DIS MISSED AND THE APPEAL OF THE ASSESSEE IS ALLOWED IN PART. ORDER PRONOUNCED IN THE OPEN COURT ON 4 TH MAY, 2018. SD/- SD/- J. SUDHAKAR REDDY S.S.VISWANETHRA RAVI ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 04/05/2018 BISWAJIT, SR. PS COPY OF ORDER FORWARDED TO: 1. M/S. BALAKRISHNA & CO., FIRST FLOOR, MATRI BHAWAN, NEW KALIMATI ROAD, SAKCHI, JAMSHEDPUR 831 001. 2. ACIT CIR 1, 47, C.H. AREA, JAMSHEDPUR 831 001. 3. THE CIT(A) 4. THE CIT 5. DR TRUE COPY, BY ORDER, SR. P.S. / H.O.O. ITAT, RANCHI