M/s. Orissa Sponge Iron & Steel Ltd, Bhubaneswar V. ACIT, Circle-1(1), Bhubaneswar, Bhubaneswar

ITA 207/CTK/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 81478 (ITAT-CUTTACK)
• Duration Of Justice: 1 year(s) 6 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-10-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 17-10-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 01-04-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: K AJAY KUMAR; ANIL SH
• Assessee Lawyers: BINOD AGARWAL; M UDAYPURIA

Judgement Text

I.T.A. NO. 207 / CTK ./20 1 3 ASSESSMENT YEAR: 20 0 8 - 20 0 9 & ITA. NO. 223 /CTK/20 1 3 ASSESSMENT YEAR: 200 8 - 200 9 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK BEFORE SHRI S .V. MEHROTRA (ACCOUNTANT MEMBER) , AND SHRI GEORGE MATHAN (JUDICIAL MEMBER) I.T.A. NO. 207 / CTK / 20 1 3 ASSESSMENT YEAR : 200 8 - 200 9 M/S. ORISSA SPONGE IRON & STEEL LTD.,...... . ......... .. .APP ELL ANT OSIL HOUSE, GANGADHAR MEHER MARG, BHUBANESWAR - 751 024 [PAN : A AACO 2568 G ] - VS. - ASSISTANT COMMISSIONER OF INCOME TAX , .... . RESPONDENT CIRCLE - 1 (1), BHUBANESWAR & I.T.A. NO. 223 / CTK / 20 1 3 ASSESSMENT YEAR : 20 0 8 - 200 9 ASSISTANT COMMISSIONER OF INCOME TAX,.........APPELLANT CIRCLE - 1(1), BHUBANESWAR - VS. - M/S. ORISSA SPONGE IRON & STEEL LTD.,.................. . RESPONDENT OSIL HOUSE, GANGADHAR MEHER MARG, BHUBANESWAR - 751 024 [PAN : AAACO 2568 G] APPEARANCES BY: SHRI M. UDAYPURIA AND SHRI BINOD AGARWAL , A .R. , FOR THE ASSESSEE SHRI K. AJAY KUMAR , CIT, D.R. AND SHRI ANIL SHARMA, D.R , FOR THE DEPARTMENT DATE OF CONCLUDING THE HEARING : OCTOBER 1 7 , 2 01 4 DATE OF PRONOUNCING THE ORDER : OCTOBER 20 , 201 4 I.T.A. NO. 207 / CTK ./20 1 3 ASSESSMENT YEAR: 20 0 8 - 20 0 9 & ITA. NO. 223 /CTK/20 1 3 ASSESSMENT YEAR: 200 8 - 200 9 PAGE 2 OF 4 O R D E R AS PER BENCH : I.T.A. NO. 207 / CTK / 20 1 3 IS AN APPEAL FILED BY THE ASSESSEE AND ITA NO. 223/CTK/2013 IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS) - I , BHUBANESWAR IN APPEAL NO. 019 2 / 10 - 11 DATED 16 . 0 1 .20 1 3 FOR THE ASSESSMENT YEAR 200 8 - 0 9. 2 . SHRI M. UDAYPURIA AND SHRI BINOD AGARWAL, ADVOCATES, REPRESENTED ON BEHALF OF THE ASSESSEE AND SHRI K. AJAY KUMAR, CIT (D.R.) AND SHRI ANIL SHARMA, D.R. , REPRESENTED ON BEHALF OF THE REVENUE . 3. IN RESPECT OF GROUNDS NO. 1 & 2 OF ASSESSEES APPEAL, IT WAS SUBMITTED BY THE LD. A.R. THAT THE ISSUES WERE AGAINST THE PRIOR PERIOD EXPENSES TO AN EXTENT OF RS.4,03,165/ - AND THE AMOUNT OF RS.3,93,155/ - HAD NOT BEEN CONSIDERED BY THE LD. CIT(APPE ALS) WHEN ADJUDICATING THE APPEAL. IT WAS THE SUBMISSION THAT THE TOTAL DISALLOWANCE ON ACCOUNT OF PRIOR PERIOD EXPENSES WAS AN AMOUNT OF RS.35,29,210/ - . HOWEVER, WHILE ADJUDICATING THE ISSUE S , THE LD. CIT(APPEALS) HAD NOT CONSIDERED THE AMOUNT OF RS.3,93, 155/ - AND RS.4,03,165/ - . IT WAS THE SUBMISSION THAT THE ASSESSEE HAD NO OBJECTION IF THIS ISSUE WAS RESTORED TO THE FILE OF THE LD. CIT(APPEALS) FOR RE - ADJUDICATION. 4 . IN REPLY, LD. D.R. VEHEMENTLY SUPPORTED THE ORDER OF THE ASSESSING OFFICER AND LD. CIT( APPEALS). 5 . WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PERUSAL OF THE ORDER OF THE LD. CIT(APPEALS) SHOWS THAT THE LD. CIT(APPEALS) HAS ONLY DISCUSSED THE AMOUNT S OF RS.22,06,174/ - AND RS.9, 2 9,881/ - . NOTHING HAS BEEN DISCUSSED BY THE LD. CIT(APPEALS) REG ARDING THE BALANCE AMOUNT. CONSEQUENTLY THIS ISSUE IS RESTORED TO THE FILE OF THE LD. CIT(APPEALS) FOR RE - ADJUDICATION TO THE LIMITED EXTENT OF THE AMOUNT NOT CONSIDERED BY HIM OUT OF THE AMOUNT OF RS.35,29,210/ - DISALLOWED BY THE ASSESSING OFFICER. IT IS SPECIFICALLY CLARIFIED THAT THE FINDING OF THE LD. CIT(APPEALS) IN RESPECT OF THE ADDITION DELETED TO THE EXTENT OF RS.22,06,174/ - AND RS.9,59,881/ - IS NOT DISTURBED. I.T.A. NO. 207 / CTK ./20 1 3 ASSESSMENT YEAR: 20 0 8 - 20 0 9 & ITA. NO. 223 /CTK/20 1 3 ASSESSMENT YEAR: 200 8 - 200 9 PAGE 3 OF 4 6 . IN RESPECT OF THE THIRD GROUND RAISED BY THE ASSESSEE WHICH IS AGAINST THE ACTION OF THE LD. CIT(APPEALS) IN CONFIRMING THE DISALLOWANCE OF RS.18,48,388/ - PAID TO THE REGISTRAR OF COMPANIES FOR INCREASING AUTHORIZED SHARE CAPITAL. LD. A.R. SUBMITTED THAT THE SAME WAS LIABLE TO BE ALLOWED AS IT WAS A GENUINE EXPENDITURE. 7 . IN REPLY, LD. D.R. VEHEMENTLY SUPPORTED THE ORDER OF THE ASSESSING OFFICER AND LD. CIT(APPEALS). 8 . WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PERUSAL OF THE ORDER OF THE LD. CIT(APPEALS) CLEARLY SHOWS THAT THE LD. CIT(APPEALS) HAS FOLLOWED THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF PUNJAB STATE INDUSTRIAL DEVELOPMENT CORPORATION LTD. VS. CIT (1997) 225 ITR 792 (SC), .WHEREIN IT HAS BEEN CLEARLY HELD THAT FEES PAID TO THE REGISTRAR OF COMPANIES FOR EXPANSION OF CAPITAL BASE OF THE COMPANY WAS CAPITAL EXPE NDITURE. IN THESE CIRCUMSTANCES, THE FINDING OF THE LD. CIT(APPEALS) ON THIS ISSUE STANDS CONFIRMED. 9 . IN REGARD TO THE REVENUES APPEAL IN RESPECT OF GROUND NO. 1, WHICH IS AGAINST THE ACTION OF THE LD. CIT(APPEALS) IN DELETING THE ADDITION MADE BY THE ASSESSING OFFICER REPRESENTING EMPLOYEES CONTRIBUTION TO P ROVIDENT F UND . 10 . LD. D.R. VEHEMENTLY SUPPORTED THE ORDER OF THE ASSESSING OFFICER. IT WAS THE SUBMISSION THAT THE EMPLOYEES CONTRIBUTION HAVING NOT BEEN PAID WITHIN THE DUE DATE, THE SAME WAS LI ABLE TO BE DISALLOWED. 11 . IN REPLY, LD. A.R. SUBMITTED THAT THE AMOUNT HAD BEEN PAID BEFORE THE DUE DATE OF F ILING OF THE RETURN. 1 2 . WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PERUSAL OF THE ASSESSMENT ORDER CLEARLY SHOWS THAT THE AMOUNT WHICH HA S BEE N DISALLOWED BY THE ASSESSING OFFICER HA S BEEN PAID BEFORE THE DUE DATE OF FILING OF THE RETURN. CONSEQUENTLY IN VIEW OF THE DECISION S OF THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. - ALOM EXTRUSIONS LTD. REPORTED IN 319 ITR 306 (SC) AND IN THE CASE OF VINAY CEMENT LTD. (2007) 213 CTR 268, THE ORDER OF THE LD. CIT(APPEALS) ON THIS ISSUE STANDS CONFIRMED. I.T.A. NO. 207 / CTK ./20 1 3 ASSESSMENT YEAR: 20 0 8 - 20 0 9 & ITA. NO. 223 /CTK/20 1 3 ASSESSMENT YEAR: 200 8 - 200 9 PAGE 4 OF 4 1 3 . IN RESPECT OF THE GROUND NO. 2, IT IS AGAINST THE ACTION OF THE LD. CIT(APPEALS) IN ALLOWING RELIEF OF RS.31,36,055/ - ON ACCOUNT OF PRIOR PERIOD EXPENSES. IT IS NOTICED THAT THE ASSESSING OFFICER HAS DISALLOWED THE AMOUNT HOLDING THAT THE AMOUNT OF EXPENDITURE HAS NOT BEEN CRYSTALLIZED FROM THE RELEVANT ASSESSMENT YEAR. THE REVENUE HAS NOT BEEN ABLE TO DISLODGE THE FINDING ARRIVED AT BY THE LD. CI T(APPEALS) THAT THE AMOUNT UNDER QUESTION HA S CRYSTALLIZED. IN THESE CIRCUMSTANCES, WE FIND NO ERROR IN THE FINDING OF THE LD. CIT(APPEALS) WHICH CALLS FOR ANY INTERFERENCE. 1 4 . IN RESPECT OF THE GROUND NO. 3, WHICH WAS IN VIOLATION OF RULE 46A, THE REVENU E HAS NOT BEEN ABLE TO POINT OUT ANYTHING OF THE FRESH EVIDENCE, WHICH HAS BEEN CONSIDERED BY THE LD. CIT(APPEALS). 1 5 . IN THE RESULT, THE APPEAL FILED BY THE REVENUE STANDS DISMISSED AND THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOS ES. ORDER PRONOUNCED IN THE OPEN COURT ON 20 TH OCTOBER , 2014. SD/ - SD/ - S .V. MEHROTRA GEORGE MATHAN ( ACCOUNTANT MEMBER) ( JUDICIAL MEMBER) KOLKATA, THE 20 TH D AY OF OCTO BER , 201 4 COPIES TO : (1) T HE ASSESSEE (2) THE DEPARTMENT (3) COMMISSIONER OF INCOME - TAX (APPEALS) (4) COMMISSIONER OF INCOME TAX ( 5 ) THE DEPARTMENTAL REPRESENTATIVE ( 6 ) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH, CUTTACK LAHA/SR. P.S.