Moving Picture Company India Ltd., New Delhi V. ACIT, New Delhi

ITA 210/DEL/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 58867 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-03-2012
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: E
• Next Hearing Date: 22-02-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 14-01-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RA J TANDON
• Assessee Lawyers: SANJAY SOOD
• Keywords: Capital asset; Depreciation; Income from undisclosed sources; Corroborative evidences; Unabsorbed depreciation
• Section: 37; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH E NEW DELHI. BEFORE SHRI A.D. JAIN AND SHRI K.G. BANSAL I.T.A. NO.210(DEL)/2011 ASSESSMENT YEAR: 2007-08 MOVING PICTURE COMPANY INDIA LTD., ASSI STANT COMMISSIONER OF RZA-71A, ROAD NO. 2, 2 ND FLOOR, VS. INCOME-TAX, CIRCLE 5(1), MAHIPALPUR EXTENSION, NEW DELHI. NEW DELHI-110037. PAN: AAACM6292R (APPLICANT) (RESPONDEN T) APPELLANT BY : SHRI SANJAY SOOD, CA RESPONDENT BY: SHR I RAJ TANDON, CIT, DR. DATE OF HEARIN G: 22.02.2012 DATE OF PRONOUN CEMENT: 16 .03.2012. ORDER PER K.G. BANSAL : A.M THE ASSESSEE HAS TAKEN UP FIVE GROUNDS IN THIS APPEAL. GROUND NO. 4 IS THAT THE LEARNED AO ERRED IN NOT CORRECTLY COMPUTING THE BROUGHT FORWARD LOSS AND UNABSORBED DEPRECIATION. THIS GROUND HAS NOT BEEN PRESSED BY THE LD. COUNSEL AS THE COMPUTATION CAN BE CORRECTED BY THE AO U/S 154 OF THE INCOME-TAX ACT, 1961. GROUND NO. 5 IS RESIDUARY IN NATURE. NO FRESH GROUND HAS BEEN RAISED IN PURSUANCE TO TH IS GROUND. THEREFORE, BOTH THESE GROUNDS ARE TREATED AS DISMISSED. ITA NO. 210(DEL)/2011 2 2. GROUND NOS. 1 AND 2 ARE IN RESPECT OF ADDITI ON OF RS. 3,19,95,890/- MADE BY THE AO ON ACCOUNT OF MEDIA LIBRARY. IT IS MENTIONED THAT THE LD. CIT(APPEALS) ERRED IN HOLDING THAT INTANGIBL E ASSETS BY WAY OF MEDIA LIBRARY ARE IN THE NATURE OF STOCK OR SCRAP GEN ERATED IN THE COURSE OF BUSINESS, WHICH HAVE A COMMERCIAL VALUE. THE FAC TS MENTIONED IN THE ASSESSMENT ORDER ARE THAT THE ASSESSEE IS CARRYING ON THE BUSINESS OF PRODUCTION OF TV SERIALS. IT HAS BEEN PRODUCING D OCUMENTARIES IN THE NATURE OF CLIPPINGS OR FILM DOCUMENTARIES. CERTAIN PILOT PROJECTS ARE ALSO UNDERTAKEN. THESE CLIPPINGS AND DOCUMENTARIES H AVE ARCHIVAL VALUE, WHICH CAN BE USED IN FUTURE. IN THIS YEAR, THE ASSESSEE HAS ESTIMATED THE PRESENT VALUE OF SUCH CLIPPINGS OR DOCUMENTARIES. THE RESULT IS THAT INTANGIBLE ASSETS HAVE BEEN ENHANCED IN VALUE BY AN AMOUNT OF RS. 3,19,95,873/-. A CORRESPONDING CAPITAL RESERVE OF EQUIVALENT AMOUNT HAS ALSO BEEN CREATED. THIS AMOUNT HAS BEEN SHOWN AS CURRENT ASSETS IN THE BALANCE-SHEET UNDER THE HEAD MEDIA LIBRARY. HOW EVER, THE PROFIT HAS NOT BEEN INCREASED BY THE CORRESPONDING AMOUNT. THE ASSESSEE WAS REQUIRED TO STATE AS TO WHY THE AMOUNT SHOULD NOT BE ADDED TO THE INCOME. IT WAS SUBMITTED THAT THE ASSESSEE ESTIMATED POTENTIAL V ALUE OF CLIPPINGS, RECORDING ETC. AT RS. 3,19,95,890/. THIS AMOUNT HAS BEEN CREDITED TO THE CAPITAL RESERVE. THE AO CONSIDERED THE FACTS OF THE CA SE AND SUBMISSIONS MADE ITA NO. 210(DEL)/2011 3 BEFORE HIM. IT HAS BEEN MENTIONED THAT RECORDING OF CORRECT VALUE OF THE STOCK IS NECESSARY FOR DETERMINING THE BUSINES S INCOME. THE ASSESSEE HAS INCREASED STOCK BY THE AFORESAID AMOUNT WIT HOUT CREDITING IT TO PROFIT AND LOSS ACCOUNT BY WAY OF INCREASE IN THE VALUE OF THE STOCK. THEREFORE, IT HAS BEEN HELD THAT THIS AMOUNT IS ASSESSABLE A S INCOME IN THIS YEAR. 2.1 THE ISSUE WAS AGITATED BEFORE THE CIT(APPE ALS)-VIII, NEW DELHI. IN THE IMPUGNED ORDER, IT HAS BEEN MENTIONED THAT THE DISPUTE BETWEEN THE REVENUE AND THE ASSESSEE IS LIMITED TO THE AMOUNT OF RS. 3,19,95,890/-. THE CASE OF THE AO IS THAT THIS IS UNDISCLOSED STOCK AND, THEREFORE, A REVENUE ITEM TAXABLE IN THIS YEAR. ON THE OTHER HAND, THE CASE OF THE ASSESSEE-COMPANY IS THAT THERE IS NO REAL ADDITI ON TO FIXED ASSETS, NAMELY, MEDIA LIBRARY, BUT ITS VALUE HAS BEEN NOTIONALLY INCREASED BY THE AFORESAID AMOUNT. HOWEVER, THE FACT OF THE MATTER IS THAT T HERE IS AN ACT OF BRINGING INTO ACCOUNTS A NEW ASSET. A CORRESPONDING CA PITAL RESERVE HAS ALSO BEEN CREATED IN THE BALANCE-SHEET. THUS, IT IS NOT A CASE OF CREATION OF ANY ARTIFICIAL ASSET WITH A VIEW TO WINDOW DRESS IT S BALANCE-SHEET. ONE OF THE POSSIBILITIES IS THAT THE ASSESSEE FAILED TO PRO PERLY ACCOUNT FOR ITEMS OF WORK-IN-PROGRESS KNOWINGLY OR UNKNOWINGLY, BUT, IN ORDER TO REMOVE THE MISTAKE THE ACCOUNTS OF THIS YEAR RECOGNIZED AD DITIONAL STOCK OF RS. ITA NO. 210(DEL)/2011 4 3,19,95,890/- BY INITIALLY SHOWING IT AS WORK-IN- PROGRESS AND THEN TRANSFERRING THE SAME TO THE BALANCE-SHEET AS AN ASSET IN THE FORM OF MEDIA LIBRARY. THE LD. CIT(APPEALS) CONSIDERED THE DETAILS OF WORK-IN- PROGRESS FURNISHED IN SCHEDULE-7 OF THE ACCOUNTS IN THIS YEAR. THE DETAILS ARE AS UNDER:- S. NO. A.Y. 2006-07 A.Y. 2007-08 (I) UNAMORTIZED COST - 10312650.20 (II) PRODUCTION WORK IN PROGRESS - 1075000. 00 (III) PRODUCTION OF FILM ON AMRITA SHERGIL 3458549.29 2655079.20 (IV) PRODUCTION OF PILOTS - 17090732.00 (V) PRODUCTION OF CHILDREN FILMS - 3280822 .00 (VI) PRODUCTION OF JATAKA - 10897635.00 (VII) FILM UNDER CO-PRODUCTION - 5560719.70 TOTAL 3458549.29 50872638.19 2.2 IT IS FURTHER MENTIONED THAT THE ASSESSEE HAS BEEN ACCOUNTING FOR EXPENSES PERTAINING TO PURCHASE OF RAW-MATERIAL, PAYMENT TO TECHNICIANS, HIRING OF EQUIPMENTS AND OTHER MISCELLANEOUS EXP ENSES. THE COST OF PRODUCTION FOR THESE TWO YEARS IN TERMS OF VARIOU S EXPENSES HAVE BEEN REPRODUCED ON PAGE 7 OF THE IMPUGNED ORDER. ITA NO. 210(DEL)/2011 5 2.3 IT HAS ALSO BEEN MENTIONED THAT EVERY ITEM OF EXPENDITURE RELATING TO PRODUCTION HAS BEEN ACCOUNTED FOR. THEREFORE, IT CANNOT BE SAID THAT THE CLIPPINGS, UNUSED PORTIONS OF THE SERIALS, WHI CH HAVE BEEN TERMED AS SCRAP, HAVE NO MONETARY VALUE. ACCORDINGLY, IT H AS BEEN HELD THAT THE STOCK OF THIS YEAR HAS NOT BEEN ENHANCED BY AN AMOUN T OF RS. 3,19,95,890/-. THUS, THIS ADDITION HAS BEEN SUSTAINED. 2.4 THE LD. CIT(APPEALS) ALSO TOOK AN ALTERNATI VE ARGUMENT FOR SUSTAINING THE AFORESAID DECISION. IT HAS BEEN THE CLAIM OF THE ASSESSEE THAT MEDIA LIBRARY IS A CAPITAL ASSET AND IF THERE IS AN ADDITION THERETO, NO ADDITION CAN BE MADE IN THE HANDS OF THE AS SESSEE. HOWEVER, THIS ARGUMENT IS REQUIRED TO BE REJECTED BECAUSE IN RE SPECT OF ANY ADDITION TO AN ASSET, EITHER OF REVENUE OR CAPITAL NATURE, T HE ASSESSEE HAS TO FURNISH EXPLANATION AS TO NATURE AND SOURCE OF INVESTMENT. THE ASSESSEE HAS NOT FURNISHED ANY EXPLANATION. THEREFORE, THE ADDI TION CAN ALSO BE SUSTAINED U/S 69B OF THE ACT. 2.5 BEFORE US, THE LD. COUNSEL SUBMITTED THAT THE ASSESSEE HAS BEEN CARRYING ON THE BUSINESS OF PRODUCING MOTION PICT URES BY WAY OF DOCUMENTARIES ETC. IN THIS YEAR, THE ASSESSEE R EVISED THE VALUE OF STOCK-IN- ITA NO. 210(DEL)/2011 6 TRADE BY AN AMOUNT OF RS. 3,19,95,890/-. A CORRES PONDING CAPITAL RESERVE WAS ALSO CREATED. THE MAIN PLANK OF THE ARGUMENT S OF THE LOWER AUTHORITIES IS THAT THIS AMOUNT REPRESENTS UNACCO UNTED STOCK. HOWEVER, THAT IS NOT THE CASE. HE REFERRED TO SCHEDULE 7 R EGARDING WORK-IN-PROGRESS. THIS SCHEDULE HAS ALREADY BEEN REPRODUCED BY US . REFERRING TO THE SCHEDULE, IT IS SUBMITTED THAT THERE ARE 7 ITE MS. ITEM NOS. 1,2 AND 3 REPRESENT UNAMORTIZED COST, WORK-IN-PROGRESS AND EXPENDITURE INCURRED ON THE FILM AMRITA SHERGIL. THESE ITEMS HAVE BEE N SHOWN AS STOCK-IN- TRADE. THERE IS NO DISPUTE IN SO FAR AS THES E ITEMS ARE CONCERNED. ITEM NUMBERS 4, 5, 6 AND 7 HAD EARLIER BEEN ACCOUNTE D ON NIL VALUE. HOWEVER, THE VALUES OF THESE ITEMS HAVE NOW BEEN ESTIMATED AND THE AMOUNT OF RS. 3,19,95,890/- IS THE ESTIMATED VA LUES OF THESE ITEMS. THESE ITEMS HAVE NOT BEEN SOLD. THERE IS NO TRANSACTION WITH ANY THIRD PARTY IN RESPECT OF THESE ITEMS. WHAT HAS BEEN DONE IS THA T THE VALUE OF NON-USABLE SCRAP HAS BEEN ESTIMATED AND INTRODUCED IN THE BOOKS AS AN ASSET UNDER THE HEAD MEDIA LIBRARY. A CORRESPONDING CAPITA L RESERVE HAS BEEN CREATED. SINCE NO TRANSACTION HAS TAKEN PLACE WITH ANY T HIRD PARTY, THERE IS NO QUESTION OF EARNING ANY PROFIT IN THIS YEAR. FUR THER, FICTITIOUS RESERVE IN RESPECT OF SCRAP HAS BEEN CREATED ONLY TO WIND OW DRESS THE BALANCE- SHEET SO THAT HIGHER LOANS COULD BE TAKEN F ROM THE BANKS. IT IS ARGUED ITA NO. 210(DEL)/2011 7 THAT A PERSON CANNOT MAKE PROFIT FROM HIMSELF. THEREFORE, WHEN THE SCRAP OF THE VALUE OF NIL IS ENHANCED TO SOME FIGURE , SAY, RS. 3,19,95,890/- IN THIS CASE, NO INCOME ACCRUES OR ARISES TO THE ASSESSEE. IT IS ALSO A MATTER OF FACT THAT NO INCOME HAS BEEN RECEIVED BY THE ASSESSEE IN RESPECT OF THIS SCRAP. ACCORDINGLY, IT IS AGITATED THAT THIS AMOUNT IS NOT TAXABLE IN THE ASSESSMENT OF THIS YEAR. 2.6 IN REPLY, THE LD. CIT, DR REFERRED TO PAGE NO. 25 OF THE PAPER BOOK IN WHICH METHOD OF VALUATION OF CLOSING STOCK H AS BEEN DESCRIBED. IT IS MENTIONED THAT THE VALUE OF FINISHED GOODS IS BASE D ON ESTIMATES OF THE ASSESSEE, STOCK OF TAPES IS VALUED AT COST AND THE VALUE OF WORK-IN- PROGRESS IS ALSO ESTIMATED BY THE ASSESSEE. IT IS SUBMITTED THAT THE ASSESSEE IS NOT FOLLOWING COST OR MARKET PRICE, WH ICHEVER IS LESS, AS THE STANDARD METHOD FOR VALUATION OF FINISHED GOODS A ND WORK-IN-PROGRESS. IT IS NOT KNOWN HOW THE VALUE OF THESE ITEMS ARE ESTIMATED. THEREFORE, CLOSING STOCK IS BEING VALUED IN AN ARBITRARY MANNER BY THE ASSESSEE. IN LAST YEAR THE ASSESSEES STAND WAS THAT THE VA LUE OF FOUR ITEMS, CAPITALIZED IN THAT YEAR, WAS NIL, BUT IN THIS YEAR HE WAN TS TO TAKE THE VALUE AT RS. 3,19,95,890/-. THIS SHOWS THAT THE STOCK WAS BEIN G UNDER-VALUED IN RESPECT OF THESE ITEMS CONSISTENTLY TILL LAST YEAR. ITS VALUE HAS BEEN ITA NO. 210(DEL)/2011 8 ESTIMATED IN THIS YEAR. THESE ITEMS ARE NOT OF C APITAL NATURE BUT OF THE NATURE OF STOCK-IN-TRADE AS THE ASSESSEE IS IN THE BUSINESS OF PRODUCING DOCUMENTARIES, FILMS ETC. THEREFORE, THIS AMOUNT IS REQUIRED TO BE TAXED IN THE HANDS OF THE ASSESSEE IN THIS YEAR. ALTERNAT IVELY, HIS SUGGESTION WAS THAT IF THE STOCK WAS UNDER-VALUED IN EARLIER YE ARS, THE AO MAY BE DIRECTED TO REOPEN THOSE ASSESSMENTS AND BRING TO TAX SUCH UNDER- VALUATION TO TAX IN CORRESPONDING YEARS. HE AL SO RELIES ON THE ORDER OF THE LD. CIT(APPEALS). 2.7 WE HAVE CONSIDERED THE FACTS OF THE CASE AND SUBMISSIONS MADE BEFORE US. THE ASSESSEE WAS IN POSSESSION OF CERT AIN PILOT PROJECTS, CHILDREN FILMS, JATAKA STORIES AND SOME OTHER FILMS UNDER CO-PRODUCTION. AS THESE ITEMS WERE NOT SELLABLE, THEIR VALUES HAVE BEEN TAKEN TO BE NIL TILL LAST YEAR. HOWEVER, THESE ITEMS WERE VALUED AT RS. 3,19,95,890/- IN THIS YEAR. A SEPARATE CLASS OF ASSET, NAMELY, MEDIA LIBR ARY, WAS CREATED AND THESE ITEMS WERE PUT UNDER THIS HEAD OF ASSETS WITH A VALUE OF RS. 3,19,95,890/-. THE SUBMISSION OF THE ASSESSEE IS THAT IT WAS D ONE WITH A VIEW TO WINDOW DRESS THE BALANCE-SHEET. NO TRANSACTION HAS BEEN TAKEN WITH ANY OUTSIDE PARTY. MERE CHANGE OF THE CLASSIFICATION OF ASS ETS FROM STOCK-IN-TRADE TO CAPITAL ASSET DOES NOT LEAD TO ANY INCOME ALTHOU GH SUCH AN INFERENCE MAY ITA NO. 210(DEL)/2011 9 BE THERE IN CASE OF CONVERSION OF A CAPITAL A SSET INTO STOCK-IN-TRADE. IT IS IN THIS BACKGROUND THAT A CAPITAL RESERVE OF EQ UIVALENT AMOUNT IS CREATED. AS AND WHEN ANY OF THE ITEM IS SOLD, CAPITAL GA INS WILL BE DECLARED WITH REFERENCE TO THE ACTUAL COST OF NIL RATHER THA N THE VALUE PLACED NOW ON THEM. THE QUESTION IS-WHETHER, THIS AMOUNT IS LIA BLE TO BE TAXED IN THIS YEAR AS INCOME? 2.8 IT IS AN ACCEPTED POSITION OF LAW THAT THE RE -VALUATION OF ASSETS IN THE BOOKS OF THE ASSESSEE DOES NOT LEAD TO GENERAT ION OF INCOME AS NO TRANSACTION HAS BEEN TAKEN UP WITH AN OUTSIDE PARTY. IN OTHER WORDS, A PERSON CANNOT MAKE PROFIT FROM HIMSELF BY MERE LY MAKING SOME ENTRIES IN THE BOOKS OF ACCOUNT. THE CASE OF THE ASSE SSEE IS THAT THE VALUE OF THESE ITEMS HAD BEEN TAKEN AS NIL AS THERE W AS NO BUYER FOR THESE ITEMS. HOWEVER, WITH A VIEW TO SHOW IMPROVED B ALANCE-SHEET FOR TAKING HIGHER LOAN FROM THE BANKS THESE ASSETS HAVE BEE N SHOWN IN THE BALANCE- SHEET NOW. NONETHELESS, NO ITEM COULD BE SOLD IN THIS YEAR ALSO. WE HAVE CONSIDERED THIS SUBMISSION ALSO. WE FIND THAT THE ASSESSEE HAS NOT INCURRED ANY EXPENDITURE WHICH HAS NOT BEEN RECOR DED IN THE BOOKS OF ACCOUNT. THE LD. CIT(APPEALS) HAS GIVEN A CLE AR FINDING THAT ALL EXPENSES REGARDING PRODUCTION OF FILMS ETC. HA VE BEEN DULY ACCOUNTED FOR ITA NO. 210(DEL)/2011 10 IN THE BOOKS. THEREFORE, IT CANNOT BE SAID THAT THESE ASSETS HAVE COME OUT OF ANY UNACCOUNTED INCOME. IN THIS LIGHT, IT BEC OMES CLEAR THAT THE ASSESSEE WAS IN POSSESSION OF THESE ASSETS, WHI CH WERE VALUED AT NIL FOR THE PURPOSE OF ARRIVING AT THE VALUE OF WORK-I N-PROGRESS. IN THE LIGHT OF THIS FACT, IT IS REASONABLE TO INFER THAT UN-SAL EABLE WORK-IN-PROGRESS, WHICH WAS VALUED AT NIL IN EARLIER YEARS, HAS NOT B EEN VALUED AT RS. 3,19,95,890/-. THIS VALUE ADMITTEDLY IS AN ART IFICIAL VALUE BECAUSE THIS WORK-IN-PROGRESS IS UN-SELLABLE EVEN NOW THOUGH T HERE IS A POSSIBILITY OF GETTING SOME AMOUNT, MAY BE EVEN LARGE AMOUNT, IN SOME FUTURE DATE IF SOME BUYER FINDS INTEREST IN THESE ITEMS. TH E OSTENSIBLE PURPOSE IS TO WINDOW-DRESS THE BALANCE-SHEET, NOT A LAUDABLE P URPOSE BUT A PURPOSE TAINTED WITH IMMORALITY OF GETTING HIGHER LOA N WITH NO CORRESPONDING SECURITY. THEREFORE, EVEN IF RE-VALUATION MAY NOT PER SE LEAD TO GENERATION OF INCOME, WE CANNOT APPROVE THE EN TRIES MADE IN THE BOOKS OF ACCOUNT IN THIS BEHALF, WHICH ALSO HAVE TAX IM PLICATION IN FUTURE, NAMELY, THAT THE BUSINESS PROFIT SHALL BECOME T AXABLE UNDER THE HEAD CAPITAL GAINS. ACCORDINGLY, IT IS HELD THAT TH E RE-CLASSIFICATION OF THE ASSETS AND THE VALUE PLACED THEREON IN THE BOOKS WILL HAVE NO CONSEQUENCE AS FAR AS INCOME TAX ASSESSMENTS ARE CONCERNED. IN OTHER WORDS, THE ASSETS FOR THE PURPOSE OF INCOME-TAX SHALL CONTIN UE TO BE GROUPED AS ITA NO. 210(DEL)/2011 11 STOCK-IN-TRADE AT NIL VALUE. SINCE NO VALUE HA S BEEN REALIZED IN RESPECT OF THIS STOCK-IN-TRADE, WE ARE ALSO OF THE VIEW TH AT NOTHING CAN BE TAXED IN THIS BEHALF IN THIS YEAR. 2.9 THUS, GROUND NOS. 1 AND 2 ARE ALLOWED AS D ISCUSSED ABOVE. 3. GROUND NO. 3 IS THAT THE LD. CIT(APPEALS) ERR ED IN CONFIRMING THE DISALLOWANCE OF RS. 11,96,173/-, THE AMOUNT WRITTEN OFF BY THE ASSESSEE IN THE BOOKS. 3.1 IN THIS CONNECTION, IT IS MENTIONED IN THE ASS ESSMENT ORDER THAT THE ASSESSEE HAS WRITTEN OFF A SUM OF RS. 11,96,173/ - IN THE BOOKS. THE ASSESSEE IS UNABLE TO SUBSTANTIATE AS TO HOW THIS AMOUNT IS DEDUCTIBLE IN COMPUTING THE INCOME. THEREFORE, THE CLAIM WAS D ENIED. 3.2 BEFORE THE LD. CIT(APPEALS), IT HAS BEEN SUBM ITTED THAT ALL THE DETAILS WERE FILED BEFORE THE AO. THESE AMOUNTS HAD BEEN EXPENDED FOR THE PURPOSE OF BUSINESS AND, THUS, DEDUCTIBLE EIT HER U/S 36 OR SECTION 37 OF THE ACT. THE DETAILS OF THE AMOUNTS WRITTEN O FF WERE ALSO FILED. THE LD. CIT(APPEALS) CONSIDERED THE FACTS OF THE CASE AND SUBMISSIONS MADE ITA NO. 210(DEL)/2011 12 BEFORE HIM. IT IS MENTIONED THAT ON CONSIDERATIO N OF DOCUMENTS PLACED BEFORE HIM, AN AGGREGATE SUM OF RS. 10,13,918/- PERTAINS TO THREE PERSONS AS UNDER:- (I) APPLAUSE ENTERTAINMENT (P) LTD. RS. 3,84,008/- BE ING BAD DEBT WRITTEN OFF. (II) VSNL-RS. 5,00,000/- BEING LICENSING FEE FOR CHANNE L. (III) MRS. KRISHNA TIWARI- RS. 1,29,910/- BEING ADVANCE TO STAFF WHO HAS LEFT THE COMPANY. 3.3 THE ASSESSEE WAS REQUIRED TO FURNISH EVIDENC E REGARDING WRITING OFF THE AMOUNT IN THE CASE OF APPLAUSE ENTERTAINMENT ( P) LTD., PAYMENT OF FEE TO VSNL AND DATES AND OTHER DETAILS OF PAYMENT S MADE TO SMT. KRISHNA TIWARI. SUCH DETAILS WERE NOT FILED. THEREFORE, THE CLAIM HAS BEEN DISALLOWED. 3.4 BEFORE US, THE LD. COUNSEL HAS REFERRED TO PA GE NO. 55 OF THE PAPER BOOK, WHICH FURNISHES THE DETAILS OF AMOUNTS W RITTEN OFF IN RESPECT OF 21 PARTIES AGGREGATING TO RS. 11,96,173/-. IT IS SU BMITTED THAT THE MATTER MAY BE RESTORED TO THE FILE OF THE AO FOR VERIFICATI ON OF THE WRITING OFF OF THE AMOUNT SO THAT THE MATTER MAY BE DECIDED DE-NO VO. ON THE OTHER HAND, THE LD. CIT, DR REFERRED TO THE FINDINGS OF THE A O AND THE LD. ITA NO. 210(DEL)/2011 13 CIT(APPEALS) AND SUBMITTED THAT NO DETAIL HAD B EEN FILED IN RESPECT OF CLAIMS MADE BY THE ASSESSEE. THEREFORE, IT IS AR GUED THAT THERE IS NO NECESSITY TO SET ASIDE THE MATTER TO THE FILE OF THE AO FOR GIVING AN OPPORTUNITY TO THE ASSESSEE TO IMPROVE ITS CASE . 3.5 WE HAVE CONSIDERED THE FACTS OF THE CASE AND SUBMISSIONS MADE BEFORE US. WE FIND THAT ALTHOUGH CERTAIN DEDUCT IONS WERE CLAIMED, THE EVIDENCE REGARDING ADMISSIBILITY WAS NOT FURNISH ED EITHER BEFORE THE AO OR THE LD. CIT(APPEALS). IN SUCH A CIRCUMSTANC E, WE DO NOT THINK IT NECESSARY TO RESTORE THE MATTER TO THE FILE OF T HE AO. WE UPHOLD THE FINDING OF THE LD. CIT(APPEALS) THAT THE AMOUNT IS NOT DEDUCTIBLE IN ABSENCE OF ANY SUPPORTING EVIDENCE. 3.6 THUS, GROUND NO. 3 IS DISMISSED. 4. IN THE RESULT, THE APPEAL IS PARTLY ALLOWED. SD/- SD/- (A.D. JAIN) (K.G. BANSAL) JUDICIAL MEMBER ACCOUNTANT MEMBER SP SATIA ITA NO. 210(DEL)/2011 14 COPY OF THE ORDER FORWARDED TO:- MOVING PICTURE COMPANY INDIA LTD., NEW DELHI. ACIT, CIRCLE 5(1), NEW DELHI. CIT(A) CIT, THE D.R., ITAT, NEW DELHI. ASSISTANT REGISTRAR.