M/s ESS AAR Universal (P) Ltd., Kanpur V. Dy. Commissioner of Income Tax-VI, Kanpur

ITA 231/LKW/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 4713 (ITAT-LUCKNOW)
• Duration Of Justice: 10 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 12-02-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 16-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P K KAPOOR
• Keywords: Revenue expenditure

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.231/LKW/2015 ASSESSMENT YEAR : 2006 2007 M/S ESS AAR UNIVERSAL (P) LTD., C 10, SITE 3, PANKI INDUSTRIAL AREA, KANPUR. PAN : AAACE5306Q VS. D.C.I.T. VI, KANPUR. (APPELLANT) (RESPONDENT) APPELLANT BY SHRI P. K. KAPOOR, C.A. RESPONDENT BY SHRI AMIT NIGAM, SR. D.R. DATE OF HEARING 12/02/2016 DATE OF PRONOUNCEMENT 2 6 /02/2016 O R D E R PER A. K. GARODIA, A.M. THIS IS ASSESSEES APPEAL DIRECTED AGAINST THE OR DER PASSED BY THE CIT (A) II KANPUR ON 26/12/2014 FOR A. Y. 2006 07. 2. THE ASSESSEE HAS RAISED AS MANY AS 9 GROUNDS BUT THE ONLY GRIEVANCE OF THE ASSESSEE IS ABOUT CONFIRMING OF PENALTY OF R S. 135,000/- IMPOSED BY THE A.O. U/ 271 (1) (C) OF THE I. T. ACT, 1961. 3. HEARD BOTH SIDES. THIS IS THE MAIN ARGUMENT THAT THE EXPENSES ON ACCOUNT OF PAYMENT OF FEES TO R.O.C. WAS FOR ISSUE OF BONUS SHARES. RELIANCE WAS PLACED ON THE JUDGMENT OF HONBLE APEX COURT RE NDERED IN THE CASE OF CIT VS. GENERAL INSURANCE CORPORATION, 286 ITR 232 WHERE IT WAS HELD THAT 2 EXPENDITURE INCURRED IN CONNECTION WITH ISSUANCE OF BONUS SHARES IS REVENUE EXPENDITURE. AS PER AUDITED ACCOUNTS AVAILABLE IN T HE PAPER BOOK, BONUS SHARES WERE ISSUED BY CAPITALIZATION OF GENERAL RES ERVES OF RS. 241.75 LACS IN THE PRESENT YEAR AND AUTHORIZED CAPITAL WAS INCR EASED FROM RS. 500 LACS TO RS. 600 LACS. UNDER THESE FACTS, IN OUR CONSIDER ED OPINION, EVEN AFTER DISALLOWANCE OF THE EXPENSES INCURRED ON INCREASE I N AUTHORIZED CAPITAL. PENALTY IS NOT JUSTIFIED. WE, THEREFORE, DELETE THE PENALTY. 4. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GAROD IA ) JUDICIAL MEMBER ACCOUNTANT MEM BER DATED:26 TH FEBRUARY, 2016. *SINGH COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. CONCERNED CIT 4. THE CIT(A) 5. D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR