ACIT, New Delhi V. M/s Spice Retail Ltd., New Delhi

ITA 3269/DEL/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 2997 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 6 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-12-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2011-2012
• Appeal Filed On: 02-06-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Depreciation; Revenue expenditure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH C NEW DELHI BEFORE SH.N.K.SAINI, ACCOUNTANT MEMBER AND SH.K.N.CHARY, JUDICIAL MEMBER ITA NO. 3269/DEL/2016 (ASSESSMENT YEAR: 2011 -12) APPELLANT BY SH. ARUN KUMAR YADAV, SR. DR RESPONDENT BY NONE DATE OF HEARING 14 . 12 .2017 DATE OF PRONOUNCEMENT 15 . 12 .2017 ORDER PER K.N.CHARY, JM AGGRIEVED BY THE ORDER DATED 22.03.2016 IN APPEAL N O.425/14-15/94/15-16 PASSED BY THE LD. COMMISSIONER OF INCOME TAX (APPEA L) [IN SHORT CIT(A)]-28, NEW DELHI FOR THE AY 2011-12, THE REVENUE FILED THI S APPEAL ON VARIOUS GROUND. 2. BRIEFLY STATED FACTS ARE THAT THE ASSESSEE IS A COMPANY ENGAGED IN THE BUSINESS OF RETAIL TRADING OF MOBILE HANDSETS, ITS ACCESSORIES AND MOBILE REPAIRING. FOR THE ASSESSMENT YEAR 2011-12, THE ASSESSEE FILED THE RETURN OF INCOME ON 28/09/2011 DECLARING A TOTAL LOSS OF RS. 8,89,27,18 5/- AGAINST WHICH THE LD. AO COMPLETED THE ASSESSMENT AT A LOSS OF RS.6,60,06,51 4/-BY MAKING CERTAIN ACIT, CIRCLE-24(1), NEW DELHI. VS SPICE RETAIL LTD., SHOP NO.1/628, PLOT NO.628, PANKHA ROAD, JANAKPURI, NEW DELHI-110058. PAN-AAACM0294P (APPELLANT) (RESPONDENT) ITA NO. 3269/DEL/2016 PAGE | 2 DISALLOWANCES, ON ACCOUNT OF ADVERTISEMENT AND MARK ETING EXPENSES AND TRAINING AND RECRUITMENT CHARGES. IN THE APPEAL PREFERRED BY THE ASSESSEE, LD. CIT (A) DELETED THESE ADDITIONS STATING THAT THESE ISSUES A RE FULLY COVERED IN FAVOUR OF THE ASSESSEE IN THEIR OWN CASE BY THE TRIBUNAL, FOR THE ASSESSMENT YEAR 2008-09 BY WAY OF ORDER DATED 30/08/2013 IN ITA NO. 5660/DEL/2 011 AND FOR THE ASSESSMENT YEAR 2009-10 BY ORDER DATED 01.02.2016 IN ITA NO. 4 933/DEL/2012, AS SUCH, WHILE RESPECTFULLY FOLLOWING THE SAME, THE ADDITION S MADE FOR THIS ASSESSMENT YEAR SHALL ALSO BE DELETED. HENCE, THE REVENUE IS IN THI S APPEAL BEFORE US. 3. LD. DR VEHEMENTLY RELIED ON THE ASSESSMENT ORDER ; WHEREAS THE LD. AR SUBMITTED THAT SINCE THE LD. CIT(A) GAVE RELIEF TO THE ASSESSEE WHILE RELYING UPON THE DECISION OF THE TRIBUNAL FOR EARLIER YEARS, NO INTERFERENCE COULD BE MADE WITH SUCH AN ORDER. 4. WE HAVE PERUSED THE IMPUGNED ORDER. LD. CIT(A) R ECORDED A FINDING THAT THE ISSUES INVOLVED IN THIS MATTER FOR THIS ASSESSMENT YEAR WERE FULLY COVERED BY THE DECISIONS OF THE TRIBUNAL FOR THE ASSESSMENT YEARS 2008-09 AND 2009-10 WHEREIN THE RELIEF WAS GRANTED TO THE ASSESSEE ON THE GROUN D THAT THE LD. AO DID NOT ALLOW THE DEPRECIATION ON THE PART OF THE EXPENDITURE INC URRED FAR ADVERTISEMENT AND MARKETING, IF IT ALL THE LD. AO HAD TO TREAT A PART OF SUCH AS SUCH EXPENDITURE AS CAPITAL NATURE. SO ALSO IT WAS HELD BY THE TRIBUNAL THAT THE RECRUITMENT AND TRAINING EXPENSES INCURRED BY THE ASSESSEE ARE ALLO WABLE AS REVENUE EXPENDITURE. THE OBSERVATIONS MADE BY THE LD. CIT(A) COULD NOT B E CONTROVERTED BY THE LD. DR AND THERE IS NO DISPUTE THAT FOR THE EARLIER YEARS, AFTER CONSIDERING THE ENTIRE FACTS ITA NO. 3269/DEL/2016 PAGE | 3 PLEADED BY THE PARTIES WHICH ARE SIMILAR TO THE FAC TS INVOLVED FOR THIS ASSESSMENT YEAR, THE TRIBUNAL HELD THAT THE LD. AO WAS NOT JUS TIFIED IN MAKING ADDITIONS ON ACCOUNT OF DISALLOWANCE OF THE ADVERTISEMENT & MARK ETING EXPENSES AND TRAINING & RECRUITMENT CHARGES. IN THESE CIRCUMSTANCES, WE D O NOT FIND ANY REASON TO TAKE A DIFFERENT VIEW FROM THE ONE THAT WAS TAKEN FOR TH E EARLIER YEARS. WE, THEREFORE, UPHOLD THE FINDINGS OF THE LD. CIT(A) AND FIND THAT THIS APPEAL IS DEVOID OF ANY MERITS. THE GROUNDS OF APPEAL ARE, THEREFORE, DISMI SSED. 5. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 15 TH DECEMBER, 2017. SD/- SD/- (N.K.SAINI) (K.N.CHARY) ACCOUNTANT MEMBER JUDICIAL MEMBER *AMIT KUMAR* DATE:- 15.12.2017 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT AS SISTANT REGISTRAR ITAT NEW DELHI