Dakshin Haryana Bijli Vitran Nigam Ltd., Hisar V. ACIT, Hisar

ITA 3412/DEL/2016

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 5384 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 8 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-02-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2008-2009
• Appeal Filed On: 09-06-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NIDHI SRIVASTAVA
• Assessee Lawyers: S KRISHNAN SH V RAJA KUMAR
• Keywords: Recovery proceedings; Tax effect; Revenue expenditure
• Section: 43B; 143(3); 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH B NEW DLEHI BEFORE SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER AND SHRI K. NARASIMHA CHARY, JUDICIAL MEMBER ITA NOS.3412 & 3413/DEL/2016 ASSESSMENT YEARS: 2008-09 & 2011-12 DAKSHIN HARYANA BIJLI VITRAN NIGAM LTD. VS. ACIT C IRCLE, THE CHIEF ACCOUNTS OFFICER, HISAR. HARYANA BIJLI VITRAN NIGAM LTD. VIDYUT SADAN, VIDYUT NAGAR, DELHI ROAD, HISAR. PAN : AABCD0033C ITA NOS.3218 & 3219/DEL/2016 ASSESSMENT YEARS: 2008-09 & 2011-12 ACIT CIRCLE, VS. DAKSHIN HARYANA BIJLI VITRAN NIGA M LTD. HISAR. VIDYUT SADAN, HISAR. (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. S. KRISHNAN, ADVOCATE SH. V. RAJA KUMAR, ADVOCATE REVENUE BY: MS. NIDHI SRIVASTAVA, CIT/DR DATE OF HEARING: 20.01.2020 DATE OF ORDER : 19.02.2020 ORDER PER K. NARASIMHA CHARY, J.M. CHALLENGING THE ORDERS DATED 30.03.2016 FOR ASSESS MENT YEAR 2008- 09 AND 31.03.2016 FOR ASSESSMENT YEAR 2011-12 IN AP PEAL NOS. 191/14-15 AND 194/14-15 RESPECTIVELY PASSED BY THE LEARNED CO MMISSIONER OF INCOME 2 TAX (APPEALS)- FARIDABAD (LD. CIT(A)), BOTH DAKSH IN HARYANA BIJLI VITRAN NIGAM LTD. (THE ASSESSEE) AND THE REVENUE HAVE PR EFERRED THESE CROSS APPEALS. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A GOVERNMENT UNDERTAKING ENGAGED IN THE BUSINESS OF DISTRIBUTION OF ELECTRICITY IN SOUTHERN HARYANA. IN SO FAR AS THE ASSESSMENT YEAR 2008-09 IS CONCERNED, THE ASSESSMENT U/S. 143(3) WAS COMPLETED BY ORDER D ATED 23.12.2010 AT NIL INCOME BUT SUBSEQUENTLY, PURSUANT TO ORDER DATED 07 .01.2013 PASSED BY COMMISSIONER OF INCOME-TAX U/S. 263 OF THE ACT, ASS ESSMENT WAS TAKEN UP AND CONCLUDED BY ORDER DATED 30.01.2014. SINCE THE ISSUES ARISEN IN THE APPEALS OF THE ASSESSEE AND THE REVENUE ARE EMANATE D FROM COMMON SET OF FACTS, WE DEEM IT JUST AND CONVENIENT TO DISPOSE OF THEM ALL BY THIS COMMON ORDER. APPEALS FOR A.Y. 2008-09: 3. THE ONLY GROUND IN ASSESSSES APPEAL RELATES TO THE ADDITION MADE U/S. 43B IN RESPECT OF MUNICIPAL TAX. DURING THE AS SESSMENT PROCEEDINGS, LD. ASSESSING OFFICER NOTICED THAT THE STATUTORY LIABIL ITY TOWARDS ELECTRICITY DUTY AND MUNICIPAL TAX WAS OUTSTANDING AS WAS REVEALED F ROM THE PERUSAL OF SCHEDULE-16. THE ASSESSEE EXPLAINED THAT THE PAYMEN T OF MUNICIPAL TAX WAS MADE TO THE MUNICIPAL COMMITTEE ON THE BASIS OF COL LECTION FROM THE CONSUMERS AND NOT ON THE BASIS OF AMOUNT BILLED AND THAT THE AMOUNT OF MUNICIPAL TAX PAYABLE TO MUNICIPAL COMMITTEE IS ADJ USTED AGAINST THE PAYMENT OF ELECTRICITY BILLS RECEIVABLE FROM MUNICI PAL COMMITTEE ON MONTHLY BASIS. IN RESPECT OF ELECTRICITY DUTY, THE SUBMISSION OF THE ASSESSEE WAS THAT ELECTRICITY DUTY BILLED TO CONSUMERS IN EN ERGY BILLS ON MONTHLY BASIS 3 AND ITS LIABILITY IS SHOWN AS PAYABLE TO GOVERNMENT , WHICH IS A CONTINUOUS PROCESS AND THE ELECTRICITY DUTY IS PAID TO THE GOV ERNMENT ON COLLECTION BASIS, BUT NOT ON THE BASIS OF BILLS RAISED TO THE CONSUMERS. GOVERNMENT OF HARYANA MAKES THE PAYMENT OF REVENUE SUBSIDY TO THE ASSESSEE ON MONTHLY BASIS FOR SUPPLYING THE ELECTRICITY ON CONC ESSIONAL TARIFF TO AGRICULTURAL CONSUMERS AFTER ADJUSTING THE ELECTRIC ITY DUTY AGAINST THE REVENUE SUBSIDY RECEIVABLE FROM GOVERNMENT OF HARYA NA. THEREFORE, THERE ARE NO OUTSTANDING DEBTORS OF ELECTRICITY DUTY AND OUTSTANDING AMOUNT WILL BE PAID TO GOVERNMENT OF HARYANA AS AND WHEN IT IS RECEIVED FROM THE CONSUMERS. THE ASSESSEE ALSO PLACED RELIANCE ON THE DECISION OF HONBLE KERALA HIGH COURT IN THE CASE OF KERALA STATE ELECT RICITY BOARD VS. DCIT (2011- ITS-69-HC-KER). 4. ASSESSING OFFICER, HOWEVER, DID NOT ACCEPT THE A SSESSEES CONTENTION BUT BY PLACING RELIANCE ON THE DECISION OF GUJRAT H IGH COURT IN THE CASE OF CIT VS. AHMEDABAD ELECTRICITY CO. LTD., (2003) 181 CTR- GUJ-222, TOOK THE VIEW THAT WHERE THE ASSESSEE WAS MAINTAINING ITS BO OKS OF ACCOUNT ON MERCANTILE SYSTEM OF ACCOUNTING, THE EXPENSES RELAT ING TO PERIOD OTHER THAN THE ASSESSMENT YEAR WAS NOT TO BE ALLOWED. 5. IN APPEAL BEFORE LD. CIT(A), THE ASSESSEE PLEADE D THAT AS A PART OF ELECTRICITY DISTRIBUTION ACTIVITY, THE ASSESSEE WAS REQUIRED BY THE GOVERNMENT TO COLLECT MUNICIPAL TAX ON GOVERNMENT B EHALF AND THEREFORE, SECTION 43B OF THE ACT HAS NO APPLICATION. LD. CIT( A) NOTED THAT ASSESSEE MERELY ACTS AS AN AGENT IN RESPECT OF COLLECTION OF THE MUNICIPAL TAXES. LD. CIT(A), HOWEVER, HELD THAT THE ASSESSEE WAS UNABLE TO PROVE ITS POINT AND DID NOT SUBMIT ANY CASE LAW ON THIS ASPECT AND THER EFORE, CONFIRMED THE VIEW TAKEN BY THE ASSESSING OFFICER. 4 6. IN RESPECT OF ELECTRICITY DUTY, LD. CIT(A) FOLLO WED THE DECISION OF HONBLE CALCUTTA HIGH COURT IN THE CASE OF CESC LTD . VS. CIT DATED 14.05.2015, WHEREIN THE DECISIONS OF BOTH HONBLE K ERALA HIGH COURT AND GUJRAT HIGH COURT WERE CONSIDERED AND HELD THAT THE ELECTRICITY DUTY DESERVES TO BE DELETED AND GRANTED RELIEF TO THE AS SESSEE. ASSESSEE, THEREFORE, CHALLENGED THE FINDING OF THE LD. CIT(A) CONFIRMING THE ADDITION MADE ON ACCOUNT OF MUNICIPAL TAX WHEREAS THE REVENU E CHALLENGED THE DELETION OF ADDITION ON ACCOUNT OF ELECTRICITY DUTY VIDE GROUND NO. 3. 7. IT IS SUBMITTED BEFORE US BY THE LD. AR THAT COL LECTION OF MUNICIPAL TAXES IN THE HANDS OF THE ASSESSEE IS NOT ITS INCOM E AND THE GOVERNMENT OF HARYANA MAKES AN ADJUSTMENT IN RESPECT OF THE REVEN UE SUBSIDY PAYABLE TO THE ASSESSEE AGAINST THE AMOUNT OF ELECTRICITY DUTY COLLECTED BY THE ASSESSEE AND PAYABLE TO THE GOVERNMENT. LD. AR SUBM ITTED THAT SECTION 43B OF THE ACT IS APPLICABLE IN RESPECT OF DEDUCTION CL AIMED IN THE PROFIT AND LOSS ACCOUNT AND IN THIS MATTER, NO AMOUNT OF MUNICIPAL TAX WAS DEBITED AGAINST THE BUSINESS PROFITS AND THEREFORE, SECTION 43B HAS NO APPLICATION TO THE FACTS OF THE CASE. 8. HE SUBMITTED THAT SIMILAR ISSUE HAS ARISEN IN AS SESSEES OWN CASE FOR THE ASSESSMENT YEAR 2006-07 ALSO AND THE COORDINATE BENCH OF THIS TRIBUNAL IN ITA NO. 3411 AND 3217/DEL/2016 BY ORDER DATED 24 .12.2019 DEALT WITH THE SAME VIDE PARA 16 TO 18 AND REACHED A CONCLUSIO N THAT DISALLOWANCE U/S. 43B OF THE ACT IS NOT SUSTAINABLE. 9. LEARNED DR PLACES RELIANCE ON THE ORDERS OF THE ASSESSING OFFICER. 10. AS SUBMITTED BY THE LD. AR, BOTH THESE ISSUES A RE COVERED BY THE ORDER OF CO-ORDINATE BENCH OF TRIBUNAL IN ITA NO. 3 411 AND 3217/DEL/2016 5 BY ORDER DATED 24.12.2019, THE RELEVANT OBSERVATION S OF THE TRIBUNAL AT PARA 16 TO 18 READ THUS : 16. COMING TO THE MERITS OF THE ADDITION UPHELD BY THE CIT(A) I.E. IN RESPECT OF OUTSTANDING MUNICIPAL TAX LIABILITY OF RS.11.63 CRORES. THE RELEVANT FACTS OF THE ISSUE ARE THAT THE GOVERNOR OF HARYANA HAD N OTIFIED THAT THE COMMITTEE SHALL IMPOSE TAX ON THE CONSUMPTION OF EL ECTRICITY @ 5 PAISE FOR EVERY UNIT OF ELECTRICITY CONSUMED BY ANY PERSON WI THIN THE LIMITS OF THE MUNICIPALITY IN THE STATE OF HARYANA. THE SAID TAX HAD TO BE COLLECTED BY HARYANA VIDYUT PRASARAN NIGAM LTD. (IN SHORT HVPNL ) AND PAID AS AN ELECTRICITY DUTY PAYABLE TO THE STATE GOVERNMENT UN DER THE PUNJAB ELECTRICITY (DUTY) ACT, 1958. SIMILAR PRACTICE WAS ADOPTED IN CASE OF MUNICIPAL TAXES BY THE MUNICIPAL COMMITTEE/COUNCIL WHILE PAYING THEIR DUES ON ACCOUNT OF CONSUMPTION OF ELECTRICITY TO TH E NIGAM AS PER GOVERNMENT OF HARYANA CIRCULAR DATED 16.05.2000. TH E ASSESSING OFFICER DID NOT ACCEPT THE PLEA OF THE ASSESSEE AND HELD TH AT SINCE THE SAID AMOUNT OF MUNICIPAL TAXES COLLECTED BY IT, HAVE NOT BEEN D EPOSITED BEFORE THE DUE DATE OF FILING OF RETURN OF INCOME, THE SAME IS LIA BLE TO BE DISALLOWED U/S 43B OF THE ACT. THE CIT(A) HAS UPHELD THE ORDER OF THE ASSESSING OFFICER IN THIS REGARD. THE QUESTION WHICH ARISES IS WHETHER T HE SAME IS TO BE ALLOWED AS DEDUCTION IN THE HANDS OF THE ASSESSEE OR NOT. T HE CASE OF THE ASSESSEE IS THAT IT WAS NOT THE LIABILITY OF THE ASSESSEE TO DEPOSIT THE SAID MUNICIPAL TAXES COLLECTED BY IT ON BEHALF OF THE STATE AUTHOR ITIES. THE ASSESSEE WAS ACTING AS COLLECTING AGENT AND THE AMOUNT HAD TO BE PAID BY THE STATE AUTHORITY. THE ASSESSEE AFTER COLLECTING THE AMOUNT HAD NOT DEBITED IT TO THE P & L ACCOUNT AND WHATEVER AMOUNT WAS NOT COLLEC TED, WAS SHOWN AS RECEIVABLE AND CONTRA ENTRY WAS PASSED AS PAYABLE T O THE STATE. ONCE THE AMOUNT HAD BEEN DEBITED TO THE P&L ACCOUNT OF THE AS SESSEE, THEN THE PROVISION OF SECTION 43B OF THE ACT WERE NOT ATTRAC TED. IN ANY CASE, THE ASSESSEE WAS ONLY A COLLECTING AGENT ON BEHALF OF T HE STATE AND IT WAS THE AMOUNT WHICH WAS NOT COLLECTED, WHICH WAS SHOWN AS RECEIVABLE AND ALSO ON THE OTHER SIDE SHOWN AS PAYABLE TO THE STATE. TH E LIABILITY IF ANY, WOULD ARISE AFTER THE AMOUNT IS COLLECTED AND THAT ALSO O F THE STATE. IN SUCH CIRCUMSTANCES, THE PROVISION OF SECTION 43B OF THE ACT COULD NOT BE APPLIED AND THE AMOUNT COULD NOT BE DISALLOWED IN THE HANDS OF THE ASSESSEE. SIMILAR ACCOUNTING HAS BEEN CARRIED OUT BY THE ASSE SSEE IN ITS BOOKS OF 6 ACCOUNTS FROM ASSESSMENT YEAR 1999-2000 AND NO DISA LLOWANCE HAS BEEN MADE IN ANY OF THE YEAR. 17. FURTHER, THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF CESC LTD. VS CIT (SUPRA) HAS HELD THAT WHERE THE ASSESSEE MERELY ACT S AS COLLECTING AGENT FOR THE STATE GOVERNMENT AND PAYS THE SAME TO THE S TATE GOVERNMENT ON COLLECTION, THEN, THE LICENCEE MERELY ACTS AS A CON DUIT AND THE ELECTRICITY DUTY WAS NOT CHARGEABLE TO THE LICENCEE. IT WAS CON CLUDED BY HOLDING THAT ELECTRICITY DUTY NOT BEING A SUM PAYABLE BY THE ASS ESSEE AS A PRIMARY LIABILITY BY WAY OF TAX, DUTY, CESS OR FEE, THEN PR OVISIONS OF SECTION 43B OF THE ACT WERE NOT ATTRACTED TO THE LICENCEE/ASSESSEE IN RESPECT OF THE ELECTRICITY DUTY COLLECTED BY IT FOR BEING PASSED O N TO THE STATE GOVERNMENT. 18. APPLYING THE SAID PROPOSITION TO THE ISSUE BEFO RE US, WE HOLD THAT THERE IS NO MERIT IN THE ORDERS OF THE AUTHORITIES BELOW IN MAKING THE AFORESAID DISALLOWANCE U/S 43B OF THE ACT. WE REVERSE THE SAM E AND ALLOW GROUND NO.2 RAISED BY THE ASSESSEE ON MERITS. 11. SINCE FACTS ARE IDENTICAL AND NO CONTRARY DECIS ION IS BROUGHT TO OUR NOTICE, WHILE RESPECTFULLY FOLLOWING THE VIEW TAKEN BY CO-ORDINATE BENCH, WE HOLD THAT BOTH THE ADDITIONS U/S. 43B CANNOT BE SUS TAINED. ACCORDINGLY, GROUND OF ASSESSEES APPEAL IS ALLOWED AND GROUND N O. 3 OF REVENUES APPEAL IS DISMISSED. 12. GROUND NO. 1 OF THE REVENUES APPEAL IS IN RESP ECT OF DELETION OF ADDITION OF RS.2,93,40,534/- ON ACCOUNT OF COST VAR IANCE RESERVE. ACCORDING TO ASSESSEE, AS PER THE ACCOUNTING POLICY, THE MATE RIAL SUPPLIED TO THEM BY THE SUPPLIER WAS TAKEN IN STORE AT THE VALUE MENTIO NED IN THE PURCHASE ORDER, BUT WHILE ISSUING THE SAME, THE RATE FIXED B Y NIGAM DEPENDENT UPON THE PRICE OF MATERIAL CST/ST, EXCISE DUTY AND OTHER CHARGES AS PER PURCHASE ORDER WERE CONSIDERED AND THE VARIANCE THAT ARISE I S BEING DEBITED AND CREDITED DURING THE YEAR TO THE COST VARIANCE ACCOU NT. FURTHER, ACCORDING TO 7 THE ASSESSEE, THE BALANCE, IF ANY AT THE END OF THE YEAR UNDER SUCH ACCOUNT IS CHARGED TO PROFIT AND LOSS ACCOUNT OF THE CURREN T YEAR AND CREDIT BALANCE UNDER THE HEAD IS SHOWN AS COST VARIANCE RESERVE UN DER RESERVE AND SURPLUS HEAD OF BALANCE SHEET, WHICH, IN SO FAR AS FINANCIA L YEAR 2007-08 IS CONCERNED, IS CREDIT BALANCE OF RS.2,93,40,534/-. 13. LEARNED ASSESSING OFFICER, HOWEVER, HELD THAT C REDIT BALANCE SHOULD BE ADDED TO THE INCOME SIDE OF PROFIT AND LOSS ACCO UNT AND, THEREFORE, THE PORTION OF COST DEBITED TO PROFIT AND LOSS ACCOUNT EQUIVALENT TO THIS PROVISION IS NOT TO BE ALLOWED AS IT WAS INFLATED. 14. LD. CIT(A) HAVING CONSIDERED THE CONTENTIONS OF THE ASSESSEE THAT IN THE NEXT FINANCIAL YEAR 2008-09, THE RESERVE OF RS. 2,93,40,534/- WAS ADJUSTED AND THE SAME WAS DISCLOSED IN 10 TH AND 11 TH ANNUAL REPORT FOR F.Y. 2008-09 AND THEREFORE, THERE IS NO LOSS TO THE REVE NUE AS THE ASSESSEE CREDITED THE AMOUNT OF ENTIRE 2.93 CRORES IN THE PR OFIT AND LOSS ACCOUNT OF NEXT ASSESSMENT YEAR. ACCORDING TO LD. CIT(A), ACCE PTING THE CONTENTION OF THE ASSESSING OFFICER WOULD AMOUNT TO DOUBLE TAXATI ON, WHICH IS NOT PERMISSIBLE. ON THIS PREMISE, LD. CIT(A) ALLOWED TH E GROUND OF ASSESSEES APPEAL AND DELETED THE ADDITION. 15. BEFORE US, THE ASSESSEE PLACED RELIANCE ON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS. EXCEL INDUSTRI ES LTD., 358 ITR 295 (SC). ON A CAREFUL CONSIDERATION OF THIS ISSUE WE ARE OF THE CONSIDERED OPINION THAT INASMUCH AS THERE IS NO DISPUTE IN THE CURRENT YEAR AND SUBSEQUENT YEAR, THE RATE OF TAX REMAINED THE SAME AND THE DIS PUTE RAISED BY THE REVENUE IS ENTIRELY ACADEMIC OR IT MAY HAVE A MINOR TAX EFFECT. BY RESPECTFULLY FOLLOWING THE DECISION OF HONBLE APEX COURT IN THE CASE OF EXCEL INDUSTRIES LTD. (SUPRA), WE ENDORSE THE VIEW TAKEN BY THE LD. CIT(A) AND HOLD 8 THAT THIS IS A REVENUE NEUTRAL TRANSACTION. WE, THE REFORE, AFFIRM THE FINDING OF THE LD. CIT(A) ON THIS ISSUE. 16. GROUND NO. 2 OF REVENUES APPEAL RELATE TO THE DELETION OF ADDITION OF RS.71,47,71,224/- ON ACCOUNT OF PROVISION OF SUR CHARGE LEVIED BUT NOT REALIZED. ON THIS ASPECT, THE CASE OF THE ASSESSEE IS THAT THEY HAVE BEEN LEVYING SURCHARGE ON BILLS ISSUED IF PAYMENT IS NOT WITHIN TIME ALLOWED, BUT IT HAS BEEN A GENERAL PRACTICE THAT MOST OF THE RURAL AREA CONSUMERS OF DOMESTIC AND AGRICULTURE CATEGORY DO NOT MAKE THE P AYMENT OF THE ORIGINAL BILLS AND THEREFORE, SURCHARGE REMAINS UNPAID. THE GOVERNMENT, THEREFORE, WAS INTRODUCING WAIVER OF SURCHARGE FROM TIME TO TI ME TO REDUCE THE DEBTORS BECAUSE RECOVERY PROCEEDINGS WERE NOT WORTH THE RECOVERED AMOUNT. LD. CIT(A) CONSIDERED THE FACT THAT THIS HA S BEEN A RECURRENT ISSUE DECIDED IN FAVOUR OF THE ASSESSEE BY FIRST AND SECO ND APPELLATE AUTHORITIES IN RESPECT OF ASSESSMENT YEAR 2006-07 AND HIGH COURT A LSO HELD THE ISSUE IN FAVOUR OF THE ASSESSEE. 17. REVENUE DOES NOT DISPUTE THE FACT THAT HONBLE HIGH COURT HELD THE ISSUE IN FAVOUR OF THE ASSESSEE IN THE ASSESSMENT Y EARS 2006-07 TO 2008-09 VIDE ORDERS DATED 01.10.2014, 02.02.2015 AND 06.10. 2014 IN ITA NOS. 209/2014, 369/2014 AND 226/2014 RESPECTIVELY. SINCE LD. CIT(A) FOLLOWED THE BINDING PRECEDENT OF HONBLE HIGH COURT, IT CAN NOT BE SAID THAT THE FINDING OF THE CIT(A) IS EITHER ERRONEOUS OR PERVER SE. WE, THEREFORE, FIND THIS GROUND OF APPEAL OF REVENUE AS DEVOID OF MERIT AND THE SAME IS LIABLE TO BE DISMISSED. GROUND NO. 2 OF REVENUES APPEAL IS DISM ISSED. APPEALS FOR A.Y. 2011-12: 18. IN SO FAR AS THE APPEALS OF THE ASSESSEE AND TH E REVENUE FOR THIS ASSESSMENT YEAR ARE CONCERNED, GROUND OF ASSESSEES APPEAL AS WELL AS 9 GROUND NO. 1 & 2 OF REVENUES APPEAL ARE COVERED BY OUR FINDINGS (SUPRA). WE, THEREFORE, ALLOW THE GROUND OF APPEAL OF THE AS SESSEE AND DISMISS GROUNDS NOS. 1 & 2 OF THE REVENUES APPEAL. 19. NOW, COMING TO GROUND NO. 3 OF REVENUES APPEAL , IT RELATES TO PRIOR PERIOD EXPENSE. THE ASSESSEE CREDITED A NET BALANCE OF RS.31,36,65,890/- IN THE PROFIT AND LOSS ACCOUNT AFTER SETTING OFF A PRI OR PERIOD EXPENSE OF RS.21,210/- FROM PRIOR PERIOD INCOME OF RS.31,36,87 ,100/- WHICH WAS DUE TO THE ARREARS OF SALARY OF THE EMPLOYEES. IT IS SUBMI TTED ON BEHALF OF ASSESSEE THAT THE SAME ACCOUNTING TREATMENT FOR PRIOR PERIOD EXPENSES HAS BEEN GIVEN BY THE ASSESSEE QUITE FOR A LONG TIME AND DUR ING THE ASSESSMENT YEAR 2010-11, THEY HAVE CLAIMED THE EXPENSES RELATING TO PRIOR PERIOD. IT IS BROUGHT TO OUR NOTICE THAT A SIMILAR ISSUE HAD ARIS EN IN EARLIER YEARS ALSO. 20. LD. CIT(A) NOTICED THAT THE GROSS PRIOR PERIOD INCOME OF RS.31,36,87,100/- AND PRIOR PERIOD EXPENSES OF RS.2 1,210/- WERE CRYSTALLIZED DURING THE YEAR AND THEREFORE, DISCLOSED BY THE ASS ESSEE IN THE BALANCE SHEET AND PROFIT AND LOSS ACCOUNT. ACCORDING TO CIT (A), THE CLAIM OF ASSESSEE ON ACCOUNT OF PAY ANOMALY OF EMPLOYEE CRYSTALLIZED DURING THE YEAR SHOULD HAVE BEEN ACCEPTED AND HE, THEREFORE, GRANTED RELIE F TO THE ASSESSEE. 21. ON A PERUSAL OF THE RECORD AND THE ORDER DATED 24.12.2009 FOR ASSESSMENT YEAR 2006-07 IN ASSESSEES OWN CASE, WE HOLD THAT THE TRIBUNAL ALSO ENDORSED THE VIEW TAKEN BY LD. CIT(A) IN EARLI ER YEARS THAT THE LIABILITY CRYSTALLIZED DURING THE YEAR HAS TO BE ALLOWED. WE DO NOT FIND ANYTHING IMPROPER IN THE APPROACH OF THE CIT(A) TO ALLOW THE EXPENSES IN RESPECT OF WHICH THE LIABILITY CRYSTALLIZED DURING THE YEAR. H ENCE, GROUND NO. 3 OF REVENUES APPEAL IS DISMISSED. 10 22. GROUND NO. 4 OF REVENUES APPEAL RELATES TO DEL ETION OF A SUM OF RS.1,38,97,653/- ON ACCOUNT OF LOSS DUE TO FLOOD, C YCLONE AND FIRE. THE ASSESSEE SUBMITTED THAT THEY HAVE INCURRED SUCH EXP ENDITURE ON ACCOUNT OF LOSS OF FIXED ASSETS SPREAD OVER 52 DIVISIONS THROU GHOUT SOUTHERN PART OF HARYANA AND BOUND TO INCUR DUE TO NATURAL CALAMITIE S. SUCH EXPENSES WERE TO BE INCURRED TO REVIVE THE ELECTRICITY SUPPLY AND TO GET IT CONTINUED. ACCORDING TO ASSESSEE, SUCH EXPENDITURE IS REGULAR FEATURE OF THE BUSINESS AND CANNOT BE SAID TO BE CAPITAL IN NATURE. LD. ASS ESSING OFFICER DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE AND HELD THAT IN THE ABSENCE OF ANY SEPARATE FIGURE IN RESPECT OF REPAIR AND MAINTENANC E HEAD FROM THE OTHER EXPENSES, THE CLAIM OF THE ASSESSEE CANNOT BE ALLOW ED. LD. CIT(A) WHILE FOLLOWING THE VIEW TAKEN IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2006- 07 ALLOWED THIS GROUND. 23. ON A PERUSAL OF THE ORDER FOR ASSESSMENT YEAR 2 006-07 IN ASSESSEES OWN CASE, WE FIND THAT A CO-ORDINATE BENCH OF THIS TRIBUNAL WAS OF THE VIEW THAT THE NATURE OF EXPENDITURE IS THE DETERMINING F ACTOR AND NOT THE NOMENCLATURE AND HAVING REGARD TO THE EXPENDITURE, THIS EXPENDITURE NEEDS TO BE CONSIDERED AS REVENUE EXPENDITURE. RESPECTFUL LY FOLLOWING THE SAID VIEW TAKEN IN ASSESSEES OWN CASE, WE DISMISS THIS GROUND OF APPEAL. 24. THE LAST GROUND OF REVENUES APPEAL IS IN RESPE CT OF DELETION OF RS.4,83,49,05,000/- ON ACCOUNT OF PAYMENT OF WHEELI NG & SLDC CHARGES. THE FACTS ON THIS ASPECT ARE THAT ON ACCOUNT OF WHEELIN G & SLDC CHARGES, ASSESSEE MADE PAYMENT OF RS.4,83,49,05,000/- TO HVP NL AND SINCE SUCH PAYMENTS DO NOT FALL WITHIN THE PURVIEW OF PROVISIO NS OF TAX DEDUCTION AT SOURCE, ASSESSEE DID NOT DEDUCT TAX ON SUCH PAYMENT . FURTHER, ACCORDING TO ASSESSEE ON THIS ISSUE, THE TRIBUNAL HELD IN THE CA SE FOR THE ASSESSMENT YEAR 11 2006-07 TO 2008-09 THAT SUCH PAYMENTS ARE NOT LIABL E FOR DEDUCTION OF TAX U/S. 194J. 25. THE ASSESSEE PLACED RELIANCE ON THE OPINION OF STATUTORY AUDITORS AND ALSO THE DECISION OF TRIBUNAL IN EARLIER YEARS. 26. LD. CIT(A) CONSIDERED THE CONTENTIONS OF THE AS SESSEE AND DECIDED THE ISSUE IN THE LIGHT OF DECISION OF THE TRIBUNAL FOR ASSESSMENT YEAR 2006-07 TO 2008-09. REVENUE DOES NOT DISPUTE THE FACT THAT THIS ISSUE HAS BEEN A RECURRENT ISSUE FOR LAST SEVERAL YEARS AND CONSISTE NT VIEW HAS BEEN TAKEN BY THE TRIBUNAL FOR ASSESSMENT YEAR 2008-09 TO 2009-10 AND AS ON DATE, THERE IS NO CONTRARY VIEW FROM THE HIGHER FORUMS. WE, THE REFORE, WHILE RESPECTFULLY FOLLOWING THE CONSISTENT VIEW TAKEN BY THE TRIBUNAL IN ASSESSEES OWN CASE UNDER IDENTICAL CIRCUMSTANCES I N EARLIER YEARS, HOLD THAT THE CIT(A) IS RIGHT IN DELETING THE ADDITION AND TH E GROUND OF REVENUES APPEAL HAS NO MERITS AND IS, ACCORDINGLY, DISMISSED . 27. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE ALLOWED AND THOSE OF THE REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 19 TH FEBRUARY, 2020. SD/- SD/- (PRASHANT MAHARISHI) (K. NARASIMHA CHARY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED:19/02/2020 AKS