BHARAT PETROLEUM CORPORATION LTD, MUMBAI V. ASST CIT (OSD) RG 2(1), MUMBAI

ITA 3636/MUM/2013

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8834 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 5 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-10-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 21-05-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 08-05-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: J D MISTRI
• Keywords: Capital asset; Business income; Depreciation; Opportunity of being heard; Rule of consistency; Additional depreciation; Earning of tax free income; Revenue expenditure; Capital expenditure
• Section: 11A; 14A; 115JB; 80G; 32; 37

Judgement Text

THE INCOME TAX APPELLATE TRIBUNALB BENCH, MUMBAI BEFORE SHRI P.K BANSAL, VICE-PRESIDENT AND SHRI PAWAN SINGH, JUDICIAL MEMBER ITA NO.3636/MUM./2013 & 4279/MUM/2014 (ASSESSMENT YEAR: 2006-07 & 2007-08) BHARAT PETROLEUM CORPORATION LTD., TAXATION SECTION, 3 RD FLOOR, BHARAT BHAVAN-LL, 4 & 6 CURRIMBHOY ROAD, BALLARD ESTATE, MUMBAI 400001, PAN AAACB1902M . APPELLANT V/S ACIT(OSD) RANGE 2(1) MUMBAI . RESPONDENT ASSESSEE BY : SHRI. J. D. MISTRI SR. ADVOCATE REVENUE BY : SHRI. ANAND MOHAN DR DATE OF HEARING 11.09.2017 DATE OF ORDER - 24.10. 2017 O R D E R PER: PAWAN SINGH 1. THESE TWO APPEALS BY ASSESSEE UNDER SECTION 253 OF INCOME TAX ACT, ARE DIRECTED AGAINST THE ORDER OF CIT-A FOR THE ASSESSM ENT YEAR 2006-07 AND 2007-08. 2. IN APPEAL FOR A.Y 2006-07 IN ITA NO. 3636/MUM/2013 THE ASSESSEE HAS RAISED FOLLOWING GROUND OF APPEAL. 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED COMMISSIONER OF INCOME TAX [CIT(A)] ERRED I N CONFIRMING BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 2 THE DISALLOWANCE OF RS. 1,57,59,706/- OF PREMIUM ON LEASEHOLD LAND. ON THE FACTS OF THE CASE CIT(A) OUGHT TO HAVE ALLOW ED THE SAME. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED CIT(A) ERRED IN CONFIRMING DISALLOWANCE OF RS. 12,77,80,000/- MADE BY THE ASSESSING OFFICER U/S 14 A OF THE INCOME TAX ACT 1961, BY INVOKING RULE 80 WHEN THE SAID RUL E IS INAPPLICABLE TO A.Y 2006-07. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED CIT(A) ERRED IN HOLDING THAT THE ASSESSEE H AS CLAIMED THAT NO EXPENDITURE IS INCURRED WITH REGARD TO EXEMPT INCOM E WHEN THE ASSESSEE HAS IN FACT SUBMITTED THAT ONLY TREASURY D EPT. EXPENSES CAN, IF AT ALL BE ATTRIBUTED TO EARNING THE EXEMPT INCOM E AND CONSEQUENTLY ONLY RS 1,77,284 QUALIFIES FOR DISALLOWANCE U/S 14A OF THE INCOME TAX ACT, 1961. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW AND WITHOUT PREJUDICE TO ABOVE, THE LEARNED CIT(A) ERRE D IN NOT HOLDING THAT SINCE THE TAX FREE INVESTMENTS ARE MADE BY THE ASSESSEE OUT OF ITS OWN FUNDS, NO AMOUNT OF THE INTEREST OF RS 247,41,3 6,975 PAID ON BORROWINGS QUALIFIES FOR DISALLOWANCE U/S 11A OF TH E INCOME TAX ACT, 1961. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED CIT(A) ERRED IN NOT ADMITTING THE ADDITIONA L GROUNDS OF APPEAL FILED BY ASSESSEE. THE ASSESSEE SUBMITS THAT THE LEARNED CIT(A) OUGHT TO HAVE ADMITTED THE ADDITIONAL GROUNDS AND A DJUDICATED THEM ON MERITS. 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE APPELLANT SUBMITS THAT THE NET LOSS ON SALE OF OIL BONDS OF RS. 80,90,000/- IS NOT A CAPITAL LOSS AND THE SAME IS A LLOWABLE AS 'BUSINESS LOSS' IN COMPUTING THE INCOME OF THE ASSE SSEE AND ALLOWED TO CARRIED FORWARD UNDER SECTION 72 OF INCOME TAX A CT, 1961. 7. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE ASSESSEE SUBMITS THAT IN CALCULATING THE BOOK PROFI TS U/S 115JB OF THE INCOME TAX ACT 1961, NO NOTIONAL DISALLOWANCE IS PE RMISSIBLE U/S 14A OF THE INCOME TAX ACT, 1961 READ WITH RULE 80. 8. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE ASSESSEE SUBMITS THAT BASED ON RECENT JUDGMENT OF J URISDICTIONAL BOMBAY HIGH COURT IN THE CASE OF CIT VS RAYMOND LTD [BORN] (209 TAXMAN 65/21), THE AMOUNT TRANSFERRED TO DEBENTURE REDEMPTION RESERVE OF RS. 189 CRS. IS NOT A TRANSFER WITHIN TH E MEANING OF CLAUSE (B) OF EXPLANATION (1) OF SECTION 115JB AND CONSEQU ENTLY, THE SAID AMOUNT IS TO BE DEDUCTED WHILE ARRIVING AT THE 'BOO KS PROFIT' U/S 115JB OF INCOME TAX ACT, 1961. 9. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE APPELLANT SUBMITS THAT BASED ON THE DECISION OF THE HON'BLE ITAT (DELHI) IN DCIT VS COSMO FILMS LTD (ITA NO. 25081 D ELL 2007), THE BALANCE ADDITIONAL DEPRECIATION U/S 32 (IIA) IN RES PECT OF ADDITIONS TO NEW PLANT AND MACHINERY MADE IN FINANCIAL YEAR 2004 -05 I.E. BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 3 RELEVANT TO ASSESSMENT YEAR 2005-06 AND PUT TO USE FOR LESS THAN 180 DAYS IN THE SAID ASSESSMENT YEAR, AMOUNTING TO RS. 371,21,86,8341- MAY BE ALLOWED AS DEDUCTION IN ASSESSMENT YEAR 2006 -07 FURTHER IT IS SUBMITTED THAT BALANCE ADDITIONAL DEP RECIATION ON RS. 371,21,86,834/- BE ALLOWED TO CARRIED FORWARD AND S ET OFF IN SUBSEQUENT ASSESSMENT YEARS U/S 32(2) OF THE INCOME TAX ACT, 1961. 10. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE ASSESSEE SUBMITS THAT INTEREST INCOME EARNED ON OIL BONDS OUGHT TO BE TAXED AS 'PROFITS AND GAINS FROM BUSINESS AND PROFE SSION' A D NOT UNDER THE HEAD 'INCOME FROM OTHER SOURCES'. 11. THE ASSESSEE CRAVES LEAVE TO AMEND, ALTER AND D ELETE ANY OF THE ABOVE GROUNDS AND ADD ANY ADDITIONAL GROUND(S) EITH ER BEFORE OR AT THE TIME OF HEARING. 3. AT THE OUTSET OF THE HEARING THE SH J.D. MISTRY LD. SR ADVOCATE ( LD AR) APPEARING ON BEHALF OF THE ASSESSEE ARGUED THAT ALL THE GROUND OF THE APPEAL RAISED BY ASSESSEE ARE COVERED IN FAVOUR OF THE ASS ESSEE BY THE DECISION OF ASSESSEES OWN CASE FOR EARLIER ASSESSMENT YEAR. TH E LD. A.R OF THE ASSESSEE SUBMITTED A CHART SHOWING THE NARRATION GR OUND OF APPEAL AND THE DETAILS OF VARIOUS ORDERS IN ASSESSEES OWN CASE FO R EARLIER ORDERS. THE LD. D.R FOR THE REVENUE AFTER GOING THOUGH THE DETAILS FURNISHED BY THE LD. A.R OF THE ASSESSEE NOT DISPUTED THE CONTENTION OF THE LD. A.R OF THE ASSESSEE. 4. GROUND NO. 1 RELATES TO DISALLOWANCE OF AMORTIZATIO N OF PREMIUM ON LEASEHOLD LAND OF RS. 1,57,59,706. THE LD. A.R OF T HE ASSESSEE ARGUED THAT THIS GROUND OF APPEAL IS COVERED IN FAVOUR OF ASSES SEE BY THE DECISION OF TRIBUNAL IN ASSESSEE OWN CASE FOR A.Y 2004-05 AND 2 005-06. 5. WE HAVE CONSIDERED THE SUBMISSION OF THE LD. A.R OF THE ASSESSEE AND PERUSED THE ORDER OF TRIBUNAL FOR A.Y 2004-05 IN IT A NO. 5963/UM/2011. BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 4 THE COORDINATE BENCH OF THE TRIBUNAL IN IDENTICAL G ROUND OF APPEAL HAS PASSED THE FOLLOWING ORDER:- 14. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVE S FOR BOTH THE PARTIES, PERUSED THE ORDERS OF THE LOWER AUTHORITIE S AND THE MATERIAL PRODUCED BEFORE US. WE FIND THAT AS STANDS GATHERE D FROM THE RECORDS, THE REVENUE IN THE ASSESSMENT FRAMED IN TH E HANDS OF THE ASSESSEE CORPORATION FOR A.Y. 2014-15 HAD ALLOWED T HE REGISTRATION AND STAMP DUTY CHARGES OF RS.2,47,98,757/- AS A REV ENUE EXPENDITURE, AS CLAIMED BY THE ASSESSEE CORPORATION IN ITS REVIS ED RETURN OF INCOME FOR A.Y. 2014-15, BY RELYING ON THE JUDGMENT OF THE HONBLE HIGH COURT OF BOMBAY IN THE CASE OF CIT-3 VS. RELIANCE I NDUSTRIAL INFRASTRUCTURE LTD. (2015) 379 ITR 0340 (BOM). THE HONBLE HIGH COURT IN ITS AFORESAID JUDGMENT HAD HELD AS UNDER:- IN FACT DURING THE HEARING BEFORE THE TRIBUNAL, TH E ONLY ISSUE WHICH APPEARS TO HAVE BEEN IN DISPUTE WAS WHETHER THE AMO UNT OF RS.23.42 LACS PAID AS A STAMP DUTY TO TAKE LAND ON LEASE IS A CAP ITAL EXPENDITURE OR REVENUE EXPENDITURE. ON THE AFORESAID FACTS, THE TR IBUNAL BY THE IMPUGNED ORDER PLACED RELIANCE UPON THE DECISIONS OF THIS CO URT, PARTICULARLY IN CINCITA PVT. LTD. WHEREIN IT HAS BEEN OBSERVED THAT THE PERIOD OF LEASE FOR WHICH THE PROPERTY HAS BEEN TAKEN, CANNOT BE REGARD ED AS A DECISIVE TEST TO DETERMINE THE NATURE OF THE EXPENDITURE. IN ANY CAS E, IT IS NOT DISPUTED BEFORE US THAT THE STAMP DUTY AMOUNT HAS BEEN PAID ON THE LEASE DEED FOR THE PURPOSES OF CARRYING ON ASSESSEE'S BUSINESS. ONCE T HE AFORESAID POSITION IS ACCEPTED THEN THE AMOUNT OF STAMP DUTY PAID FOR HAS TO BE ALLOWED AS REVENUE NATURE. WE WOULD NOW TEST THE CLAIM OF THE ASSESSEE AS REGA RDS THE ALLOWABILITY OF AMORTIZATION OF LEASEHOLD PREMIUM A S A REVENUE EXPENDITURE, IN THE BACKDROP OF THE AFORESAID JUDGM ENT OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF RELIANCE I NDUSTRIAL INFRASTRUCTURE LTD. (SUPRA). WE FIND THAT THE ASSES SEE HAD ENTERED INTO AN AGREEMENT WITH VARIOUS PARTIES FOR THE PURCHASE OF LEASEHOLD LANDS AT VARIOUS PLACES, WHICH WERE TO BE USED FOR ITS BU SINESS OPERATIONS, VIZ. FOR ESTABLISHING RETAIL OUTLETS, LPG BOTTLING PLANTS, REFINERIES ETC. THE PREMIUM PAID BY THE ASSESSEE CORPORATION WAS ON E OF THE MODE OF GIVING COMPENSATION TO THE LANDLORDS, BESIDES NOMIN AL ANNUAL RENT PAID TO THEM. IT IS THUS THE CONTENTION OF THE ASSE SSEE THAT THE PREMIUM PAID WAS IN THE NATURE OF RENT, AND AS SUCH THE AMO RTIZATION OF PREMIUM SHOULD BE CONSIDERED AS A REVENUE EXPENDITU RE. PER CONTRA, THE LD. D.R RELIED ON THE ORDERS OF THE LOWER AUTHO RITIES, AND THEREIN AVERRED THAT AS THE SAID PAYMENT BY THE ASSESSEE CO RPORATION WAS CLEARLY BY WAY OF A CAPITAL EXPENDITURE, THEREFORE THE SAME HAD RIGHTLY BEEN HELD AS NOT ALLOWABLE AS A REVENUE EXP ENDITURE BY THE BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 5 LOWER AUTHORITIES. WE HAVE HEARD THE AUTHORIZED REP RESENTATIVES FOR BOTH THE PARTIES, PERUSED THE ORDERS OF THE LOWER A UTHORITIES AND THE MATERIAL PRODUCED BEFORE US. WE ARE OF THE CONSIDER ED VIEW THAT AFTER APPRECIATING THE FACTS OF THE CASE IN TOTO, IT CAN SAFELY BE CONCLUDED THAT THE LEASEHOLD PREMIUM AMORTIZED BY THE ASSESSE E CORPORATION WAS IN THE NATURE OF COMPENSATION PAID TO THE LANDL ORDS, IN ADDITION TO THE RENT. WE THUS ARE OF THE CONSIDERED VIEW THA T THE LEASEHOLD PREMIUM AMORTIZED BY THE ASSESSEE CORPORATION, BEIN G IN THE NATURE OF RENT, WAS THEREFORE ALLOWABLE AS A REVENUE EXPEN DITURE IN THE HANDS OF THE ASSESSEE. WE ARE OF THE CONSIDERED VIE W THAT OUR AFORESAID VIEW STANDS FORTIFIED BY AN ANALOGY THAT CAN SAFELY BE DRAWN FROM THE JUDGMENT OF THE HONBLE JURISDICTIONAL HIG H COURT IN THE CASE OF RELIANCE INDUSTRIAL INFRASTRUCTURE LTD. (SU PRA), ON THE BASIS OF WHICH THE CLAIM OF THE ASSESSEE CORPORATION TOWARDS REGISTRATION AND STAMP DUTY CHARGES OF RS.2,47,98,757/-, AS OBSERVED BY US HEREINABOVE, HAD BEEN ALLOWED AS A REVENUE EXPENDIT URE IN THE ASSESSMENT FRAMED IN THE CASE OF THE ASSESSEE CORPO RATION FOR A.Y. 2014-15. WE ARE FURTHER OF THE CONSIDERED VIEW THAT THE CLAIM OF THE ASSESSEE CORPORATION THAT THE LEASE PREMIUM PAID TO THE LANDLORDS IN ORDER TO FACILITATE PAYMENT OF NOMINAL RENT , CAN S AFELY BE CHARACTERIZED AS A REVENUE EXPENDITURE IN THE LIG HT OF THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF : COMMI SSIONER OF INCOME TAX VS. MADRAS AUTO SERVICE (P) LTD. (1998 ) 233 ITR 468 (SC), WHEREIN IT WAS HELD AS UNDER:- 5. IN ORDER TO DECIDE WHETHER THIS EXPENDITURE IS REVE NUE EXPENDITURE OR CAPITAL EXPENDITURE, ONE HAS TO LOOK AT THE EXPENDI TURE FROM A COMMERCIAL POINT OF VIEW. WHAT ADVANTAGE DID THE ASSESSEE GET BY CONSTRUCTING A BUILDING WHICH BELONGED TO SOMEBODY ELSE AND SPENDI NG MONEY FOR SUCH CONSTRUCTION? THE ASSESSEE GOT A LONG LEASE OF A NE WLY CONSTRUCTED BUILDING SUITABLE TO ITS OWN BUSINESS AT A VERY CONCESSIONAL RENT. THE EXPENDITURE, THEREFORE, WAS MADE IN ORDER TO SECURE A LONG LEASE OF NEW AND MORE SUITABLE BUSINESS PREMISES AT A LOWER RENT. IN OTHE R WORDS, THE ASSESSEE MADE SUBSTANTIAL SAVINGS IN MONTHLY RENT FOR A PERI OD OF 39 YEARS BY EXPENDING THESE AMOUNTS. THE SAVING IN EXPENDITURE WAS A SAVING IN REVENUE EXPENDITURE IN THE FORM OF RENT. WHATEVER S UBSTITUTES FOR REVENUE EXPENDITURE SHOULD NORMALLY BE CONSIDERED AS REVENU E EXPENDITURE. MOREOVER, ASSESSEE IN THE PRESENT CASE DID NOT GET ANY CAPITAL ASSET BY SPENDING THE SAID AMOUNTS. THE ASSESSEE, THEREFORE, COULD NOT HAVE CLAIMED ANY DEPRECIATION. LOOKING TO THE NATURE OF THE ADVA NTAGE WHICH THE ASSESSEE OBTAINED IN A COMMERCIAL SENSE, THE EXPENDITURE APP EARS TO BE REVENUE EXPENDITURE . WE THUS ARE PERSUADED TO SUBSCRIBE TO THE VIEW OF T HE LD. A.R THAT THE AMOUNT OF RS. 1,04,86,210/- PERTAINING TO AMORTIZAT ION OF PREMIUM ON BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 6 LEASEHOLD LAND WAS ALLOWABLE AS A REVENUE EXPENDITU RE IN THE HANDS OF THE ASSESSEE CORPORATION. THE GROUND OF APPEAL N O. 5 RAISED BY THE ASSESSEE BEFORE US IS THUS ALLOWED. 6. FURTHER FOR A.Y 2005-06 ON SIMILAR GROUND OF APPEAL IN ITA NO. 5966/MUM/2011 THE COORDINATE BENCH OF THE TRIBUNAL PASSED THE FOLLOWING ORDER :- 21. THAT THE ASSESSEE HAD ASSAILED THE UPHOLDING BY THE CIT(A) OF THE DISALLOWANCE OF RS.1,40,19,374/- ON AMORTIZATION OF PREMIUM OF LEASEHOLD LAND. THAT AT THE VERY OUTSET OF THE HEAR ING OF THE APPEAL IT WAS SUBMITTED BY THE LD. A.R. THAT THE ISSUE INVOLV ED IN THE GROUND OF APPEAL NO. 1 IN THE PRESENT APPEAL WAS IDENTICAL T O THE GROUND OF APPEAL NO. 5 RAISED BY THE ASSESSEE CORPORATION IN ITS APPEAL BEFORE US FOR A.Y. 2004-05, VIZ. BHARAT PETROLEUM CORPORAT ION LTD. VS. ADDITIONAL CIT-RANGE-2(1), MUMBAI, MARKED AS ITA 5963/MUM/2011. THE LD. D.R. HAD NOT DISPUTED THE AF ORESAID FACTUAL POSITION. WE HAVE PERUSED THE ORDERS OF THE LOWER A UTHORITIES AND THE MATERIAL PRODUCED BEFORE US. WE FIND THAT THE ISSUE INVOLVED IN THE PRESENT APPEAL IS IDENTICAL TO THAT AS WAS RAISED B EFORE US BY THE ASSESSEE CORPORATION AS GROUND OF APPEAL NO. 5 IN ITS APPEAL FOR A.Y. 2004-05. THAT IN THE BACKDROP OF OUR OBSERVATI ONS AND REASONINGS ADOPTED WHILE ADJUDICATING THE GROUND O F APPEAL NO. 5 RAISED BY THE ASSESSEE BEFORE US IN ITS AFORESAID A PPEAL FOR A.Y. 2004- 05, VIZ. BHARAT PETROLEUM CORPORATION LTD. VS. ADDI TIONAL CIT- RANGE-2(1), MUMBAI, MARKED AS ITA 5963/MUM/2011, OU R DECISION PASSED IN THE CONTEXT OF THE ISSUE UNDER CONSIDERAT ION SHALL APPLY MUTATIS MUTANDIS IN THE PRESENT APPEAL ALSO. WE THU S GOING BY OUR OBSERVATIONS AND REASONINGS ADOPTED WHILE DISPOSING OF THE GROUND OF APPEAL NO. 5 RAISED BEFORE US IN ASSESSES OWN A PPEAL FOR A.Y. 2004-05, THEREIN ALLOW THE GROUND OF APPEAL NO. 1 RAISED BY THE ASSESSEE BEFORE US IN THE PRESENT APPEAL. CONSIDERING THE ORDER OF TRIBUNAL FOR AY 2004-05 & 2005-06 AND FOLLOWING THE PRINCIPLE OF CONSISTENCY, THE GROUND NO. 1 OF APPEAL RAISED BY ASSESSEE IS ALLOWED. 7. GROUND NO. 2 TO 4, RELATES TO DISALLOWANCE U/S. 14A READ WITH RULE 8D. THE LD. A.R OF THE ASSESSEE ARGUED THAT THESE GROUNDS O F APPEAL ARE ALSO BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 7 COVERED IN FAVOUR OF ASSESSEE IN ASSESSEES OWN CAS E FOR A.Y 2002-03 AND 2003-04 AND FURTHER IN APPEAL FOR A.Y 2004-05 AND 2 005-06. ON THE OTHER HAND, LD. D.R FOR THE REVENUE NOT DISPUTED THE CONT ENTION OF LD. A.R OF THE ASSESSEE. 8. WE HAVE CONSIDERED THE RIVAL SUBMISSION OF THE PART IES AND HAVE GONE THROUGH THE ORDER OF AUTHORITIES BELOW. WE HAVE SEE N THAT ASSESSEE HAS RAISED SIMILAR GROUND OF APPEAL A.Y 2004-05 & 2005- 06 IN ITA NO. 5963, 5966/MUM/2011 PASSED THE FOLLOWING ORDER:- 22. THAT IT WAS SUBMITTED BY THE LD. A.R. THAT THE ISS UE PERTAINING TO DISALLOWANCE U/S. 14A WHICH HAD BEEN ASSAILED BY TH E ASSESSEE BY WAY OF GROUND OF APPEAL NO. 2 & 3 IN THE PRESENT APPEAL, IS IDENTICAL TO THAT INVOLVED IN GROUND OF APPEAL 2 & 3 RAISED IN THE ASSESSES APPEAL FOR A.Y. 2004-05 BEFORE US, VIZ. BHARAT PETROLEUM CORPORATION LTD. VS. ADDITIONAL CIT-RANGE-2(1), MUM BAI, MARKED AS ITA 5963/MUM/2011. THE LD. D.R. HAD NOT DISPUTE D THE AFORESAID FACTUAL POSITION. WE HAVE HEARD THE AUTHORIZED REPR ESENTATIVES OF BOTH THE PARTIES, PERUSED THE ORDERS OF THE LOWER A UTHORITIES AND THE MATERIAL PRODUCED BEFORE US. WE FIND THAT THE ISSUE INVOLVED IN THE PRESENT APPEAL IS IDENTICAL TO THAT INVOLVED IN THE APPEAL BEFORE US IN THE ASSESSES OWN CASE FOR A.Y. 2004-05. THAT IN THE BACKDROP OF OUR OBSERVATIONS AND REASONING ADOPTED WHILE ADJUDICATI NG THE GROUND OF APPEAL NO. 2 & 3 RAISED BY THE ASSESSEE BEFORE US IN ITS AFORESAID APPEAL FOR A.Y. 2004-05, MARKED AS ITA NO. 5963/MUM /2011, OUR DECISION PASSED IN THE CONTEXT OF THE ISSUE UNDER C ONSIDERATION SHALL APPLY MUTATIS MUTANDIS IN THE PRESENT APPEAL ALSO. WE THUS GOING BY OUR OBSERVATIONS AND REASONINGS ADOPTED WHILE DISPO SING OF THE GROUNDS OF APPEAL NO.2 & 3 RAISED BEFORE US IN TH E ASSESSES OWN APPEAL FOR A.Y. 2004-05, VIZ. BHARAT PETROLEUM CORPORATION LTD VS. BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 8 ADDITIONAL CIT-RANGE-2(1), MUMBAI, MARKED AS (ITA NO. 5963/MUM/2011) , THEREIN ALLOW THE GROUNDS OF APPEAL NO. 2 AND 3 RAISED BY THE ASSESSEE BEFORE US IN THE PRESENT APP EAL. 9. CONSIDERING THE DECISION OF CO-ORDINATE BENCH IN AS SESSEES OWN CASE AND FOLLOWING THE PRINCIPLE OF CONSISTENCY, GROUND NO. 2 TO 4 OF APPEAL ARE ALLOWED IN FAVOUR OF ASSESSEE WITH SIMILAR DIRECTIO N AS CONTAINED IN THE ORDER FOR AY 2004-05 . 10. GROUND NO. 5 RELATES TO NOT ADMITTING THE GROUND OF APPEAL RAISED BEFORE LD CIT(A). GROUND NO.6 IS THE CLAIM WITH REGARD TO LOS S ON OIL BOND AS A BUSINESS LOSS, WHICH WAS RAISED AS ADDITIONAL GROUN D NO.1 OF BEFORE LD. CIT(A). THE LD CIT(A) NOT ADMITTED THE ADDITIONAL G ROUND OF APPEAL HOLDING THAT THE ASSESSEE HAS NOT REVISED THE RETUR N NOR SUCH CLAIM WAS MADE BEFORE THE AO DURING THE ASSESSMENT PROCEEDING . IT WAS ARGUED THAT SIMILAR LOSS ON OIL BONDS WAS ALLOWED AS BUSINESS L OSS BY THE TRIBUNAL IN ASSESSEES OWN APPEAL FOR AY 2004-05 & 2005-06. 11. CONSIDERING THE CONTENTION OF LD. AR OF THE ASSESSE E AND THE DECISION OF CO-ORDINATE BENCH IN ASSESSEES OWN CASE IN ITA NO. 5963 & 5966/M/2004-05 & 2005-06. WE ADMIT THIS GROUND OF A PPEAL AND RESTORED THE MATTER TO THE FILE OF CIT(A) TO VERIFY THE FACT AND ALLOW THE CLAIM IN ACCORDANCE WITH LAW AND CONSIDERING THE DECISION OF TRIBUNAL IN ASSESSEES OWN CASE FOR AY 2004-05 & 2005-06. IN THE RESULT, T HE GROUND NO. 5 & 6 ARE ALLOWED FOR STATISTICAL PURPOSE. BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 9 12. GROUND NO. 7 RELATES TO CALCULATING THE BOOK PROFIT UNDER SECTION 115JB AND DISALLOWANCE UNDER SECTION 14A. THE LD. AR OF THE A SSESSEE ARGUED THAT THIS GROUND OF APPEAL IS ALSO COVERED IN FAVOUR OF ASSES SEE BY THE DECISION OF TRIBUNAL IN CASE OF RELIANCE INDUSTRIAL INFRASTRUCT URE LTD. VS ACIT IN ITA NO. 69 & 70/M/2009 DATED 05.04.2013. THE LD. DR FOR THE REVENUE NOT DISPUTED THE CONTENTION OF LD. AR OF THE ASSESSEE. 13. WE HAVE CONSIDERED THE CONTENTION OF BOTH THE PARTI ES AND NOTICED THAT RECENTLY THE SPECIAL BENCH OF DELHI TRIBUNAL IN ACI T VS. VIREET INVESTMENT PVT. LTD.[2017] 82TAXMAN.COM 415(DELHI-T RIB)(SB) HELD THAT COMPUTATION UNDER CLAUSE-(F) OF EXPLANATION-1 TO SE CTION 115JB(2) OF THE ACT IS TO BE MADE WITHOUT RESORTING TO COMPUTATION AS CONTEMPLATED U/S 14A R.W. RULE 8D OF THE ACT. WE MAY NOTE THAT LOWER AUTHORITY WAS NOT HAVING THE BENEFIT OF DECISION OF SPECIAL BENCH WHI LE PASSING THE ORDER IMPUGNED IN THE PRESENT APPEAL. CONSIDERING THE FAC T THAT THE LOWER AUTHORITIES WERE NOT HAVING BENEFIT OF DECISION OF SPECIAL BENCH IN ACIT VS. VIREET INVESTMENT PVT. LTD.(SUPRA). IN VIEW OF THE SUBMISSIONS OF BOTH THE PARTIES AND THE NATURE OF DISALLOWANCE, THE MAT TER IS RESTORED TO THE FILE OF AO TO PASS THE ORDER IN ACCORDANCE WITH LAW AFTE R CONSIDERING THE DECISION OF ACIT VS. VIREET INVESTMENT PVT. LTD. (S UPRA). IN THE RESULT, THIS GROUND OF APPEAL IS ALLOWED FOR STATISTICAL PURPOSE . 14. GROUND NO. 8 & 9 WAS NOT PRESSED BY LD. AR OF THE A SSESSEE, HENCE, BOTH THE GROUNDS ARE DISMISSED AS NOT PRESSED. BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 10 15. GROUND NO.10 RELATES TO INCOME FROM OIL BONDS TO BE TAXED AS BUSINESS INCOME. THE LD. AR OF THE ASSESSEE ARGUED THAT THIS GROUND OF APPEAL IS ALSO COVERED IN FAVOUR OF ASSESSEE BY THE DECISION OF TR IBUNAL IN ASSESSEES OWN CASE FOR AY 2004-05 & 2005-06 AND BY THE DECISION O F HONBLE BOMBAY HIGH COURT IN CASE OF MANGALORE REFINERY & PETROCHE MICAL LTD. (SUPRA). THE LD. DR FOR THE REVENUE NOT DISPUTED THE CONTENT ION OF LD. AR OF THE ASSESSEE. 16. WE HAVE CONSIDERED THE SUBMISSION OF BOTH THE PARTI ES AND NOTICED THAT SIMILAR GROUND OF APPEAL WAS RAISED BY ASSESSEE BEF ORE THE TRIBUNAL FOR AY 2004-05 & 2005-06 IN ITA NO. 5963 & 5966/M/2011. TH E TRIBUNAL PASSED THE FOLLOWING ORDER: 24. THAT THE LD. A.R HAD ASSAILED BEFORE US THE AS SESSING OF THE INTEREST INCOME ON OIL BONDS, WHICH THOUGH WAS SHOW N BY THE ASSESSEE UNDER THE HEAD PROFITS AND GAINS OF BUSINESS, BUT HAD BEEN ASSESSED BY THE A.O. UNDER THE HEAD INCOME FROM OTHER SOURCES . THAT IT WAS SUBMITTED BY THE LD. A.R THAT A SIMILAR CHANGE OF H EAD OF INCOME HAD ALSO BEEN CARRIED OUT BY THE A.O IN THE CASE OF THE ASSE SSEE FOR THE A.Y. 2004- 05. IT WAS FURTHER AVERRED BY THE LD. A.R THAT THE SAID CHANGE OF HEAD OF INCOME HAD ALSO BEEN ASSAILED BEFORE US IN THE APPE AL OF THE ASSESSEE FOR A.Y. 2004-05, VIZ. BHARAT PETROLEUM CORPORATION LTD. VS. ADDITIONAL CIT-RANGE-2(1), MUMBAI , MARKED AS ITA 5963/MUM/2011. WE FIND THAT THE IDENTICAL ISSUE RAISED BY THE ASSESSEE IN THE P RESENT APPEAL BEFORE US WAS ALSO RAISED IN ITS AFORESAID APPEAL FOR A.Y. 20 04-05, MARKED AS ITA 5963/MUM/2011, WHEREIN IN THE BACKDROP OF THE ORDER OF THE ITAT PASSED IN THE CASE OF MANGALORE REFINERIES AND PETRO CHEMICALS LTD.(SUPRA ) VS. DCIT (ITA NO. 776/MUM/2004), WHICH THEREAFTER HAD BEEN AFFIRMED BY THE HONBLE HIGH COURT OF BOMBAY IN THE CASE OF MANGLORE REFINERIES AND PETRO CHEMICALS LTD.(SUPRA) , WE HAD RESTORED THE MATTER TO THE FILE OF THE CIT(A) FOR RE-ADJUDICATION. WE T HUS IN THE BACKDROP OF OUR AFORESAID OBSERVATIONS AND ON THE SAME REASONIN G, THEREFORE IN ALL FAIRNESS RESTORE THE MATTER TO THE FILE OF THE CIT( A), WITH A DIRECTION TO READJUDICATE THE SAME IN THE BACKDROP OF THE AFORES AID JUDGMENT OF THE HONBLE HIGH COURT OF BOMBAY IN THE CASE OF MANGALORE REFINERIES AND PETRO CHEMICALS LTD.(SUPRA). NEEDLESS TO SAY, THE CIT(A) DURING THE BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 11 COURSE OF READJUDICATING THE AFORESAID ISSUE SHALL AFFORD REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE ADD ITIONAL GROUND OF APPEAL RAISED BY THE ASSESSEE US IS THUS ALLOWED IN TERMS OF OUR AFORESAID OBSERVATIONS. 17. CONSIDERING THE DECISION OF CO-ORDINATE BENCH IN AS SESSEES OWN CASE WHEREIN THE SIMILAR GROUND OF APPEAL WAS RESTORED T O THE FILE OF CIT(A), HENCE, KEEPING IN VIEW, THE PRINCIPLE OF CONSISTENC Y, THIS GROUND OF APPEAL IS ALSO RESTORED TO THE FILE OF LD. CIT(A) TO DECID E IT AFRESH, WITH SIMILAR DIRECTIONS. IN THE RESULT, THIS GROUND OF APPEAL IS ALLOWED FOR STATISTICAL PURPOSE. 18. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. 19. IN APPEAL FOR A.Y 2007-08 IN ITA NO. 4279/MUM/2013 THE ASSESSEE HAS RAISED FOLLOWING GROUND OF APPEAL. 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED COMMISSIONER OF INCOME TAX [CIT(A)] ERRED I N CONFIRMING THE DISALLOWANCE OF RS. 1,71,56,704/- OF PREMIUM ON LEASEHOLD LAND. ON THE FACTS OF THE CASE CIT(A) OUGHT TO HAVE ALLOW ED THE SAME. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF RS 16,13,13,124/- MADE BY THE ASSESSING OFFICER U/S 14 A OF THE INCOME TAX ACT 1961, BY INVOKING RULE 80 WHEN THE SAID RUL E IS INAPPLICABLE TO A.Y. 2007-08. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED CIT(A) ERRED IN HOLDING THAT THE ASSESSEE H AS CLAIMED THAT NO EXPENDITURE IS INCURRED WITH REGARD TO EXEMPT INCOM E WHEN THE ASSESSEE HAS IN FACT SUBMITTED THAT ONLY TREASURY E XPENSES CAN, IF AT ALL BE ATTRIBUTED TO EARNING THE EXEMPT INCOME AND CONSEQUENTLY ONLY RS 1,52,577/- QUALIFIES FOR DISALLOWANCE U/S 14A OF THE INCOME TAX ACT, 1961. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW AND WITHOUT PREJUDICE TO ABOVE, THE LEARNED CIT(A) ERRE D IN NOT HOLDING THAT SINCE THE TAX FREE INVESTMENTS ARE MADE BY THE ASSESSEE OUT OF ITS BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 12 OWN FUNDS, NO AMOUNT OF THE INTEREST OF RS 477,35,2 6,537/- PAID ON BORROWINGS QUALIFIES FOR DISALLOWANCE U/S 14A OF TH E INCOME TAX ACT, 1961 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE CIT(A) ERRED IN HOLDING THAT THE OIL BONDS ARE CAPI TAL ASSETS AND IN CONFIRMING THAT THE LOSS OF RS. 42,21,00,000/- INCU RRED ON SALE OF OIL BONDS IS A CAPITAL LOSS AND NOT BUSINESS LOSS. 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, ASSESSEE SUBMITS THAT OIL BONDS ISSUED BEING IN LIE U OF UNDER RECOVERY ON SALE OF SENSITIVE PETROLEUM PRODUCTS ARE NOT CAP ITAL ASSETS & CONSEQUENTLY LEARNED CIT (A) ERRED IN CONFIRMING AS SESSING OFFICER'S ACTION OF TREATING LOSS ON SALE OF OIL BONDS AS CAP ITAL LOSS AND NOT AS BUSINESS LOSS. 7. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE CIT(A) ERRED IN CONFIRMING DISALLOWANCE OF PRIOR PE RIOD EXPENDITURE MADE BY ASSESSING OFFICER AMOUNTING TO RS. 4,32,53, 288/- 8. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE ASSESSEE SUBMITS THAT INTEREST INCOME EARNED ON OIL BONDS OUGHT TO BE TAXED AS 'PROFITS AND GAINS FROM BUSINESS AND PR OFESSION' INSTEAD OF 'INCOME FROM OTHER SOURCES'. 9. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW THE ASSESSEE SUBMITS THAT THE CONTRIBUTION OF RS. 1,55,00,000/- TO THE RAJIV GANDHI INSTITUTE OF PETROLEUM TECHNOLOGY MADE BY THE CORPO RATION IS ALLOWABLE AS DEDUCTION UNDER SECTION 37 OF THE INCO ME TAX ACT, 1961 AND THE LEARNED CIT(A) ERRED IN NOT ALLOWING THE SA ME IN ENTIRETY. 10. THE APPELLANT CRAVES LEAVE TO AMEND, ALTER AND DELETE ANY OF THE ABOVE GROUNDS AND ADD ANY ADDITIONAL GROUND(S) EITH ER BEFORE OR AT THE TIME OF HEARING. 20. GROUND NO.1 RELATES TO DISALLOWANCE OF AMORTIZATION OF PREMIUM ON LEASE HOLD LAND. WE HAVE SEEN THAT THIS GROUND OF APPEAL IS IDENTICAL TO THE GROUNDS OF APPEAL FOR AY 2006-07 WHICH WE HAVE ALLO WED ON THE BASIS OF DECISION OF TRIBUNAL FOR AY 2004-05 & 2005-06. THUS , FOLLOWING THE PRINCIPLE OF CONSISTENCY, THIS GROUND OF APPEAL IS ALLOWED IN FAVOUR OF ASSESSEE. BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 13 21. GROUND NO.2 TO 4 RELATES TO DISALLOWANCE UNDER SECT ION 14A R.W.R 8D OF THE ACT. WE HAVE SEEN THAT THESE GROUNDS OF APPEAL ARE IDENTICAL TO THE GROUND NO.2 TO 4 OF APPEAL FOR AY 2006-07 WHICH WE HAVE AL LOWED IN FAVOUR OF ASSESSEE ON THE BASIS OF DECISION OF TRIBUNAL IN AS SESSEES OWN CASE FOR EARLIER YEARS. THUS, THESE GROUNDS OF APPEAL ARE AL LOWED MUTATIS MUTANDIS. 22. GROUND NO. 5 RELATES TO LOSS ON SALE OF OIL BONDS. THIS GROUND OF APPEAL IS IDENTICAL TO THE GROUND NO. 6 OF APPEAL FOR AY 2006 -07, WHICH WE HAVE RESTORED TO THE FILE OF LD. CIT(A) FOR VERIFICATION OF FACT AND TO ALLOW THE RELIEF TO THE ASSESSEE ON THE BASIS OF DECISION FOR AY 2004-05 & 2005-06. CONSIDERING THE DECISION OF TRIBUNAL IN ASSESSEES OWN CASE FOR AY 2004- 05 & 2005-06 VIDE ORDER DATED 14.06.2007 WHEREIN TH E SIMILAR GROUND OF APPEAL WAS RESTORED TO THE FILE OF LD. CIT(A) TO DE CIDE AFRESH. HENCE, THIS GROUND OF APPEAL IS ALSO RESTORED TO THE FILE OF LD . CIT(A) WITH SIMILAR DIRECTION. 23. GROUND NO.6 RELATES TO LOSS ON SALE OF OIL BONDS IS BUSINESS LOSS. THE LD. AR OF THE ASSESSEE ARGUED THAT THIS GROUND OF APPEA L IS ALSO COVERED IN FAVOUR OF ASSESSEE BY THE DECISION OF HONBLE BOMBA Y HIGH COURT IN CASE OF MANGALORE REFINERY AND PETROCHEMICAL LTD. (SUPRA ) AND DECISION OF TRIBUNAL IN CASE OF MANGALORE REFINERY AND PETROCHE MICAL LTD. VS. DCIT IN ITA NO. 77/M/2003. LD. DR FOR THE REVENUE NOT DI SPUTED THE CONTENTION OF ASSESSEE. BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 14 24. WE HAVE SEEN THAT THE SIMILAR GROUNDS OF APPEAL WAS RAISED BY ASSESSEE FOR AY 2006-07 WHICH WE HAVE ALREADY RESTORED TO THE FI LE OF LD. CIT(A) ON THE BASIS OF DECISION OF TRIBUNAL IN ASSESSEES OWN CAS E FOR AY 2004-05. THUS, CONSIDERING THE PRINCIPLE OF CONSISTENCY, THIS GROU ND OF APPEAL IS ALSO RESTORED TO THE FILE OF LD. CIT(A) WITH SIMILAR DIR ECTION. 25. GROUND NO.7 RELATES TO PRIOR PERIOD EXPENDITURE. TH E LD. AR OF THE ASSESSEE ARGUED THAT THIS GROUND OF APPEAL IS ALSO COVERED I N FAVOUR OF ASSESSEE BY THE DECISION OF TRIBUNAL IN ASSESSEES OWN CASE FOR AY 2002-03 IN ITA NO. 2557/M/2011. THE LD. DR FOR THE REVENUE NOT DISPUTE D THE CONTENTION OF LD. AR OF THE ASSESSEE. WE HAVE CONSIDERED THE SUBM ISSION OF BOTH THE PARTIES AND FIND THAT THE CO-ORDINATE BENCH OF TRIB UNAL IN ASSESSEES OWN CASE FOR AY 2002-03 HAVE PASSED THE FOLLOWING ORDER : GROUND NO. 4. 10. THIS GROUND IS AGAINST THE DISALLOWANCE OF RS.5 ,33,97,234/- HELD TO BE PRIOR PERIOD EXPENSES. SIMILAR ISSUE WAS DECIDED BY COORDINATE BENCH IN ITA NO.1013/MUM/2001 AND THE OPERATIVE PARA IS REPR ODUCED BELOW:- 2. GROUND NO.1 OF THE APPEAL IS REGARDING DISALLOW ANCE OF PRIOR PERIOD EXPENSES AMOUNTING TO RS.34,51,324/-. 3. LEARNED DEPARTMENTAL REPRESENTATIVE OF THE REVEN UE SUPPORTED THE ORDERS OF AUTHORITIES BELOW. 4. IT IS SUBMITTED BY LD. AR OF THE ASSESSEE THAT THE AMOUNT OF PRIOR PERIOD EXPENSES OF RS.34.51 LAKHS ARISES ON ACCOUNT OF VAR IOUS EXPENSES FOR THE REASON THAT THERE WAS SOME MISTAKE IN MAKING PROVIS IONS IN THE RELEVANT YEAR AND IT CONSTITUTES ONLY 0.03% OF THE TURNOVER OF THE ASSESSEE, WHICH IS RS.1045.22 CRORES. IT IS SUBMITTED THAT UNDER THES E FACTS, THIS ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY THE TRIBUNAL J UDGMENT RENDERED IN THE CASE OF ESCORTS LIMITED VS. IAC REPORTED IN 79 ITD 291 (DEL). OUR ATTENTION WAS DRAWN TO PARA NO.118 TO 121 OF THIS T RIBUNAL JUDGMENT AS PER WHICH UNDER SIMILAR SITUATION THIS ISSUE WAS DE CIDED BY THE TRIBUNAL IN FAVOUR OF THE ASSESSEE. RELEVANT PARA NO. 121 IS REPRODUCED BELOW:- BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 15 '121. IN THE PECULIAR FACTS AND CIRCUMSTANCES OF T HE CASE WHERE THE TURNOVER OR .HE ASSESSEE IS SUBSTANTIAL, SOME BONAF IDE ADJUSTMENTS IN THE BOOKS OF ACCOUNTS WHERE THE ACCOUNTS FOR THE RELEVA NT YEAR MAY HAVE BEEN CLOSED OR THE ASSESSEE'S AVENUES FOR CLAIMING THESE DEDUCTIONS IN THE RELEVANT YEAR HAVE BEEN EXHAUSTED. THE ASSESSEE WOU LD BE ENTITLED TO CLAIM SUCH DEDUCTIONS..THEREFORE WE ARE UNABLE TO C OME TO ANY OTHER CONCLUSION AND ARE OR THE OPINION THAT NO INTERFERE NCE IN THE IMPUGNED ORDER IS CALLED FOR. ACCORDINGLY THE GROUND RAISED BY THE REVENUE IS REJECTED.' . 5. IN THE PRESENT CASE ALSO, WE FIND THAT THE TURNO VER OF THE ASSESSEE IS SUBSTANTIAL I.E. RS. 1045.22 CRATES AND THE AMOUNT OF PRIOR PERIOD EXPENSES DISALLOWED BY THE: ASSESSING OFFICER IS ON LY RS: .34.51 LAKHS, SINCE, FACTS AND CIRCUMSTANCES OF THE PRESENT' CASE ARE SIMILAR WITH THE FACTS IN THE CASE (X ESCORTS LIMITED (SUPRA), WE DE CIDE THIS ISSUE IN FAVOUR OF THE ASSESSEE' BY RESPECTFULLY FOLLOWING THIS TRI BUNAL JUDGEMENT. THIS GROUND OF THE ASSESSEE IS ALLOWED. 11. AS IDENTICAL FACTS AND CIRCUMSTANCES HAVE BEE N BROUGHT BEFORE US IN THE PRESENT CASE HENCE WE DECIDE THIS ISSUE IN FAVO UR OF ASSESSEE BY RESPECTFULLY FOLLOWING THE ORDER OF COORDINATE BENC H IN THE CASE OF RASHTRIYA CHEMICALS AND FERTILIZERS LTD. VS. JCIT , ITA NO. 1013 /MUM/2001. THEREFORE, THIS GROUND IS ALLOWED. 26. CONSIDERING THE DECISION OF TRIBUNAL IN ASSESSEES OWN CASE FOR AY 2002- 03 AND RESPECTFULLY FOLLOWING THE DECISION OF CO-OR DINATE BENCH, THIS GROUND OF APPEAL IS ALLOWED IN FAVOUR OF ASSESSEE. 27. GROUND NO.8 RELATES TO INTEREST INCOME FROM OIL BON DS TO BE TAXED AS BUSINESS INCOME. WE HAVE SEEN THAT THIS GROUND OF A PPEAL IS IDENTICAL TO THE GROUND NO.10 OF APPEAL FOR AY 2006-07 WHICH WE HAVE RESTORED TO THE FILE OF LD. CIT(A) TO DECIDE AFRESH IN ACCORDANCE W ITH THE DIRECTION CONTAINED HEREINABOVE. THUS, RESPECTFULLY FOLLOWING THE DECISION OF CO- ORDINATE BENCH, THIS GROUND OF APPEAL IS ALSO RESTO RED TO THE FILE OF CIT(A) BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 16 TO DECIDED AFRESH A PER THE DIRECTION IN APPEAL F OR AY 2006-07. IN THE RESULT THIS GROUND OF APPEAL IS ALLOWED FOR STATIST ICAL PURPOSE. 28. GROUND NO.9 RELATES TO CONTRIBUTION TO RAJIV GANDHI INSTITUTE OF PETROLEUM TECHNOLOGY. THE LD. AR OF THE ASSESSEE ARGUED THAT THE ASSESSEE CONTRIBUTED A SUM OF RS.1,55,00,000/- TO RAJIV GAND HI INSTITUTE OF PETROLEUM TECHNOLOGY. THE CONTRIBUTION WAS MADE FOR PROMOTION OF EFFICIENT HUMAN RESOURCES AND TO MEET THE GROWING R EQUIREMENT OF PETROLEUM AND ENERGY SECTOR. THE CONTRIBUTION IS AL LOWABLE DEDUCTION UNDER SECTION 37 OF THE ACT. ON THE OTHER HAND, THE LD. DR FOR THE REVENUE SUPPORTED THE ORDER OF AUTHORITY BELOW. 29. WE HAVE CONSIDERED THE RIVAL SUBMISSION OF THE PART IES AND PERUSED THE RECORD OF THE CASE. RAJIV GANDHI INSTITUTE OF PETRO LEUM TECHNOLOGY WAS SET UP BY THE GOVERNMENT OF INDIA BY ENACTING LAW WITH THE OBJECT TO PROMOTE RESEARCH AND DEVELOPMENT FOR BENEFIT OF OIL, GAS AN D PETROCHEMICAL INDUSTRY THROUGH INTEGRATION OF TEACHING AND RESEAR CH. THE CHAIRMAN AND MANAGING DIRECTOR OF ASSESSEE-COMPANY IS ONE OF THE EX-OFFICIO, MEMBER OF GENERAL COUNCIL OF INSTITUTE. THE ASSESSEE HAS C LAIMED THE CONTRIBUTION OF RS. 1,55,00,000/-. THE RAJIV GANDHI INSTITUTE OF PE TROLEUM TECHNOLOGY IS PROMOTED BY EMINENT PETROLEUM COMPANIES INCLUDING A SSESSEE ON THE DIRECTIVE OF THE MINISTRY OF PETROLEUM AND NATURAL GAS FOR IMPARTING EDUCATION IN THE FIELD OF PETROLEUM TECHNOLOGY. THE ASSESSEE MADE THE CONTRIBUTION OF RS. 1,57,00000/- TO RAJIV GANDHI IN STITUTE OF PETROLEUM BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 17 TECHNOLOGY DURING THE RELEVANT FINANCIAL YEAR. THE ASSESSEE CLAIMED DEDUCTION UNDER SECTION 37 ON THE GROUND THAT EDUCA TION PROVIDED BY THE SAID INSTITUTE IS GOING TO BE HELPFUL IN OVER ALL D EVELOPMENT OF THE ASSESSEE- COMPANY. THE AO DISALLOWED THE CLAIM HOLDING THAT A SSESSEE HAS NOT FILED ANY EVIDENCE FOR THE SAID PAYMENT. BEFORE LD. CIT(A ) ASSESSEE PLACED COPY OF RECEIPT NO.10 DATED 22.03.2017 FOR RS. 1,55,00,0 00/-. THE ASSESSEE IN ALTERNATIVE CLAIMED DEDUCTION UNDER SECTION 80G. TH E LD. CIT(A) DISALLOWED THE DEDUCTION HOLDING THAT SUCH DEDUCTIO N/DONATION TO INSTITUTE CAN ONLY BE ALLOWED WHEN CONTRIBUTION ARE APPROVED BY THE GOVERNMENT FOR DEDUCTION UNDER ANY SPECIFIC SECTION OF I.T. AC T. DEDUCTION UNDER SECTION 80G CAN BE ALLOWED ON FULFILLING THE REQUIR ED CONDITION. THE LD. CIT(A) DIRECTED THE AO TO ENTERTAIN THE CLAIM OF AS SESSEE UNDER SECTION 80G AND ALLOWED, IF THE CONDITIONS OF SECTION 80G A RE FULFILLED. WE HAVE SEEN THAT THE ASSESSEE HAS MADE THE CONTRIBUTION RE LATED TO RESEARCH. RAJIV GANDHI INSTITUTE OF PETROLEUM TECHNOLOGY IS ENGAGED IN RESEARCH RELATED TO THE BUSINESS OF ASSESSEE-COMPANY. THE CONTRIBUTION WAS MADE BY ASSESSEE AS PER THE DIRECTIVE OF MINISTRY OF PETROLEUM AND N ATURAL GAS. RAJIV GANDHI INSTITUTE OF PETROLEUM TECHNOLOGY IS AN ORGA NIZATION SET UP BY GOVERNMENT OF INDIA FOR PROMOTING QUALITY AND EXCEL LENCE IN EDUCATION AND RESEARCH IN THE AREA OF PETROLEUM AND HYDROCARBON. THE INSTITUTE IS PROVIDING EDUCATION RELATING TO THE RESEARCH LEADIN G TO AWARD OF BACHELORS, MASTER AND DOCTORAL DEGREE AND ENGINEERING TECHNOLO GY, MANAGEMENT, BHARAT PETROLEUM CORPORATION LTD ITA NO.3636/MUM./2013 & 4279/MUM/2014 18 SCIENCE AND ARTS IN THE AREA OF PETROLEUM AND HYDRO CARBON BESIDES OTHER INNOVATIVE RESEARCH AND DEVELOPMENT FOR THE BENEFIT OF OIL, GAS AND PETROCHEMICAL INDUSTRY. THE RECEIPT OF CONTRIBUTION PLACED BY ASSESSEE CONTAINS THE REFERENCE OF CERTIFICATE OF EXEMPTION UNDER SECTION 80G, GRANTED TO RAJIV GANDHI INSTITUTE OF PETROLEUM TECH NOLOGY VIDE LETTER NO. 58-59/130/19/2006-07/IT/A-A-1/LUCK/126/121. THE ASS ESSEE HAS ALREADY DECLARED INCOME OF RS. 2650,94,29,571/- FOR THE AY UNDER CONSIDERATION, THE ASSESSEE HAS CONTRIBUTED RS.1.55 CRORE ONLY TO THE SAID INSTITUTE. WE THEREFORE DIRECT THE AO TO ALLOWED THE DEDUCTION OF THE SAID CONTRIBUTION UNDER SECTION 80G IN ACCORDANCE WITH LAW. IN THE RE SULT, GROUND OF APPEAL RAISED BY ASSESSEE IS ALLOWED FOR STATISTICAL PURPO SE. 30. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALL OWED. ORDER PRONOUNCED IN THE OPEN C OURT ON 24.10.2017 SD/- SD/- P.K. BANSAL PAWAN SI NGH VICE-PRESIDENT JUDICIAL MEMBER MUMBAI, DATED: 24.10.2017 COPY OF THE ORDER FORWARDED TO : 1. THE ASSESSEE; 2. THE REVENUE; 3. THE CIT(A); 4. THE CIT, MUMBAI CITY CONCERNED; 5. THE DR, ITAT, MUMBAI; 6. GUARD FILE. BY ORDER SK PRIVATE SECRETARY (DY./ASSTT.REGISTRAR) ITAT, MUMBAI