ITO-6(1), Kanpur V. M/s. Dolphin Developers Ltd., Kanpur

ITA 364/LKW/2011

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 8166 (ITAT-LUCKNOW)
• Duration Of Justice: 1 year(s) 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-08-2012
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 03-07-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 22-06-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Earning of tax free income
• Section: 14A; 115JB; 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A , LUCKNOW BEFORE SHRI S UNIL KUMAR YADAV , JUDICIAL MEMBER AND SHRI MEHAR SI NGH , ACCOUNTANT MEMBER ITA NO. 364/LKW/2011 ASSESSMENT YEAR: 2007 - 08 INCOME TAX OFFICER 6(1) KANPUR V. M/S DOLPHIN DEVEL OPERS LTD. 13/386 - D, PRABHU RACHNA CIVIL LINES, KANPUR PAN: AABCD8079J (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI. PRAVEEN KUMAR, CIT (DR) RESPONDENT BY: SHRI. RAKESH GARG, ADVOCATE DATE OF HEARING: 03.07.2012 DATE OF PRONOUNCEMENT: 22. 0 8.2012 O R D E R PER S UNIL KUMAR YADAV : THIS APPEAL IS PREFERRED BY THE REVENUE AGAINST THE ORDER OF THE LD. CIT(A) ON VARIOUS GROUNDS, WHICH ARE AS UNDER: - 1 . THAT THE CIT (A) - II, KANPUR HAS ERRED IN LAW AND ON FACTS IN NOT APPRECIATING THE FACT THAT THE ASSESSEE HAS SHOWN ADVANCES ON FLAT BOOKINGS AS INCOME IN PROFIT & LOSS A/C WITH AN INTENTION TO INFLATE THE REVENUE AND THEREBY CLAIM HIGHER DEDUCTION U/S 80 - IB AND THE CONDITIONS FOR CLAIM OF DEDUCTION U/S 80 - IB ARE NOT FULFILLED. : - 2 - : 2 . THAT THE CIT (A) - II, KANPUR HAS ERR ED IN LAW AND ON FACTS IN NOT APPRECIATING THE FACT THAT NO CONSTRUCTION ACTIVITY WAS UNDERTAKEN EVEN AFTER THE RELEVANT PREVIOUS YEAR, YET THE ASSESSEE HAD CLAIMED DEDUCTION U/S 80 - IB ON THE INFLATED PROFITS. 3 . THAT THE CIT (A) - II, KANPUR HAS ERRED IN LAW A ND ON FACTS IN NOT APPRECIATING THE FACT THAT THE ASSESSEE HERE HAS INDULGED IN CAMOUFLAGING BY INFLATING THE REVENUE AND THEREBY CLAIMING HIGHER DEDUCTION 80 - IB IN IGNORING THE FACT THAT THE ASSESSEE CANNOT INFLATE THE PROFIT WITH AN EYE FOR THE CLAIM OF HIGHER DEDUCTION AS HELD BY THE APEX COURT IN THE CASE OF SANJEEV WOOLEN V/S CIT - 279 ITR 434 (SC). 4 . THAT THE CIT (A) - II, KANPUR HAS ERRED IN LAW AND ON FACTS IN NOT APPRECIATING THE FACT THAT THE PROVISIONS OF INSTRUCTIONS NO.4 OF 2009 DATED 30.06.2009 AR E NOT APPLICABLE IN THIS CASE AS THE CONDITIONS OTHER THAN THE COMPLETION OF PROJECTS ARE ALSO NOT FULFILLED AND THE BOOKS OF ACCOUNT ARE NOT RELIABLE. 5 . THAT THE CIT (A) - II, KANPUR HAS ERRED IN LAW AND ON FACTS TO RESTRICT THE ADMINISTRATIVE EXPENSES TO THE EXTENT OF RS. 50,000/ - WHICH WAS MADE U/S 14A READ WITH RULE 8D. 6 . THAT THE APPELLANT CRAVES LEAVE TO AMEND ANYONE OR MORE OF THE GROUNDS OF APPEAL A STATED ABOVE. 7 . THAT THE ORDER OF THE LD. CIT (A) II, KANPUR BEING ERRONEOUS IN LAW AND ON THE FACTS DESERVES TO BE VACATED AND THE ORDER OF THE A'O BE RESTORED. : - 3 - : 2 . GROUNDS NO.1 TO 4 RELATE TO THE CLAIM OF DEDUCTION UNDER SECTION 80IB OF THE INCOME - TAX ACT, 1961 (HEREINAFTER CALLED IN SHORT THE ACT') RAISED BY THE ASSESSEE. IN THIS REGARD, IT IS NOTICED FROM THE O RDERS OF THE LOWER AUTHORITIES THAT THE ASSESSING OFFICER HAS DISALLOWED THE CLAIM OF DEDUCTION UNDER SECTION 80IB OF THE ACT IN RESPECT OF ANAND GOOBA GARDEN PROJECT FOR THE REASON THAT THERE HAD BEEN NO CONSTRUCTION ACTIVITIES FOR THIS PROJECT. 3 . THE ASSES SEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A) ON VARIOUS GROUNDS AND ALSO WITH THE SUBMISSION THAT IF THERE WAS NO CONSTRUCTION, THERE COULD NOT BE ANY REVENUE RECOGNITION. T HEREFORE, NO PROFIT FROM THIS P ROJECT WOULD BE ASCERTAINED. 4 . THE LD. CIT(A) EXAM INED THE ISSUE IN THE LIGHT OF VARIOUS JUDICIAL PRONOUNCEMENTS AND HAS COME TO THE CONCLUSION THAT THERE COULD NOT HAVE BEEN ANY REVENUE RECOGNITION IN RESPECT OF THE IMPUGNED PROJECT AS NO CONSTRUCTION ACTIVITY WAS CARRIED OUT AT ALL DURING THE YEAR. THE INCOME RECOGNIZED BY THE ASSESSEE - COMPANY IS ONLY HYPOTHETICAL INCOME. IT HAS NO LEGS TO STAND UPON AS IT DOES NOT CONFORM TO ANY RECOGNIZED PRINCIPLES OF ACCOUNTANCY AND/OR THE ACCOUNTING STANDARDS. THEREFORE, NO INCOME HAS FACTUALLY RESULTED OR MATERI ALIZED TO THE ASSESSEE DURING THE YEAR. THE LD. CIT(A) ACCORDINGLY DIRECTED THE ASSESSING OFFICER TO RECOMPUTE THE INCOME OF THE ASSESSEE AND IN DOING SO THERE WILL NEITHER BE ANY REVENUE RECOGNITION IN RESPECT OF ANAND GOOBA GARDEN PROJECT NOR CLAIM OF D EDUCTION UNDER SECTION 80IB(1 0 ) OF THE ACT ON THIS PROJECT SHALL BE PERMITTED. THE ASSESSING OFFICER WAS FURTHER DIRECTED THAT IN SUCCEEDING YEARS , REVENUE IN RESPECT OF ANAND GOOBA GARDEN PROJECT ARE RECOGNIZED AS PER NORMAL METHOD OF ACCOUNTING HITHERTO FOLLOWED BY THE ASSESSEE AND ACCEPTED BY THE D EPARTMENT. THE ASSESSING OFFICER WAS ALSO DIRECTED TO RECOMPUTE THE CLOSING VALUATION OF WORK - IN - PROGRESS IN RESPECT OF THIS : - 4 - : PROJECT AND MAKE SURE THAT IT IS ONLY THIS AMOUNT THAT IS CARRIED FORWARD IN THE NE XT YEAR. BESIDES, DIRECTION WAS ALSO GIVEN TO THE ASSESSING OFFICER TO COMPUTE THE TAX LIABILITY UNDER SECTION 115JB OF THE ACT AS PER THE PROFITS SHOWN IN THE BOOKS OF ACCOUNT OF THE ASSESSEE - COMPANY AND ALSO MAKE FURTHER ADJUSTMENTS IN RESPECT OF EXPEND ITURE INCURRED ON EARNING TAX FREE INCOME. 5 . THE ORDER OF THE LD. CIT(A) IS CHALLENGED BEFORE US BY THE REVENUE ON VARIOUS GROUNDS, BUT THE LD. CIT (DR) EMPHATICALLY OBJECTED THE DIRECTIONS GIVEN BY THE LD. CIT(A) TO THE ASSESSING OFFICER FOR COMPUTATION OF THE INCOME IN A PARTICULAR MANNER. THE LD. CIT (DR) HAS CONTENDED THAT THE LD. CIT(A) HAS NO JURISDICTION TO SET ASIDE THE MATTER TO THE ASSESSING OFFICER FOR RECOMPUTATION OF INCOME EITHER AFRESH OR IN A PARTICULAR MANNER. IN SUPPORT OF HIS CONTENTION, THE LD. CIT (DR) HAS INVITED OUR ATTENTION TO THE PROVISIONS OF SECTION 251(1)(A) OF THE ACT WITH THE SUBMISSION THAT THE LD. CIT(A) IS ONLY EMPOWERED , WHILE DEALING WITH AN APPEAL AGAINST AN ORDER OF ASSESSMENT , EITHER TO CONFIRM, REDUCE, ENHANCE OR ANNUL THE ASSESSMENT. HE HAS NO POWER TO SET ASIDE THE MATTER TO THE ASSESSING OFFICER FOR EITHER READJUDICATION OF THE ISSUE AFRESH OR TO COMPUTE THE INCOME IN A PARTICULAR MANNER. POWER TO SET ASIDE WAS WITHDRAWN BY THE FINANCE ACT, 2001 W.E.F. 1.6.2001. B EFORE THIS AMENDMENT, THE LD. CIT(A) WAS ALSO EMPOWERED TO SET ASIDE THE ASSESSMENT TO THE ASSESSING OFFICER FOR READJUDICATION OF THE ISSUE EITHER AFRESH OR IN A PARTICULAR MANNER. SINCE THE LD. CIT(A) HAS EXCEEDED HIS JURISDICTION BY ISSUING DIRECTIONS TO THE ASSESSING OFFICER TO RECOMPUT E THE INCOME IN A PARTICULAR MANNER, THE ORDER OF THE LD. CIT(A) DESERVES TO BE SET ASIDE . 6 . THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, HAS SUBMITTED THAT THE LD. CIT(A) HAS NOT SET ASIDE THE MATTER TO THE ASSESS ING OFFICER , H E HAS SIMPLY ASKED THE ASSESSING OFFICER TO COMPUTE THE INCOME IN : - 5 - : A PARTICULAR MANNER AND TH IS TYPE OF DIRECTION DOES NO T FALL WITHIN THE PURVIEW OF DEFINITION OF SET ASIDE. SET ASIDE MEANS THE ENTIRE ASSESSMENT ORDER IS SET ASIDE AND THE AS SESSING OFFICER IS DIRECTED TO FRAME ASSESSMENT AFRESH. 7 . DURING THE COURSE OF HEARING, THE LD. CIT (DR) DID NOT OBJECT WITH REGARD TO THE FINDINGS OF THE LD. CIT(A) IN RESPECT OF THE CLAIM OF DEDUCTION UNDER SECTION 80IB OF THE ACT AND ALSO THE FINDING WITH REGARD TO THE COMPUTATION OF INCOME. HIS MAIN GRIEVANCE IS WITH REGARD TO THE DIRECTIONS ISSUED TO THE ASSESSING OFFICER. 8 . HAVING GONE THROUGH THE ORDERS OF THE LOWER AUTHORITIES IN THE LIGHT OF THE RIVAL SUBMISSIONS AND THE RELEVANT PROVISIONS OF THE ACT , WE FIND THAT UNDISPUTEDLY POWER TO SET ASIDE THE MATTER TO THE ASSESSING OFFICER BY THE LD. CIT(A) WAS WITHDRAWN BY THE FINANCE ACT, 2001 W.E.F. 1.6.2001. THEREAFTER THE LD. CIT(A) IS ONLY EMPOWERED EITHER TO CONFIRM, REDUCE, ENHANCE OR ANNUL THE ASSESS MENT. HE HAS NO POWER TO SET ASIDE THE MATTER TO THE ASSESSING OFFICER FOR EITHER FRAMING ASSESSMENT DE NOVO OR TO COMPUTE THE INCOME IN A PARTICULAR MANNER. THEREFORE, THE DIRECTION ISSUED BY THE LD. CIT(A) TO THE ASSESSING OFFICER TO COMPUTE THE INCOME IN A PARTICULAR MANNER DOES NOT APPEARS TO BE IN ACCORDANCE WITH THE PROVISIONS OF LAW. INSTEAD OF SENDING THE MATTER BACK TO THE ASSESSING OFFICER FOR COMPUTING THE INCOME , THE LD. CIT(A) SH OULD HAVE COMPUTED THE INCOME HIMSELF IN A MANNER SUGGESTED IN HIS ORDER. SO FAR AS THE FINDINGS ON MERIT ARE CONCERNED, NONE OF THE PARTIES HAVE ANY OBJECTION. RATHER, THE REVENUE HAS ONLY OB JECTED THE CLAIM OF DEDUCTION UNDER SECTION 80IB OF THE ACT , FOR WHICH THE LD. CIT(A) HAS ALSO HELD THAT THE ASSESSEE IS NOT ENTITLED TO CLAIM OF DEDUCTION UNDER SECTION 80IB(10) OF THE ACT IN THE IMPUGNED ASSESSMENT YEAR AS THERE WAS NO CONSTRUCTION ACTIVITY CARRIED OUT AT ALL DURING THE YEAR. NOW THE ONLY ISSUE LEFT OUT IS WITH REGARD TO THE MODE OF : - 6 - : COMPUTATION OF INCOME OF T HE ASSESSEE. THE LD. CIT(A) HAS ALREADY GIVEN HIS FINDING WITH REGARD TO THE MODE AND MANNER OF COMPUTATION OF INCOME. THEREFORE, WE DIRECT THE LD. CIT(A) TO COMPUTE THE INCOME HIMSELF IN A MANNER PRESCRIBED BY HIM IN HIS ORDER WITHOUT INTERFERING THE FI NDINGS ON MERIT. 9 . GROUND NO.5 RELATES TO THE RESTRICTION OF ADMINISTRATIVE EXPENSES AT ` 50,000 , WHICH WAS MADE UNDER SECTION 14A READ WITH RULE 8D. 10 . FROM A CAREFUL PERUSAL OF RECORD, WE FIND THAT THE ASSESSING OFFICER HAS COMPUTED THE DISALLOWANCE OF ` 5,47,1 50 IN ACCORDANCE WITH RULE 8D , WHICH WAS CHALLENGED BEFORE THE LD. CIT(A) ON THE GROUND THAT RULE 8D IS APPLICABLE ONLY W.E.F. ASSESSMENT YEAR 2008 - 09. THEREFORE, NO DISALLOWANCE IS TO BE MADE IN ACCORDANCE WITH RULE 8D AS ASSESSMENT YEAR INVOLVED IS 2007 - 08. IN SUPPORT OF THIS CONTENTION, T HE ASSESSEE HAS PLACED RELIANCE UPON VARIOUS JUDICIAL PRONOUNCEMENTS. THE LD. CIT(A) EXAMINED THE CASE OF THE ASSESSEE AND WAS CONVINCED WITH THE EXPLANATION THAT RULE 8D WOULD NOT BE APPLICABLE IN THE CASE OF THE ASS ESSEE AS IT WOULD BE APPLICABLE FROM ASSESSMENT YEAR 2008 - 09. HE, HOWEVER, MADE DISALLOWANCE OF ` 50,000 AS ADMINISTRATIVE EXPENSES. THE RELEVANT OBSERVATIONS OF THE LD. CIT(A) IS EXTRACTED HEREUNDER: - 5.1 THE ASSESSEE HAS MADE FOLLOWING WRITTEN SUB MISSIONS BEFORE ME: - 2. 'THE AO HAS MADE A DISALLOWANCE OF RS.5,47,150 / - U/S 14A READ WITH RULE 8D. YOUR HONOUR'S KIND ATTENTION IS INVITED TO THE DECISION OF THE HON'BL E BOMBAY HIGH COURT IN THE CASE OF GODREJ & BOYCE MFG. CO. LTD. V. DCI T 328 I TR 81 AND F OLLOWED BY THE HON'BLE ITAT, LUCKNOW : - 7 - : BENCH IN GOEL INVESTMENTS LTD. V. ADDL . CIT IN ITA NO.238(LUC)/2010 WHEREIN IT HAS BEEN HELD THAT RULE 8D IS APPLICABLE ONLY W.E.F AY 2008 - 09. IN VIEW OF THE ABOVE AND FURTHER FACTS STATED HEREIN BELOW NO DISALLOWANCE C OULD BE MADE IN ACCORDANCE WITH RULE 8D. 3.1. YOUR HONOUR T HE DISALLOWANCE HAS BEEN MADE IN A MECHANICAL MANNER WITHOUT ANY APPLICATION OF MIND AS THE ASSESSEE COMPANY HAS NOT INCURRED ANY EXPENSE TOWARDS EARNING ANY INCOME WHICH IS EXEMPT FROM I. TAX. TH E ASSESSEE IS A LIMITED COMPANY AND ITS ACCOUNTS ARE AUDITED WITH SUPPORTING BILLS AND VOUCHERS. THE AO HAS FAILED TO POINT OUT ANY INSTANCE OR ITEM OF EXPENSE RELATING TO EXEMPT INCOME, YET HE HAS MADE A DISALLOWANCE OF RS.4,96,283/ - . IT IS FURTHER AVERRE D THAT THE ASSESSEE COMPANY HAS SUFFICIENT NON INTEREST BEARING - FUNDS IN THE FORM OF PAID UP CAPITAL AND FREE RESERVES WHICH FAR EXCEED ITS INVESTMENTS THEREFORE THERE CANNOT BE ANY DISALLOWANCE OF INTEREST. AS AGAINST PAID UP CAPITAL AND FREE RESERVES OF RS.6 1 .2 1 CRORES T HE INVESTMENTS ARE RS. 11.02 CRORES AS ON 31.03.2007. RELIANCE IS PLACED ON THE FOLLOWING DECIS I ONS: - I ) CIT V S. WINSOME TEXTILES INDUSTRIES L TD. 379 I TR 204 (PUNJAB & HARYANA) . II ) CIT VS. PREM HEAVY ENGINEERING WORKS PVT. : - 8 - : LTD. 9 MTC 79 (ALLAHABA D). III ) CIT VS. RELIANCE UTILITIES & POWER LTD. 178 TAXMAN 135 (BOMBAY) . IV ) CIT VS. RADICO KHAITAN LTD. 274 ITR 354 (ALLAHABAD) . V ) IN MARUTI UDYOG LTD. VS. DCIT (2005) 92 ITD 119 (DEL) THE HON'BLE ITAT HELD THAT WHEN THE ASSESSEE HAS FUNDS FAR IN EXCESS OF A MOUNT INVESTED IN SHARES OF OTHER COMPANIES, NO DISALLOWANCE COULD BE MADE U/S 14A ON THE GROUND THAT THE INTEREST BEARING FUNDS WERE INVESTED IN EARNING TAX FREE DIVIDENDS. THE HON'BLE ITAT FURTHER HELD THAT NEXUS BETWEEN BORROWED FUNDS AND INVESTMENTS C AN BE SAID TO BE ESTABLISHED ONLY WHERE IT IS SHOWN THAT INTEREST FREE FUNDS ARE NOT AVAILABLE WITH THE ASSESSEE. SIMIL AR VIEW HAS BEEN EXPRESSED BY THE DELHI BRANCH OF ITAT IN ESCORTS LTD. VS ACIT (2006) 102 TTJ 522 AND T HE MA DH YA PRADESH HIGH COURT IN TH E CASE OF SHREE SYNTHETIC LTD. VS CIT & ANR. 205 C T R 386. VI ) THE PUNJAB & HARYANA HIGH COURT IN CASE OF C I T VS HERO CYCLES LTD. 31 DTR 307 HAVE HELD THAT WHERE THERE IS A FINDING THAT NO EXPENDITURE HAS BEEN INCURRED BY THE ASSESSEE FOR EARNING EXEMPT INCOME, NO DISALLOWANCE U/S 14 A CAN BE MADE. : - 9 - : VII ) IN CIT VS. WINSOME TEXTILE INDUSTRIES LTD. 319 ITR 204 THE PUNJAB & HARYANA HIGH COURT HAVE HELD THAT IF THE ASSESSEE HAS MADE INVESTMENT FOR EARNING EXEMPT INCOME OUT OF HIS OWN FUNDS THE IN TEREST PAID BY THE ASSESSEE CAN NOT BE DISALLOWED U/S 1 4A. VIII ) THE COCHIN BRANCH OF ITAT IN THE CASE OF STATE BANK OF TRAVANCORE VS. ACIT 318 ITR 171 HELD THAT THE ASSESSEE INVESTED IN TAX FREE BONDS FOR CARRYING ON IT'S TO THE M EET THE STATUTORY OBLIGATION OF SLR RATIO AND NOT FOR EARNI NG TAX FREE INTEREST. AS SUCH NO DISALLOWANCE CAN BE MADE U/S 14A. YOUR HONOUR TOTAL INTEREST DEBITED TO PROFIT AND LOSS ACCOUNT IS RS.2,86,160/ - , DETAILS OF WHICH ARE AS FOLLOWS: - INTEREST ON UNSECURED LOANS RS.2,07,682.00 HIRE CHARGE S (INTT . ON CA R LOAN) RS. 40,900.91 BANK CHARGES RS. 37,572.20 RS.2,86,155.11 YOUR HONOUR WOULD APPRECIATE THAT ONLY A SUM OF RS.2,07,682 COULD BE CONSIDERED FOR DISALLOWANCE U/S 1 4A. THE ASSESSEE COMPANY IS A VERY OLD COMPANY AND RECENTLY ABOUT NINE COMPANIES WERE AMALGAMATED WITH THE ASSESSEE COMPANY THEREFORE PROVIDING A CASH FLOW PROVING DIRECT NEXUS WITH INTEREST FREE FUNDS WOULD NOT BE POSSIBLE, HOWEVER FACT REMAINS THAT THE ASSESSEE COMPANY HAS INTEREST FREE FUNDS FAR : - 10 - : IN EXCESS OF THE INVESTMENTS THEREFORE NO D I SALLOWANCE U/S 14A IS WARRANTED. RELIANCE IS PLACED ON THE CASE MARUTI UDYOG LTD. VS. DCIT ( SUPRA ) .' 5.2 DECISION I HAVE PERUSED THE ORDER OF THE AO AND THE A RGUMENTS OF THE ASSESSEE COMPANY. I AGREE WITH THE LD. AR THAT RULE 8D HAD NO APPLICABILITY FOR THE YEAR UNDER APPEAL. HOWEVER, THE ASSESSEE COMPANY HAS NOT PROVIDED ANY CASH FLOW STATEMENT WHICH COULD PROVE THAT THERE WAS NO NEXUS B ETWEEN THE INTEREST BEA RING FUNDS AND THE INVESTMENTS MADE. THE ASSESSEE COMPANY HAS SUBMITTED A BREAK UP OF INTEREST PAYMENTS OF RS. 2, 8 6, 155/ - (REPRODUCED HERE IN ABOVE) WHICH INCLUDES INTEREST ON CAR LOANS, BANK CHARGES AND INTEREST ON UNSECURED LOANS AMOUNTING TO RS.207682/ - . SINCE THERE IS COMPLETE INTERMINGLING OF OWNED AND BORROWED FUNDS, IT CANNOT BE SAID THAT NO BORROWED FUNDS HAD BEEN USED TO MAKE THE AFORESAID INVESTMENTS WHICH TOTAL TO RS. 11 CRORES. THE A.O. HAS MADE A DISALLOWANCE OF ONLY RS.50867/ - ON ACCOUNT OF PRO PORTIONATE INTEREST, WHICH UNDER THE FACTS OF THE CASE, IS VERY REASONABLE AND IS, THEREFORE, SUSTAINED. HOWEVER, DISALLOWANCE OF RS.496283/ - , ON ACCOUNT OF ADMINISTRATIVE EXPENSES IS HIGHLY EXCESSIVE AND I RESTRICT THE SAID DISALLOWANCE TO RS.50,000 / - AS ADMINISTRATIVE EXPENDITURE INCURRED IN RELATION TO EARNING OF TAX FREE INCOME. : - 11 - : 11 . SINCE THE REVENUE HAS NOT PLACED ANY JUDGMENT CONTRARY TO THE JUDGMENT RELIED UPON BY THE ASSESSEE, WE FIND NO INFIRMITY IN THE ORDER OF THE LD. CIT(A). WE ACCORDINGLY CONFIR M THE SAME. 12 . IN THE RESULT, APPEAL OF THE REVENUE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 22.8.2012. S D/ - S D/ - [ MEHAR SINGH ] [ S UNIL KUMAR Y ADAV ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 22.8.2012 JJ: 1307 COPY FORWARDED TO: 1 . APPELLA NT 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR ASSISTANT REGISTRAR