M/s Aster Infratek Pvt Ltd, Hyderabad V. DCIT, Circle-1(1), Hyderabad

ITA 398/HYD/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 91787 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 4 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-07-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 09-07-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 10-03-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAMAKRISHNA BANDI
• Assessee Lawyers: S RAMA RAO
• Keywords: Earning of tax free income
• Section: 14A; 54

Judgement Text

` IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO. 398 & 399/HYD/2014 ASSESSMENT YEARS: 2008-09 & 2009-10 M/S ASTER INFRATEK PVT. LTD., HYDERABAD. PAN AAGCA 3411 N VS. DY. COMMISSIONER OF INCOME- TAX, CIRCLE 1(1), HYDERABAD. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI S. RAMA RAO REVENUE BY : SHRI RAMAKRISHNA BANDI DATE OF HEARING 09-07-2015 DATE OF PRONOUNCEMENT 22-07-2015 O R D E R PER SAKTIJIT DEY, J.M.: THESE APPEALS BY ASSESSEE ARE DIRECTED AGAINST SEP ARATE ORDERS OF LD. CIT(A) II, HYDERABAD BOTH DATED 09/ 12/2013 FOR THE AYS 2008-09 & 2009-10. 2. THE ONLY ISSUE RAISED IN BOTH THE APPEALS IS WIT H REGARD TO DISALLOWANCE OF INTEREST EXPENDITURE U/S 14A OF THE ACT. 3. SINCE FACTS IN BOTH THE APPEALS ARE MORE OR LESS IDENTICAL, FOR THE SAKE OF CONVENIENCE, WE REFER TO THE FACTS AS I NVOLVED IN AY 2008- 09 BEING ITA NO. 398/HYD/2014. 4. BRIEFLY THE FACTS ARE, ASSESSEE A COMPANY IS INC ORPORATED ON 29/03/2007 UNDER A SCHEME OF DEMERGER PROCESS OF AS TER TELESERVICES PVT. LTD. (ATPL). ASSESSEE IS BASICALL Y ENGAGED IN THE ACTIVITY OF CONSTRUCTING, EXECUTING, IMPROVING, DEV ELOPING AND 2 ITA NOS. 398 & 399 /HYD/2014 M/S ASTER INFRATEK PVT. LTD. MANAGING OR CONTROLLING IN INDIA OR ELSEWHERE INFRA STRUCTURE PROJECTS OF CIVIL, MECHANICAL INCLUDING LAYING OF OPTICAL FI BER AND COPPER CABLES RELATED TO INFORMATION TECHNOLOGY, TELECOMMUNICATIO NS, HOTELS, WAREHOUSES, MARKETS, FACTORY BUILDINGS, RESIDENTIAL AND COMMERCIAL COMPLEXES, BRIDGES ETC. IT IS ALSO ENGAGED IN THE B USINESS TO ACQUIRE, PURCHASE, LEASE, EXCHANGE, HIRE OR OTHERWISE DEAL I N LANDED PROPERTY OF ANY NATURE. FOR THE AY UNDER CONSIDERATION, ASSE SSEE FILED ITS RETURN OF INCOME ON 20/09/08 DECLARING TOTAL LOSS O F RS. 3,65,09,402. DURING THE ASSESSMENT PROCEEDING, AO NOTICED THAT A SSESSEE DURING THE RELEVANT PY HAS MADE INVESTMENT IN TAX EXEMPT A SSETS. HOWEVER, ASSESSEE HAS DEBITED INTEREST EXPENDITURE OF RS. 2, 63,29,579. AO WAS OF THE VIEW THAT ASSESSEE HAS UTILIZED SOME OF THE BORROWED AMOUNT FOR MAKING THE TAX EXEMPT INVESTMENT. AS ASS ESSEE HAS NOT DISALLOWED ANY INTEREST EXPENDITURE ON ITS OWN, AO BY APPLYING THE PROVISIONS OF SECTION 14A READ WITH RULE 8D, PROCEE DED TO COMPUTE DISALLOWANCE OF INTEREST EXPENDITURE ON ACCOUNT OF INVESTMENT MADE AND QUANTIFIED THE SAME AS PER RULE 8D(2) AT RS. 40 ,18,400. BEING AGGRIEVED OF SUCH DISALLOWANCE, ASSESSEE CHALLENGED THE SAME IN APPEAL FILED BEFORE LD. CIT(A). 5. IN COURSE OF HEARING BEFORE LD. CIT(A), IT WAS S UBMITTED BY ASSESSEE, OUT OF TOTAL INVESTMENT OF RS. 12,23,74,0 84 AS ON 31/03/08 ONLY AN INVESTMENT OF RS. 3,41,10,330 WAS MADE BY A SSESSEE AFTER DEMERGER. IT WAS SUBMITTED, SURPLUS FUNDS WERE ONLY UTILIZED FOR THE PURPOSE OF INVESTMENTS AND BORROWED FUNDS WERE USED FOR THE PURPOSE OF WORKING CAPITAL NEEDS AS THEY WERE SANCT IONED BY IDBI AND AXIS BANK FOR SPECIFIC PURPOSE. IT WAS SUBMITT ED BY ASSESSEE THAT SINCE INVESTMENTS WERE OUT OF OWN/SURPLUS FUND S AVAILABLE WITH ASSESSEE AND NO BORROWED FUND WAS UTILIZED, DISALL OWANCE OF INTEREST EXPENDITURE CANNOT BE MADE U/S 14A OF THE ACT. IN S UPPORT OF SUCH CONTENTION, ASSESSEE ALSO RELIED UPON CERTAIN JUDIC IAL PRECEDENTS. 6. LD. CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF ASSESSEE IN THE CONTEXT OF THE STATUTORY PROVISIONS, OBSERVED THAT ASSESSEE IS 3 ITA NOS. 398 & 399 /HYD/2014 M/S ASTER INFRATEK PVT. LTD. MAINTAINING COMMON ACCOUNT FROM WHERE ALL ITS BUSIN ESS TRANSACTIONS ARE ROUTED INCLUDING LOANS TAKEN AND INVESTMENTS MA DE. SHE OBSERVED, THERE IS NOTHING ON RECORD TO SHOW THAT I NVESTMENTS MADE WERE OUT OF ITS OWN FUNDS AND NOT FROM BORROWED FUN DS. SHE ALSO OBSERVED THAT THOUGH ASSESSEE WAS REQUESTED TO SUBM IT COPY OF THE BANK ACCOUNT REFLECTING LOANS TAKEN AND THE DATES O F INVESTMENTS MADE, BUT, ASSESSEE DID NOT FURNISH SUCH INFORMATIO N. LD. CIT(A) REFERRING TO THE DECISION OF THE HONBLE MUMBAI HIG H COURT IN CASE OF GODREJ & BOYCE MFG. CO. LTD. VS. DCIT HELD THAT AS RULE 8D OF THE IT RULES, APPLICABLE FROM AY 2008-09, AO IN CASE WAS N OT SATISFIED WITH THE ACCOUNTS OF ASSESSEE CAN MAKE DISALLOWANCE BY A PPLYING THE SAID RULE. ON THE AFORESAID REASONING, SHE CONFIRMED THE DISALLOWANCE MADE BY AO. HOWEVER, SHE DIRECTED AO TO EXCLUDE AN AMOUNT OF RS. 33,40,353 WHILE COMPUTING DISALLOWANCE U/S 14A OF T HE ACT, AS THE SAID AMOUNT IS NOT PERTAINING TO INVESTMENT. 7. LD. AR MORE OR LESS REITERATING THE SUBMISSIONS MADE BEFORE LD. CIT(A), STATED THAT AT THE TIME OF DEMERGER ITSELF THERE WAS AN INVESTMENT OF RS. 7,83,12,754 MADE BY ATPL. LD. AR REFERRING TO THE BALANCE SHEET OF ASSESSEE COMPANY AS AT 31/03/08 SU BMITTED, DURING THE YEAR ASSESSEE WAS HAVING OWN FUNDS OF RS. 58,35 ,40,000 AS SHARE CAPITAL AND UNSECURED LOANS OF RS. 7,84,25,06 2, WHICH IS AVAILABLE WITH ASSESSEE APART FROM THE SECURED LOAN S OF RS. 12,25,39,051 AVAILED FROM BANKS AND FINANCIAL INSTI TUTIONS FOR SPECIFIED PURPOSES. LD. AR SUBMITTED, SINCE THE SEC URED LOAN OBTAINED FROM IDBI AND AXIS BANK ARE IN THE NATURE OF TERM LOAN AND FOR THE PURPOSE OF WORKING CAPITAL AS WELL AS PURCH ASING FIXED ASSETS, THEY WERE TOTALLY UTILIZED FOR THAT PURPOSE WHICH W OULD BE EVIDENT FROM THE ADDITION MADE TO THE FIXED ASSETS AS WELL AS SU NDRY DEBTORS, INVENTORIES, ETC. LD. AR REFERRING TO THE SCHEME OF DEMERGER AS INCORPORATED IN THE NOTES ON ACCOUNTS SUBMITTED, AT THE TIME OF DEMERGER, ASSESSEE RECEIVED RESERVES AND SURPLUS OF RS. 58,36,79,820. THUS, IT WAS SUBMITTED, AS ASSESSEE W AS HAVING A HUGE 4 ITA NOS. 398 & 399 /HYD/2014 M/S ASTER INFRATEK PVT. LTD. AMOUNT OF SURPLUS/OWN FUNDS TO TAKE CARE OF THE TAX EXEMPT INVESTMENTS, IT CANNOT BE SAID THAT ASSESSEE HAS UT ILIZED BORROWED FUNDS FOR MAKING INVESTMENT. HE SUBMITTED, UNLESS A NEXUS IS ESTABLISHED BETWEEN BORROWED FUNDS AND INVESTMENTS, DISALLOWANCE OF INTEREST EXPENDITURE CANNOT BE MADE U/S 14A. LD . AR SUBMITTED, THE MATERIALS PLACED ON RECORD WILL CLEARLY SHOW TH AT BORROWED FUNDS WERE UTILIZED FOR THE PURPOSE FOR WHICH THEY WERE S ANCTIONED I.E., PURCHASE OF FIXED ASSETS AND FOR WORKING CAPITAL. T HUS, IT WAS SUBMITTED BY LD. AR, SINCE BORROWED FUNDS ARE NOT U TILIZED FOR INVESTMENT NO DISALLOWANCE OUT OF INTEREST EXPENDIT URE CAN BE MADE. IN SUPPORT OF SUCH CONTENTION, HE RELIED UPON THE F OLLOWING DECISIONS: 1. CIT VS. HERO CYCLES LTD., [2010] 323 ITR 518 (P &H) 8. LD. DR REFERRING TO THE PROVISIONS OF SECTION 14 A OF THE ACT SUBMITTED BEFORE US, FOR APPLYING PROVISIONS CONTAI NED THEREIN, TWO CONDITIONS HAVE TO BE SATISFIED; FIRSTLY, THERE MUS T BE AN INVESTMENT GIVING RAISE TO INCOME WHICH DOES NOT FORM PART OF TOTAL INCOME AND SECONDLY THERE MUST BE EXPENDITURE TOWARDS INTERES T. THEREFORE, IF THE AFORESAID TWO CONDITIONS ARE SATISFIED, PROVISI ONS OF SECTION 14A AUTOMATICALLY APPLY. HE SUBMITTED, SINCE ASSESSEE D URING THE YEAR HAS MADE INVESTMENTS GIVING RISE TO EXEMPT INCOME A ND HAS ALSO INCURRED INTEREST EXPENDITURE, DISALLOWANCE HAS TO BE MADE IN TERMS WITH SECTION 14A READ WITH RULE 8D(2). LD. DR SUBMI TTED, ASSESSEES CONTENTION THAT INVESTMENTS WERE MADE OUT OF SURPLU S FUNDS WILL NOT BE ACCEPTABLE UNLESS ASSESSEE SPECIFICALLY PROVES T HE FACT THAT INVESTMENTS MADE WERE OUT OF SUCH FUNDS. THEREFORE, IT IS NECESSARY TO BRING ON RECORD THE FACT THAT ON THE DATES INVES TMENTS WERE MADE ASSESSEE WAS HAVING SURPLUS FUNDS. IN OTHER WORDS, A LINK HAS TO BE ESTABLISHED BETWEEN INVESTMENTS AND AVAILABILITY OF SURPLUS FUNDS. LD. DR REFERRING TO THE CASH FLOW STATEMENT OF ASSESSEE , FOR THE YEAR ENDED 31/03/2008 SUBMITTED, CASH AVAILABLE TO ASSES SEE IS RS. 19,19,81,663 AND RS. 6,40,36,344 TOTALLING TO RS. 2 5,60,18,007, WHEREAS, ASSESSEE HAS MADE INVESTMENT OF RS. 24,24, 87,035. THAT 5 ITA NOS. 398 & 399 /HYD/2014 M/S ASTER INFRATEK PVT. LTD. ITSELF PROVES NEXUS BETWEEN INVESTMENT AND THE BORR OWED FUNDS. LD. DR SUBMITTED, ASSESSEE SIMPLY REFERRING TO THE CLOS ING BALANCE IN THE CASH FLOW AT THE END OF THE YEAR CANNOT CLAIM THAT INVESTMENTS WERE MADE OUT OF SURPLUS FUNDS. THUS, IT WAS SUBMITTED, CONDITIONS OF SECTION 14A OF THE ACT HAVING BEEN SATISFIED, DISAL LOWANCE MADE IS IN ORDER. IN SUPPORT OF HIS CONTENTION, LD. DR RELIED UPON THE FOLLOWING DECISIONS: 1. SIVA INDUSTRIES & HOLDINGS LTD. VS. ACIT, 54 SO T 49 (CHENNAI) 2. ACIT VS. CHAMPION COMMERCIAL CO. LTD., 139 ITD 108 3. ITO VS. RBK SHAREBROKING PVT. LTD., [2013] 54 I TCL 164 4. DABUR INDIA LTD. VS. ACIT, [2013] 145 ITD 175 5. CIT VS. STATE BANK OF TRAVANCORE, 203 TAXMAN 63 9 6. CHEMINVEST LTD. VS. ITO, [2009] 121 ITD 318 9. WE HAVE CONSIDERED THE SUBMISSIONS OF THE PARTIE S AND PERUSED THE ORDERS OF REVENUE AUTHORITIES AS WELL AS OTHER MATERIALS ON RECORD. ON PERUSAL OF THE DISTRIBUTION OF ASSETS AND LIABIL ITIES UNDER THE SCHEME OF DEMERGER OF ATPL FORMING PART OF ANNUAL REPORT OF ASSESSEE COMPANY, IT IS NOTICED THAT AT THE TIME OF DEMERGER THERE WAS INVESTMENT OF RS. 7,83,12,754 WHEREAS AFTER DEM ERGER AS PER THE BALANCE SHEET OF ASSESSEE COMPANY AS AT 31/03/08 TO TAL INVESTMENTS ARE TO THE TUNE OF RS. 12,43,77,506. THUS, FROM THE AFORESAID FACTS, IT CAN BE CONCLUDED THAT ACTUAL INVESTMENT MADE BY ASS ESSEE DURING THE YEAR IS TO THE TUNE OF RS. 4,60,64,752. . AS AG AINST SUCH INVESTMENTS, AS SEEN FROM THE BALANCE SHEET SOURCES OF FUNDS OF ASSESSEE ARE SHARE CAPITAL OF RS. 58,35,40,000 AND UNSECURED LOANS OF RS. 7,84,25,062. SECURED LOANS FROM BANKS AND FI NANCIAL INSTITUTIONS DURING THE YEAR WAS TO THE TUNE OF RS. 12,25,39,051. FROM THE AFORESAID FACTS, IT BECOMES CLEAR THAT ASSESSEE WAS HAVING SUBSTANTIAL AMOUNT TOWARDS ITS OWN FUND FOR MAKING INVESTMENTS. THOUGH, LD. DR TRIED TO MAKE OUT A CASE BY STATING THAT SECTION 14A AUTOMATICALLY APPLIES IF THERE IS INVESTMENT MADE B Y ASSESSEE GIVING RISE TO EXEMPT INCOME AND ASSESSEE HAS INCURRED INT EREST 6 ITA NOS. 398 & 399 /HYD/2014 M/S ASTER INFRATEK PVT. LTD. EXPENDITURE, BUT, ON CAREFUL READING OF SECTION 14A IT WILL BE CLEAR THAT ONE MORE CONDITION ALSO HAS TO BE SATISFIED WHICH I S EXPENDITURE INCURRED MUST BE IN RELATION TO EXEMPT INCOME. THER EFORE, IF THERE IS NO RELATION BETWEEN EXPENDITURE AND THE INCOME EARN ED, NO DISALLOWANCE U/S 14A CAN BE MADE. IN THE PRESENT CA SE, FACTS AND MATERIALS CLEARLY DEMONSTRATE THAT ASSESSEE WAS HAV ING SUFFICIENT SURPLUS FUNDS AVAILABLE WITH IT TO MAKE INVESTMENTS . THAT BEING THE CASE, A PRESUMPTION CANNOT BE MADE THAT ASSESSEE HA S UTILIZED BORROWED FUNDS TOWARDS MAKING INVESTMENTS. MORE SO, WHEN THE SECURED LOANS WERE SANCTIONED BY BANKS AND FINANCIA L INSTITUTIONS WITH CONDITIONS ATTACHED AND MATERIAL ON RECORD AL SO SHOW THAT ASSESSEE HAS UTILIZED THE SAME FOR THE PURPOSE FOR WHICH THEY WERE OBTAINED AS THERE IS SUBSTANTIAL INCREASE IN THE V ALUE OF FIXED ASSETS, SUNDRY DEBTORS, ETC. THEREFORE, UNLESS A LINK/NEXUS IS ESTABLISHED BETWEEN BORROWED FUNDS AND THE INVESTMENTS MADE, NO DISALLOWANCE U/S 14A CAN BE MADE AS FAR AS INTEREST EXPENDITURE IS CONCERNED. IN THE PRESENT CASE, WHEN THERE IS SURPLUS FUND AVAILA BLE WITH ASSESSEE TO TAKE CARE OF THE INVESTMENTS AND THERE IS NOTHIN G ON RECORD TO INDICATE THAT BORROWED FUNDS WERE UTILIZED FOR MAKI NG INVESTMENTS, IN OUR VIEW, NO DISALLOWANCE U/S 14A READ WITH RULE 8D (II) & (III) CAN BE MADE. THE HONBLE P & H HIGH COURT IN CASE OF CIT V S. HERO CYCLES LTD. (SUPRA) WHILE DEALING WITH THE ISSUE OF DISALL OWANCE U/S 14A HELD THAT THERE MUST BE A FINDING OF FACT THAT INTEREST EXPENDITURE WAS INCURRED FOR EARNING EXEMPT INCOME. THE RELEVANT OB SERVATION OF THE HONBLE HIGH COURT IS EXTRACTED HEREUNDER: WHETHER, IN A GIVEN SITUATION, ANY EXPENDITURE WA S INCURRED WHICH WAS TO BE DISALLOWED, IS A QUESTION OF FACT. THE CONTE NTION OF THE REVENUE THAT DIRECTLY OR INDIRECTLY SOME EXPENDITURE IS AL WAYS INCURRED WHICH MUST BE DISALLOWED UNDER S. 14A AND THE IMPACT OF EXPEN DITURE SO INCURRED CANNOT BE ALLOWED TO BE SET OFF AGAINST THE BUSIN ESS INCOME WHICH MAY NULLIFY THE MANDATE OF S. 14A, CANNOT BE ACCEPTED. DISALLOWANCE UNDER S. 14A REQUIRES FINDING OF INCURRING OF EXPENDITURE; WHERE IT IS FOUND THAT FOR EARNING EXEMPTED INCOME NO EXPENDITURE HAS BEEN IN CURRED, DISALLOWANCE UNDER S. 14A CANNOT STAND. 7 ITA NOS. 398 & 399 /HYD/2014 M/S ASTER INFRATEK PVT. LTD. 9.1 IN OUR VIEW, THE PRINCIPLE LAID DOWN BY THE HON BLE PUNJAB & HARYANA HIGH COURT, WOULD STILL APPLY EVEN AFTER IN TRODUCTION OF RULE 8D OF IT RULES. THE HONBLE BOMBAY HIGH COURT IN CA SE OF CIT VS. RELIANCE UTILITIES AND POWER LTD., 313 ITR 340 WH ILE EXAMINING DISALLOWANCE OF INTEREST EXPENDITURE ON THE ALLEGAT ION THAT INTEREST FREE ADVANCES WERE MADE TO SISTER CONCERNS, HELD TH AT WHEN THE ASSESSEE HAS BOTH INTEREST BEARING FUNDS AS WELL AS NON INTEREST BEARING SURPLUS FUND, PRESUMPTION WOULD BE NON-INTE REST BEARING SURPLUS FUNDS HAVE BEEN ADVANCED TO SISTER CONCERNS , HENCE, NO DISALLOWANCE OF INTEREST EXPENDITURE CAN BE MADE. T HOUGH, AFORESAID DECISION OF THE HONBLE BOMBAY HIGH COURT IS IN THE CONTEXT OF DISALLOWANCE OF INTEREST U/S 36(1)(III) BUT THE PRI NCIPLE LAID DOWN WILL EQUALLY APPLY TO DISALLOWANCE MADE U/S 14A. 9.2 THEREFORE, WHEN ASSESSEE WAS HAVING ENOUGH NON- INTEREST BEARING SURPLUS FUND TO MAKE THE INVESTMENT AND DE PARTMENT HAS FAILED TO ESTABLISH ANY NEXUS BETWEEN THE BORROWED FUNDS AND INVESTMENT, PRESUMPTION WOULD BE THAT ASSESSEE HAS MADE INVESTMENT UTILIZING ITS OWN FUNDS. THE DECISIONS R ELIED UPON BY LD. DR WOULD BE OF NO HELP TO DEPARTMENT AS THEY ARE NO T ON THE PROPOSITION, WHETHER INTEREST EXPENDITURE WILL BE D ISALLOWABLE WHERE ASSESSEE PROVES THAT INVESTMENTS WERE OUT OF NON-IN TEREST BEARING SURPLUS FUND. IN THE AFORESAID VIEW OF THE MATTER, WE DO NOT FIND ANY REASON TO SUSTAIN THE DISALLOWANCE OF INTEREST EXPE NDITURE MADE BY AO UNDER RULE 8D(2)(II) READ WITH SECTION 14A OF TH E ACT. HOWEVER, AS FAR AS DISALLOWANCE MADE UNDER RULE 8D(2)(III) IS C ONCERNED, WE ARE OF THE VIEW THAT SUCH DISALLOWANCE HAS TO BE SUSTAINED IN VIEW OF SPECIFIC PROVISION CONTAINED UNDER SUB-SECTION (3) OF SECTION 14A, WHICH PROVIDES THAT EVEN IN A CASE WHERE AN ASSESSE E CLAIMS THAT NO EXPENDITURE HAS BEEN INCURRED BY HIM IN RELATION TO INCOME WHICH DOES NOT FORM PART OF TOTAL INCOME, STILL DISALLOW ANCE CAN BE MADE BY AO. IN VIEW OF THE AFORESAID, WE DIRECT AO TO COMPU TE DISALLOWANCE @ 8 ITA NOS. 398 & 399 /HYD/2014 M/S ASTER INFRATEK PVT. LTD. 0.5% OF THE TOTAL AVERAGE INVESTMENT IN TERMS WITH RULE 8D(2)(III) OF IT RULES. 10. AS FAR AS ITA NO. 399/HYD/14 FOR AY 2009-10 IS CONCERNED, THE FACTS AND ISSUES ARE SIMILAR TO THAT OF ITA NO. 398 /HYD/2010 (SUPRA). FOLLOWING OUR DECISION THEREIN, WE DIRECT AO TO RES TRICT THE DISALLOWANCE TO 0. 5% OF THE TOTAL AVERAGE INVESTME NT AS PER RULE 8D(2)(III). 11. IN THE RESULT, BOTH THE APPEALS OF ASSESSEE ARE PARTLY ALLOWED. PRONOUNCED IN THE OPEN COURT ON 22 ND JULY, 2015. SD/- SD/- (P.M. JAGTAP) (SAKTIJIT DEY) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DATED: 22 ND JULY, 2015 KV COPY TO:- 1) M/S ASTER INFRATEK PVT. LTD., D.NO. 54/S, ANUPUR AM, ECIL POST, HYDERABAD 500 062. 2 DCIT, CIRCLE 1(1), HYDERABAD 3 CIT(A) II, HYDERABAD 4) CIT-I, HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDE RABAD.