ACIT CEN CIR 29 CEN RG 7, MUMBAI V. KNIGHT RIDERS SPORTS P.LTD, MUMBAI

ITA 4087/MUM/2014

• Counselvise Citation: [2018] 112 COUNSELVISE.COM (IT) 5800 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 6 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-12-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 04-06-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: J D MISTRI WITH HITEN CHANDE
• Keywords: Depreciation; Business expenditure; Opportunity of being heard; Wholly owned subsidiary; Tax effect; Revised return; Revenue expenditure; Capital expenditure; Set aside
• Section: 143(3); 133A; 234B; 37(1); 250; 37

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL H BENCH MUMB AI BEFORE SHRI G.S. PANNU, VICE PRESIDENT AND SHRI PAWAN SINGH, JUDICIAL MEMBER ITA NO. 4087/MUM/2014 (ASSESSMENT YEAR 20 10-11 ) DCIT CC-29, R NO. 409, 4 TH FLOOR, AAYAKAR BHAVAN, M.K. ROAD, CHURCHGATE, MUMBAI-400020. VS. M/S KNIGHT RIDERS SPORTS PVT. LTD., DEEPVAN, ANAND VIHAR SOCIETY, 20 TH ROAD, KHAR (W), MUMBAI-400052. PAN: AADCK3118M APPELLANT RESPONDE NT ITA NO. 4310/MUM/2014 (ASSESSMENT YEAR 2010-11 ) M/S KNIGHT RIDERS SPORTS PVT. LTD., DEEPVAN, ANAND VIHAR SOCIETY, 20 TH ROAD, KHAR (W), MUMBAI-400052. PAN: AADCK3118M VS. DCIT CC-29, R NO. 409, 4 TH FLOOR, AAYAKAR BHAVAN, M.K. ROAD, CHURCHGATE, MUMBAI-400020. APPELLANT RESPONDE NT REVENUE BY : SHRI M.C. OMI NINGSHEN WITH SHRI B. SRINIWAS (CIT -DR) ASSESSEE BY : SHRI J.D. MISTRI WITH HITEN CHANDE (AR) DATE OF HEARING : 05.10.2018 DATE OF PRONOUNCEMEN T : 12.12.2018 ORDER UNDER SECTION 254(1)OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER; 1. THE AFORESAID CROSS APPEALS UNDER SECTION 253 OF IN COME-TAX ACT (THE ACT) ARE DIRECTED AGAINST THE ORDER OF LD. CIT(A)-40, MU MBAI DATED 31.03.2014 FOR ASSESSMENT YEAR 2010-11. THE REVENUE IN ITS APP EAL HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) WAS RIGHT IN DELETING THE ADDITION OF RS. 61 ,77,358/- MADE BY THE ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 2 ASSESSING OFFICER IN RESPECT OF WEBSITE DESIGN CHAR GES TREATING IT AS A REVENUE EXPENDITURE EVEN THOUGH THE SAME ADDITION I N A.Y. 2009-10, WAS CONFIRMED BY THE LD. CIT(A) TREATING IT AS CAPITAL IN NATURE?. 2. THE APPELLANT CRAVES TO LEAVE TO ADD, TO AMEND AND / OR TO ALTER ANY OF THE GROUNDS OF APPEAL, IF NEED BE. 2. THE ASSESSEE IN ITS CROSS APPEAL HAS RAISED THE FOL LOWING GROUNDS OF APPEAL: BASED ON THE FACTS AND CIRCUMSTANCES OF THE CASE, K NIGHT RIDERS SPORTS PRIVATE LIMITED (HEREINAFTER REFERRED TO AS THE 'APPELLANT' ) RESPECTFULLY CRAVES LEAVE TO PREFER AN APPEAL AGAINST THE ORDER PASSED BY THE LE ARNED COMMISSIONER OF INCOME-TAX (APPEALS) - 40 ['CIT(A)'], MUMBAI DATED 31 MARCH 2014 UNDER SECTION 250 OF THE INCOME-TAX ACT, 1961 ('ACT') ON THE FOLLOWING GROUNDS: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED CIT(A): GENERAL 1. ERRED IN NOT ACCEPTING TOTAL RETURNED LOSS OF TH E APPELLANT. SPONSORSHIP RIGHTS INCOME 2. ERRED IN UPHOLDING THE ORDER OF THE LEARNED ASSE SSING OFFICER ('AO'), BY CONFIRMING THE ADDITION OF RS 1,99,94,876 IN RESPEC T OF REVENUES FROM SPONSORSHIP RIGHTS, WITHOUT APPRECIATING THE FACT T HAT: THE ABOVE DID NOT ACCRUE IN A Y 20 I 0-11 (BUT IN A Y 2011-12), AS PER THE METHOD OF ACCOUNTING REGULARLY AND CONSISTENTLY FOL LOWED BY THE APPELLANT; AND IGNORING THAT THE LEARNED AO HAS ACCEPTED THE ACC OUNTING PRINCIPLES FOR REVENUES FROM SPONSORSHIP RIGHTS IN EARLIER A V'S. DEDUCTION OF FRANCHISE CONSIDERATION - CAPITAL OR R EVENUE EXPENDITURE 3. ERRED IN UPHOLDING THE ORDER OF THE LEARNED AO, BY CONFIRMING THE ANNUAL CONSIDERATION OF RS 30,03,60,000 PAID/PAYABLE BY TH E APPELLANT TO THE BOARD OF CONTROL FOR CRICKET IN INDIA ('BCCI'), WHICH IS REVENUE IN NATURE, AS A CAPITAL EXPENDITURE. 4. ERRED IN UPHOLDING THE ORDER OF THE LEARNED AO, BY CONFIRMING THAT THE ANNUAL CONSIDERATION PAID/PAYABLE TO BCCI IS IN THE NATURE OF LICENSE OR FRANCHISE OR ANY OTHER BUSINESS OR COMMERCIAL RIGHT OF SIMILAR NATURE (I.E INTANGIBLE ASSET) AS PER THE PROVISIONS OF SECTION 32(1)(II) OF THE ACT. 5. WITHOUT PREJUDICE TO THE ABOVE, ERRED IN UPHOLDI NG THE LEARNED AO'S ORDER BY CONFIRMING THE COST OF THE INTANGIBLE ASSET TO B E ONLY RS 30,03,60,000 (I.E THE ANNUAL CONSIDERATION), INSTEAD OF ADJUSTING THE ACTUAL COST OF THE FRANCHISE FOR THE PURPOSE OF COMPUTING THE DEPRECIATION. ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 3 DISALLOWANCE OF FEASIBILITY STUDY EXPENSES 6. ERRED IN UPHOLDING THE ORDER OF THE LEARNED AO, BY CONFIRMING THE DISALLOWANCE OF RS 19,32,720 IN CONNECTION WITH FEA SIBILITY STUDY EXPENSES, ON THE PREMISE THAT THE EXPENDITURE IS IN NATURE OF PRELIMINARY EXPENDITURE AND COVERED UNDER SECTION 350 OF THE ACT. 7. ERRED IN NOT APPRECIATING THAT THESE EXPENSES AR E REVENUE IN NATURE AND FULLY ALLOWABLE UNDER THE PROVISIONS OF THE ACT. DISALLOWANCE OF STAMP DUTY EXPENSES 8. ERRED IN UPHOLDING THE ORDER OF THE LEARNED AO, BY CONFIRMING THE DISALLOWANCE OF EXPENDITURE AMOUNTING TO RS 2,75,01 0 IN CONNECTION WITH STAMP DUTY EXPENSES, ON THE PREMISE THAT THE EXPEND ITURE PROVIDES BENEFIT OF ENDURING NATURE AND THEREFORE COULD NOT BE ALLOWED AS A REVENUE EXPENDITURE. ARBITRARY ADHOC DISALLOWANCE IN CONNECTION WITH AIR FARE AND TRAVELLING EXPENSE 9. ERRED IN UPHOLDING THE ORDER OF THE LEARNED AO, BY CONFIRMING THAT THE ARBITRARY ADHOC DISALLOWANCE OF THE EXPENDITURE IN CONNECTION WITH AIRFARE AND TRAVELLING EXPENSES ON THE PREMISE THAT THE SAID EX PENSES ARE NOT IN THE NATURE OF BUSINESS EXPENDITURE ALLOWABLE UNDER SECTION 37( 1) OF THE ACT. 10. WITHOUT PREJUDICE TO THE ABOVE, ERRED IN UPHOLD ING THE ORDER OF THE LEARNED AO, BY CONFIRMING THE ARBITRARY ADHOC DISALLOWANCE OF A SUM OF RS 82,12,985 (I.E 25% OF RS 3,28,51,941) BEING EXPENDITURE IN CO NNECTION WITH AIRFARE AND TRAVELLING EXPENSE, WHICH WAS DISALLOWED BY THE LEA RNED AO WITHOUT REQUESTING FOR ACTUAL DETAILS OF INVITED GUESTS AND CELEBRITIES AND INSPITE OF FURNISHING THE ACTUAL AMOUNT OF EXPENDITURE INCURRE D TOWARDS INVITED GUESTS AND CELEBRITIES BEFORE THE LEARNED CIT(A) DURING TH E APPELLATE PROCEEDINGS. ARBITRARY ADHOC DISALLOWANCE IN RESPECT OF EXPENDIT URE IN CONNECTION WITH A) LODGING AND BOARDING B) FOOD AND NUTRITION II. ERRED IN UPHOLDING THE ORDER OF THE LEARNED AO, BY CONFIRMING THE ADHOC DISALLOWANCE OF THE EXPENDITURE IN CONNECTION WITH LODGING AND BOARDING AND FOOD AND NUTRITION ON THE PREMISE THAT THE SAID EXP ENSES ARE NOT IN THE NATURE OF BUSINESS EXPENDITURE ALLOWABLE UNDER SECTION 37( 1) OF THE ACT. 12. WITHOUT PREJUDICE TO THE ABOVE, ERRED IN UPHOLDING THE ARBITRARY ADHOC DISALLOWAN CE TO THE EXTENT OF RS 1,02,90,355 (I.E 33% OF RS 3,11,82,893) IN CONNECTI ON WITH LODGING AND BOARDING AND FOOD AND NUTRITION EXPENSES OF ITS INV ITED GUESTS AND CELEBRITIES; ERRED IN NOT CONSIDERING THAT THE SUPPORTING INVO ICES WERE NOT VERIFIED BY THE LEARNED AO BEFORE MAKING THE ARBITRARY ADHOC DISALL OWANCE; AND ERRED IN NOT CONSIDERING THE ACTUAL AMOUNT OF EXP ENDITURE INCURRED TOWARDS INVITED GUESTS AND CELEBRITIES FURNISHED BEFORE THE LEARNED CIT(A) DURING THE APPELLATE PROCEEDINGS. OTHERS ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 4 13. ERRED IN UPHOLDING THE ADDITIONS MADE TO THE RE TURNED LOSS OF THE APPELLANT ON AN ADHOC BASIS, ON THE BASIS OF INCORRECT ASSUMP TIONS AND NOT CONSIDERING THAT THE BUSINESS EXPENSES HAVE BEEN SOLELY INCURRE D FOR THE PURPOSE OF THE APPELLANT'S BUSINESS, WHICH THE APPELLANT DOES NOT AGREE AND DISPUTES. 14. ERRED IN UPHOLDING CONSEQUENTIAL LEVY OF INTERE ST UNDER SECTION 234B OF THE ACT AND SECTION 2340 OF THE ACT. 15. ERRED IN UPHOLDING THE INITIATION OF PENALTY PR OCEEDINGS UNDER SECTION 271(L)(C) OF THE ACT. EACH OF THE ABOVE GROUND IS INDEPENDENT AND WITHOUT PREJUDICE TO ONE ANOTHER. THE APPELLANT CRAVES, TO CONSIDER EACH OF THE ABOVE GROUNDS OF APPEAL WITHOUT PREJUDICE TO EACH OTHER AND CRAVES LEAVE TO ADD, AL TER, DELETE OR MODIFY ALL OR ANY OF THE ABOVE GROUNDS OF APPEAL AT OR BEFORE THE HEARING OF THE APPEAL, TO DECIDE THE APPEAL ACCORDING TO LAW. 3. THE ASSESSEE VIDE ITS APPLICATION 26 TH JUNE 2018 RAISED THE FOLLOWING ADDITIONAL GROUND OF APPEAL: 16. WITHOUT PREJUDICE TO GROUND NO.1 TO GROUND NO. 15 AND OUT OF ABUNDANT CAUTION (IN LIGHT OF THE ORDER DATED 29 DECEMBER 20 17 PASSED BY THE HONBLE INCOME-TAX APPELLATE TRIBUNAL IN THE CASE OF THE AP PELLANT FOR THE AY 2009- 10) THE CIT(A) OUGHT TO HAVE ALLOWED A DEDUCTION OF : ANNUAL FRANCHISE CONSIDERATION AMOUNTING TO RS 30 ,03,60,000 PERTAINING TO INDIAN PREMIER LEAGUE (IPL) SEASON 2 (THE FIRST M ATCH OF THE LEAGUE BEING PLAYED ON 18 APRIL 2009); ANNUAL FRANCHISE CONSIDERATION AMOUNTING TO RS 30 ,03,60,000 PERTAINING TO IPL SEASON 3 (THE FIRST MATCH OF THE LEAGUE BEING P LAYED ON 12 MARCH 2010) WHEN COMPUTING THE INCOME CHARGEABLE TO TAX OF THE APPELLANT FOR THE AY 2010-11. 4. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A PRIVATE LIMITED COMPANY BEING 100% SUBSIDIARY OF M/S RED CHILLIES ENTERTAIN MENT PVT LIMITED. THE ASSESSEE COMPANY OWNED AND OPERATE KOLKATA FR ANCHISEE OF INDIAN PREMIER LEAGUE (IPL) I.E. KOLKATA KNIGHT RIDERS (KKR). THE ASSESSEE FILED ITS RETURN OF INCOME FOR ASSESSMENT YEAR 2010 -11 ON 13.10.2010 DECLARING LOSS OF RS. 86,67,016/-. SUBSEQUENTLY, TH E ASSESSEE-COMPANY HAS ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 5 FILED REVISED RETURN OF INCOME ON 29.12.2010 BY INC ORPORATING THE DETAILS OF BROUGHT FORWARD LOSSES OF AY 2008-09 AND A.Y. 20 09-10.THE ASSESSMENT WAS COMPLETED UNDER SECTION 143(3) ON 28 .03.2013. THE ASSESSING OFFICER WHILE PASSING THE ASSESSMENT ORDE R BESIDES OTHER ADDITIONS, DISALLOWANCE MADE ADDITION OF RS. 1,99,9 4,876/- ON ACCOUNT OF INCOME FROM SPONSORSHIP RIGHT, ADDITION ON ACCOUNT OF FRANCHISE FEES OF RS. 16,89,52,500/-, DISALLOWED FEASIBILITY STUDY EX PENSES OF RS. 19,32,720/-, STAMP DUTY EXPENSES OF RS. 2,75,010/-, AIR FAIR EXPENSES, TRAVELLING EXPENSES AND VEHICLE HIRE CHARGES OF RS. 82,12,985/-, TREATED THE WEBSITE DESIGN EXPENSES OF RS. 61,77,358/- AS CAPITAL AND ALLOWED DEPRICIATION @ 60% ONLY-, DISALLOWED LODGING, BOARD ING AND PARTING BILL OF RS. 1,50,83,708/-. ON APPEAL BEFORE THE LD. CIT( A), THE EXPENSES OF WEBSITE DESIGN WAS TREATED AS REVENUE EXPENSES AND ALLOWED ENTIRE EXPENSES, HOWEVER, OTHER ADDITIONS/DISALLOWANCES WE RE SUSTAINED. THEREFORE, BEING AGGRIEVED BOTH THE PARTIES HAVE FI LED THEIR RESPECTIVE APPEALS CHALLENGING THE ORDER OF LD. CIT (A) RAISIN G THE GROUNDS OF APPEAL AS REFERRED ABOVE. 5. WE HAVE HEARD THE SUBMISSIONS OF THE LEARNED AUTHOR IZED REPRESENTATIVE (AR) OF THE ASSESSEE AND THE LEARNED DEPARTMENTAL R EPRESENTATIVE (DR) FOR THE REVENUE AND HAVE GONE THROUGH THE ORDERS OF THE AUTHORITY BELOW. ITA NO. 4087/MUM/2014 BY REVENUE ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 6 6. AT THE OUTSET OF HEARING, WE HAVE NOTED THAT THE SO LE GROUND OF APPEAL RAISED BY REVENUE RELATES TO DELETING THE ADDITION OF WEBSITE DESIGN CHARGES. THE REVENUE IN ITS GROUND OF APPEAL HAS WR ONGLY MENTIONED THAT LD. CIT(A) ERRED IN DELETING THE ADDITION OF RS. 61 ,77,358/-. IN FACT THE ASSESSEE CLAIMED DEDUCTION OF RS. 61,77,358/-. THE ASSESSING OFFICER WHILE PASSING ASSESSMENT ORDER TREATED THE EXPENDIT URE ON WEBSITE DESIGN AS CAPITAL EXPENDITURE AND ALLOWED DEPRECIATION @ 6 0% (RS.37,06,415/-) THEREBY RESTRICTED TO RS. 24,70,493/-. THE LD. CIT( A) TREATED THE ENTIRE EXPENDITURE AS REVENUE EXPENDITURE AND DIRECTED THE ASSESSING OFFICER TO DELETE THE ENTIRE ADDITION. 7. IN THE AFORESAID BACKGROUND, WE HAVE NOTED THAT THE TAX EFFECT INVOLVED IN THE REVENUES APPEAL IS LESS THAN THE MONETARY LIMI T DETERMINED BY CBDT IN ITS CIRCULAR NO. 3/2018 DATED 11 TH JULY, 2018. THEREFORE, KEEPING IN VIEW THAT TAX EFFECT INVOLVED IN THE REVENUES APPE AL IS LESS THAN THE MONETARY LIMIT FIXED BY THE CBDT FOR FILING APPEAL BEFORE THE TRIBUNAL. HENCE, THE APPEAL FILED BY REVENUE IS DISMISSED AS NOT MAINTAINABLE. 8. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ITA NO. 4310/MUM/2014 BY ASSESSEE 9. IN SUPPORT OF ASSESSEES APPEAL, THE LD. AR OF THE ASSESSEE SUBMITS THAT GROUND NO.1 OF THE APPEAL IS GENERAL. GROUND NO.2 R ELATES TO ADDITION ON ACCOUNT OF SPONSORSHIP RIGHTS. THE LD. AR OF THE AS SESSEE SUBMITS THAT THE INCOME FROM SPONSORSHIP RIGHTS WAS NOT ACCRUED TO A SSESSEE IN ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 7 ASSESSMENT YEAR 2010-11 BUT ACCRUED IN SUBSEQUENT A SSESSMENT YEAR AS PER THE METHOD OF ACCOUNTING REGULARLY AND CONSISTE NTLY FOLLOWED BY THE ASSESSEE. THE ASSESSING OFFICER HAS ACCEPTED THE A CCOUNTING POLICY OF REVENUE FROM SPONSORSHIP RIGHTS IN EARLIER ASSESSME NT YEAR. THE IPL MATCH FOR IPL SEASON 2010 TOOK PLACE DURING THE 12 TH MARCH 2010 TO 25 TH APRIL 2010 AS PER THE REVENUE SPONSORSHIP RIGHTS, T HE MANAGEMENT OF ASSESSEE ATTRIBUTE 90% SPONSORSHIP AMOUNT CONTRIBUT ED FOR IPL SEASON 2010 TOWARDS MATCHES PLAYED BY TEAM IN EACH SEASON AND BALANCE 10% OF THE FEES ARE ATTRIBUTED TOWARDS PARTICIPATION OF PR OMOTIONAL ACTIVITIES BY TEAM MEMBER. THE 90% OF THE REVENUE FROM SPONSORSHI P RIGHT, IT IS PAYABLE TO THE MATCHES PLAYS BY THE TEAM FOR THE SE ASON. THE ASSESSEE HAS PROACTIVELY ALLOCATED SPONSORSHIP RIGHT TO REVENUE ON IPL SEASON 2010 ON PRO-RATA BASIS I.E. IN RATION OF 50-50 ON ACCOUN T OF EQUAL NUMBER OF MATCHES PLAYED PRIOR TO 31 ST MARCH 2010 AND FURTHER BALANCE OF 10% OF THE REVENUE ARE ATTRIBUTED FOR PROMOTION OF THE FRANCHI SE CONTRIBUTOR BRANDS AND PRORATE OVER THE TERM OF RESPECTIVE SPONSORSHIP RIGHT AGREEMENT. THE ASSESSEE HAS MADE DETAILED FACTUAL AND LEGAL SUBMIS SION BEFORE THE ASSESSING OFFICER. THE LD AR FOR THE ASSESSEE SUBMI TS THAT 50% OF 90% OF THE REVENUE HAVE BEEN OFFERED DURING THE YEAR AND R EMAINING 10% HAS BEEN OFFERED ON PRORATE BASIS OVER THE TERM OF RESP ECTIVE SPONSORSHIP RIGHT, WHICH IS RS.16,45,21,911/- TILL 31/03/2010 AND THE SAME IS OFFERED TO TAX, THUS NO ADDITION OUGHT TO HAVE MADE. THE ASSESSING OFFICER HAVE TAXED THE ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 8 50% OF TOTAL AMOUNT OF RS. 36,90,33,574/- DURING T HE YEAR. THE LD. CIT(A) UPHELD THE ACTION OF ASSESSING OFFICER HOLDI NG THAT THE ASSESSEE SHOULD HAVE OFFERED 50% OF INCOME VOLUNTARILY ON HI S OWN. 10. ON THE OTHER HAND THE LD. DR FOR THE REVENUE SUPPO RTED THE ORDER OF THE AUTHORITIES BELOW. 11. WE HAVE CONSIDERED THE RIVAL SUBMISSION OF THE PART IES AND HAVE GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. WE HAVE NO TED THAT DURING THE ASSESSMENT PROCEEDING, THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAS RECEIVED A TOTAL AMOUNT OF RS. 36,90,33,574/- ON AC COUNT OF SPONSORSHIP RIGHT, 50% OF WHICH IS RS. 18,45,16,787/-, HOWEVER, THE ASSESSEE WHILE FILING RETURN OF INCOME HAS OFFERED RS. 16,45,21,91 1/- THEREBY OFFERED LESS INCOME OF RS. 1,99,94,876/-. THEREFORE, THE DIFFERE NCE AMOUNT WAS BROUGHT TO TAX. BEFORE THE LD. CIT(A), THE ASSESSEE URGED THAT SIMILAR CONTENTION AS URGED BEFORE US THAT 10% OF THE FEES WERE ATTRIBUTED TOWARDS PARTICIPATION AND PROMOTIONAL ACTIVITIES BY THE TEA M MEMBERS AND ACCORDINGLY 50% OF 90% OF THE REVENUE HAS BEEN OFFE RED DURING THE YEAR AND REMAINING 10% HAS BEEN OFFERED ON PRO-RATA BASI S OVER THE TERM OF RESPECTIVE SPONSORSHIP RIGHT AGREEMENT AND THE SAME HAS BEEN OFFERED FOR TAX ACCORDINGLY. THE LD. CIT(A) AFTER CONSIDERI NG THE CONTENTION OF THE ASSESSEE OBSERVED THAT THE METHODOLOGY ADOPTED IS F OLLOWED BY THE ASSESSEE IS DIFFICULT TO UNDERSTAND AS THE SAME IS NEITHER AS PER ACCOUNTING STANDARD NOR AS PER ANY SPECIFIED CRITERIA, ONCE TH E SPONSORSHIP RIGHT ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 9 AGREEMENT HAVE BEEN SIGNED FOR PARTICULAR SUPPORTIN G EVENT, THE AMOUNT RECEIVED IS ALREADY DETERMINED, THEREFORE, THE ASSE SSEE ON HIS OWN SHOULD HAVE OFFERED 50% OF SUCH INCOME, IF 100% IS NOT OFF ERED WITHIN THE TAXING YEAR. HOWEVER, THE ASSESSEE HAS ADOPTED ITS OWN MET HODOLOGY BY DIVIDING THE INCOME INTO TWO PARTS. HOWEVER, THE LD. CIT(A) DIRECTED THE ASSESSING OFFICER THAT IF THE AMOUNT OF RS. 1,99,94,786/- IS TAXED IN ASSESSMENT YEAR 2011-12, SAME SHOULD BE DELETED TO AVOID THE DOUBLE TAXATION. WE HAVE SEEN THAT LD. CIT(A) HAS GIVEN REASONABLE DIRECTION TO THE ASSESSING OFFICER, IF THE ASSESSEE HAS OFFERED REMAINING RECE IPT IN SUBSEQUENT ASSESSMENT YEAR THEN TO REDUCE SUCH INCOME FROM ASS ESSEES TOTAL INCOME ASSESSED FOR ASSESSMENT YEAR 2011-12. IN OUR VIEW, THE DIRECTION GIVEN BY LD. CIT(A) IS QUITE REASONABLE AND WHICH DOES NOT R EQUIRE ANY INTERFERENCE. 12. IN THE RESULT, GROUND OF APPEAL IS DISMISSED. 13. GROUND NO.3 TO 5 RELATES TO THE ADDITION ON ACCOUNT OF ANNUAL CONSIDERATION PAID TO BCCI. THE LD. AR OF THE ASSES SEE ARGUED THAT THESE GROUNDS OF APPEAL ARE COVERED BY THE DECISION OF TR IBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2009-10. 14. ON THE OTHER HAND, THE LD. DR FOR THE REVENUE AFTER GOING THROUGH THE DECISION OF TRIBUNAL CONCEDED THAT THESE GROUNDS OF APPEAL ARE COVERED BY THE DECISION OF TRIBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2009- 10 IN ITA NO. 1307/MUM/2013 DATED 29.12.2017. ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 10 15. WE HAVE CONSIDERED THE RIVAL SUBMISSION OF THE PART IES AND HAVE GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. WE HAVE NO TED THAT SIMILAR GROUND OF APPEAL WAS RAISED BY THE ASSESSEE FOR ASSESSMENT YEAR 2009-10 AND THE TRIBUNAL ON SIMILAR GROUND OF APPEAL PASSED THE FOL LOWING ORDER: 45. WE SHALL FIRST TAKE UP THE CORE ISSUE INVOLVED IN THE PRESENT APPEAL AS TO WHETHER THE FRANCHISE FEE PAID BY THE ASSESSEE TO B CCI- IPL WAS RIGHTLY CLAIMED BY IT AS A REVENUE EXPENDITURE, OR THE SAME BEING IN THE NATURE OF A CAPITAL EXPENDITURE WAS RIGHTLY DISALLOWED BY THE L OWER AUTHORITIES. WE FIND THAT THE ASSESSEE HAD ENTERED INTO A FRANCHISE AGREEMENT WITH BCCI- IPL IN APRIL, 2008. THAT PURSUANT TO THE AFORESAID AGREEMENT THE ASSESSEE WAS VESTED WITH THE RIGHT TO OPERATE THE FRANCHISE AND TO BE A MEMBER O F THE LEAGUE AND OPERATE A TEAM IN THE CITY OF KOLKATA AND PARTICIPATE IN THE IPL TOURNAMENT, WHICH WAS OWNED AND OPERATED BY BCCI-IPL. THE ASSESSEE IN TER MS OF CLAUSE 7 OF THE FRANCHISE AGREEMENT REMAINED UNDER AN OBLIGATION TO PAY TO BCCI-IPL THE ANNUAL FRANCHISE FEE OF THE FOLLOWING AMOUNT: (A). IN RESPECT OF THE PERIOD 2008-17 (INCLUSIVE), AS UNDER:- (I) A SUM OF USD 22,52,700/- EQUIVALENT TO INR 9,01 ,08,000/- TOWARDS 'LEAGUE DEPOSIT' ON OR BEFORE 2ND JANUARY IN EACH SUCH YEAR , WHICH THEREAFTER WAS TO BE APPROPRIATED TOWARDS THE ANNUAL FRANCHISE CONSIDERA TION ON THE DATE OF THE FIRST MATCH OF THE LEAGUE IN THE YEAR IN WHICH THE LEAGUE DEPOSIT WAS PAID. THE LEAGUE DEPOSIT WAS REFUNDABLE IN ANY YEAR IF THE LEAGUE DI D NOT TAKE PLACE AT ALL IN SUCH YEAR, UNDER WHICH CIRCUMSTANCE THE AMOUNT WAS TO BE REFUNDED WITHOUT INTEREST; AND (II) A SUM OF USD 52,56,300/- EQUIVALENT TO INR 21, 02,52,000/- WAS TO BE PAID BY THE ASSESSEE EVERY YEAR ON THE DATE OF THE FIRST MA TCH OF THE LEAGUE IN EACH SUCH YEAR. (B). THAT FROM AND INCLUDING THE YEAR 2018 ONWARDS, THE FRANCHISEE REMAINED UNDER AN OBLIGATION TO PAY AN AMOUNT EQUAL TO 20% OF THE FRA NCHISEE INCOME RECEIVED IN RESPECT OF SUCH YEAR, WHICH SUM WAS TO BE PAID IN F OUR INSTALMENTS, I.E WITHIN 60 DAYS OF 31ST MARCH, 30TH JUNE, 30TH SEPTEMBER AND 3 1ST DECEMBER IN 2018 AND EACH SUBSEQUENT YEAR OF THE TERM. WE FURTHER FIND THAT THE TERM 'YEAR' AS DEFINED IN CLAUSE 1 WAS TO BE CONSTRUED AS EACH 12 MONTH PERIOD (OR PART THEREOF) FROM 1ST JANUARY TO 31ST DECEMBER DURING THE TERM, EXCEPT FOR THE YEAR UNDER CONSIDER ATION, WHICH BEING THE FIRST YEAR OF THE LEAGUE WAS TO BE RECKONED FROM THE DATE OF SIGNING OF THE AGREEMENT TILL 31 DECEMBER, 2008. WE FURTHER FIND THAT THE 'F RANCHISEE RIGHTS' WHICH AGAIN IS DEFINED IN CLAUSE 1 OF THE FRANCHISE AGREEMENT, PROVIDES THAT THE SAME SHALL MEAN ALL RIGHTS IN RESPECT OF THE TEAM, INCLUDING T HOSE RIGHTS SET OUT IN CLAUSE 4.3, VIZ. (I) THE SHIRTS SPONSORSHIP RIGHTS IN RESP ECT OF THE TEAM; (II) OFFICIAL SUPPLIERSHIP RIGHTS IN RESPECT OF THE TEAM; (III) C ORPORATE ENTERTAINMENT/PREMIUM ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 11 SEATING RIGHTS AT THE STADIUM DURING HOME LEAGUE MA TCHES; (IV) RIGHT TO CONDUCT FRANCHISEE LICENSING;(V) RIGHT TO RETAIN ALL OF THE GATE RECEIPTS IN RESPECT OF THE FRANCHISEE HOME LEAGUE MATCHES; (VI) THE RIGHT TO S ELL MERCHANDISE AT THE STADIUM ON THE DAY OF ITS HOME LEAGUE MATCHES; AND (VII). SUCH OTHER RIGHTS IN RELATION TO THE TEAM WHICH MAY BE IDENTIFIED IN THE COMMERCIAL GUIDELINES PROVIDED BY BCCI-IPL. HOWEVER, THE ASSESSEE WAS NOT VESTED WITH ANY RIGHT IN RESPECT OF THE CENTRAL RIGHTS AND ALL RIGHTS IN RES PECT OF THE LICENSING OF REPLICA UNIFORMS FOR ANY TEAM IN THE LEAGUE. 46. WE HAVE PERUSED THE VARIOUS CLAUSES OF THE FRAN CHISE AGREEMENT, AS PER WHICH THE FRANCHISE RIGHTS HAD BEEN VESTED WITH THE ASSESSEE. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE NATURE OF THE RIGHT S, AND FIND THAT THE PAYMENT OF THE FRANCHISE FEE BY THE ASSESSEE FOR A YEAR, THERE IN VESTED WITH HIM A RIGHT TO PARTICIPATE IN THE TOURNAMENT FOR THE SAID YEAR WIT HOUT GUARANTEE THAT IN THE FUTURE YEARS IT WOULD BE ELIGIBLE TO PARTICIPATE IN THE TOURNAMENT. WE FIND THAT THE PAYMENT OF THE FRANCHISE FEE BY THE ASSESSEE AS PER THE TERMS CONTEMPLATED IN THE FRANCHISE AGREEMENT ENABLED IT TO PARTICIPAT E IN THE TOURNAMENT FOR THE SUBJECT YEAR AND EARN REVENUE FROM THE SAME. WE FUR THER FIND THAT THE PAYMENT OF THE FRANCHISE FEE BY THE ASSESSEE WAS IN THE NAT URE OF RECURRING ANNUAL PAYMENT WHICH WAS PAID TO FACILITATE PARTICIPATION IN THE LEAGUE AND OPERATING THE TEAM ONLY FOR THE YEAR FOR WHICH THE PAYMENT PE RTAINED, WITH NEITHER VESTING OF ANY RIGHT OF PARTICIPATION IN THE SUBSEQUENT YEA RS, NOR LEADING TO CREATION/OWNERSHIP OF AN ASSET OR GENERATION OF A B ENEFIT OF AN ENDURING NATURE IN THE HANDS OF THE ASSESSEE. WE FURTHER FIND THAT THE YEAR UNDER CONSIDERATION WAS THE FIRST YEAR , AND AS SUCH WAS TO BE CONSTRUED FROM THE DATE OF SIGNING OF THE AGREEMENT TILL 31ST DECEMBER, 2008. WE HAVE DEL IBERATED AT LENGTH ON THE RIGHTS AND OBLIGATIONS CONTEMPLATED IN THE FRANCHIS E AGREEMENT. WE FIND THAT IN CASE OF NON-STAGING OF THE LEAGUE BY BCCI- IPL (IN WHOLE OR PART) THE SAME WAS NOT TO CONSTITUTE A BREACH OF THE AGREEMENT, AND TH E ASSESSEE WAS DIVESTED OF HIS RIGHT TO TAKE ANY LEGAL ACTION AGAINST THE OTHER PA RTY, VIZ. BCCI OR ENFORCE THE PLAYING OF THE MATCHES. WE FURTHER FIND THAT AS CAN FAIRLY BE GATHERED FROM PERUSING THE DETAILS OF THE CENTRAL LICENSING/FRANC HISEE LICENSING AS DEFINED IN THE FRANCHISEE AGREEMENT PER THE TERMS OF THE AGREE MENT, ALL THE BROADCASTING RIGHTS AS REGARDS THE TELECAST OF THE MATCHES REMAI NED WITH THE BCCI, WHILE FOR THE ASSESSEE WAS ONLY VESTED WITH THE RIGHTS AS THA T OF A FRANCHISEE. WE FURTHER FIND THAT THE ASSESSEE AS GATHERED FROM CLAUSE 10 O F THE FRANCHISE AGREEMENT WAS NOT VESTED WITH ANY RIGHT TO ASSIGN OR DELEGATE THE PERFORMANCE OF ANY RIGHT OR OBLIGATION UNDER THE AGREEMENT. THAT STILL FURTH ER AS PER CLAUSE 22 OF THE AGREEMENT, IN CASE OF BREACH BY THE FRANCHISEE OF T HE TERMS CONTEMPLATING THE PAYMENT OBLIGATION TO BCCI, THE SAME WAS TO BE CONS TRUED AS A MATERIAL BREACH OF THE AGREEMENT. WE FURTHER WHILE DELIBERATING ON THE TERMS OF THE FRANCHISE AGREEMENT HAD OBSERVED THAT AS PER CLAUSE 16 OF THE AGREEMENT, THE RIGHTS GRANTED TO THE FRANCHISEE WERE PERSONAL TO THE FRAN CHISEE AND HAD NO RIGHT TO ASSIGN THE AGREEMENT OR TO SUB-CONTRACT OR OTHERWIS E DELEGATE THE FRANCHISEES OBLIGATIONS UNDER IT WITHOUT THE BCCI-IPL WRITTEN C ONSENT. 47. WE HAVE DELIBERATED AT LENGTH AS REGARDS THE NA TURE OF THE RIGHTS AS GOT VESTED WITH THE ASSESSEE ON THE PAYMENT OF THE FRAN CHISE FEE OF RS.30,03,60,000/- TO BCCI. WE HAVE GIVEN A THOUGHTF UL CONSIDERATION TO THE ISSUE BEFORE US AND ARE OF THE CONSIDERED VIEW THAT THE PAYMENT OF THE FRANCHISE ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 12 FEE BY THE ASSESSEE TO BCCI-IPL ONLY FACILITATED PA RTICIPATION IN THE LEAGUE AND OPERATING THE TEAM FOR THE YEAR FOR WHICH THE PAYME NT PERTAINED, WITH NO VESTED RIGHT TO PARTICIPATE IN THE EVENTS FOR THE SUBSEQUE NT YEAR/YEARS. WE ARE OF THE CONSIDERED VIEW THAT AS THE AFORESAID PAYMENT OF FR ANCHISE FEE WHICH FACILITATED THE PARTICIPATION IN THE LEAGUE AND OPERATING THE T EAM WAS RESTRICTED ONLY TO THE YEAR TO WHICH THE PAYMENT PERTAINED, THEREFORE, IT CAN SAFELY BE CONCLUDED THAT BY MAKING SUCH PAYMENT THERE WAS NEITHER A CREATION OF AN ASSET OR GENERATION OF A BENEFIT OF AN ENDURING NATURE IN THE HANDS OF THE ASSESSEE. WE FIND THAT A CONJOINT READING OF CLAUSE 7 OF THE AGREEMENT CONTE MPLATING THE PAYMENT OF THE FRANCHISE FEE AND CLAUSE 1 DEFINING THE TERM 'YEAR' , CLEARLY REVEALS BEYOND ANY SCOPE OF DOUBT THAT THE PAYMENT OF THE FRANCHISE FE E OF RS.30,03,60,000/- BY THE ASSESSEE FOR IPL SEASON-1 WAS ONLY FOR THE PERIOD 1 0.04.2008 (I.E THE DATE OF THE SIGNING OF THE AGREEMENT) TILL 31.12.2008. THAT AS STANDS GATHERED FROM THE FRANCHISE AGREEMENT, THE MAKING OF THE AFORESAID PA YMENT OF FRANCHISE FEE BY THE ASSESSEE TO BCCI-IPL FOR IPL SEASON-1 ONLY ENAB LED THE ASSESSEE TO PARTICIPATE IN THE LEAGUE TOURNAMENTS FOR IPL SEASO N-1 AND OPERATE ITS TEAM FOR THE AFORESAID PERIOD FOR WHICH THE PAYMENT WAS MADE . WE ARE UNABLE TO PERSUADE OURSELVES TO SUBSCRIBE TO THE VIEW OF THE LOWER AUTHORITIES THAT ANY BENEFIT OF ENDURING NATURE WAS GENERATED IN THE HAN DS OF THE ASSESSEE BY MAKING THE PAYMENT OF THE FRANCHISE FEE OF RS.30,03,60,000 /-, WHICH AS OBSERVED BY US WAS ONLY FOR FACILITATING THE ASSESSEE TO PARTICIPA TE IN THE LEAGUE TOURNAMENTS FOR IPL SEASON-1. WE HAVE DELIBERATED ON THE NATURE OF RIGHTS OF THE ASSESSEE FRANCHISEE ON PAYMENT OF THE FRANCHISE FEE AND FIND THAT WHILE FOR THE 'CENTRAL RIGHTS' WERE RETAINED BY BCCI, THE 'FRANCHISEE RIGH TS' REMAINED WITH THE ASSESSEE. WE FURTHER FIND THAT THOUGH BY MAKING THE PAYMENT OF THE FRANCHISE FEE THE ASSESSEE GOT A RIGHT TO PARTICIPATE IN THE LEAGUE AND OPERATE ITS HOME TEAM FOR THE YEAR FOR WHICH THE PAYMENT WAS MADE, BUT HO WEVER, THE NON-STAGING OF THE LEAGUE BY BCCI-IPL (IN WHOLE OR PART) WOULD NOT CONSTITUTE A BREACH OF THE AGREEMENT, AND THE ASSESSEE WAS NEITHER VESTED WITH ANY RIGHT TO ENFORCE THE PLAYING OF SUCH MATCHES BY BCCI NOR HAD ANY RIGHT T O TAKE ANY LEGAL ACTION FOR THE SAID FAILURE ON THE PART OF THE BCCI TO STAGE T HE MATCHES. WE HAVE FURTHER OBSERVED THAT THE AFORESAID FRANCHISE RIGHTS AS PER CLAUSE 16 OF THE FRANCHISE AGREEMENT WERE PERSONAL TO THE FRANCHISEE AND IT HA D NO RIGHT TO EITHER ASSIGN THE AGREEMENT OR TO SUB-CONTRACT OR OTHERWISE DELEGATE THE FRANCHISEES OBLIGATIONS UNDER IT WITHOUT THE BCCI-IPLS WRITTEN CONSENT. WE FURTHER FIND THAT THE ISSUE BEFORE US AS TO WHETHER THE FRANCHISE FEE PAID TO B CCI-IPL IS A REVENUE EXPENDITURE OR A CAPITAL EXPENDITURE HAD ALREADY BE EN LOOKED INTO AND ADJUDICATED UPON BY A COORDINATE BENCH OF TRIBUNAL, VIZ. ITAT 'I' BENCH, MUMBAI IN THE CASE OF INDIA WIN SPORTS PVT. LTD. VS . ACIT (ITA NO. 5290 & 5291/MUM/2014, DATED 22.07.2016, WHEREIN THE TRIBUN AL HAD HELD AS UNDER: 'THE EXPENDITURE OF RS.44,76,00,000/- INCURRED BY I T FOR MAKING PAYMENT OF THE FIRST INSTALMENT TO THE BCCI-IPL IN TERMS OF CLAUSE 7 OF THE AGREEMENT WAS NOT FOR THE PURPOSE OF ACQUISITION OF ANY ASSET BUT FOR AN ANNUAL RIGHT TO MANAGE THE FRANCHISE. THE PURPOSE OF THE EXPENDITURE TO BE INC URRED UNDER THE AGREEMENT BY THE ASSESSEE HAS BEEN STATED IN CLAUSE 6 OF THE AGR EEMENT AS CONSIDERATION FOR THE RIGHT TO OPERATE THE FRANCHISE AND TO BE A MEMBER O F THE LEAGUE. THE TOTAL EXPENDITURE OF RS.44,76,00,000/- PAYABLE IN YEARLY INSTALMENTS OF RS.44,76,00,000/- FOR TEN YEARS WAS CLEARLY FOR THE PURPOSE OF SECURI NG FRANCHISE RIGHT FROM BCCI. THUS PAYMENTS MADE BY THE ASSESSEE WERE FOR THE ANN UAL BENEFITS ONLY NOT EXTENDING BEYOND ONE YEAR. ITS RIGHT TO OPERATE AND MANAGE THE TEAM IS SUBJECT TO ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 13 PRIOR PAYMENT OF ANNUAL FRANCHISE FEE; IF THE ASSES SEE FAILS TO MAKE THE PAYMENT, THEN IT WOULD NOT BE ALLOWED TO PARTICIPATE IN IPL. THUS, THE ASSESSEE HAS MADE THE ANNUAL PAYMENTS TO EARN THE ANNUAL INCOME. THE NATU RE OF TRANSACTION/PAYMENT CLEARLY DEMONSTRATES THAT THE ASSESSEE IS NEITHER O BTAINING ANY ENDURING BENEFIT BY MAKING PAYMENT OF ANNUAL INSTALMENT THESE PAYMENTS ARE GIVING RISE TO ANY ASSETS. THESE PAYMENTS ARE MERE ANNUAL PAYMENTS TO BCCI-IPL TO GIVE A RIGHT TO THE ASSESSEE TO PARTICIPATE IN THE MATCHES WITH ITS TEA M. THEREFORE, THE ANNUAL FRANCHISE PAYMENT WAS A REVENUE EXPENDITURE.' WE FURTHER FIND THAT A SIMILAR VIEW WAS ALSO TAKEN BY THE ITAT, HYDERABAD 'B', HYDERABAD IN THE CASE OF DCIT VS. M/S DECCAN CHARGE RS SPORTING VENTURES LTD. (ITA NO. 1043/HYD/2013, DATED 28.10.2015, WHER EIN TOO THE TRIBUNAL HAD CONCLUDED THAT THE FRANCHISE FEE PAID BY THE FRANCH ISEE ASSESSEE TO BCCI-IPL WAS IN THE NATURE OF A REVENUE EXPENDITURE. WE FIND THAT THE JUDGMENTS OF THE HON'BLE SUPREME COURT IN THE CASE OF TECHNO SHARES & STOCKS LTD. & ORS. VS. COMMISSIONER OF INCOME TAX (2010) 327 ITR 323( SC) AND JONAS WOODHEAD AND SONS (INDIA) LTD. VS. COMMISSIONER OF INCOME-TA X (1997) 224 ITR 342 (SC) RELIED UPON BY THE A.O ARE DISTINGUISHABLE ON FACTS. WE FIND THAT IN THE CASE OF TECHNO SHARES & STOCKS LTD. & ORS (SUPRA) T HE ISSUE BEFORE THE HON BLE APEX COURT WAS AS TO WHETHER THE RIGHT OF MEMBERSHI P CONFERRED UPON THE MEMBERS UNDER THE BSE MEMBERSHIP CARD IS A 'BUSINES S OR COMMERCIAL RIGHT' WHICH GIVES A NON-DEFAULTING CONTINUING MEMBER A RI GHT TO ACCESS THE EXCHANGE AND TO PARTICIPATE THEREIN, AND IN THAT SENSE A LIC ENSE OR AKIN TO LICENCE IN TERMS OF SEC. 32(1)(II) OF THE ACT. WE FIND THAT AS THE A FORESAID RIGHT OF MEMBERSHIP CONFERRED UPON THE MEMBERS UNDER THE BSE MEMBERSHIP CARD AN ENDURING BENEFIT, WHICH WOULD VEST WITH THE STOCK EXCHANGE O NLY ON THE DEFAULT/DEMISE IN TERMS OF RULES AND BYE-LAWS OF BSE, THEREFORE, IT W AS IN THE BACKDROP OF THE AFORESAID MATERIAL FACTS THAT THE HON BLE APEX COURT HAD CONCLUDED THAT THE SAME WAS AN INTANGIBLE RIGHT WHICH WAS ENTITLED FOR CLAIM OF DEPRECIATION. WE MAY HEREIN OBSERVE THAT THE HON BLE APEX COURT IN THE AFORESAID CASE HAD AS A WORD OF CAUTION OBSERVED THAT THE SAID JUDGMENT MAY NOT BE UNDERSTOOD TO MEAN THAT EVERY BUSINESS OR COMMERCIAL RIGHT WOULD CONST ITUTE A 'LICENCE' OR A 'FRANCHISE' IN TERMS OF SEC. 32(1)(II) OF THE ACT, BY HOLDING AS UNDER: '24. BEFORE CONCLUDING, WE WISH TO CLARIFY THAT OUR PRESENT JUDGMENT IS STRICTLY CONFINED TO THE RIGHT OF MEMBERSHIP CONFERRED UPON THE MEMBER UNDER THE BSE MEMBERSHIP CARD DURING THE RELEVANT ASSESSMENT YEAR S. WE HOLD THAT THE SAID RIGHT OF MEMBERSHIP IS A 'BUSINESS OR COMMERCIAL RIGHT' W HICH GIVES A NON-DEFAULTING CONTINUING MEMBER A RIGHT TO ACCESS THE EXCHANGE AN D TO PARTICIPATE THEREIN AND IN THAT SENSE IT IS A LICENCE OR AKIN TO LICENCE IN TE RMS OF S. 32(1)(II) OF THE 1961 ACT. THAT, SUCH A RIGHT VESTS IN THE EXCHANGE ONLY ON DE FAULT/DEMISE IN TERMS OF THE RULES AND BYE-LAWS OF BSE, AS THEY STOOD AT THE REL EVANT TIME. OUR JUDGMENT SHOULD NOT BE UNDERSTOOD TO MEAN THAT EVERY BUSINESS OR CO MMERCIAL RIGHT WOULD CONSTITUTE A 'LICENCE' OR A 'FRANCHISE' IN TERMS OF S. 32(1)(II) OF THE 1961 ACT. ' SIMILARLY, IN THE CASE OF JONAS WOODHEAD AND SONS ( INDIA) LTD. (SUPRA) THE HON BLE APEX COURT IN THE BACKDROP OF THE FACTS INVOLVE D IN THE CASE BEFORE IT, OBSERVED, THAT AS THE FOREIGN COMPANY PURSUANT TO A N AGREEMENT WITH THE ASSESSEE HAD PROVIDED TECHNICAL KNOW HOW AND SERVIC ES FOR SETTING UP OF THE PLANT AND MANUFACTURING OF PRODUCTS, WITH NO EMBARG O ON THE ASSESSEE TO CONTINUE WITH THE MANUFACTURING OF THE PRODUCTS EVE N AFTER THE EXPIRY OF THE AGREEMENT, THEREFORE, AN ENDURING BENEFIT GOT VESTE D WITH THE ASSESSEE, AND THUS ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 14 THE PAYMENT MADE BY THE ASSESSEE FOR THE SAME WAS A CAPITAL EXPENDITURE. WE ARE OF THE CONSIDERED VIEW THAT UNLIKE THE FACTS IN VOLVED IN THE AFORESAID CASE LAWS RELIED UPON BY THE A.O, IN THE CASE BEFORE US, AS NO ENDURING BENEFIT BY MAKING THE PAYMENT OF THE FRANCHISE FEE GOT VESTED WITH THE ASSESSEE, THEREFORE, THE SAID JUDICIAL PRONOUNCEMENTS BEING DISTINGUISHA BLE ON FACTS WOULD NOT ASSIST THE CASE OF THE REVENUE. WE THUS IN THE BACKDROP OF OUR AFORESAID OBSERVATIONS AND FINDING OURSELVES TO BE IN AGREEMENT WITH THE V IEW TAKEN BY THE COORDINATE BENCHES OF THE TRIBUNAL, THEREFORE, ARE OF THE CONS IDERED VIEW THAT THE PAYMENT OF THE FRANCHISE FEE FOR IPL SEASON-1 OF RS.30,03,6 0,000/- BY THE ASSESSEE CAN SAFELY BE HELD TO BE IN THE NATURE OF A REVENUE EXP ENDITURE, WHICH WAS RIGHTLY CLAIMED BY THE ASSESSEE AS SUCH WHILE COMPUTING ITS INCOME FOR THE YEAR UNDER CONSIDERATION. WE THUS SET ASIDE THE ORDER OF THE C IT(A) AND DIRECT THE A.O TO DELETE THE ADDITION OF RS.30,03,60,000/-. WE MAY HE REIN OBSERVE THAT AS WE HAVE HELD THAT THE FRANCHISE FEE OF RS.30,03,60,000/- PA ID BY THE ASSESSEE TO BCCI IS A REVENUE EXPENDITURE, THEREFORE, THE CONTENTIONS O F THE ASSESSEE AS REGARDS QUANTIFICATION OF THE W.D.V FOR COMPUTING THE DEPRE CIATION IN RESPECT OF THE FRANCHISE RIGHTS IS RENDERED AS REDUNDANT AND IS NO T BEING ADJUDICATED BY US. THE GROUND OF APPEAL NO. 2 TO 4 ARE ALLOWED IN TERMS OF OUR AFORESAID OBSERVATIONS. 16. CONSIDERING THE DECISIONS OF TRIBUNAL IN ASSESSEES OWN CASE, THE GROUND NO. 3 TO 5 OF THE APPEAL ARE ALLOWED WITH SIMILAR O BSERVATION AS PER THE ORDER DATED 29.12.2017 IN ITA NO. 1307/MUM/2013. 17. GROUND NO. 6 & 7 RELATES TO FEASIBILITY STUDY EXPEN SE. THE LD. AR OF THE ASSESSEE SUBMITS THAT FEASIBILITY STUDY EXPENSES IN CURRED BY THE ASSESSEE ARE RELATED WITH THE BUSINESS EXPENSES. THERE IS NO ALLEGATION OF LOWER AUTHORITIES THAT IT WAS NOT FOR THE BUSINESS PURPOS E. THE LD. AR OF THE ASSESSEE FURTHER SUBMITS THAT AFTER IPL SEASON 2008 , THE ASSESSEE DELIBERATE THAT SINCE ANNUAL COST HIRING OF STADIUM UNDER BY GREATER ASSOCIATION OF BENGAL IS SUBSTANTIALLY HIGH, IT MAY BE COST EFFICIENT TO COMPLETE OWN AND MANAGE CRICKET STADIUM IN EASTERN INDIA, CATCHMENT AREA FOR HOME MATCHES OF ASSESSEE. THE STADIUM USED BY ASSESSEE WAS STATE GOVERNMENT STADIUM AND ASSESSEE WAS UNABLE TO IMPROVE AS THE REQUIREMENT AND STANDARD OF IPL, THEREFORE, MANAGEM ENT WAS EXPLORING ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 15 THE POTENTIAL AND FEASIBILITY OF NEW ENTERTAINMENT FOCUS MULTI-USE STADIUM. DURING THE RELEVANT PERIOD, THE ASSESSEE IDENTIFIED A SCENE IN HAWARA ACROSS HUGLY RIVER AND THE PROFESSIONAL LIKE HOK SP ORTS & VENUE & EVENT PVT. LTD. A SINGAPORE BASED COMPANY, APPOINTED TO U NDERTAKE FEASIBILITY STUDY TO ESTABLISH THE POTENTIAL OF THE NEW LOCATIO N OF THE PROPOSED SITE. THE ASSESSEE INCURRED EXPENSES OF RS. 24,15,900/- F OR THE PROFESSIONAL SERVICES RENDERED BY THOSE PROFESSIONAL. DURING THE ASSESSMENT, THE ASSESSEE PROVIDED THE DETAILS OF LEDGER ACCOUNT ALO NG WITH DETAIL FACTUAL AND LEGAL SUBMISSION. THE STUDY EXPENSES ARE REVENU E IN NATURE, NEITHER NEW BUSINESS OR NEW ASSET OR ENDURING THE BENEFIT C AME INTO EXISTENCE AS A RESULT OF FEASIBILITY STUDY. THE ASSESSING OFFICER ALLOWED ONLY 1/5 TH OF THE EXPENSES. THE ASSESSEE IS ENTITLED FOR THE ENTIRE E XPENDITURE. IN SUPPORT OF HIS SUBMISSIONS THE LD AR FOR THE ASSESSEE RELIED O N THE DECISION OF DELHI HIGH COURT IN CIT VS PRIYA VILLAGE ROADSHOW LTD. (2 011) 332 ITR 594. 18. ON THE OTHER HAND, THE LD. DR FOR THE REVENUE SUPPO RTED THE ORDER OF LOWER AUTHORITIES. THE LD. DR SUBMITS THAT THE CASE OF THE ASSESSEE IS CLEARLY COVERED BY SECTION 35D. 19. WE HAVE CONSIDERED THE RIVAL SUBMISSION OF THE PART IES AND HAVE GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. THE ASSESS ING OFFICER TREATED THE ENTIRE EXPENDITURE AS PRELIMINARY EXPENSES AND CAPI TALIZED THE SAME. THE ASSESSING OFFICER ALLOWED 1/5 TH OF THE EXPENDITURE IN ACCORDANCE WITH SECTION 35D, WHICH RESULTED AN ADDITION OF RS. 19,3 2,720/-. THE LD. CIT(A) ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 16 CONFIRMED THE ACTION OF ASSESSING OFFICER HOLDING T HAT BEING NOT UNREASONABLE. WE HAVE NOTED THAT THERE IS NO DISPUT E ABOUT THE EXPENSES INCURRED BY THE ASSESSEE. THERE IS NO DISPUTE THAT LOWER AUTHORITIES HAVE NOT DISPUTED THE COST OF THE EXPENSES. WE HAVE NOTE D THAT THE LOWER AUTHORITIES HAVE FAILED TO SPECIFY AS TO HOW THE CA SE OF ASSESSEE IS COVERED UNDER SECTION 35D, WHEN NO NEW STADIUM WAS MADE WAS ASSESSEE. THE ASSESSEE HAS INCURRED THE PRELIMINARY EXPENSES FOR FEASIBILITY EXPENSES. IT IS AN UNDISPUTED FACT THAT ULTIMATELY THE ASSESSEE ABUNDANT THE IDEA OF CONSTRUCTION OF NEW STADIUM. AS NEITHER THE SCHEME NOR THE IDEA OF ASSESSEE WAS MATERIALIZED OR NO NEW UNIT/ STADIUM W AS MADE, THEREFORE, THE ASSESSEE IS ENTITLED FOR DEDUCTION OF ENTIRE EX PENDITURE INCURRED ON SUCH FEASIBILITY REPORT AS REVENUE EXPENDITURE SIMI LAR VIEW WAS EXPRESS BY HONBLE DELHI HIGH COURT IN CIT VS PRIYA VILLAGE RO ADSHAW (SUPRA). 20. IN THE RESULT, GROUND NO. 6 & 7 OF APPEAL ARE ALLOW ED. 21. GROUND NO. 8 RELATES TO STAMP DUTY EXPENSES. THE LD . AR OF THE ASSESSEE SUBMITS THAT THE EXPENSES INCURRED BY ASSESSEE ON S TAMP DUTY EXPENSES PAID ON VARIOUS AGREEMENTS ARE PURELY A REVENUE EXP ENSES. THE ASSESSING OFFICER TREATED THE EXPENDITURE AS CAPITAL IN NATUR E. 22. ON THE OTHER HAND, THE LD. DR FOR THE REVENUE SUPPO RTED THE ORDER OF LOWER AUTHORITIES. THE LD. DR FOR THE REVENUE SUBMI TS THAT EXPENSES WERE NOT INCURRED FOR THE PURPOSE OF BUSINESS OF THE ASS ESSEE. ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 17 23. WE HAVE CONSIDERED THE RIVAL SUBMISSION AND PERUSED THE ORDERS OF AUTHORITIES BELOW. WE HAVE NOTED THAT THE ASSESSEE CLAIMED EXPENDITURE OF RS. 2,75,010/- TOWARDS STAMP DUTY EXPENSES FOR TRAN SFER OF ASSESSEES COMPANY SHARE FROM RED CHILLIS ENTERTAINMENT PVT. LTD. TO SHAHRUKH KHAN & GAURI KHAN. THE ASSESSING OFFICER TREATED TH E EXPENSES AS CAPITAL IN NATURE AND DISALLOWED THE SAME. THE LD. CIT(A) C ONFIRMED THE ACTION OF ASSESSING OFFICER HOLDING THAT THE EXPENDITURE IS G OING TO PROVIDE THE ASSESSEE ENDURING BENEFIT. WE HAVE NOTED THAT THE S TAMP DUTY WAS PAID BY THE ASSESSEE-COMPANY FOR THE PURPOSE OF REGISTRATIO N OF NEW SHAREHOLDER WHICH CANNOT BE TREATED AS CAPITAL EXPENDITURE. THE REFORE, WE DIRECT THE ASSESSING OFFICER TO DELETE THE DISALLOWANCES. 24. GROUND NO. 9 & 10 RELATES TO ADHOC DISALLOWANCE OF AIRFARE EXPENSE, TRAVELLING EXPENSE AND VEHICLE HIRE CHARGES. THE LD . AR OF THE ASSESSEE SUBMITS SIMILAR GROUND OF APPEAL IN APPEAL FOR A.Y. 2009-10 HAVE BEEN RESTORED TO THE FILE OF ASSESSING OFFICER FOR VERIFICATION OF DOCUMENTARY EVIDENCES. THE LD. AR OF THE ASSESSE E FURTHER SUBMITS THAT THERE ARE SUFFICIENT DOCUMENTARY EVIDENCES ON RECOR D FOR THE YEAR UNDER CONSIDERATION AS PER PAGE 209 TO 261 OF THE PAPER B OOK. THEREFORE, THESE GROUNDS OF APPEAL SHOULD BE ALLOWED. 25. ON THE OTHER HAND, THE LD. DR FOR THE REVENUE SUPPO RTED THE ORDER OF LOWER AUTHORITIES. ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 18 26. WE HAVE CONSIDERED THE RIVAL SUBMISSION OF THE PART IES AND HAVE GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. WE HAVE NO TED THAT THE ASSESSEE HAS RAISED SIMILAR GROUND OF APPEAL IN APPEAL FOR A .Y. 2009-10 AND THE TRIBUNAL RESTORED THE ISSUES TO THE FILE OF ASSESSI NG OFFICER WITH THE FOLLOWING DIRECTION: 56. WE SHALL NOW TAKE UP THE DISALLOWANCE OF A SUM OF RS.95,63,132/- (I.E 25% OF RS.3,82,52,527/-) BEING EXPENDITURE INCURRED IN CONNECTION WITH AIRFARE EXPENSES, TRAVELLING EXPENSE AD VEHICLE HIRE CHARGE S. WE FIND THAT THE A.O HOLDING A CONVICTION THAT AS THE ASSESSEE HAD INCUR RED EXPENSES ON FOOD AND STAY OF VIPS AND CELEBRITIES, THEREFORE, THE AIRFARE EXP ENSES OF RS.3,28,96,505/-, TRAVELLING EXPENSES OF RS.12,66,462/- AND VEHICLE H IRE CHARGES OF RS.40,89,560/- MUST ALSO BE INCLUDING EXPENSES INCURRED ON VIPS AN D CELEBRITIES. THE A.O ON THE BASIS OF HIS AFORESAID CONVICTION THUS CARRIED OUT AN ADHOC DISALLOWANCE OF THE EXPENSES, VIZ. (I). RS.82,25,126/- OUT OF AIRFA RE EXPENSES; (II). RS.3,16,616/- OUT OF TRAVELLING EXPENSES ; AND (II). RS.10,22,390 /- OUT OF VEHICLE HIRE CHARGES, AS A RESULT WHEREOF A TOTAL DISALLOWANCE OF RS.95,6 3,132/-WAS MADE BY HIM. WE FIND THAT THE ASSESSEE HAD CLAIMED THAT DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS DOCUMENTARY EVIDENCE SUPPORTING THE AFO RESAID EXPENSES INCURRED BY IT WERE FURNISHED WITH THE A.O. HOWEVER, THE CIT (A) WHILE UPHOLDING THE ADHOC DISALLOWANCE MADE BY THE A.O OBSERVED THAT THE ASSE SSEE HAD FAILED TO PRODUCE BEFORE HIM ANY EVIDENCE, VIZ. AIR TICKETS, DETAILS OF VEHICLES, NAME OF SERVICE PROVIDERS, PERSONS UTILIZING THE SERVICES A ND THEIR NEXUS WITH THE BUSINESS OF THE ASSESSEE. WE FIND THAT A PERUSAL OF THE ASSE SSMENT ORDER REVEALS THAT AN ADHOC DISALLOWANCE OF THE AFOREMENTIONED EXPENSES WAS CAR RIED OUT BY THE A.O NOT FOR THE REASON THAT THE ASSESSEE HAD FAILED TO SUBSTANTIATE THE GENUINENESS AND VERACITY OF THE EXPENSES, BUT RATHER, FOR THE REASO N THAT AS PER HIM NOW WHEN THE ASSESSEE HAD INCURRED EXPENSES TOWARDS FOOD, BOARDI NG AND LODGING FOR THE ACTORS, CELEBRITIES, VIP'S ETC., THEREFORE, IT WOUL D ALSO HAVE INCURRED AIRFARE EXPENSES, TRAVELLING EXPENSES AND VEHICLE CHARGES I N RESPECT OF THE SAID PERSONS. WE FIND THAT THE CIT(A) OBSERVING THAT THE ASSESSEE HAD NOT PLACED BEFORE HIM ANY EVIDENCE, E.G AIR TICKETS, DETAILS OF VEHICLE, NAME OF SERVICE PROVIDERS, ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 19 PERSONS UTILIZING THESE SERVICES AND THEIR NEXUS WI TH BUSINESS ETC, THEREFORE, CONCLUDED THAT THE POSSIBILITY OF THE EXPENDITURE B EING PARTLY FOR NON BUSINESS PURPOSES COULD NOT BE RULED OUT. THUS THE CIT(A) ON THE AFORESAID REASONING HAD UPHELD THE DISALLOWANCE OF THE AFORESAID EXPENDITUR E MADE BY THE A.O. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE ISSUE BEFOR E US AND ARE OF THE CONSIDERED VIEW THAT AS OBSERVED BY US HEREINABOVE, THE EXPENS ES INCURRED BY THE ASSESSEE ON THE ACTORS, CELEBRITIES AND VIPS IN ORDER TO FAC ILITATE MARKING THEIR PRESENCE AT THE MATCHES, WHICH SUBSTANTIALLY CONTRIBUTED TOWARD S GENERATION OF HIGHER REVENUE IN THE HANDS OF THE ASSESSEE BY WAY OF PUSH ING TICKETING SALES AND HIGHER SPONSORSHIP RECEIPTS, CAN SAFELY BE HELD TO HAVE BEEN INCURRED WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF THE BUSINESS OF THE ASSESSEE. WE THUS ARE OF THE VIEW THAT EXPENSES INCURRED TOWARDS AIRFARE EXPENSE S, TRAVELLING EXPENSE AND VEHICLE HIRE CHARGES BY THE ASSESSEE IN RESPECT OF THE SUCH PERSONS CANNOT BE DIVORCED FROM THE BUSINESS OF THE ASSESSEE, AND HAS TO BE HELD AS AN EXPENDITURE INCURRED BY THE ASSESSEE IN THE COURSE OF HIS BUSIN ESS OF CRICKETING. WE ARE UNABLE TO PERSUADE OURSELVES TO SUBSCRIBE TO THE OB SERVATIONS OF THE A.O WHO HAD CARRIED OUT AN ADHOC DISALLOWANCE OF 25% OF THE EXPENSES, FOR THE REASON THAT THE ASSESSEE MUST HAD INCURRED THE EXPENSES ON SUCH PERSONS, VIZ. ACTORS, CELEBRITIES, VIPS, WHICH COULD NOT BE HELD AS AN EX PENDITURE INCURRED WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF ITS BUSINESS. WE ARE OF THE CONSIDERED VIEW THAT IF THE A.O HAD THAT STRONG A CONVICTION THAT THE AFORE SAID EXPENSES INCURRED ON THE AFORESAID PERSONS WERE IN NO WAY IN CONTEXT OF THE BUSINESS OF THE ASSESSEE, OR WERE IN THE NATURE OF ITS PERSONAL EXPENSE, THEN HE REMAINED UNDER A STATUTORY OBLIGATION TO HAVE SPECIFICALLY DEMONSTRATED THE SA ME BY REFERRING TO THE EXPENSES BOOKED BY THE ASSESSEE IN ITS BOOKS OF ACC OUNTS. HOWEVER, WE FIND THAT THE CIT(A) HAD TAKEN A SHIFT FOR SUSTAINING THE SAI D DISALLOWANCE AND HAD OBSERVED THAT AS THE ASSESSEE HAD NOT PRODUCED BEFO RE HIM ANY EVIDENCE, VIZ. AIR TICKETS, DETAILS OF VEHICLES, NAME OF SERVICE PROVI DERS, PERSONS UTILIZING THESE SERVICES AND THEIR NEXUS WITH THE BUSINESS ETC., TH EREFORE, THE POSSIBILITY OF THE EXPENDITURE PARTLY HAVING BEEN FOR NON BUSINESS PUR POSES COULD NOT BE RULED OUT. WE FURTHER FIND THAT THE ASSESSEE ALSO HAD AVERRED BEFORE US THAT IT WAS NOT GIVEN AN OPPORTUNITY OF BEING HEARD BY THE A.O WHILE MAKI NG AN ADHOC DISALLOWANCE OF THE AFORESAID EXPENSES. WE HAVE GIVEN A THOUGHTF UL CONSIDERATION TO THE ISSUE BEFORE US, AND AS OBSERVED BY US HEREINABOVE, ARE O F THE CONSIDERED VIEW THAT THE ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 20 OBSERVATIONS OF THE A.O THAT AN ADHOC DISALLOWANCE OF AIRFARE EXPENSES, TRAVELLING EXPENSES AND VEHICLE HIRING EXPENSES WAS CALLED FOR IN THE HANDS OF THE ASSESSEE FOR THE REASON THAT EXPENSES UNDER THE SAID RESPECTIVE HEADS MUST HAD BEEN INCURRED BY THE ASSESSEE IN RESPECT OF ACT ORS, CELEBRITIES, AND VIPS, CANNOT BE SUSTAINED. HOWEVER, KEEPING IN VIEW THE F ACT THAT AS OBSERVED BY THE CIT(A) THAT THE ASSESSEE HAD FAILED TO PLACE BEFORE HIM ANY EVIDENCE E.G AIR TICKETS, DETAILS OF VEHICLES, NAME OF SERVICE PROVI DERS, DETAILS OF PERSONS UTILIZING THESE SERVICES AND THEIR NEXUS WITH BUSINESS ETC, T HEREFORE, AS PER HIM THE POSSIBILITY OF THE EXPENDITURE PARTLY HAVING BEEN I NCURRED FOR NON BUSINESS PURPOSES COULD NOT BE RULED OUT, AND THE FACT THAT THE ASSESSEE TOO HAD SUBMITTED BEFORE US THAT SUFFICIENT OPPORTUNITY WAS NOT ALLOW ED TO IT AT THE TIME WHEN SUCH ADHOC DISALLOWANCE OF EXPENSES WAS MADE, THEREFORE, IN AL L FAIRNESS RESTORE THE MATTER TO THE FILE OF THE A.O FOR MAKING NECESSARY VERIFICATIONS ON THE BASIS OF DOCUMENTARY EVIDENCE AS REGARDS THE ENTITLEMENT OF THE ASSESSEE TOWARDS THE CLAIM OF THE AFORESAID EXPENSES. WE HEREIN DIRECT T HAT THE A.O SHALL IN THE BACKDROP OF OUR AFORESAID OBSERVATIONS MAKE NECESSA RY VERIFICATIONS AS REGARDS THE AFORESAID CLAIM OF EXPENSE OF THE ASSESSEE BOOK ED UNDER THE SAID RESPECTIVE HEADS, VIZ. AIRFARE EXPENSES, TRAVELLING EXPENSES A ND VEHICLE HIRING CHARGES. NEEDLES TO SAY, THE A.O SHALL DURING THE COURSE OF THE SET ASIDE PROCEEDINGS AFFORD SUFFICIENT OPPORTUNITY OF BEING OF HEARD TO THE ASSESSEE, WHO SHALL REMAIN AT A LIBERTY TO SUBSTANTIATE ITS CLAIM BY PLACING O N RECORD FRESH DOCUMENTARY EVIDENCE. HOWEVER, WE MAY HEREIN CLARIFY THAT IN CA SE THE A.O IN THE COURSE OF THE SET ASIDE PROCEEDINGS IS NOT SATISFIED WITH THE DOCUMENTARY EVIDENCE AND SUBMISSIONS OF THE ASSESSEE IN SUPPORT OF ITS CLAIM OF THE AFORESAID EXPENSES, THEN HE THOUGH WOULD BE AT A LIBERTY TO DISALLOW TH E SAME, BUT HOWEVER, THE SAID DISALLOWANCE SHALL NOT EXCEED THAT MADE BY HIM TOWA RDS THE RESPECTIVE EXPENSES WHILE PASSING THE ORIGINAL ASSESSMENT ORDER. THE GROUND OF APPEAL NO. 11 TO 13 ARE ALLOWED FOR STATISTICAL PURPOSES IN TERMS OF OU R AFORESAID OBSERVATIONS 27. CONSIDERING THE DECISION OF THE TRIBUNAL FOR ASSES SMENT YEAR 2009-10, THESE GROUNDS OF APPEAL IS ALSO RESTORED TO THE FIL E OF ASSESSING OFFICER WITH THE SIMILAR DIRECTIONS TO VERIFY THE DOCUMENTARY EV IDENCES AND GRANT APPROPRIATE RELIEF TO THE ASSESSEE IN ACCORDANCE WI TH LAW. NEEDLESS TO ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 21 DIRECT THAT BEFORE PASSING THE ORDER THE ASSESSING OFFICER SHALL GRANT OPPORTUNITY OF HEARING TO THE ASSESSEE. THE CONTENT ION OF THE LD. AR FOR THE ASSESSEE THAT THE ASSESSEE HAS PLACED SUFFICIENT EV IDENCES ON RECORD AND APPROPRIATE RELIEF BE ALLOWED TO THE ASSESSEE. WE A RE NOT INCLINED TO ACCEPT SUCH PRAYER OF ASSESSEE, LET ALL THE EVIDENCE BE EX AMINED BY THE ASSESSING OFFICER IN ACCORDANCE WITH LAW. IN THE RESULT THESE GROUNDS OF APPEAL ARE ALLOWED FOR STATISTICAL PURPOSE. 28. GROUND NO. 11 & 12 RELATES TO DISALLOWANCE OF (A) L ODGING AND BOARDING AND (B) FOOD AND NUTRITION. THE LD AR FOR THE ASSE SSEE SUBMITS THAT THESE GROUNDS OF APPEALS ARE ALSO COVERED IN FAVOUR OF TH E ASSESSEE AND AGAINST THE REVENUE BY THE DECISION OF THE TRIBUNAL IN ASSE SSEES OWN CASE FOR ASSESSMENT YEAR 2009-10, WHEREIN THE SIMILAR GROUND S OF APPEAL WAS RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR V ERIFICATION OF EVIDENCES, HOWEVER, FOR THE YEAR UNDER CONSIDERATION THE ASSES SEE HAS FILE SUFFICIENT EVIDENCES AS PER PAGE NO. 262 TO 270 OF THE PAPER B OOK. THE LD AR FOR THE ASSESSEE SUBMITS THAT THE ASSESSEE BE ALLOWED F ULL RELIEF AS THE ASSESSEE HAS FURNISHED COMPLETE EVIDENCES. 29. ON THE OTHER HAND THE LD. DR FOR THE REVENUE SUPPO RTED THE ORDER OF THR AUTHORITIES BELOW. 30. WE HAVE CONSIDERED THE RIVAL SUBMISSION OF THE PART IES AND HAVE GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. WE HAVE NO TED THAT THE ASSESSEE HAS RAISED SIMILAR GROUND OF APPEAL IN APPEAL FOR A .Y. 2009-10 AND THE ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 22 TRIBUNAL RESTORED THE ISSUES TO THE FILE OF ASSESSI NG OFFICER WITH THE FOLLOWING DIRECTION: 54. WE NOW ADVERT TO THE DISALLOWANCE BY THE A.O OF TH E EXPENSES WHICH WERE CLAIMED BY THE ASSESSEE IN ITS PROFIT AND LOSS ACCO UNT FOR THE YEAR UNDER CONSIDERATION, WHICH THEREAFTER HAD BEEN SUSTAINED BY THE CIT(A), VIZ. (I) OUT OF FOOD AND NUTRITION EXPENSES: RS.58,53,575/-; AND (I I) OUT OF BOARDING AND LODGING EXPENSES OF RS.1,90,16,944/-. WE FIND THAT AS PER T HE A.O THE INFORMATION GATHERED DURING THE COURSE OF SURVEY PROCEEDINGS CO NDUCTED UNDER SEC. 133A ON 21.04.2010 AT THE OFFICE PREMISE OF THE ASSESSEE AT EDEN GARDEN, CALCUTTA, REVEALED THAT THE ASSESSEE HAD INCURRED AN EXPENDIT URE OF RS.1,35,46,255/- (ROOM BILLING: RS. 96,25,375/- AND PARTYING BILL: RS.39,1 9,880/-) AT ITC, SONAR, KOLKATA. WE FIND THAT THE A.O HAD CARRIED OUT DISALLOWANCE O F THE PARTYING EXPENDITURE OF RS.39,19,880/- BY OBSERVING THAT THE PARTIES HOSTED BY THE ASSESSEE AT ITC SONAR, KOLKATA INCLUDED VARIOUS RELATIVES OF DIRECTORS, VI PS AND CELEBRITIES, WHICH THUS COULD NOT BE HELD AS A BUSINESS EXPENDITURE. THE A. O FURTHER HOLDING A CONVICTION THAT THE ROOM BOOKING CHARGES OF RS.96,2 6,375/- INCURRED BY THE ASSESSEE FOR ROOMS TAKEN ON HIRE AT ITC, SONAR, KOL KATA WERE ALSO TO SOME EXTENT INCURRED BY THE ASSESSEE FOR THE STAY OF RELATIVES OF DIRECTORS, VIPS AND CELEBRITIES, THEREFORE, ON THE SAID COUNT HAD ON AN ESTIMATE BASIS DISALLOWED 33% OF SUCH EXPENSES AND MADE AN ADDITION OF RS.31,76,7 05/-. THAT AS REGARDS THE BALANCE EXPENDITURE OF RS.1,13,24,264/- (I.E. EXCLU DING EXPENDITURE INCURRED AT ITC, SONAR, KOLKATA), THE A.O HAD ON A SIMILAR ANAL OGY CARRIED OUT AN ESTIMATED DISALLOWANCE OF 33% OF THE SAID EXPENSES AND MADE A FURTHER ADDITION OF RS.37,37,007/-. WE THUS FIND THAT ON THE BASIS OF H IS AFORESAID OBSERVATIONS THE A.O HAD CARRIED OUT AN AGGREGATE DISALLOWANCE OF RS .1,08,33,592/- OUT OF THE FOOD AND NUTRITION AND BOARDING AND LODGING EXPENSE S CLAIMED BY THE ASSESSEE. 55. WE HAVE DELIBERATED ON THE OBSERVATIONS OF THE LOW ER AUTHORITIES, AND FIND THAT THE PRIMARY REASON WHICH HAD WEIGHED IN THE MI ND OF THE A.O WHILE MAKING THE DISALLOWANCE OF EXPENSES BOOKED BY THE ASSESSEE UNDER THE HEAD FOOD AND NUTRITION EXPENSES AND BOARDING AND LODGING EXPENSE S, WAS THAT THE INFORMATION GATHERED DURING THE COURSE OF THE SURVEY PROCEEDING S CONDUCTED UNDER SEC. 133A ON 21.04.2010 AT THE OFFICE PREMISES OF THE AS SESSEE AT EDEN GARDEN, ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 23 CALCUTTA, REVEALED THAT THE PARTIES HOSTED BY THE A SSESSEE INCLUDED VARIOUS RELATIVES OF DIRECTORS, VIPS AND CELEBRITIES AS INV ITEES. WE FIND THAT THE A.O HAD DISALLOWED THE ENTIRE PARTYING EXPENDITURE OF RS.39 ,19,880/-INCURRED BY THE ASSESSEE AT ITC, SONAR, KOLKATA, AS WELL AS DISALLO WED 33% OF THE ROOM EXPENSES OF RS.96,26,375/- INCURRED BY THE ASSESSEE ON BOOKI NG OF ROOMS AT ITC, SONAR, KOLKATA, AND A FURTHER DISALLOWANCE OF 33% OF THE B ALANCE EXPENDITURE OF RS.1,13,24,264/-. WE FIND SUBSTANTIAL FORCE IN THE CONTENTION OF THE LD. A.R THAT THE AFORESAID EXPENSES WERE INCURRED BY THE ASSESSE E IN THE COURSE OF OPERATING ITS TEAMS, WHEREIN THE VISITING TEAMS ALONGWITH PEO PLE FROM SHOW BUSINESS, ACTORS, CELEBRITIES, VIPS ETC, WERE INVITED FOR THE MATCHES FOR THE PURPOSE OF INCREASING THE VIEWING OF THE MATCHES, WHICH THUS C ONSEQUENTLY LED TO INCREASE IN SALE OF TICKETS AND GENERATION OF HIGHER AMOUNT OF SPONSORSHIP FEES. WE HAVE DELIBERATED ON THE CONTENTIONS RAISED BY THE AUTHOR IZED REPRESENTATIVES FOR BOTH THE PARTIES AND THE MATERIAL AVAILABLE ON RECORD. W E ARE OF THE CONSIDERED VIEW THAT IT REMAINS AS A MATTER OF FACT THAT THE GAME O F CRICKET, UNLIKE IN THE PAST, AS ON DATE HAD BEEN HIGHLY COMMERCIALIZED. WE FIND THA T THE MAIN SOURCE OF INCOME OF AN IPL FRANCHISEE FROM HOSTING OF THE CRI CKET MATCHES IS FROM TICKETING AND RECEIPT OF SPONSORSHIPS BY STAGING TH E CRICKET MATCHES. WE ARE OF THE CONSIDERED VIEW THAT IT REMAINS NO HIDDEN A FAC T THAT IN ORDER TO BOOST THE TICKET SALES AND TO RECEIVE HIGHER SPONSORSHIPS THE FRANCHISEES OF THE IPL TEAMS LEAVE NO STONE UNTURNED, AND TO LURE THE PUBLIC FOR BUYING TICKETS, INVITE ACTORS, CELEBRITIES, VIPS ETC. DURING THE MATCHES. WE FIND SUBSTANTIAL FORCE IN THE CONTENTION OF THE LD. A.R THAT THIS IS THE WAY THE ASSESSEE OPERATES ITS TEAM AND CARRIES OUT ITS BUSINESS. WE CANNOT REMAIN OBLIVIOU S OF THE FACTUAL REALITY AS REGARDS THE STRATEGICAL PLANNING IN THE BUSINESS OF CRICKETING, AND ARE OF THE CONSIDERED VIEW THAT NOW WHEN THE ACTORS, CELEBRITI ES, VIPS ETC., PURSUANT TO INVITATIONS BY THE FRANCHISEE, MARK THEIR PRESENCE IN THE MATCHES, THE SAME LEADS TO SUBSTANTIAL PUSH TO TICKETING SALES AND HIGHER S PONSORSHIP RECEIPTS. WE ARE OF THE CONSIDERED VIEW THAT THE VISITS OF THE ACTORS, CELEBRITIES, VIP'S ETC. AT THE MATCHES STAGED IS STRATEGICALLY PLANNED BY THE FRAN CHISEES, WHICH CARRIES WITH IT THE OBLIGATION AND RESPONSIBILITY OF PROVIDING BOAR DING, LODGING, FOOD ETC. TO THE LEVEL OF THEIR STANDARD. WE ARE FURTHER OF THE VIEW THAT THE MARKING OF PRESENCE BY THE ACTORS, CELEBRITIES, VIPS ETC. AT THE MATCHE S IS STRATEGICALLY PLANNED AND IS GUIDED BY THE BUSINESS PRUDENCE OF THE FRANCHISEE, KNOWING WELL THAT THE SAME ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 24 WOULD BOTH BOOST THE SALES OF TICKETS AS MORE OF VI EWERS WOULD BE ATTRACTED FOR SUCH MATCHES, AS WELL AS GIVE A SUBSTANTIAL PUSH TO THE SPONSORSHIP RECEIPTS FROM THE BUSINESS HOUSES. WE WOULD NOT HESITATE TO OBSER VE THAT KEEPING IN VIEW THE COMMERCIALIZATION OF THE GAME OF CRICKET, IT WOULD NOT BE WRONG TO CONCLUDE THAT EVEN IF THE ASSESSEE WOULD HAVE ARRANGED PAID VISIT S OF THE ACTORS, CELEBRITIES, VIPS FOR THE MATCHES, BEING WELL CONVERSANT WITH TH E FACT THAT THE SAME WOULD SUBSTANTIALLY GIVE A BOOST TO HIS REVENUE COLLECTIO NS FROM STAGING OF MATCHES, EVEN THE SAID PAYMENTS WOULD SAFELY FALL WITHIN THE SWEEP OF AN EXPENDITURE INCURRED WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF THE BUSINESS. BE THAT AS IT MAY, IN THE BACKDROP OF OUR AFORESAID OBSERVATIONS, WE ARE UNABLE TO PERSUADE OURSELVES TO SUBSCRIBE TO THE VIEW OF THE A.O THAT THE EXPENSES INCURRED BY THE ASSESSEE TOWARDS FOOD AND NUTRITION EXPENSES AND BO ARDING AND LODGING EXPENSES PROVIDED TO THE ACTORS, CELEBRITIES AND VIPS ARE LI ABLE TO BE DISALLOWED BY CHARACTERISING THEM AS EXPENSES WHICH COULD NOT BE HELD TO HAVE BEEN INCURRED BY THE ASSESSEE WHOLLY AND EXCLUSIVELY FOR ITS BUSI NESS. WE ARE OF THE CONSIDERED VIEW THAT AS THE VISITS OF THE ACTORS, CELEBRITIES AND VIPS AT THE VENUES WHERE THE MATCHES ARE STAGED IS STRATEGICALLY PLANNED BY THE ASSESSEE IN THE VERY INTEREST OF ITS BUSINESS, THEREFORE, EXPENSES INCURRED BY THE A SSESSEE BY WAY OF PROVIDING THEM FOOD AND NUTRITION OR ARRANGING FOR THEIR STAY IN HOTELS CAN SAFELY BE HELD TO BE AN EXPENDITURE INCURRED IN THE COURSE OF ITS BUS INESS. WE ARE FURTHER OF THE VIEW THAT HOSTING OF PARTIES BY THE ASSESSEE AT ITC , SONAR KOLKATA OR AT OTHER VENUES ON THE DAYS WHEN THE MATCHES WERE PLAYED AT THE HOME GROUNDS OF THE ASSESSEE, WHICH WERE ATTENDED BY THE ASSESSEE'S OWN TEAM, VISITING TEAMS, SUPPORT STAFF, DIRECTORS AND INVITEE GUESTS, WHICH INCLUDED AMONGST OTHERS ACTORS, CELEBRITIES, VIPS WHO HAD MARKED THEIR PRESENCE AT THE MATCHES, CAN SAFELY BE HELD TO BE EXPENDITURE INCURRED BY THE ASSESSEE IN THE VERY INTEREST OF ITS BUSINESS. WE ARE OF THE CONSIDERED VIEW THAT THE AL LOWABILITY OF AN EXPENDITURE UNDER SEC.37(1) OF THE ACT IS REQUIRED TO SATISFY T HE REQUISITE CONDITION CONTEMPLATED THEREIN, VIZ. (I) THE EXPENSES ARE NOT OF THE NATURE OF THE EXPENSES DEFINED IN SEC.32 TO 36 OF THE ACT; (II) THE EXPENS ES ARE NOT IN THE NATURE OF A CAPITAL EXPENDITURE; (III) THE EXPENSES ARE NOT THE PERSONAL EXPENSES OF THE ASSESSEE; AND (IV) THE EXPENSES ARE INCURRED WHOLLY AND EXCLUSIVELY FOR THE PURPOSES OF THE BUSINESS OF THE ASSESSEE. WE FIND T HAT IN THE PRESENT CASE BEFORE US THE AFORESAID REQUISITE CONDITIONS HAD DULY BEEN SATISFIED BY THE ASSESSEE, AND ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 25 AS OBSERVED BY US HEREINABOVE, THE EXPENDITURE INCU RRED BY THE ASSESSEE ON FOOD AND NUTRITION AND BOARDING AND LODGING INCURRED IN RESPECT OF THE INVITEES ACTORS, CELEBRITIES AND VIPS, BEING A PART OF THE STRATEGIC AL PLANNING OF THE ASSESSEE TO BOOST ITS GENERATION OF REVENUES IS THUS ALLOWABLE UNDER SEC. 37(1) OF THE ACT. WE MAY HEREIN OBSERVE THAT NEITHER BEFORE THE LOWER AUTHORITIES NOR BEFORE US IT HAS BEEN ESTABLISHED BY THE REVENUE THAT EITHER THE EXPENSES CLAIMED BY THE ASSESSEE IN RESPECT OF THE AFORESAID PERSONS IS FOU ND TO BE BOGUS, OR THE SAID EXPENDITURE SO INCURRED ON THEM WERE NOT IN CONTEXT OF THE BUSINESS OF THE ASSESSEE. WE ARE OF THE CONSIDERED VIEW THAT THE AF ORESAID EXPENDITURE INCURRED BY THE ASSESSEE BY HOSTING DINNERS ON THE DAYS ON W HICH THE MATCHES WERE PLAYED AT THE HOME GROUND, WHICH AMONGST OTHERS WER E ATTENDED BY THE AFORESAID ACTORS, CELEBRITIES ETC, AND ARRANGING FOR THEIR ST AY AT THE HOTELS OF REPUTE, CAN SAFELY BE HELD AS AN EXPENDITURE INCURRED BY THE AS SESSEE WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF ITS BUSINESS. WE THUS BEING OF T HE CONSIDERED VIEW THAT AS THE EXPENDITURE INCURRED BY THE ASSESSEE ON FOOD AND NU TRITION AND BOARDING AND LODGING FOR THE MEMBERS OF THE TEAM (INCLUDING VISI TING TEAMS), SUPPORT STAFF, DIRECTORS AND THE INVITED GUESTS, WHICH AMONGST OTH ERS INCLUDED ACTORS, CELEBRITIES, VIPS, BEING IN THE NATURE OF EXPENDITU RE INCURRED BY THE ASSESSEE IN THE VERY INTEREST OF ITS BUSINESS, THEREFORE, IN TH E ABSENCE OF ANY IRREFUTABLE DOCUMENTARY EVIDENCE WHICH COULD HAD ESTABLISHED BE YOND ANY DOUBT THAT THE SAME HAD BEEN INCURRED BY THE ASSESSEE EITHER TO ME ET OUT A PERSONAL OBLIGATION OR WAS FOR A PURPOSE WHICH COULD NOT BE HELD TO BE WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF THE BUSINESS, THEREFORE, ARE UNABLE TO PERSUADE OURSELVES TO SUBSCRIBE TO THE DISALLOWANCE OF THE EXPENSES BY TH E A.O FOR THE REASON THAT THE PARTIES HOSTED BY THE ASSESSEE WERE ATTENDED BY SUC H ACTORS, CELEBRITIES AND VIPS, AS WELL AS EXPENDITURE WAS INCURRED TOWARDS BOOKING OF ROOMS FOR THEIR STAY IN HOTELS OF REPUTE. WE ARE FURTHER IN AGREEMENT WITH THE CONTENTION OF THE LD. A.R WHO HAD RIGHTLY STATED THAT THIS IS THE WAY THE ASS ESSEE CARRIES OUT HIS BUSINESS, AND ARE OF THE CONSIDERED VIEW THAT AS LONG AS THE CLAIM OF THE ASSESSEE IN RESPECT OF THE AFORESAID EXPENSES SATISFIED THE CONDITIONS CONTEMPLATED UNDER SEC. 37 (1), THE ENTITLEMENT OF THE ASSESSEE CANNOT BE INTE RFERED WITH. HOWEVER, WHILE PERUSING THE ORDER OF THE CIT(A) WE FIND THAT LATTE R HAD REFERRED TO CERTAIN BILLS WHEREIN A CLEAR NEXUS BETWEEN THE EXPENDITURE INCUR RED AND THE PURPOSE OF HOSTING THE PARTIES COULD NOT BE ESTABLISHED, VIZ. (I) BILL OF RS.3,44,410/- FOR 300 ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 26 SNACKS, 300 SOFT BEVERAGES AND TRANSPORT CHARGES, W HEREIN NOTHING COULD BE GATHERED FROM PERUSING THE SAME ABOUT THE PURPOSE A ND PERSONS ATTENDING THE PARTY; (II) BILL OF RS.5,31,573/-, DATED 30.04.2008 WHICH THOUGH WAS RAISED IN FAVOUR OF IPL ODC FOR DINNER OF 400 PERSONS, HOWEVE R, AS TO HOW THE SAME WAS PAYABLE BY THE ASSESSEE HAD REMAINED UNEXPLAINED; ( III). THAT CERTAIN OTHER BILLS, VIZ. BILL OF RS.5,31,893/- FOR 08.05.2008; BILL OF RS.5,31,893/- FOR 13.05.2008; AND BILL OF RS.5,31,894/- FOR 20.05.2008, WHICH INC LUDED DINNER, EQUIPMENT RENTAL, TOBACCO, ETC, BUT THEY TOO DID NOT INDICATE THE PURPOSE AND THE PERSONS ATTENDING THE SAID OCCASION; (IV). BILL OF RS.4,51, 900/- WHICH WAS FOR 400 SNACKS, SOFT DRINKS, TRANSPORTATION, EQUIPMENT RENTAL, WHIC H DID BEAR A DISCREPANCY, AS AGAINST THE SAID DATE THE AMOUNT MENTIONED IN THE S UBMISSIONS BY THE ASSESSEE WAS RS.6,83,071/- WHICH COULD NOT BE RECONCILED; AN D (V) BILL OF RS.5,31,893/- FOR 25.05.2008 WHICH WAS STATED TO BE OF RS.6,69,69 8/- IN THE SUBMISSIONS WHICH TOO COULD NOT BE RECONCILED BY THE ASSESSEE. WE ARE OF THE CONSIDERED VIEW THAT IN THE BACKDROP OF THE OBSERVATIONS OF THE CIT(A) T HAT EITHER THE ASSESSEE HAD FAILED TO RELATE THE AFORESAID BILLS PERTAINING TO HOSTING OF DINNERS, TEA PARTIES ETC., WITH THE PURPOSE FOR WHICH THE SAME HAD BEEN INCURR ED, OR THE SAME SUFFERED FROM CERTAIN DISCREPANCIES AS REGARDS THE AMOUNTS M ENTIONED THEREIN IN COMPARISON TO THOSE STATED BY THE ASSESSEE DURING T HE COURSE OF THE PROCEEDINGS AND HAD NOT BEEN RECONCILED, THEREFORE, IN ALL FAIR NESS RESTORE THE MATTER TO THE FILE OF THE A.O FOR VERIFYING AS TO WHETHER THE AFO RESAID BILLS, VIZ. (I). BILL OF RS.5,31,573/-, DATED 30.04.2008; (II) BILL OF RS.5, 31,893/-, DATED 08.05,2008; (III). BILL OF RS.5,31,893/-, DATED 13.05.2008; (IV ). BILL OF RS.5,31,894/-, DATED 20,05.2008; (V). BILL OF RS.4,51,900/-;AND (VI) AND BILL OF RS.5,31,893/-, DATED 25.05.2008 PERTAINED TO EXPENSES INCURRED BY THE AS SESSEE IN THE COURSE OF ITS BUSINESS, OR NOT. WE MAY HOWEVER CLARIFY THAT THE A .O SHALL WHILE RE- ADJUDICATING THE AFORESAID ISSUE KEEP IN VIEW OUR A FORESAID OBSERVATIONS. WE THUS IN THE BACKDROP OF OUR AFORESAID OBSERVATIONS RESTORE THE MATTER TO THE FILE OF THE A.O FOR CARRYING OUT NECESSARY VERIFICATIONS IN RESPECT OF THE LIMITED ISSUE FOR WHICH THE MATTER HAD BEEN RESTORED TO HIS FILE. NEEDLESS TO SAY, THE A.O SHALL WHILE RE-ADJUDICATING THE AFORESAID ISSUE AFFORD SU FFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE, WHO SHALL REMAIN AT A LIBERT Y TO FURNISH MATERIAL AND DOCUMENTS TO SUBSTANTIATE HIS CLAIM. THE GROUNDS OF APPEAL NO. 9 & 10 ARE ALLOWED FOR STATISTICAL PURPOSE IN TERMS OF OUR AFO RESAID PURPOSES. ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 27 31. CONSIDERING THE DECISION OF THE TRIBUNAL FOR ASSESS MENT YEAR 2009-10, THESE GROUNDS OF APPEAL IS ALSO RESTORED TO THE FIL E OF ASSESSING OFFICER WITH THE SIMILAR DIRECTION. THE ASSESSING OFFICER IS ALS O DIRECTED TO FOLLOW THE DIRECTION AS CONTAINED IN PARA 27.IN THE RESULT THE SE GROUNDS OF APPEAL ARE ALLOWED FOR STATISTICAL PURPOSE. 32. GROUNDS NO. 13 TO 15 ARE GENERAL OR CONSEQUENTIAL, WHICH NEEDS NO ADJUDICATION. THEREFORE, THESE GROUNDS OF APPEAL AR E DISMISSED. 33. GROUND NO.16 (ADDITIONAL GROUND) RELATES WITH THE C LAIM OF THE DEDUCTION OF FRANCHISE FEE /CONSIDERATION. THE LD. AR FOR TH E ASSESSEE SUBMITS THAT THE ASSESSEE HAS RAISED ADDITIONAL GROUNDS OF APPEA L, WHICH IS WITHOUT PREJUDICE TO THE ORIGINAL GROUNDS OF APPEAL RAISED BY THE ASSESSEE. THE LD. AR FOR THE ASSESSEE SUBMITS THAT ALL THE FACTS FOR ADJUDICATION OF ADDITIONAL GROUND OF APPEAL ARE EMANATING FROM THE RECORD AND NO NEW FACTS ARE NECESSARY TO BROUGHT ON RECORD. THE LD. AR FOR TH E ASSESSEE SUBMITS THAT THE ADDITIONAL GROUNDS OF APPEAL MAY BE ADMITTED AN D APPROPRIATE DIRECTION MAY BE GIVEN TO THE LOWER AUTHORITIES TO CONSIDER THE ADDITIONAL GROUNDS IN THE LIGHT OF DECISION OF TRIBUNAL DATED 29 TH DECEMBER 2017, WHICH ARE WITHOUT PREJUDICE TO THE ORIGINAL GROUNDS OF APPEAL. 34. ON THE OTHER HAND THE LD. DR FOR THE REVENUE OPPOS ED THE PLEA OF THE LD. AR FOR THE ASSESSEE. THE LD. DR FOR THE REVENUE FUR THER SUBMITS THAT THE ASSESSEE INTENDS TO CLAIM DOUBLE RELIEF ON THE BASI S OF DECISION OF TRIBUNAL FOR ASSESSMENT YEAR 2009-10. ITA NO. 4087 & 4310 MUM 2014-M/S KNIGHT RIDERS SPOR TS PVT. LTD. 28 35. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF THE PA RTIES AND PERUSED THE ADDITIONAL GROUND OF APPEAL. WE HAVE NOTED THAT THE ASSESSEE HAS RAISED THIS GROUND OF APPEAL ON THE BASIS OF DECISION OF T RIBUNAL FOR ASSESSMENT YEAR 2009-10 DATED 29.12.2017. THE ASSESSEE HAS RAI SED THIS GROUND OF APPEAL FOR THE FIRST TIME BEFORE THE TRIBUNAL; THER EFORE, THE ADDITIONAL GROUND OF APPEAL IS ADMITTED AND IS RESTORED TO THE FILE OF ASSESSING OFFICER TO DECIDE THE SAME IN ACCORDANCE WITH LAW. NEEDLES S TO ORDER THAT BEFORE PASSING THE ORDER THE ASSESSING OFFICER SHALL GRANT THE OPPORTUNITY TO THE ASSESSEE TO EXPLAIN AND SUBSTANTIATE ITS CONTENTION ON THE ISSUE. IN THE RESULT THE ADDITIONAL GROUND OF RESULT IS ALLOWED F OR STATISTICAL PURPOSE. 36. IN THE RESULT THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 12/ 12/2018. SD/- S D/- G.S. PANNU PAWAN SINGH VICE-PRESIDENT J UDICIAL MEMBER MUMBAI, DATE: 12.12.2018 SK COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE 2. RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. DR H BENCH, ITAT, MUMBAI 6. GUARD FILE BY ORDER, DY./ASST. REGISTRAR ITAT, MUMBAI