ACIT, Cochin V. M/s.Harrisons malayalam Ltd, Cochin

ITA 457/COCH/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 90788 (ITAT-COCHIN)
• Duration Of Justice: 6 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-05-2015
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 11-05-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 17-10-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: M ANIL KUMAR
• Assessee Lawyers: DILIP S DAMLE
• Keywords: Capital asset; Business income; Business expenditure; Opportunity of being heard; Source of fund; Cost of acquisition; Bad and doubtful debts; Capital receipt; Commercial expediency

Judgement Text

HARRISONS MALAYALAM LTD 1 IN THE INCOME TAX APPEL L A TE T R IBUNAL COCHIN BENCH , COCHIN BEFORE S/SH RI V DURGA RAO , JM & B R BASKARAN , AM ITA NO S 455 TO 459/COCH/2014 (ASST YEA RS 2003 - 04, 2007 - 08 TO 2010 - 11 ) THE ASSTT.COMM . OF INCOME TAX,CIRCLE - 1(2), KOCHI VS M/S. HARRISONS MALAYA LAM LTD., BRISTOW ROAD, WILLINGDON ISLAND, KOCHI - 682 003. ( APPELLANT) (RESPONDENT) PAN NO. AAACH 6769C ASSESSEE BY SHRI DILIP S DAMLE REVENUE BY SHRI M ANIL KUMAR, CIT - DR DATE OF HEARING 11 TH MAY 201 5 DATE OF PRONOUNCEMENT 14 TH MAY 20 1 5 OR D ER PER BENCH: ALL THESE APPEALS FILED BY THE REVENUE ARE DIRECTED AGAINST THE ORDERS PASSED BY THE LD CIT(A) - II, KOCHI AND THEY RELATE TO THE AYS 2003 - 04 , 2007 - 08 TO 2010 - 11 RESPECTIVELY. SINCE MOST OF THE ISSUES URGED IN THESE APPEALS ARE IDENTICAL IN NATURE, THEY WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS COMMON ORDER , FOR THE SAKE OF CONVENIENCE. 2 WE HAVE HEARD THE PARTIES AND PERUSED THE RECORDS. THE ASSESSEE IS A PUBLIC LIMITED COMPANY ENGAGED IN GROWING AND MANUFACTURING OF TEA, RUBBER HARRISONS MALAYALAM LTD 2 ETC. THE REVENUE HAS FILED THESE APPEALS ON BEING AGGRIEVED BY THE DECISION OF THE LD CIT(A) IN DELETING VARIOUS DISALLOWANCES MADE BY THE AO. 3 THE FIRST ISSUE RELATES TO THE DISALLOWANCE OF PART OF INTEREST EXPENDITURE ON THE GROUND THA T THE ASSESSEE HAS DIVERTED INTEREST BEARING FUNDS TO ITS SUBSIDIARY COMPANIES. THIS ISSUE ARISES IN AYS 2003 - 04, 2007 - 08 TO 2009 - 10. 4 BOTH THE PARTIES HAVE AGREED THAT THIS ISSUE IS COVERED BY THE DECISION OF THIS TRIBUNAL DATED 29 TH JUNE 2012 PASSED IN ASSESSEES OWN CASE IN ITA NO. 77/COCH/201 0 . FOR THE SAKE OF CONVENIENCE, WE EXTRACT BELOW THE OPERATIVE PORTION OF THE ORDER OF THE TRIBUNAL REFERRED ABOVE: 9. WE HAVE HEARD THE RIVAL CONTENTIONS ON THIS ISSUE. IN PARAGRAPH 4 SUPRA, WE HAVE NARRATE D THE METHODOLOGY ADOPTED BY THE AO IN WORKING OUT THE DISALLOWANCE OF INTEREST EXPENDITURE RELATABLE TO THE INVESTMENTS MADE IN SUBSIDIARY COMPANIES. THE SAID METHODOLOGY SUGGESTS ABOUT NON - APPLICATION OF MIND ON THE PART OF THE AO, I.E., HE HAS MADE TH E DISALLOWANCE IN A MECHANICAL MANNER WITHOUT ANALYSING WHETHER THERE WAS ANY COMMERCIAL EXPEDIENCY IN MAKING THE INVESTMENT IN SUBSIDIARY COMPANIES OR WHETHER THE INTEREST BEARING FUNDS HAVE ACTUALLY BEEN DIVERTED. FROM THE ARGUMENTS ADVANCED BY THE ASSE SSEE, WE NOTICE THAT THE ASSESSEE COMPANY IS 100% OWNER OF THE SUBSIDIARY COMPANIES VIZ., M/S HARRISONS MALAYALAM FINANCIAL SERVICES LTD, M/S HARRISONS RUBBER PRODUCTS LTD AND M/S HARRISONS AGRO PRODUCTS LTD. THE ASSESSEE HAS ALSO STATED THAT IT HAS ACQUI RED PROMOTERS INTEREST IN MANY OTHER BODY CORPORATE BOTH LISTED AND UNLISTED, WHICH WOULD IN TURN HELP TO PROMOTE ITS BUSINESS INTERESTS. IT IS THE PREVALENT PRACTICE OF BIG BUSINESS GROUPS TO PROMOTE SUCH KIND OF SUBSIDIARY COMPANIES, WHICH WOULD IN TURN ACQUIRE BUSINESS AND PROMOTERS SHARE IN OTHER LISTED AND UNLISTED COMPANIES. THIS IS A KIND OF CORPORATE STRATEGY GENERALLY FOLLOWED BY ALL BUSINESS GROUPS; THE PURPOSE IS CERTAINLY TO CONSOLIDATE ITS BUSINESS POSITION. ACCORDINGLY, WE FIND MERIT IN THE CONTENTION OF THE LD A.R THAT THERE WAS COMMERCIAL EXPEDIENCY IN MAKING INTEREST FREE ADVANCES TO THE SUBSIDIARY COMPANIES. HARRISONS MALAYALAM LTD 3 10. THE ASSESSEE HAS ALSO EXPLAINED ABOUT THE SOURCE OF FUNDS FOR MAKING INVESTMENTS IN THE SUBSIDIARY COMPANIES DURING THE YE AR UNDER CONSIDERATION. THE AO HIMSELF HAS WORKED OUT THE AVERAGE INVESTMENTS MADE DURING THE YEAR AT RS.13035.04 LACS. DURING THE YEAR THE ASSESSEE HAS REALIZED RS.7250 LAKHS ON SALE OF ITS RUBBER ESTATES AND RS.3748.77 LACS FROM SALE OF INVESTMENTS. BESIDES THE ABOVE THE ASSESSEE HAS MADE A TURNOVER OF RS.15267.54 LAKHS DURING THE YEAR UNDER CONSIDERATION AND WE NOTICE FROM THE PROFIT AND LOSS FILED IN THE PAPER BOOK THAT IT HAS MADE A CASH PROFIT OF RS.7305 LAKHS. THESE SOURCES GENERATED DURING THE YEAR WERE MORE THAN SUFFICIENT TO MAKE THE AVERAGE INVESTMENTS STATED ABOVE. BESIDES THE ABOVE, IT WAS ALSO STATED THAT THE ASSESSEE IS HAVING INTEREST FREE FUNDS IN THE FORM OF SHARE CAPITAL AND RESERVES TO THE TUNE OF RS.30168.70 LAKHS, WHICH WERE MORE THAN THE INVESTMENT MADE IN SUBSIDIARIES VIZ., RS.21221.04 LAKHS. 11. THUS, WE NOTICE THAT THE ASSESSEE HAS ESTABLISHED THE COMMERCIAL EXPEDIENCY IN MAKING INTEREST FREE ADVANCES TO ITS SUBSIDIARY COMPANIES AND IT HAS ALSO ESTABLISHED THAT IT HAS ON LY UTILISED ONLY INTEREST FREE FUNDS FOR THE SAID PURPOSE. ACCORDINGLY, THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF S.A. BUILDERS AND THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF BHARTI TELEVENTURES LTD, REFERRED SUPRA APPLY TO THE FAC TS OF THE INSTANT CASE. IN VIEW OF THE FOREGOING DISCUSSIONS, WE DO NOT FIND ANY INFIRMITY IN THE DECISION OF LD CIT(A) IN DELETING THE DISALLOWANCE OF INTEREST CLAIM. 4.1 ACCORDING TO THE ASSESSEE, THE QUANTUM OF INTEREST FREE FUNDS AVAILABLE WITH THE ASSESSEE WERE MORE THAN THE INVESTMENTS MADE IN SUBSIDIARY COMPANIES, AS EVIDENCED FROM THE ASSESSMENT ORDER PASSED FOR ALL THESE YEARS. FOR THE SAKE OF CONVENIENCE, WE EXTRACT BELOW THE RATIO OF FUNDS AVAILABLE WITH THE ASSESSEE AS WORKED OUT BY THE AO: ASST YEAR INTEREST FREE FUNDS OWN FUNDS AVERAGE INVESTMENT IN SUBSIDIARIES 2003 - 04 22638 7982 4536 2007 - 08 31256 7665 21537 2008 - 09 30550 8549 21742 2009 - 10 30830 9286 21405 HARRISONS MALAYALAM LTD 4 4.2 HOWEVER, AT THE TIME OF HEARING, THE LD D.R SUBMITTED A COPY OF TH E ORDER DATED 03 - 08 - 2012 PASSED BY THE HONBLE JURISDICTIONAL HIGH COURT OF KERALA IN ASSESSEES OWN CASE IN ITA NO.93 OF 2000 RELATING TO AY 1992 - 93. THE FOLLOWING OBSERVATIONS MADE BY THE HIGH COURT WOULD BE RELEVANT HERE: - 10. IN THE INSTANT CASE, I T IS NOT THE CASE OF THE ASSESSEE THAT IT HAD SUFFICIENT FUNDS IN ITS ACCOUNTS TO MAINTAIN INTEREST FREE LOANS TO SUBSIDIARIES. THE ASSESSEE WOULD TAKING INTO ACCOUNT THE TOTAL PROFITS OR RATHER RECEIPTS OF THE BUSINESS OF THE YEAR, CONTEND THAT SUCH RECE IPTS BEING MORE THAN THE LOANS GRANTED TO THE SUBSIDIARIES, IT CAN ONLY BE ASSUMED THAT THE LOANS TO THE SUBSIDIARIES WERE FROM ITS OWN FUNDS. THE FACTS NOTICED BY US REGARDING BORROWINGS MADE IMMEDIATELY BEFORE THE LOANS TO SUBSIDIARIES WERE GRANTED DIST INGUISHES THE INSTANT CASE ON FACTS FROM THE CASES CITED ABOVE. THE FACT NOTICED BY THE ASSESSING OFFICER WOULD ESTABLISH A DIRECT NEXUS WITH THE BORROWINGS MADE BY THE ASSESSEE AND LOANS GRANTED BY THE ASSESSEE. ..WE ARE INCLINED TO FOLLOW THE MADRAS H IGH COURT DECISION IN K.SOMASUNDARAMS CASE (SUPRA), WHICH ARE MORE APPOSITE TO THE FACTS OF THE ABOVE CASE AND THE REASONING OF WHICH IS ACCEPTABLE TO US. .. 11. WE WOULD ALSO NOTICE, WITH RESPECT, THE DECISION OF THE HONBLE SUPREME COURT IN S.A. BUI LDERS V. CIT(APPEALS) (2007)(1 SCC 781).. ACCORDING TO THE HONBLE SUPREME COURT, THE TEST IN SUCH CASES SHOULD BE AS TO WHETHER THE ADVANCES WERE AS A MEASURE OF COMMERCIAL EXPEDIENCY. ..HOLDING THAT WHAT IS RELEVANT IS WHETHER THE ASSESSEE ADVANCED THE MONEY TO ITS SISTER CONCERN AS A MEASURE OF COMMERCIAL EXPEDIENCY, THE SUPREME COURT REMANDED THE MATTER TO THE TRIBUNAL, SINCE SUCH FACTS WERE NEVER EXAMINED. IN THE INSTANT CASE, THE SPECIFIC CONTENTIONS OF THE ASSESSEE IS THAT BORROWALS WERE MADE FOR I TS DAY TO DAY BUSINESS ACTIVITIES AND THE LOANS ADVANCED TO THE SUBSIDIARY COMPANIES WERE FROM THE RECEIPTS OF ASSESSEES BUSINESS. THE ASSESSEE, HENCE, CLEARLY DISTINGUISHES THE LOANS GRANTED TO SUBSIDIARY COMPANIES FROM ITS BUSINESS EXPENSES AND HENCE S UCH ADVANCES TO SUBSIDIARY COMPANIES CANNOT AT ALL BE TREATED AS A MEASURE OF COMMERCIAL EXPEDIENCY. 4.3 A CAREFUL READING OF THE ORDER OF THE HONBLE JURISDICTIONAL HIGH COURT WOULD SHOW THAT THE HIGH COURT HAS EXPRESSED THE VIEW THAT THE DIVERSION O F FUNDS TO SUBSIDIARY COMPANIES OUT OF LOAN FUNDS MEANT FOR BUSINESS EXPENSES (PURPOSES) WOULD NOT BE A MEASURE OF COMMERCIAL EXPEDIENCY. THUS THE MATTER OF COMMERCIAL EXPEDIENCY AS DISCUSSED BY THE HONBLE HIGH COURT HAS TO BE CONSIDERED IN PREFERENCE TO THAT ONE DISCUSSED BY THE TRIBUNAL. FURTHER , IN HARRISONS MALAYALAM LTD 5 THE YEARS UNDER CONSIDERATION , WE NOTICE THAT THE RELEVANT DETAILS RELATING TO THE ADVANCES GIVEN TO THE SUBSIDIARIES, I.E., THE DETAILS OF PAYMENT AND RECEIPT OF ADVANCE TO/FROM EACH SUBSIDIARY COMPANY, THE SOURCES OF FUNDS AVAILABLE WITH THE ASSESSEE TO MAKE THE PAYMENT ETC. ARE NOT AVAILABLE ON RECORD. FOR EXAMPLE, IF ANY PART OF THE LOAN FUNDS MEANT FOR BUSINESS PURPOSES IS DIVERTED TO THE SUBSIDIARY COMPANIES INTEREST FREE, THEN THE SAME WOULD ATTRA CT DISALLOWANCE , IN VIEW OF THE DECISION OF JURISDICTIONAL HIGH COURT, REFERRED ABOVE . WE NOTICE THAT THE ASSESSING OFFICER HAS NOT ANALYSED THE TRANSACTIONS MADE WITH THE SUBSIDIARY COMPANIES AND THE ASSESSEE HAS ALSO NOT FURNISHED ANY ACCOUNT COPY OF SUBSIDIARY COMPANIES TO SHOW THAT THERE WAS NO MOVEMENT OF FUNDS DURING THE YEAR UNDER CONSIDERATION. BEFORE US, THE LD A.R MADE A REFERENCE TO AGGREGATE AMOUNT OF ADVANCES OUTSTANDING IN THE NAME OF SUBSIDIARY COMPANIES. HOWEVER, THE WORKING OF AVERAGE AMOUNT OF INVESTMENTS GIVEN IN THE ASSESSMENT ORDER WOULD SUGGEST THAT THERE WAS MOVEMENT OF FUNDS IN THE ACCOUNTS OF SUBSIDIARY COMPANIES. HENCE, IN OUR VIEW, THE SOURCES OF FUNDS THAT WERE GIVEN TO EACH OF THE SUBSIDIARY COMPANIES DURING THE RELEVANT Y EARS UNDER CONSIDERATION REQUIRES TO BE EXAMINED IN ORDER TO FIND OUT ABOUT THE DIVERSION OF INTEREST BEARING FUNDS. HENCE, IN OUR VIEW, THIS ISSUE REQUIRES FRESH EXAMINATION AT THE END OF THE ASSESSING OFFICER IN THE LIGHT OF THE DECISION RENDERED BY TH E HONBLE JURISDICTIONAL HIGH COURT REFERRED SUPRA. ACCORDINGLY, WE SET ASIDE THE ORDERS OF LD CIT(A) ON THIS ISSUE IN ALL THE RELEVANT YEARS AND RESTORE THE SAME TO THE FILE OF THE ASSESSING OFFICER IN ALL THE YEARS WITH THE HARRISONS MALAYALAM LTD 6 DIRECTION TO EXAMINE THIS ISS UE AFRESH BY DULY CONSIDERING THE MOVEMENT OF FUNDS IN THE ACCOUNTS OF THE SUBSIDIARIES , SOURCES FOR THE SAME ETC. AND TAKE APPROPRIATE DECISION IN ACCORDANCE WITH LAW, AFTER AFFORDING NECESSARY OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 5. THE NEXT COMMON ISSUE URGED IN AY 2007 - 08 TO 2010 - 11 RELAT ES TO THE DISALLOWANCE OF LICENS E FEE PAID TO M/S RPG ENTERPRISES. THE AO DISALLOWED THE SAID CLAIM BY HOLDING THAT THE DEPARTMENT HAS DISALLOWED THE IDENTICAL CLAIMS MADE IN THE EARLIER YEARS. THE LD CIT (A), HOWEVER, BY FOLLOWING THE DECISION OF THE TRIBUNAL RENDERED IN ASSESSEES OWN CASE IN EARLIER YEARS, DELETED THE DISALLOWANCE. 5.1 BOTH THE PARTIES AGREED THAT THIS ISSUE IS COVERED BY THE DECISION OF THE CO - ORDINATE BENCHES RENDERED IN THE ASSESSEES OWN CASE IN EARLIER YEARS. FOR THE SAKE OF CONVENIENCE, WE EXTRACT BELOW THE OBSERVATIONS MADE BY THE CO - ORDINATE BENCH IN ITS ORDER DATED 29 - 06 - 2012 RENDERED IN ITA NO.77/COCH/2010: - 3. THE FIRST ISSUE RELATES TO THE DISALLOWANCE OF LICENCE FEE PAI D TO RPG ENTERPRISES AMOUNTING TO RS.60.00 LAKHS. WE NOTICE THAT THE ASSESSING OFFICER HAS DISALLOWED THE LICENCE FEE PAYMENTS BY FOLLOWING HIS ORDER IN THE EARLIER YEARS. IN THOSE YEARS, THE ASSESSEE HAS CARRIED THE MATTER IN APPEAL BEFORE THE LD CIT(A) AND THEN TO THE TRIBUNAL. THE COCHIN BENCH OF THE TRIBUNAL IN ITS APPELLATE ORDER DATED 11.5.2007 IN ITA NOS. 104 TO 106 OF 2005 RELATING TO THE ASSESSMENT YEAR 2001 - 02 TO 2003 - 04 HAS HELD THAT THE LICENCE FEE PAID TO M/S RPG ENTERPRISES WAS AN ALLOWABLE EXPENDITURE. THE SAID VIEW WAS REITERATED BY THE TRIBUNAL IN ITS ORDER DATED 12.5.2009 RELATING TO THE ASSESSMENT YEAR 2005 - 06 IN ITA NO.60/COCH/2009. WE FURTHER NOTICE THAT THE LD CIT(A) HAS FOLLOWED THE DECISIONS RENDERED BY THE TRIBUNAL IN DECIDING THIS ISSUE IN FAVOUR OF THE ASSESSEE. THE ASSESSEE SUBMITTED BEFORE US THAT THERE WAS NO CHANGE IN THE FACTS SURROUNDING THIS EXPENDITURE. HOWEVER, THE LD D.R, BY PLACING RELIANCE ON THE HARRISONS MALAYALAM LTD 7 DECISION OF JURISDICTIONAL KERALA HIGH COURT IN THE CASE OF CIT VS. PREMIER BREWERIES LTD (2005)(279 ITR 51), SUBMITTED THAT MERE EXISTENCE OF AN AGREEMENT IS NOT SUFFICIENT TO PROVE COMMERCIAL EXPEDIENCY IN RESPECT OF THIS PAYMENT. THERE CANNOT BE ANY DISPUTE THAT THE QUESTION OF EXISTENCE OF COMMERCIAL EXPEDIENCY HAS T O BE DECIDED ON THE FACTS PREVAILING IN EACH CASE. IN THE INSTANT CASE, THE CO - ORDINATE BENCH OF THE TRIBUNAL HAS EXAMINED THIS PAYMENT AND HAS TAKEN THE VIEW THAT THIS EXPENDITURE IS ALLOWABLE AND IT WAS SO HELD BY THE TRIBUNAL IN MORE THAN ONE YEAR. HE NCE, WE ARE INCLINED TO FOLLOW THE VIEW CONSISTENTLY TAKEN BY THE TRIBUNAL. SINCE THE LD CIT(A) HAS FOLLOWED THE DECISION OF THE TRIBUNAL, WE DO NOT FIND ANY REASON TO INTERFERE WITH HIS DECISION ON THIS ISSUE. 5.2 WHEN A SPECIFIC QUERY WAS ASKED TO LD D.R AS TO WHETHER THIS ISSUE HAS SINCE BEEN DECIDED BY HONBLE HIGH COURT OF KERALA IN THE APPEAL, IF ANY, FILED BY THE DEPARTMENT, THE LD D.R SUBMITTED THAT THERE IS NO DECISION OF HONBLE HIGH COURT ON THIS ISSUE. UNDER THESE CIRCUMSTANCES, SINCE TH E LD CIT(A) HAS FOLLOWED THE DECISION RENDERED BY THE CO - ORDINATE BENCH, WE DO NOT FIND ANY REASON TO INTERFERE WITH HIS ORDER ON THIS ISSUE. 6. THE NEXT COMMON ISSUE URGED IN AY 2007 - 08 TO 2010 - 11 RELATES TO THE DISALLOWANCE OF EMPLOYEES PROVIDENT FUND, LABOUR WELFARE FUND AND ESI ON ACCOUNT OF DELAYED REMITTANCE, I.E., BEYOND THE DATE PRESCRIBED IN THE RESPECTIVE ENACTMENTS. THE SUBMISSION OF THE ASSESSEE IS THAT ALL THESE PAYMENTS HAVE BEEN MADE BEFORE THE DUE DATE PRESCRIBED FOR FILING RETURN OF INCO ME U/S 139(1) OF THE ACT AND HENCE NO DISALLOWANCE IS REQUIRED TO BE MADE. HE ALSO RELIED UPON THE DECISION RENDERED BY THE CO - ORDINATE BENCH, VIDE ITS ORDER DATED 29 - 06 - 2012 PASSED IN ITA NO.77/COCH/2010 IN ASSESSEES OWN CASE RELATING TO AY 2006 - 07. WE NOTICE THAT THE LD CIT(A) HAS FOLLOWED THE DECISION RENDERED BY HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. AIML (321 HARRISONS MALAYALAM LTD 8 ITR 508) AND ALSO THE DECISION OF HONBLE SUPREME COURT RENDERED IN THE CASE OF ALOM EXTRUSIONS (319 ITR 306) IN DECIDING THIS ISSUE IN FAVOUR OF THE ASSESSEE. 6.1 HOWEVER, WE NOTICE THAT THE ASSESSING OFFICER HAS NOT GIVEN THE DETAILS OF DATE OF PAYMENT OF THE EMPLOYEES PF/ESI ETC, IN THE ASSESSMENT ORDER. THE LD CIT(A) HAS ALSO NOT EXAMINED THE SAME. THE DECISIONS RENDERED BY THE CO ORDINATE BENCH, HIGH COURT AND SUPREME COURT (REFERRED SUPRA) SHALL APPLY ONLY IF THE PAYMENTS HAVE BEEN MADE BEFORE THE DUE DATE PRESCRIBED U/S 139(1) OF THE ACT FOR FILING RETURN OF INCOME. SINCE THE DETAILS OF DATE S OF PAYMENT ARE NOT AVAILABLE ON RECO RD, WE ARE OF THE VIEW THAT THIS ISSUE REQUIRES FRESH EXAMINATION IN ALL THE YEARS. IF THE PAYMENTS HAVE BEEN MADE BEFORE THE DUE DATE PRESCRIBED U/S 139(1) OF THE ACT FOR FILING RETURN OF INCOME, NO DISALLOWANCE IS REQUIRED TO BE MADE. OTHERWISE, THE DI SALLOWANCE SHOULD BE MADE IN RESPECT OF THE AMOUNTS PAID AFTER THE DUE DATE PRESCRIBED U/S 139(1) OF THE ACT. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD CIT(A) ON THIS ISSUE IN ALL THE YEARS REFERRED ABOVE AND DIRECT THE ASSESSING OFFICER TO EXAMINE THE SA ME IN THE LIGHT OF DISCUSSIONS MADE SUPRA. 7 THE NEXT COMMON ISSUE URGED BY THE REVENUE FOR THE AYS 2007 - 08 TO 2010 - 11 RELATE TO THE ADDITION OF THE AMOUNT REALIZED ON SALE OF OLD AND UNYIELDING RUBBER TREES. HARRISONS MALAYALAM LTD 9 7.1 BOTH THE PARTIES AGREED THAT THIS ISSUE IS COVERED BY THE DECISION OF THE CO - ORDINATE BENCHES OF THIS TRIBUNAL RENDERED IN ASSESSEES OWN CASE IN EARLIER YEARS. THE LD AR INVITED OUR ATTENTION TO THE ORDER DATED 29.6.2012 PASSED IN ITA NO. 77/COCH/2010 PARTICULARLY PARAS 13 TO 15 OF THE TRIBUN AL ORDER. FOR THE SAKE OF CONVENIENCE, WE EXTRACT BELOW THE PARAGRAPHS REFERRED ABOVE: 13. THE NEXT ISSUE RELATES TO THE ADDITION OF AMOUNT REALISED ON SALE OF OLD AND UNYIELDING RUBBER TREES AMOUNTING TO RS.5,12,84,878/ - AS REVENUE RECEIPT UNDER RUL E 7A OF THE INCOME TAX RULES. THE ASSESSEE CLAIMED THE AMOUNT REALISED ON SALE OF OLD AND UNYIELDING RUBBER TREES AS NOT TAXABLE BY FOLLOWING THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF KALPETTA ESTATES LTD (221 ITR 601). HOWEVER, THE AO TOOK TH E VIEW THAT THE TAXABLE POSITION OF AMOUNT REALISED ON SUCH SALE HAS UNDERGONE A CHANGE AFTER THE INTRODUCTION OF RULE 7A OF THE INCOME TAX RULES. ACCORDING TO RULE 7A, THE INCOME FROM RUBBER ESTATE HAS TO BE APPORTIONED IN THE RATIO OF 65 : 35 AND THE 35 % OF THE INCOME IS TO BE ASSESSED AS BUSINESS INCOME. ACCORDINGLY HE TOOK THE VIEW THAT THE SALE VALUE OF OLD AND UNYIELDING TREES IS ONLY A SALVAGE VALUE GOT FROM AN EXHAUSTED STOCK JUST LIKE THE MONEY GOT ON SALE OF EMPTY GUNNY BAGS BY A CEMENT DEALER O R OF EMPTY BOTTLES BY A BAR HOTEL AND HENCE THE TREES CANNOT BE CALLED AS A CAPITAL ASSET. THE AO FURTHER TOOK THE VIEW THAT THE CAPITAL ASSETS ARE NOT ALLOWED AS A DEDUCTION UNDER THE INCOME TAX ACT. HOWEVER, IN THE INSTANT CASE, THE EXPENSES INCURRED O N ESTATE EXPENSES AND REPLANTING EXPENSES HAVE BEEN CLAIMED BY THE ASSESSEE ITSELF, WHICH SHOWS THAT THE RUBBER TREES ARE NOT CAPITAL ASSETS. ACCORDINGLY, THE AO BROUGHT TO TAX 35% OF THE AMOUNT REALISED ON SALE OF OLD AND UNYIELDING TREES. THE LD CIT(A) ALLOWED THE CLAIM OF THE ASSESSEE BY HOLDING THAT RULE 7A SHALL NOT APPLY TO THE SALE OF OLD AND UNYIELDING TREES. 14. THE MAIN CONTENTION OF THE DEPARTMENT IS THAT THE RULE 7A SHALL APPLY TO THE INCOME GENERATED ON SALE OF OLD AND UNYIELDING RUBBER TREE S. WE HAVE GONE THROUGH RULE 7A OF INCOME TAX RULES AND FOR THE SAKE OF CONVENIENCE, WE EXTRACT THE SAME BELOW: - INCOME FROM THE MANUFACTURE OF RUBBER 7A (1) INCOME DERIVED FROM THE SALE OF CENTRIFUGED LATEX OR CENEX OR LATEX BASED CREPES (SUCH AS PALE LATEX CREPE) OR BROWN CREPES (SUCH AS ESTATE BROWN CREPE, REMILLED CREPE, SMOKED BLANKET CREPE OR FLAT BARK CREPE) OR TECHNICALLY SPECIFIED BLOCK RUBBERS MANUFACTURED OR PROCESSED FROM FIELD LATEX OR COAGULUM OBTAINED FROM RUBBER PLANTS GROWN BY THE SELL ER IN INDIA SHALL BE COMPUTED AS HARRISONS MALAYALAM LTD 10 IF IT WERE INCOME DERIVED FROM BUSINESS, AND THIRTY - FIVE PER CENT OF SUCH INCOME SHALL BE DEEMED TO BE INCOME LIABLE TO TAX. ON A CAREFUL PERUSAL OF RULE 7A, WE NOTICE THAT THE SAID RULE TALKS ABOUT COMPUTATION OF INCO ME DERIVED FROM SALE OF CENTRIFUGED LATEX OR CENEX OR LATEX BASED CREPES (SUCH AS PALE LATEX CREPE) OR BROWN CREPES ETC . THE SAID RULE DOES NOT TALK ABOUT THE TAXABILITY OF INCOME FROM SALE OF OLD RUBBER TREES. ACCORDING TO LD A.R, THE RULE 7A PROVIDES F OR ASCERTAINMENT OF BUSINESS INCOME OBTAINED ON SALE OF CENTRIFUGED LATEX ETC. WHEN MANUFACTURED OR PROCESSED FROM FIELD LATEX OR COAGULUM OBTAINED FROM RUBBER PLANTS GROWN BY THE SELLER IN INDIA , I.E., WHEN THERE IS A COMBINED ACTIVITY OF GROWING RUBBER TREES AND ALSO MANUFACTURING OR PROCESSING OF FIELD LATEX OR COAGULUM OBTAINED FROM RUBBER PLANTS, RULE 7A PROVIDES FOR SEGREGATION AND ASCERTAINMENT OF AGRICULTURAL INCOME AND THE BUSINESS INCOME. ON A PLAIN READING OF RULE 7A, WE ARE INCLINED TO ACCEPT THE CONTENTIONS OF LD A.R. THUS, THE SAID RULE 7A DOES NOT TAKE IN ITS AMBIT THE QUESTION OF SALE OF OLD RUBBER TREES. WITH REGARD TO THE POSITION OF RUBBER TREES, THE LD CIT(A) HAS OBSERVED AS UNDER: - IN SO FAR AS SALE OF OLD AND UNYIELDING RUBBER TR EES ARE CONCERNED, RUBBER TREES ARE GROWN BY CARRYING OUT AGRICULTURAL OPERATIONS ON LAND. AS HELD BY THE SUPREME COURT, RUBBER TREES ARE NOT GROWN FOR THE PURPOSE OF SELLING THE TREES BUT FOR GENERATING INCOME FROM THE TREES IN THE SHAPE OF LATEX. THE R UBBER TREES CONSTITUTE CAPITAL ASSET OF RUBBER ESTATE AND DOMINANT PURPOSE OF GROWING RUBBER TREES IS TO CREATE SOURCE FOR SUPPLY OF LIQUID LATEX. THE RUBBER TREES THEREFORE CONSTITUTE CAPITAL ASSET OF AGRICULTURAL OPERATIONS. THERE IS NO MANUFACTURING A CTIVITY INVOLVED EITHER AT THE STAGE OF CULTIVATION AND GROWING OF RUBBER TREE OR AT THE TIME OF ITS FELLING ON TREES BECOMING OLD AND UNYIELDING. INCOME DERIVED FROM SALE OF OLD AND UNYIELDING TREES DO NOT INCLUDE ANY ELEMENT OF INCOME DERIVED FROM SALE OF CENTRIFUGED LATEX OR SENEX OR LATEX BASED CREPES. IN THE CIRCUMSTANCES, CONDITION PRECEDENT FOR APPLYING RULE 7A IS ABSENT WHEN OLD AND UNYIELDING RUBBER TREES ARE SOLD AS NO MANUFACTURING OR PROCESSING ELEMENT IS INVOLVED IN THE ACTIVITY. IN MY OPINI ON THEREFORE RULE 7A OF INCOME TAX RULES HAS NO APPLICATION TO THE INCOME DERIVED ON SALE OF OLD RUBBER TREES. NO MATERIAL CHANGE HAS BEEN BROUGHT ABOUT BY INTRODUCTION OF RULE 7A BECAUSE RULE 7A IS APPLICABLE ONLY WHEN THE GROWER OF RUBBER TREES HIMSELF C ARRIES ON MANUFACTURING ACTIVITY ON LATEX OR COAGULUM SOURCED FROM RUBBER TREES GROWN BY HIM. THE JUDICIAL PRINCIPLES LAID DOWN BY THE SUPREME COURT IN THE EARLIER DECISIONS CONTINUE TO HOLD GOOD EVEN AFTER INTRODUCTION OF RULE 7A. IN TUNE WITH THE SUPRE ME COURT DECISIONS IN THE CASE OF KALPETTA ESTATES LTD VS. CIT REPORTED IN 221 ITR 601 AND IN THE CASE OF KAILAS RUBBER & CO. LTD REPORTED IN 60 ITR 435, I HOLD THAT HARRISONS MALAYALAM LTD 11 NO INCOME CHARGEABLE TO TAX ACCRUED ON SALE OF OLD AND UNYIELDING RUBBER TREES. 15. WE NOTICE THAT THE LD CIT(A) HAS TAKEN THE VIEW WITH REGARD TO THE APPLICATION OF RULE 7A, WHICH IS IDENTICAL WITH THE VIEW EXPRESSED BY US IN THE EARLIER PARAGRAPH, I.E., IT APPLIES ONLY TO A PERSON WHO CARRIES ON THE COMBINED ACTIVITY OF GROWING RUBBER T REES AND ALSO MANUFACTURING OR PROCESSING OF FIELD LATEX OR COAGULUM OBTAINED FROM RUBBER PLANTS. THE DOMINANT PURPOSE OF GROWING RUBBER TREES IS TO OBTAIN LIQUID LATEX FROM THEM. THE RUBBER TREES ARE NOT USED AS IT IS FOR THE PURPOSE OF MANUFACTURING O R PROCESSING, BUT ONLY THE LATEX OBTAINED FROM THEM. HENCE, THE SALE VALUE OF OLD RUBBER TREES CANNOT BE CONSIDERED AS SALVAGE VALUE OBTAINED FROM THE EXHAUSTED STOCK. SINCE THE RUBBER TREES CONTINUE TO THE CAPITAL ASSET. ACCORDINGLY, THE EXAMPLES OF SAL E OF OLD GUNNY BAGS OR OLD BOTTLES QUOTED BY THE AO ARE NOT APPLICABLE TO THE CASE OF RUBBER TREES. HENCE, THE DECISION OF SUPREME COURT IN HOLDING THAT THE RUBBER TREES CONSTITUTE CAPITAL ASSETS SHALL HOLD GOOD EVEN AFTER THE INTRODUCTION OF RULE 7A IN T HE INCOME TAX RULES. IN VIEW OF THE ABOVE, WE AGREE WITH THE VIEWS EXPRESSED BY LD CIT(A) ON THIS ISSUE. 7.2 WE NOTICED THAT THE LD CIT(A) FOLLOWED THE DECISION RENDERED BY THE TRIBUNAL IN AY 2006 - 07 . BEFORE US, THE LD D.R COULD NOT FURNISH ANY MATERIA L/ORDER TO SHOW THAT THE ORDER PASSED BY THE TRIBUNAL ON THE ABOVE SAID ISSUE IN THE EARLIER YEARS HAS BEEN REVERSED BY HONBLE HIGH COURT. H ENCE, WE DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF LD CIT(A) ON THIS ISSUE. 8 NEXT COMMON ISSUE URGED IN AYS 2007 - 08 TO 2010 - 11 RELATES TO THE ASSESSMENT OF SALE OF GREVILLEA TREES UNDER THE HEAD CAPITAL GAINS TAX . THIS ISSUE HA S ALSO BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY LD CIT(A) BY FOLLOWING THE DECISION RENDERED BY THE TRIBUNAL IN THE ASSESSEE S OWN CASE IN A Y 2006 - 07. FOR THE SAKE OF CONVENIENCE, WE EXTRACT BELOW THE OBSERVATIONS MADE BY THE HARRISONS MALAYALAM LTD 12 TRIBUNAL IN PARAS 17 TO 20 OF THE ORDER REFERRED ABOVE IN ITA NO.77/COCH/2010 DATED 29.6.2012 RELATING TO THE AY 2006 - 07: 17. THE NEXT ISSUE RELATES TO THE ASSESSMENT OF RS.83,65,516/ - AS CAPITAL GAIN ON SALE OF GREVELIA TREES. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE REALISED A SUM OF RS.1.19 CRORES ON SALE OF GREVELIA TREES. THESE TREES ARE GROWN TO AFFORD SHADE TO THE TEA BUSHES. IN THE RETURN OF INCOME FILED, THE ASSESSEE ESTIMATED THE MARKET PRICE AS ON 1.4.1981 AT 30% OF THE SALE PRICE REALISED BY IT. AFTER CLAIMING INDEXED COST OF ACQUISITION, THE ASSESSEE RETURNED A LONG TERM CAPITAL LOSS OF RS.58,66,409/ - . HOWEVER, THE AO TOOK TH E VIEW THAT THE COST OF ACQUISITION AS ON 1.4.1981 WOULD BE NEGLIGIBLE AS THE TREES WOULD HAVE BEEN YOUNG SAPLINGS AT THAT POINT OF TIME. ACCORDINGLY, THE AO CONSIDERED 30% OF THE SALE PRICE AS THE INDEXED COST OF ACQUISITION AND AFTER DEDUCTING THE SAME FROM THE SALE PRICE, THE AO TREATED THE BALANCE AMOUNT (I.E. 70% OF SALE PRICE) AS THE LONG TERM CAPITAL GAIN. 18. BEFORE LD CIT(A), THE ASSESSEE RELIED UPON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF STATE OF KERALA VS. KARIMTHARUVI TEA ES TATES LTD (60 ITR 275) TO SUBMIT THAT THE GREVELIA TREES CONSTITUTE CAPITAL ASSET AND HENCE THE AMOUNT REALISED ON ITS SALE WOULD CONSTITUTE CAPITAL RECEIPT. THE ASSESSEE ALSO RELIED UPON THE DECISION OF HONBLE CALCUTTA HIGH COURT IN THE CASE OF CIT VS. KANAN DEVAN HILL PRODUCE CO. LTD (200 ITR 453), WHEREIN THE COURT HAS HELD THAT THE PROFIT DERIVED FROM SALE OF OLD AND USELESS GREVELIA TREES WAS NOT TAXABLE UNDER THE CENTRAL INCOME TAX AS THEY HAVE TO BE CONSIDERED AS PART OF AGRICULTURAL ACTIVITIES. 19. THE LD CIT(A) NOTICED THAT THE ASSESSING OFFICER HAS DISALLOWED THE CLAIM OF CAPITAL LOSS IN THE EARLIER YEARS BY APPLYING THE RATIO OF HONBLE SUPREME COURT IN THE CASE OF CIT VS. B.C. SREENIVASA SHETTY (128 ITR 294) AND ALSO THE DECISION OF JURI SDICTIONAL KERALA HIGH COURT IN THE CASE OF RAJAGIRI RUBBER & PRODUCE COMPANY LTD REPORTED IN 189 ITR 182 (CONFIRMED BY THE SUPREME COURT IN 221 ITR 601). IN THE CASE OF RAJAGIRI RUBBER & PRODUCE COMPANY LTD, IT HAS BEEN HELD THAT THE CAPITAL GAINS COULD NOT BE CHARGED/COMPUTED U/S 45 / 48 IN RESPECT OF SALE OF RUBBER TREES BECAUSE THE COST OF ACQUISITION OF THE TREES COULD NOT BE CONCEIVED WITH REASONABLE ACCURACY. IN THE CASE OF B.C. SREENIVASA SHETTY, IT WAS HELD THAT THE AMOUNT REALISED ON TRANSFER OF GOOD WILL CANNOT BE CHARGED TO CAPITAL GAINS TAX, AS THE COST OF ACQUISITION OF GOOD WILL CANNOT BE ASCERTAINED WITH REASONABLE ACCURACY. ACCORDINGLY, THE AO, IN THE PRECEDING YEARS, HAD HELD THAT THE CAPITAL GAINS ON SALE OF GREVELIA TREES CANNOT BE CO MPUTED AND ACCORDINGLY DISALLOWED THE CLAIM OF CAPITAL LOSS HARRISONS MALAYALAM LTD 13 CLAIMED BY THE ASSESSEE. THE LD CIT(A) ALSO NOTICED THAT THE SAID VIEW OF THE AO WAS UPHELD BY THE FIRST APPELLATE AUTHORITY. ACCORDINGLY, THE LD CIT(A), BY FOLLOWING HIS PREDECESSOR ORDER, HELD THAT THE AMOUNT RECEIVED ON SALE OF GREVELIA TREES WAS CAPITAL RECEIPT AND NEITHER ANY INCOME NOR LOSS WAS ASSESSABLE IN COMPUTATION OF CENTRAL INCOME TAX. 20. WE HAVE CAREFULLY GONE THROUGH THE DECISION RENDERED BY LD CIT(A) ON THIS ISSUE. THE LD C IT(A) HAS NOTICED THAT THE ASSESSING OFFICER WAS TAKING CONSISTENT STAND IN THE EARLIER YEARS THAT NO CAPITAL GAIN OR CAPITAL LOSS CAN BE COMPUTED ON SALE OF GREVELIA TREES, AS THE COST OF ACQUISITION COULD NOT BE ASCERTAINED IN A REASONABLE MANNER. TO SU PPORT HIS VIEW, THE AO HAS TAKEN THE HELP OF THE JURISDICTIONAL HIGH COURT DECISION IN THE CASE OF RAJAGIRI RUBBER & PRODUCE COMPANY LTD, REFERRED SUPRA, WHICH WAS ALSO CONFIRMED BY THE SUPREME COURT IN THE CASE OF KALPETTA ESTATES LTD, REFERRED SUPRA. TH E AO HAS ALSO TAKEN SUPPORT FROM THE DECISION OF THE HONBLE APEX COURT IN THE CASE OF B.C. SREENIVASA SHETTY. HAVING TAKEN SUCH A CONSISTENT STAND OVER THE YEARS, THE AO HAS CHANGED HIS STAND IN THE INSTANT YEAR AND HAS PROCEEDED TO ASSESS THE CAPITAL GA IN ON SALE OF GREVELIA TREES. IN OUR VIEW, THE LEGAL POSITION WITH REGARD TO THE TAXABILITY OF THE OLD GREVELIA TREES, WHICH WAS DISCUSSED AT LENGTH IN THE EARLIER ASSESSMENT ORDERS, CANNOT BE CHANGED IN THE YEAR UNDER CONSIDERATION, MERELY BECAUSE THE PR ESENT ASSESSING OFFICER HAS A DIFFERENT VIEW. IT IS PERTINENT TO NOTE THAT THE AO HAS NOT BROUGHT ON RECORD ANY NEW FACT OR ANY NEW LEGAL VIEW WHICH WOULD COMPEL HIM TO CHANGE THE VIEW THAT WAS CONSISTENTLY TAKEN IN THE EARLIER YEARS. ACCORDINGLY WE ARE OF THE VIEW THAT THE LD CIT(A) WAS RIGHT IN ADHERING TO THE VIEW TAKEN BY THE TAX AUTHORITIES IN THE PRECEDING YEARS. ACCORDINGLY, WE UPHOLD HIS ORDER ON THIS ISSUE. 8 .1 BEFORE US, THE LD D.R COULD NOT FURNISH ANY MATERIAL/ORDER TO SHOW THAT THE ORDER P ASSED BY THE TRIBUNAL ON THE ABOVE SAID ISSUE IN THE EARLIER YEARS HAS BEEN REVERSED BY HONBLE HIGH COURT. SINCE THE LD CIT(A) HAS FOLLOWED THE DECISION OF THE TRIBUNAL ON THIS ISSUE, WE DO NOT FIND ANY INFIRMITY IN HIS ORDER ON THIS ISSUE. HARRISONS MALAYALAM LTD 14 9 NEXT COMMO N ISSUE RELATES TO THE ADDITION OF PROVISION OF GRATUITY FOR COMPUTING BOOK PROFITS U/S 115 J/JB OF THE ACT. THIS ISSUE IS CONTESTED IN THE APPEALS FILED FOR AY 2007 - 08 TO 2010 - 11. T HE LD CIT(A) HAS DELETED THIS ADDITION BY FOLLOWING THE DECISION OF THE T RIBUNAL RENDERED FOR THE AY 2006 - 07. IN THAT YEAR, THE TRIBUNAL HAS MADE THE FOLLOWING OBSERVATIONS ON THIS ISSUE: 25. THE NEXT ISSUE RELATES TO THE ADDITION OF PROVISION FOR GRATUITY LIABILITY AMOUNTING TO RS.5.58 CRORES WHILE COMPUTING THE BOOK P ROFIT BY TREATING THE SAME AS UNASCERTAINED LIABILITY. THE LD CIT(A) DIRECTED THE AO TO DELETE THE SAID ADDITION BY FOLLOWING THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF METAL BOX CO OF INDIA LTD VS. THEIR WORKMEN (73 ITR 53) AND ALSO THE DECISIO N RENDERED IN THE CASE OF BHARAT EARTH MOVERS LTD VS. CIT (245 ITR 428). 26. BEFORE US, THE LD A.R RELIED ON FOLLOWING TWO DECISIONS WHICH ARE DIRECT ON THE ISSUE UNDER CONSIDERATION. (A) CIT VS. ILPEA PARAMOUNT (P) LTD (2010)(192 TAXMAN 65)(DELHI) (B) EASTERN POWER DISTRIBUTION CO. OF AP LTD. VS. ACIT (132 ITD 568) (VIZAG) IN THESE TWO DECISIONS, IT HAS BEEN HELD THAT THE PROVISION FOR GRATUITY LIABILITY CANNOT BE ADDED FOR THE PURPOS E OF COMPUTATION OF BOOK PROFIT. SINCE THE DECISION RENDERED BY LD CIT(A) IS IN ACCORDANCE WITH THE TWO DECISIONS REFERRED SUPRA, WE UPHOLD HIS DECISION ON THIS ISSUE. THUS, IT IS SEEN THAT THE COORDINATE BENCHES OF THIS TRIBUNAL HAS HELD THAT THE PROVI SION OF GRATUITY CANNOT BE ADDED FOR COMPUTING BOOK PROFIT U/S 115JA/JB OF THE ACT. BEFORE US, THE LD D.R COULD NOT FURNISH ANY MATERIAL/ORDER TO SHOW THAT THE ORDER PASSED BY THE TRIBUNAL ON THE ABOVE SAID ISSUE IN THE EARLIER YEARS HAS BEEN REVERSED BY HONBLE HIGH COURT. SINCE T HE LD CIT(A) HAS FOLLOWED THE DECISION OF THE COORDINATE BEN CHES OF THE TRIBUNAL, WE CONFIRM HIS ORDER ON THIS ISSUE. HARRISONS MALAYALAM LTD 15 10 IN THE AY 2007 - 08, THE AO HAS ALSO ADDED A SUM OF RS. 45,31,274/ - BEING THE PROVISION FOR DOUBTFUL DEBTS /ADVANCES. THE LD AR FAIRLY CONCEDED THAT THE LD CIT(A) HAS DELETED THIS DISALLOWANCE WITHOUT DISCUSSING ANYTHING ABOUT THE SAME. UNDER THE SET OF FACTS, WE ARE OF THE VIEW THAT THIS ISSUE IS REQUIRES EXAMINATION AT THE END OF THE CIT(A). ACCORDINGLY, W E RESTORE THIS ISSUE TO THE FILE OF THE CIT(A) WITH THE DIRECTION TO EXAMINE THE ISSUE AFRESH IN ACCORDANCE WITH LAW AND AFTER AFFORDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 1 1 IN THE RESULT, ALL THE APPEALS FILED BY THE REVENUE ARE TREA TED AS PARTLY ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 14 TH DAY OF MAY 2015 . SD/ - SD/ - ( V DURGA RAO ) ( B R BASKARAN ) JUDICIAL MEMBER ACCOUNTANT MEMBER COCHIN: DATED 14 TH , MAY 2015 RAJ* COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT , 5. DR 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR ITAT, COCHIN HARRISONS MALAYALAM LTD 16