DCIT, New Delhi V. M/s. Delhi Warehousing (P) Ltd., New Delhi

ITA 4571/DEL/2013

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 7330 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 1 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-09-2014
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 02-07-2014
• Assessment Year: 2010-2011
• Appeal Filed On: 02-08-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SRINIVASA KUMAR
• Keywords: Business income; Depreciation; Business expenditure; Question of law

Judgement Text

INCOME TAX APPELLATE TRIBUNAL DELHI BENCH A : NEW DELHI BEFORE SHRI S.V. MEHROTRA , ACCOUNTANT MEMBER AND SHRI A. T. VARKEY, JUDICIAL MEMBER ITA NO. 4571 /DEL/ 2013 (ASSESSMENT YEAR: 2010 - 11 ) DCIT CIRCLE - 10(1) NEW DELHI VS. DELHI WAREHOUSING (P) LTD A - 58, NIZAMUDDIN EAST NEW DELHI PAN:AAACD3718K (APPELLANT) (RESPONDENT) APPELLANT BY : SH. SRINIVASA KUMAR, DR RESPONDENT BY : SALI L KAPOOR AND SANAT KAPOOR, ADV. O R D E R PER A. T. VARKEY , JUDICIAL MEMBER THIS APPEAL ARISES FROM AN ORDER OF LD CIT(A) - XIII DATED 28 TH MAY 2013 AND RELATED TO ASSESSMENT YEAR 2010 - 11. 2. THE GROUND OF APPEAL ARE AS UNDER: - 1. WHETHER THE LD CIT(A) UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW JUSTIFIED IN ALLOWING INCOME RECEIVED FROM LEASED OUT OF PROPERTY AS BUSINESS INCOME AGAINST THE HOUSE PROPERTY INCOME AS ASSESSED BY THE ASSESSING OFFICE AND IN ALLOWING DEPRECIATION THEREON AMOUNTING TO RS.34,58,879/ - . 2. WHETHER THE LD CIT(A) UNDER THE FACTS AND CIRCUMST ANCES OF THE CASE AND IN LAW JUSTIFIED IN ALLOWING THE DISALLOWANCE OF RS.17,76,765/ - BEING 2/3 RD OF EXPENSES OUT OF ADMINISTRATIVE, PERSONNEL AND FINANCE CHARGES IN CONSEQUENCE TO GROUND NO.1 3. APROPOS GROUND NO.1 IS REGARDING TREATMENT OF INCOME RECE IVE D FROM LEASE OUT OF PROPERTY AS BUSINESS INCOME AS AGAINST HOUSE PROPERTY AND ALLOWING DEPRECIATION OF RS.34,58,879/ - . 4. BRIEF FACT OF THE CASE IS THAT THE APPELLANT IS THE OWNER OF 'NEEMRANA FORT PALACE' - A HERITAGE HOTEL AT VILLAGE NEEMRANA, DISTRICT ALWAR - 301,705, RAJASTHAN, INDIA. THE APPELLANT IS RUNNING THE SAID PALACE AS HOTEL IN THE NAME & STYLE OF NEEMRANA FORT PALACE AND ALSO GOT THE APPROVAL FOR RUNNING THE SAME AS 'HERITAGE HOTEL . THE APPELLANT HAS GIVEN THIS PALACE TO NEEMRANA HOTELS GROUP OF COMPANIES FOR RUNNING AS HOTEL AS PER REVENUE SHARING AGREEMENT DATED 01.04.2009. PAGE NO. 2 AS PER THE AGREEMENT, THE ENTIRE BUSINESS ACTIVITY ON THE PROPERTY IS TO BE CARRIED OUT BY THE NEEMRANA HOTEL GROUP FOR RUNNING A HOTEL AND TO INCUR ALL RELATED EXPENDITURE. AS PER THE REVENUE SHARING AGREEMENT, THE APPELLANT IS TO GET 10% OF THE GROSS OPERATING PROFIT WHICH IS CALCULATED AS PER SPECIFIED FORMULA IN THE AGREEMENT. THE APPELLANT TREATED THIS INCOME AS BUSINESS INCOME. IN THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER TREATED THE 1/10 TH SHARE OF INCOME AS INCOME FROM HOUSE PROPERTY. THE ASSESSING OFFICER HAS ALSO DISALLOWED 2/3 RD OF THE ADMINISTRATIVE, PERSONAL AND FINANCE EXPENSES AMOUNTING TO RS.17,76,765/ - OUT OF THE TOTAL EXPENDITURE OF RS.26,65, 148/ - WHICH INCLUDES THE DONATION OF RS.10,00,000/ - WHICH WAS ALREADY ADDED BY THE APPELLANT IN THE COMPUTATION OF INCOME. THE ASSESSING OFFICER HAS ALSO DISALLOWED DEPRECIATION OF RS.34,58,897/ - . 5. AGGRIEVED BY THE AO S ACT ION, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD CIT(A), WHO WAS PLEASED TO ALLOW THE CLAIM OF THE ASSESSEE. BEING AGGRIEVED OF THE SAME, THE REVENUE IS BEFORE US. 6. LD DR SUPPORTED THE AO S STAND THAT INCOME BE TAXED UNDER THE HEAD, HOUSE PROPERTY. I T WAS SUBMITTED THAT ASSESSEE IS NOT CARRYING OUT ANY BUSINESS ACTIVITY AND INCOME IS GENERATED SIMPLY FROM THE ASSETS ITSELF. IT WAS SUBMITTED THAT ALL DAY TODAY EXPENSES OF HOTEL ARE CARRIED OUT BY NEEMARANA HOTEL GROUP AND THE ASSESSEE IS NOT LIABLE FOR ANY EXPENDITURE. IN SUCH CIRCUMSTANCES, THE INCOME IS TAXABLE UNDER THE HEAD HOUSE - PROPERTY. HE ALSO SUBMITTED THAT ON THE LEASE AMOUNT TDS HAS ALSO BEEN DEDUCTED AND AS SUCH LD CIT(A) ERRED IN ACCEPTING THE CLAIM OF THE ASSESSEE THAT INCOME FROM HOTEL NE EMARANA IS TAXABLE UNDER THE HEAD BUSINESS OR PROFESSION . THEREFORE HE PRAYS THAT THE IMPUGNED ORDER BE SET - ASIDE AND THE ORDER OF THE AO BE RESTORED. ON THE OTHER HAND THE LD AR SUPPORTED THE ORDER OF THE LD CIT(A) AND DOES NOT WANT US TO INTERFERE. 7. WE HAVE HEARD BOTH THE PARTIES AND HAVE CAREFULLY PERUSED THE RECORDS. THE BASIC ISSUES INVOLVED IS THE TAXABILITY OF INCOME RECEIVED BY THE ASSESSEE UNDER THE REVENUE SHARING AGREEMENT WITH M/S. NEEMARANA HOTEL PVT. LTD. FOR RUNNING THE NEEMARANA FORT PA LACE AS A HERITAGE HOTEL . THE GENUINENESS OF AGREEMENT HAS NOT BEEN DISPUTED OR QUESTIONED BY THE REVENUE. IT IS ALSO NOT DISPUTED THAT ASSESSEE IS THE OWNER OF THE HOTEL AND HAD OBTAINED THE APPROVAL FOR RUNNING THE HOTEL. THE LD CIT(A) ON THE AFORESAID ADMITTED FACTS HAS CONCLUDED AS UNDER: - I HAVE CONSIDERED THE SUBMISSION OF THE APPELLANT AND OBSERVATION OF THE ASSESSING OFFICER AND VARIOUS CASE LAWS RELIED UPON BY THE APPELLANT IN THIS REGARD. THE APPELLANT COMPANY IS THE OWNER OF 'NEEMRANA FORT PALACE' A HERITAGE HOTEL AT VILLAGE NEEMRANA, DISTRICT ALWAR. THE APPELLANT IS RUNNING THE SAID PALACE AS HOTEL IN THE NAME AND STYLE OF 'NEERNRANA FORT PALACE'. THE APPELLANT COMPANY WAS FACING SOME DIFFICULTIES IN MANAGING THE AFFAIRS OF ITS PALACE AS HOTEL ON ITS PAGE NO. 3 OWN WITHOUT THE TEAM OF MARKETING PERSONAL. THEREFORE, THE APPELLANT DECIDED TO GIVE THE PALACE HOTEL ON REVENUE SHARING AGREEMENT WITH MIS NEEMRANA HOTELS PVT. LTD, 'TO MARKET, SUPERVISE AND MANAGE THE OPERATIONS OF THE HOTELS IN THEIR HO TEL PREMISE'. THE DOMINANT PURPOSE OF THE AFORESAID AGREEMENT WAS TO PERMIT THE NEEMRANA HOTELS PVT. LTD. TO RUN, CONDUCT, OPERATE, MANAGE, MARKET, DIRECT, CONTROL AND SUPERVISE. IN PURSUANCE OF THE REVENUE SHARING AGREEMENT ENTERED INTO WITH NEEMRANA HOTE LS PVT. LTD. THE APPELLANT IS RECEIVING LICENSE FEE FROM NEEMRANA HOTELS PVT. LTD AS REVENUE SHARE FROM RUNNING OF THE HOTEL IN THE SAID PROPERTY AT NEERNRANA VILLAGE. IT IS ALSO SEEN THAT APPELLANT IS HAVING FULL CONTROL/ PARTICIPATION IN THE WORKING OF T HE HOTEL BECAUSE OF THE FACT THAT M/S FRANCIS WACZIARG AND SH. AMAN NATH, DIRECTORS OF THE APPELLANT COMPANY ARE ALSO DIRECTORS IN THE NEEMRANA HOTELS PVT. LTD. FURTHER, THE CLAUSE - I.2 OF THE REVENUE SHARING AGREEMENT PERMITS THE APPELLANT TO PARTICIPATE I N ALL MAJOR DECISIONS IN THE WORKING OF HOTELS WHICH IS AS UNDER: - 'IT IS HEREBY AGREED THAT BOTH THE PARTIES SHALL HOLD MEETINGS FROM TIME TO TIME TO TRANSACT NECESSARY BUSINESS AND TO REVIEW THE AFFAIRS OF THE HOTEL. THEY SHALL MUTUALLY DECIDE UPON THE APPOINTMENT/ENGAGEMENT OF EXPERTS IN THE FIELD OF HOTEL MANAGEMENT/ OPERATIONS TO RUN, CONDUCT, OPERATE, MANAGE, MARKET, DIRECT, CONTROL AND SUPERVISE THE OPERATIONS OF THE SAID HOTELS'. THE ABOVE CLAUSE OF THE REVENUE SHARING AGREEMENT CLEARLY ESTABLISH THAT THE APPELLANT IS INVOLVED IN ALL THE ASPECT OF THE MANAGEMENT AND DAY TO DAY RUNNING OF THE PROPERTY BEING RUN AS HOTEL. IT IS ALSO OBSERVED FROM THE AGREEMENT THAT LICENSE FEE RECEIVED BY THE APPELLANT FROM VARIOUS YEARS IS NOT A FIXED SUM OF MONEY A S IN THE CASE OF INCOME FROM HOUSE PROPERTY BUT IT VARIES FROM YEAR TO YEAR AS IT IS BASED ON REVENUE SHARING ARRANGEMENT, WHICH ARISES ON THE BASIS OF RECEIPTS. THE ASSESSING OFFICER HAS NOT BROUGHT ANY INFORMATION ON RECORD WHICH COULD CONCLUSIVELY PROVE THAT INCOME RECEIVED BY THE APPELLANT WAS IN THE NATURE OF RENTAL INCOME. THE ASSESSING OFFICER'S OBSERVATION THAT THE BUSINESS IS BEING RUN BY MIS NEEMRANA HOTELS PVT. LTD AND NOT BY THE APPELLANT DOES NOT ALSO APPEARS TO BE TOTALLY CORRECT. IT IS NOT CO RRECT TO SAY THAT THE EXCLUSIVE USE AND MAINTENANCE OF THE NEEMRANA HOTEL IS WITH NEEMRANA HOTELS PVT LTD. IT APPEARS THAT IN THE EYES OF ASSESSING OFFICER THE REVENUE SHARING AGREEMENT WAS A SHAM AGREEMENT WITHOUT BRINGING ANY ADVERSE INFORMATION ON RECOR D AND WITHOUT GIVING ANY FINDINGS. THE APPELLANT HAS A PALACE WHICH IS BEING RUN AS A HOTEL AND DIRECTORS OF THE APPELLANT COMPANY ARE TAKING ACTIVE INTEREST IN MANAGING, RUNNING AND OPERATING THE SAID HOTEL. THE APPELLANT IS GETTING 10% SHARE OF THE RECEI PTS RECEIVED BY THE OPERATOR OF THE HOTEL. ALL THESE FACTS AND CIRCUMSTANCES PROVE THAT THE INCOME OF THE APPELLANT WAS A BUSINESS INCOME AND SAME IS ASSESSABLE AS INCOME FROM BUSINESS AND PROFESSION. THEREFORE, THE DECISION OF THE ASSESSING OFFICER OF TRE ATING THE BUSINESS INCOME OF THE APPELLANT AS INCOME FROM HOUSE PROPERTY IS DELETED. THE ASSESSING OFFICER IS DIRECTED TO TREAT THE 10% SHARE OF RECEIPT FROM NEEMRANA HOTELS PVT. LTD. AS BUSINESS INCOME OF THE APPELLANT. IT IS ALSO SEEN THAT ASSESSING OFFICER HAS TREATED 10% RECEIPTS RECEIVED FROM NEEMRANA HOTELS PVT. LTD. AS SHARE OF THE APPELLANT'S INCOME AS INCOME FROM HOUSE PROPERTY, THEREFORE, THE ASSESSING OFFICER HAS DISALLOWED THE CLAIM OF THE APPELLANT OF DEPRECIA TION OF RS.34,58,879/ - . AS DISCUSSED ABOVE, THE 10% SHARE OF RECEIPTS RECEIVED FROM NEEMRANA HOTELS PVT. LTD. HAS BEEN TREATED AS BUSINESS INCOME OF THE APPELLANT COMPANY' WHICH HAS ARISEN TO THE APPELLANT BY RUNNING THE NEEMRANA PALACE PROPERTY AS HOTEL. SINCE THE PALACE IS BEING USED FOR BUSINESS PURPOSES OF THE APPELLANT COMPANY, PAGE NO. 4 THEREFORE, THE APPELLANT IS ENTITLED FOR DEPRECIATION AT THE PRESCRIBED RATES. ASSESSING OFFICER IS THEREFORE, DIRECTED TO ALLOW THE DEPRECIATION OFRS.34,58,879/ - TO THE APPELLAN T. 8. THE LD DR HAS BEEN UNABLE TO PERSUADE US TO ARRIVE AT A CONCLUSION WHICH IS DIFFERENT FROM THE AFORESAID FINDING OF THE LD CIT(A). IN OUR CONSIDERED OPINION IT IS A CASE OF EXPLOITATION OF THE PROPERTY BY THE OWNER IN THE COURSE OF BUSINESS, ALB E IT , NOT BY HIMSELF, BUT THROUGH AN AGENCY UNDER A REVENUE SHARING ARRANGEMENT. IT IS NOT A CASE WHERE OWNER HAS PARTED AWAY WITH AN ASSET FOR A RETURN, WHICH CAN BE DESCRIBED AS A RENT - SIMPLICTOR . THE LD CIT(A) HAS GIVEN COGENT REASONS TO SHOW THAT THE ASS ESSEE WAS PARTICIPATING IN THE MANAGEMENT AND DAY TO DAY RUNNING OF THE HOTEL. IN VIEW THEREOF WE ENDORSE THE OPINION OF THE LD CIT(A) THAT ASSESSEE COMPANY WAS ENGAGED IN MANAGEMENT, RUNNING AND OPERATING THE SAID HOTEL. WE ARE ALSO IN AGREEMENT WITH THE FINDING OF THE LD CIT(A), THAT THE CONCLUSION IS SUPPORTED BY THE JUDGMENT OF THE HON BLE JURISDICTIONAL HIGH COURT IN FRANCIS WACZIARH 353 ITR 187 (DEL), WHEREIN IT WAS HELD AS UNDER: - FROM THE GROUNDS OF APPEAL RAISED BEFORE THE TRIBUNAL, IT IS NOTICEABLE THAT THE REVENUE DID NOT SPECIFICALLY CHALLENGE THE FINDING OF THE COMMISSIONER (APPEALS) THAT INCOME FROM THE PROPERTIES IN QUESTION WAS TAXABLE UNDER THE HEAD 'INCOME FROM BUSINESS OR PROFESSION' AND NOT UNDER THE HEAD 'INCOME FROM HOUSE PROPE RTY'. IN THESE CIRCUMSTANCES, THE REVENUE CANNOT CHALLENGE THE ORDER OF THE TRIBUNAL ON THE GROUND THAT INCOME FROM THOSE PROPERTIES IS CHARGEABLE UNDER THE HEAD 'INCOME FROM HOUSE PROPERTY' AND NOT UNDER THE HEAD OF 'INCOME FROM BUSINESS AND PROFESSION'. [PARA 11) EVEN OTHERWISE, THE COMMISSIONER (APPEALS) HAS GIVEN DETAILED FACTUAL FINDING WHY INCOME EARNED BY THE ASSESSEE FROM THE PROPERTIES IS TAXABLE UNDER THE HEAD 'INCOME FROM BUSINESS OR PROFESSION' AND NOT UNDER THE HEAD 'INCOME FROM HOUSE PROPERT Y'. THE REASONING GIVEN BY THE ASSESSING OFFICER IS CRYPTIC AND SHE HAS NOT CONSIDERED THE RELEVANT ASPECTS. ON THE BASIS O F FINDINGS RECORDED BY HER, IT IS NOT POSSIBLE TO HOLD THAT THE FINDING OF TACT RECORDED BY THE COMMISSIONER (APPEALS)/TRIBUNAL ARE U NFOUNDED OR UNREASONABLE . IN ANY CASE, THE SAID FINDINGS ARE NOT PERVERSE AND AR E BASED ON DOCUMENTS AND MATERIAL PLACED ON RECORD THE REASONING IS COGENT AND WELL - EXPLAINED. THEREFORE NO QUESTION OF LAW ARISES ON THE FIRST ASPECT AS TO WHETHER THE INCOME EARNED BY THE ASSESSEE IS TAXABLE UNDER THE HEAD INCOME FROM HOUSE PROPERTY . (PARA 12) 9. IN THE LIGHT OF THE AFORESAID, FACTUAL AND JUDICIAL POSITION WE CONCLUDE THAT LICENCE FEES IS TAXABLE AS BUSINESS IN COME AND NOT UNDER THE HEAD INC OM E FROM HOUSE PROPERTY . ACCORDING LY THE ACTION OF THE LD CIT(A) GRANTING THE DEPRECIATION OF RS.34,58,879/ - IS UPHELD. THE GROUND RAISED BY THE REVENUE IS THUS REJECTED. 10. GROUND NO.2 IS REGARDING DISALLOWANCE OF RS.17,76,765/ - BEING 2/3 RD OF EXPENSES OU T OF ADMINISTRATIVE , PERSONAL AND FINANCIAL CHARGES. PAGE NO. 5 11. THE AO, IN THE ORDER OF ASSESSMENT HA S HELD THAT EVEN IF THE INCOME IS ASSESSABLE UNDER THE HEAD BUSINESS INCOME , THEN THE QUESTION ARISES WHETHER THE EXPENSES AGGREGATING TO RS.26,65,148/ - UNDER THE HEAD ADMINISTRATIVE EXPENSES , PERSONAL EXPENSES, AND FINANCIAL CHARGES ARE NOT ATTRIBUTABLE TO LEASE INCOME AND THUS NOT ALLOWABLE AS BUSINESS EXPENDITURE. THE LD CIT(A) WAS HOWEVER ALLOWED 2/3 RD OF THE EXPENDITURE BY CONCLUDING AS UNDER: - I HAVE C ONSIDERED THE SUBMISSION OF THE APPELLANT AND OBSERVATION OF THE ASSESSING OFFICER. IT IS SEEN THAT APPELLANT HAD CLAIMED AN EXPENDITURE OF RS.26,65,148/ - WHICH INCLUDES DONATION OF RS.10,00,000/ - GIVEN BY THE APPELLANT COMPANY WHICH HAS ALREADY BEEN ADDED BACK IN THE COMPUTATION OF INCOME. THE APPELLANT COMPANY HAS CLAIMED EXPENDITURE ON SALARY PAID TO THE DIRECTORS OF RS.L2,72,0001 - , ADMINISTRATIVE EXPENSES OF RS. 3,90,934/ - AND FINANCE CHARGES OF RS.22 14/ - . THE SALARY PAYMENT HAS BEEN DONE TO THE DIRECTORS FOR LOOKING AFTER DAY TO DAY ACTIVITIES OF THE APPELLANT COMPANY WHICH INCLUDES LEGAL AND ADMINISTRATIVE WORKS, VERIFYING AND MONITORING THE BILLING DONE BY THE SECOND PARTY AND COLLECTION OF THE INCO ME FROM SALE OF TICKETS FOR ENTERING THE FORT. THE ADMINISTRATIVE EXPENDITURE OF RS.3,90,934/ - HAS BEEN INCURRED ON ACCOUNT OF AUDIT FEE, INSURANCE OF BUILDING, ACCOUNTANCY CHARGES WHICH ARE REQUIRED TO MANAGE DAY TO DAY AFFAIRS OF THE COMPANY. IT IS SEEN THAT EXPENSES OF RS.26,65,148/ - WHICH INCLUDES DONATION OF RS.10,00,000/ - ARE RELATING TO THE BUSINESS OF THE APPELLANT COMPANY. IT HAS BEEN HELD BY ME SUPRA THAT APPELLANT IS CARRYING ON THE BUSINESS OF RUNNING HOTELS AT NEERNRANA PALACE, THEREFORE, THE E XPENSES INCURRED WERE FOR EARNING OF BUSINESS INCOME ONLY. THE ASSESSING OFFICER'S STAND THAT THESE EXPENSES ARE NOT RELATED TO THE BUSINESS OF THE APPELLANT COMPANY CANNOT BE UPHELD. THE ASSESSING OFFICER HAS DISALLOWED 2/3 RD OF THE EXPENSE I.E. RS.17, 76 , 765/ - BY OBSERVING THAT THE APPELLANT COMPANY WAS NOT DOING ANY BUSINESS AND IT WAS RECEIVING INCOME FROM HOUSE PROPERTY. IN THE SAME ORDER THE ASSESSING OFFICER HAS ALLOWED EXPENDITURE OF RS.8,88,383/ - HOLDING THAT THIS EXPENDITURE IS ALLOWABLE AGAINST T HE INCOME RECEIVED FROM SALE OF ENTRY TICKETS. THIS STAND OF THE ASSESSING OFFICER CLEARLY SHOWS THAT HE HIMSELF WAS NOT SURE ABOUT THE STAND TAKEN BY HIM. THE DISALLOWANCE OF 2/3 RJ EXPENDITURE MADE BY THE ASSESSING OFFICER WAS BASED ON THE DECISION THAT A PPELLANT WAS NOT RECEIVING BUSINESS INCOME. IN MY DECISION VIDE GROUND NO. 1&2, 1 HAVE HELD THAT APPELLANT WAS RECEIVING BUSINESS INCOME FROM NEEMRANA HOTELS PVT. LTD. AS ITS 10% SHARE AND SAME IS ASSESSABLE AS BUSINESS INCOME, THEREFORE, THE EXPENSES CLAI MED BY THE APPELLANT IN THE P&L ACCOUNT WERE WHOLLY AND EXCLUSIVELY FOR THE BUSINESS PURPOSES OF THE APPELLANT COMPANY AND FOR EARNING BUSINESS INCOME. HENCE, THE DISALLOWANCE MADE BY THE ASSESSING OFFICER OF 2/3 RD OF EXPENSES IS DELETED. 12. DURING THE COURSE OF HEARING, BOTH THE PARTIES AGREED THAT THE MATTER BE RESTORED TO THE FILE OF AO FOR FRESH EXAMINATION, IN TERMS OF OUR CONCLUSION THAT INCOME FROM LICENSE I S BUSINESS INCOME. THEREFORE WE SET - ASIDE THE ORDER OF LD CIT(A) ON THIS ISSUE AND REMAND T HIS MATTER BACK TO THE FILE OF AO AND DIRECT THE AO, TO MAKE A FRESH ADJUDICATION ON THIS ISSUE. PAGE NO. 6 13. IN THE RESULT THE APPEAL IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 2 6 . 09 .2014. - S D / - - S D / - ( S. V. MEHROTRA ) (A. T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 2 6 / 09 / 2014 A K KEOT COPY FORWARDED TO 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI