Carbon Finance Ltd., Kolkata V. ITO, WD-8(2), KOLKATA, Kolkata

ITA 517/KOL/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 9287 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 11 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-03-2017
• Appeal Filed By: Assessee
• Bench Allotted: B
• Next Hearing Date: 17-01-2017
• Assessment Year: 2004-2005
• Appeal Filed On: 25-03-2014
• Court: TRIBUNAL
• Department Lawyers: S S ALAM
• Assessee Lawyers: RUCHIRA KHERIA ACA
• Keywords: Deemed to accrue or arise in india
• Section: 143(3); 14A; 115JB; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: KOL KATA [BEFORE SHRI M. BALAGANESH, AM & SHRI PARTHA SARAT HI CHAUDHURY, JM] I.T.A NO.517/KOL/2014 ASSESSMENT YEAR: 2004-05 CARBON FINANCE LTD. VS. INCOME-TAX OFFICER, WD- 8(2), KOLKATA (PAN: AABCB9071C) ( APPELLANT ) ( RESPONDENT ) DATE OF HEARING: 02.03.2017 DATE OF PRONOUNCEMENT: 08.03.2017 FOR THE APPELLANT: MS. RUCHIRA KHERIA, ACA ` FOR THE RESPONDENT: SHRI S. S. ALAM, JCIT, SR. D R ORDER PER SHRI PARTHA SARATHI CHAUDHURY, JM: THIS APPEAL PREFERRED BY ASSESSEE ARISES OUT OF THE ORDER OF CIT(A)-XVI, KOLKATA VIDE APPEAL NO. 116/CIT(A)-XVI/8(2)/08-09 DATED 04. 12.2013 ON THE FOLLOWING GROUNDS: 1.0 THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LD. CIT(APPEALS) WAS NOT JUSTIFIED AND GROSSLY ERRED IN CONFIRMING THE PENAL TY OF RS. 37,935/- IMPOSED ON DISALLOWANCE AMOUNTING TO RS. 1,05,743/- ON ACCOUNT OF LOSS INCURRED ON PURCHASE AND SALE OF SECURITIES AND UNITS AS PER PROVISION U/ S 94(7) OF THE ACT. 2.0 THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, LD. CIT(APPEALS) WAS NOT JUSTIFIED AND GROSSLY ERRED IN CONFIRMING THE PENAL TY U/ S 271(1)(C) INSPITE OF THE FACT THAT THERE WAS NO CONCEALMENT OF INCOME NOR INACCURATE P ARTICULARS HAVE BEEN FILED. 3.0 THAT THE RESPONDENT CRAVES LEAVE TO ADD, AMEND, MODIFY, RESCIND, SUPPLEMENT OR ALTER ANY OF THE GROUNDS STATED HERE-IN-ABOVE EITHER BEFO RE OR AT THE TIME OF HEARING OF THE APPEAL. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESS EE IS A COMPANY REGISTERED UNDER THE COMPANIES ACT, 1956 AND IS ENGAGED IN THE BUSIN ESS OF INVESTMENT AND TRADING IN SECURITIES. THE ASSESSEE HAS FILED ITS RETURN OF I NCOME U/S. 139(1) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) ON 30.10.2004 SHOWING A LOSS OF RS.47,160/- UNDER THE NORMAL PROVISIONS OF THE ACT ( OTHER THAN THE PROVISIONS OF SECTION 115JB ) AND BOOK PROFIT UNDER THE PROVISION S OF SECTION 115JB OF THE ACT AT RS.1,20,33,081/-. THE SAID RETURN WAS PROCESSED U/ S. 143 (1) OF THE ACT DATED 29.03.2005 AND THEREAFTER SELECTED FOR SCRUTINY. O RDER U/S. 143 (3) OF THE ACT WAS PASSED ON 24. 11. 2006 DETERMINING TOTAL INCOME UND ER THE PROVISIONS OF ACT OTHER THAN SECTION 115JB OF THE ACT AT RS. 3,26,230/- AND BOOK PROFIT UNDER THE 2 ITA NO.517/K/2014 CARBON FINANCE LTD., AY 2004-05 PROVISIONS OF SECTION 115JB OF THE ACT AS PER THE R ETURNED INCOME. THE SAID ORDER WAS THEREAFTER RECTIFIED VIDE ORDER U/S. 154 OF THE ACT DATED 16.05.2007 RECTIFYING THE TOTAL INCOME AT RS.2,20,490/- INSTEAD OF RS.3,26,23 0/- AS COMPUTED VIDE ORDER U/S. 143(3) OF THE ACT. SUBSEQUENTLY, THE AO ISSUED NOTI CE U/S. 271(1)(C) OF THE ACT INITIATING PENALTY PROCEEDINGS AGAINST FOLLOWING DI SALLOWANCES MADE VIDE ORDER U/S. 143(3) OF THE ACT: (I) DISALLOWANCE U/S. 14A OF THE ACT TO THE TUNE OF RS.1,61,907/- (II) DISALLOWANCE U/S. 94(7) OF THE ACT TO THE TUNE OF RS.1,05,743/- IN RESPONSE TO THE ABOVE NOTICE, THE ASSESSEE FILED DETAILED SUBMISSION VIDE LETTER DATED 19.05.2007 SUBMITTING AS TO WHY NO PENALTY CAN BE L EVIED IN THE INSTANT CASE. DISREGARDING THE SAID SUBMISSION, THE AO PASSED ORDER U/S. 271(1 )(C) OF THE ACT DATED 25.05.2007 IMPOSING PENALTY TO THE TUNE OF RS.96,020/-. THAT AS APPEARING IN THE ORDER OF THE LD. CIT(A) THE FACTS OBSERVED BY THE AO IS THAT THE REL EVANT ASSESSMENT WAS COMPLETED U/S. 143(3) OF THE ACT ON 24.11.2006 MAKING TWO ADDITION S VIZ., (I) U/S. 94(7) RS.1,05,743/- AND (II) U/S. 14A RS.1,61,907/- = RS.2,67,650/-. T HE DETAILS OF REASONS FOR ADDITIONS OF THE ABOVE TWO AMOUNTS WERE DISCUSSED IN THE BODY OF THE ASSESSMENT ORDER AND PROCEEDINGS U/S. 271(1)(C) OF THE ACT WAS INITIATED. IN RESPON SE TO THE NOTICE U/S. 271(1)(C) OF THE ACT THE DIRECTOR OF THE COMPANY SUBMITTED WRITTEN EXPLA NATION WHEREIN IT WAS CLAIMED THAT THOUGH THE ADDITIONS WERE MADE BUT IT ONLY CONVERTE D RETURNED LOSS OF RS.47,160/- TO ASSESSED INCOME OF RS.2,20,490/-. IT WAS ALSO CLAI MED BY THE ASSESSEE THAT THE TAX HAS BEEN PAID U/S. 115JB OF THE ACT AND WHICH HAS BEEN ACCEPTED BY THE AO. THIS FACT IS ALSO APPEARING IN THE ORDER U/S. 271(1)(C) OF THE ACT PA SSED BY THE AO DATED 25.05.2007. IN THAT ORDER, THE REASONS FOR IMPOSING PENALTY U/S. 2 71(1)(C) OF THE ACT BY THE AO IS THAT THE ASSESSEE CLAIMED SHORT TERM CAPITAL LOSS ON SOME TR ANSACTIONS OF M/S. RELIANCE INCOME FUND DIVIDEND PLAN, PRUDENTIAL ICICI POWER DIVIDEND , BIRLA MIP PLAN AND THE TRANSFER WERE MADE WITHIN THE PERIOD OF 3 MONTHS IN CASE OF SECURITIES AND WITHIN THE PERIOD OF 9 MONTHS IN THE CASE OF UNIT OF MUTUAL FUND. ACCORDI NG TO AO, ASSESSEE DID NOT DISCLOSE THAT IT HAS RECEIVED DIVIDEND OF HIGHER AMOUNT THAN THE LOSS ON TRANSACTION FROM THE ABOVE MUTUAL FUNDS BEFORE TRANSFERRING THE SAME AND ALSO CLAIMED EXEMPTION ON SUCH DIVIDEND. NO DETAILS OF THE DIVIDEND WERE FILED ALONG WITH TH E RETURN. ONLY THE TOTAL DIVIDEND 3 ITA NO.517/K/2014 CARBON FINANCE LTD., AY 2004-05 CLAIMED AS EXEMPTION U/S. 10(35) WERE COMPUTED IN T HE COMPUTATION FILED WITH THE RETURN. THE ASSESSEE WAS REQUIRED TO COMPUTE THE DISALLOWAN CES U/S. 94(7) OF THE ACT OF RS.1,05,747/- AND SHOULD HAVE ADDED IT IN THE COMPU TATION UNDER THE HEAD SHORT TERM CAPITAL GAIN. THUS, ACCORDING TO AO, IT WAS A FIT CASE FOR IMPOSITION OF PENALTY U/S. 271(1)(C) OF THE ACT AND THE COMPUTATION OF TAX SOU GHT TO BE EVADED CALCULATED AS PER EXPLANATION (4) TO SECTION 271(1)(C) OF THE ACT FO R FURNISHING INACCURATE PARTICULARS OF INCOME. IN THAT ORDER U/S. 271(1)(C) OF THE ACT TH E AO WENT ON TO IMPOSE RS.96,020/- AS PENALTY U/S. 271(1)(C) OF THE ACT. BEING AGGRIEVED , THE ASSESSEE HAD PREFERRED AN APPEAL BEFORE THE LD. CIT(A) AGAINST THE PENALTY ORDER PAS SED BY THE AO AND THE LD. CIT(A) HAS DELETED THE PENALTY IMPOSED ON DISALLOWANCE MADE U/ S. 14A OF THE ACT OF RS.1,61,907/- BUT HAS CONFIRMED THE PENALTY IMPOSED U/S. 271(1)(C ) OF THE ACT ON ADDITION OF RS.1,05,747/- U/S. 94(7) OF THE ACT AND HENCE, THIS PRESENT APPEAL. 4. THE CRUX OF THE GROUNDS OF APPEAL PREFERRED BY T HE ASSESSEE (GROUND NOS. 1 AND 2) RELATES TO THE CONFIRMATION OF PENALTY U/S. 271(1)( C) OF THE ACT WITH REGARD TO RS.1,05,743/- U/S. 94(7) OF THE ACT. THAT AT THE FIRST APPELLATE STAGE THE ASSESSEE SUBMITTED THE REASONS ON BASIS OF WHICH PENALTY HAS BEEN INITIATED WAS NO WH ERE MENTIONED IN THE ORDER. THE ASSESSEE IN THIS REGARD REFERRED TO THE DECISION OF HONBLE APEX COURT IN THE CASE OF CIT VS. RELIANCE PETRO PRODUCTS PVT. LTD. (2010) 322 IT R 158 (SC), WHEREIN IT HAS BEEN HELD THAT IN ORDER TO IMPOSE PENALTY ON THE ASSESSEE, UN LESS THE CASE IS STRICTLY COVERED BY THE PROVISION, PENALTY CANNOT BE INVOKED. CONDITIONS U /S. 271(1)(C) OF THE ACT MUST EXIST BEFORE THE PENALTY CANNOT BE IMPOSED. IN THE PRESE NT CASE, NONE OF THE CRITERION OF THE PROVISIONS IS PRESENT AND HENCE, THE INITIATION OF PENALTY U/S. 271(1)(C) OF THE ACT IS BAD IN LAW AND IS REQUIRED TO BE DELETED. THE ASSESSEE FU RTHER PLACED RELIANCE IN THIS REGARD UPON THE DECISION OF HONBLE DELHI HIGH COURT IN THE CA SE OF CIT VS. NALWA SONS INVESTMENTS LTD. (2010) 327 ITR 543 (DEL) WHEREIN IT HAS BEEN H ELD THAT WHEN COMPUTATION WAS MADE U/S. 115JB OF THE ACT, THE CONCEALMENT, IF ANY, DID NOT LEAD TO TAX EVASION AT ALL AND, THEREFORE, PENALTY U/S. 271(1)(C) OF THE ACT COULD NOT BE IMPOSED. THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF NALWA SONS INVESTME NTS LTD., SUPRA HAS BEEN CONFIRMED BY THE HONBLE APEX COURT VIDE SLP NO.18564/2011 DA TED 4.5.2012 DISMISSING THE APPEAL OF THE DEPARTMENT. THE ASSESSEE FURTHER SUBMITTED T HAT IN THE PRESENT CASE COMPLETE AND TRUE DETAILS IN ORDER TO CLAIM MADE IN THE RETURN H AS BEEN FURNISHED WHICH HAS DULY BEEN 4 ITA NO.517/K/2014 CARBON FINANCE LTD., AY 2004-05 ACCEPTED BY THE AO VIDE ORDER U/S. 143(3) OF THE AC T DATED 24.11.2006. DETAILS OF DIVIDEND AS WELL AS STATEMENT OF TRANSACTIONS OF MU TUAL FUND WERE ALSO DULY FILED BEFORE THE AO DURING THE ASSESSMENT PROCEEDINGS AS AND WHE N REQUIRED. THUS, THERE WAS NEITHER ANY CONCEALMENT OF INCOME NOR ANY INACCURATE DETAIL S/PARTICULARS WERE FILED. THE ASSESSEE FURTHER REFERRED TO THE CASE OF HONBLE DELHI HIGH COURT IN CIT VS. VIKAS PROMOTER PVT. LTD. (2005) 277 ITR 337 (DEL), WHEREIN IT WAS HELD THAT SATISFACTION IS NOT TO BE IN THE MIND OF THE AO BUT MUST BE REFLECTED FROM THE RECOR D. THE PROVISIONS OF SEC. 271(1)(C) OF THE ACT ARE PENAL IN NATURE THUS MUST BE STRICTLY INTERPRETED AND THE ELEMENT OF SATISFACTION SHOULD BE APPARENT FROM THE ORDER ITSELF. FURTHER RELIANCE WERE PLACED BY THE ASSESSEE IN THE CASE OF RANJIT SEN VS. ACIT (1992) 40 ITD 528 ( CAL-TRIB.) AND DIWAN ENTERPRISES VS. CIT (2000) 246 ITR 571 (DEL). THAT IN THE CASE OF THE ASSESSEE THE AO HAS NOT RECORDED ANY SUCH SATISFACTION IN THE ASSESSMENT PROCEEDINGS TO THE FACT THAT INCOME WERE SOUGHT TO BE CONCEALED BY THE ASSESSEE. THE LD. CIT(A) IN HI S ORDER HELD THAT THE AO HAS GIVEN THE FINDINGS THAT ASSESSEE DID NOT DISCLOSE THAT IT HAS RECEIVED DIVIDEND OF HIGHER AMOUNT THAN THE LOSS ON TRANSACTION FROM THE ABOVE MUTUAL FUNDS BEFORE TRANSFERRING THE SAME. THE ASSESSEE ALSO NOT FILED ANY DETAIL OF DIVIDENDS ALO NG WITH THE RETURN OF INCOME. THE ASSESSEE FILED ONLY TOTAL DIVIDEND CLAIMED AS EXEMP TION U/S. 10(35) OF THE ACT. THE LD. CIT(A) FURTHER WAS OF THE OPINION THAT THE ASSESSEE HAS NOT DISCLOSED FULL FACTS IN THE RETURN OF INCOME AND, THEREFORE, SUSTAINED THE PENA LTY U/S. 271(1)(C) OF THE ACT IMPOSED ON ADDITION OF RS.1,05,747/- BY THE AO. BEING FURTHER AGGRIEVED, THE ASSESSEE HAS PREFERRED THIS APPEAL BEFORE US. 5. THE LD. AR AT THE TIME OF HEARING BEFORE US FURN ISHED THE CASE LAWS OF THE HONBLE APEX COURT IN SLP NO. 18564/2011 IN THE CASE OF NAL WA SONS INVESTMENTS LTD., SUPRA WHICH HAS BEEN ARISEN OUT OF THE DECISION OF HONBL E DELHI HIGH COURT IN THE CASE OF NALWA SONS INVESTMENTS LTD., SUPRA, AND THE HONBLE APEX COURT CONFIRMED THE DECISION OF HONBLE HIGH COURT WHICH WAS IN FAVOUR OF THE AS SESSEE. THE LD. AR FURTHER REFERRED TO THE DECISION OF KOLKATA ITAT IN ITA NO. 2220/KOL/20 13, AY 2005-06 IN THE CASE OF DCIT VS. SALASAR STOCK BROKING LTD., WHEREIN THE JU RISDICTIONAL TRIBUNAL HAD REFERRED TO THE CASE OF NALWA SONS INVESTMENTS LTD., SUPRA AND HAD HELD THE CANCELLATION OF PENALTY IMPOSED BY THE AO U/S. 271(1)(C) OF THE ACT BY PLAC ING RELIANCE ON THE DECISION OF HONBLE DELHI HIGH COURT. THE LD. DR, ON THE OTHER HAND, REITERATED THE SUBMISSIONS AS 5 ITA NO.517/K/2014 CARBON FINANCE LTD., AY 2004-05 HAVE BEEN FORWARDED BY THE SUBORDINATE AUTHORITIES AND PLACED RELIANCE ON THEIR RESPECTIVE ORDERS. 6. WE HAVE PERUSED THE CASE RECORDS, ANALYSE THE FA CTS AND CIRCUMSTANCES OF THE CASE AND HEARD THE RIVAL CONTENTIONS. WE ARRIVE AT OUR CONSIDERED VIEW THAT THE CASE OF THE ASSESSEE IS SQUARELY COVERED BY THE DECISION OF HON BLE DELHI HIGH COURT WHICH WAS GIVEN SUPPORT BY THE HONBLE APEX COURT IN THE CASE OF NALWA SONS INVESTMENTS LTD., SUPRA, AND FURTHERMORE, THE JURISDICTIONAL TRIBUNAL IN THE CASE OF SALASAR STOCK BROKING LTD., SUPRA HAVE ALSO SUPPORTED THE HONBLE DELHI H IGH COURT DECISION AND HAVE GIVEN RELIEF TO THE ASSESSEE. ON PERUSAL OF THE DECISION OF NALWA SONS INVESTMENTS LTD., SUPRA THE ANALYSIS OF PROVISIONS OF SECTION 271(1)(C) AND SEC. 115JB OF THE ACT SEEMS WORTH MENTIONING. THE HONBLE HIGH COURT HAD OPINED AS PE R SECTION 271(1)(C) OF THE ACT THE PENALTY CAN BE IMPOSED WHEN ANY PERSON HAS CONCEALE D THE PARTICULARS OF INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOME. ONCE T HIS CONDITION IS SPECIFIED QUANTUM OF PENALTY IS TO BE LEVIED AS PER CLAUSE (3) OF SECTIO N 271(1)(C) OF THE ACT WHICH STIPULATES THAT THE PENALTY SHALL NOT EXCEED THREE TIMES THE A MOUNT OF TAX SOUGHT TO BE EVADED. THE QUESTION WOULD BE AS TO WHETHER THE FURNISHING OF S UCH WRONG PARTICULARS HAD ANY EFFECT ON THE AMOUNT OF TAX SOUGHT TO BE EVADED. UNDER THE S CHEME OF THE ACT, THE TOTAL INCOME OF ASSESSEE IS FIRST COMPUTED UNDER THE NORMAL PROVISI ONS OF THE ACT AND TAX PAYABLE ON SUCH TOTAL INCOME IS COMPARED WITH THE PRESCRIBED PERCEN TAGE OF THE BOOK PROFITS COMPUTED UNDER SECTION 115JB OF THE ACT. THE HIGHER OF THE T WO AMOUNTS IS REGARDED AS TOTAL INCOME AND TAX IS PAYABLE WITH REFERENCE TO SUCH TOTAL INC OME. IF THE TAX PAYABLE UNDER THE NORMAL PROVISIONS IS HIGHER, SUCH AMOUNT IS THE TOTAL INCO ME OF THE ASSESSEE, OTHERWISE, BOOK PROFITS ARE DEEMED AS THE TOTAL INCOME OF THE ASSES SEE IN TERMS OF SEC. 115JB OF THE ACT. THE HONBLE DELHI HIGH COURT FURTHER OBSERVED THAT IN THE CASE BEFORE THEM THE ASSESSEE WAS ASSESSED U/S. 115JB OF THE ACT AND NOT UNDER NO RMAL PROVISIONS. NO DOUBT THERE WAS CONCEALMENT BUT THAT HAD ITS REPERCUSSIONS ONLY WHE N THE ASSESSMENT WAS DONE UNDER THE NORMAL PROCEDURE. THE ASSESSMENT AS PER THE NORMAL PROCEDURE WAS, HOWEVER, NOT ACTED UPON. ON THE CONTRARY, IT IS THE DEEMED INCOME ASSE SSED U/S. 115JB OF THE ACT WHICH HAS BECOME THE BASIS OF ASSESSMENT AS IT WAS HIGHER OF THE TWO. TAX IS THUS PAID ON THE INCOME ASSESSED U/S. 115JB OF THE ACT. HENCE, WHEN THE COMPUTATION WAS MADE U/S. 115JB, THE CONCEALMENT HAD NO ROLE TO PLAY AND WAS TOTALLY IRRELEVANT. THEREFORE, THE 6 ITA NO.517/K/2014 CARBON FINANCE LTD., AY 2004-05 CONCEALMENT DID NOT LEAD TO TAX EVASION AT ALL. TH EREFORE, PENALTY U/S. 271(1)(C) OF THE ACT COULD NOT BE IMPOSED. THAT IN THE CASE OF THE ASSE SSEE, IT IS ON RECORD AS APPEARING IN THE LD. CIT(A)S ORDER THAT ASSESSEE HAS FILED TOTAL DI VIDEND CLAIMED AS EXEMPTION U/S. 10(35) OF THE ACT. THAT FURTHER IN THE ORDER ITSELF IN TH E ASSESSEES OWN SUBMISSION AS ON RECORD, IT IS CLEAR THAT COMPLETE AND TRUE DETAILS IN RELATION TO CLAIM MADE IN THE RETURN WERE FURNISHED, DETAILS OF DIVIDEND AS WELL AS STATEMENT OF TRANSACTIONS OF MUTUAL FUND WERE DULY FILED BEFORE THE AO AS AND WHEN REQUIRED. WE FURTHER OBSERVE ALSO IN THE PENALTY ORDER U/S. 271(1)(C) OF THE ACT PASSED BY THE AO, I T IS MENTIONED THAT IT IS ALSO CLAIMED BY THE ASSESSEE THAT THE TAX HAS BEEN PAID U/S. 115JB AND WHICH HAS BEEN ACCEPTED BY THE AO. THAT, THEREFORE, IT IS A CASE WHERE NEITHER C ONCEALMENT HAS BEEN DONE NOR ANY INACCURATE PARTICULARS WERE FURNISHED AND AT THE SA ME TIME, THE FLAT SITUATION WITH REGARD TO SECTION 115JB IS CLEARLY COVERED WITH THE CASE OF T HE HONBLE DELHI HIGH COURT DECISION IN NALWA SONS INVESTMENTS LTD., SUPRA. THE INCOME-TAX ACT BEING A WELFARE LEGISLATION AND NOT BEING A PENAL LEGISLATION IT IS ALL THE MORE ES SENTIAL AND MANDATORY IN CASE OF IMPOSITION OF PENALTY THE REQUIREMENTS OF STATUTES MUST BE FULFILLED WHICH IN CASE OF THE ASSESSEE WERE NOT COMPLIED WITH BY THE SUBORDINATE AUTHORITIES. THEREFORE, ON CONSIDERING THE TOTALITY OF FACTS OF THE INSTANT CASE AND JUDIC IAL PRONOUNCEMENTS THAT IS THE JUDGMENT OF THE HONBLE DELHI HIGH COURT AND CONFIRMED THE SAME BY THE HONBLE APEX COURT, CITED SUPRA AND ALSO THE DECISION OF JURISDICTIONAL TRIBU NAL IN THE CASE OF SALASAR STOCK BROKING LTD., SUPRA, WE ARRIVE AT OUR CONSIDERED VIEW THAT PENALTY IMPOSED U/S. 271(1)(C) OF THE ACT BY THE AO AND CONFIRMED BY LD. CIT(A) IS HEREBY DEL ETED. THEREFORE, THE GROUNDS OF APPEAL OF ASSESSEE (GROUND NOS. 1 AND 2) ARE ALLOWE D. 7. GROUND NO. 3 IS GENERAL IN NATURE AND HENCE, NO ADJUDICATION IS REQUIRED. 8. IN THE RESULT, THE APPEAL OF ASSESSEE IS ALLOWED . ORDER IS PRONOUNCED IN THE OPEN COURT ON 08.03.201 7 SD/- SD/- (M. BALAGANESH) (PARTHA SARATHI CHAUDHURY ,) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 8 TH MARCH, 2017 JD.(SR.P.S.) 7 ITA NO.517/K/2014 CARBON FINANCE LTD., AY 2004-05 COPY OF THE ORDER FORWARDED TO: 1 . APPELLANT CARBON FINANCE LTD., 31, CHOWRINGHEE R OAD, KOLKATA- 700 016. 2 RESPONDENT ITO, WARD-8(2), KOLKATA. 3. THE CIT(A), KOLKATA 4. 5. CIT , KOLKATA. DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, ASSTT. REGISTRAR .