DCIT 10(3), MUMBAI V. HIND RECTIFIERS LTD, MUMBAI

ITA 6411/MUM/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 93329 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-07-2015
• Appeal Filed By: Department
• Bench Allotted: H
• Next Hearing Date: 26-05-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 31-10-2013
• Court: TRIBUNAL
• Department Lawyers: JEETENDRA KUMAR
• Assessee Lawyers: CHARUL TOPRANI
• Keywords: Business income; Depreciation; Proportionate interest; Onus to prove; Revised return; Capital expenditure
• Section: 43B; 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL H , BENCH MUMBAI BEFORE SHRI G.S.PANNU, AM & SHRI SANJAY GARG , J M ITA NO. 6411 / MUM/20 1 3 ( ASSESSMENT YEAR : 2010 - 2011 ) DCIT - 10(3), MUMBAI VS. M/S HIND RECTIFIERS LTD., LAKE ROAD, BHANDUP (W), MUMBAI - 400078 PA N NO. : A A ACG 1781 Q ( / APPELLANT ) .. ( / RESPONDENT ) REVENUE BY : SHRI JEETENDRA KUMAR ASSESSEE BY : MS. CHARUL TOPRANI DATE OF HEARING : 26 TH MAY, 201 5 DATE OF PRONOUNCEMENT 29 TH JULY, 2015 / O R D E R PER SANJAY GARG, JUDICIA L MEMBER TH IS APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE ORDER OF CIT(A) - 22 , MUMBAI RELATING TO THE ASSESSMENT YEAR 20 10 - 11 , ON THE FOLLOWING GROUNDS : - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN HOLDING THAT INTEREST ATTRIBUTABLE TOWARDS CAPITAL WORK IN PROGRESS AMOUNTING TO RS. 323,203/ - SHOULD NOT BE CAPITALIZED WITHOUT APPRECIATING THE DIFFERENTIAL POSITION OF THE ASSESSEE FOR THE INSTANT ASSESSMENT YEAR. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW, THE LD. CIT(A) ERRED IN HOLDING THAT DEPRECIATION @60% IS ALLOWABLE ON UPS WHICH NOT AN INTEGRAL PART OF THE COMPUTER. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN GRANTING DEDUCTION IN RESPEC T OF ADJUSTMENT UNDER SECTION 145A OF THE ACT AMOUNTING TO RS. 37,75, 411/ - WITHOUT APPRECIATING THE RATIO CONTAINED IN THE CASE OF HAWKINS COOKER LTD. (ITA NO.505/MUM/04) AND ALSO THE PROVISIONS CONTAINED IN 43B. 2. SUCCINCTLY STATED THE FACTS OF THE CASE ARE THAT THE ASSESSEE COMPANY IS ENGAGED IN THE BUSINESS OF MANUFACTURING RECTIFIERS, TRANSFORMERS, DEVICES, THYRISTORS FOR TELECOMMUNICATION, RAILWAYS, DEFENCE DEPARTMENTS. THE ASSESSEE FILED ITS RETURN ORIGINALLY DECLARING ITA NO. 6411 / 1 3 2 TOTAL INCOME AT RS.5,26,99,509 / - . SUBSEQUENTLY, IT ALSO FILED A REVISED RETURN DECLARING TOTAL INCOME OF RS.5,60,77,170/ - . A SSESSMENT WAS FRAMED U/S.143(3) OF THE ACT MAKING VARIOUS ADDITIONS , OUT OF WHICH THE CIT(A) HAS DELETED MOST OF THE ADDITIONS, AGAINST WHICH THE REVENUE IS IN AP PEAL BEFORE US. 2. GROUND NO.1 IS IN REGARD TO DELETING THE ADDITION MADE BY THE AO OF RS.32,203/ - ON ACCOUNT OF INTEREST ATTRIBUTABLE TO CAPITAL WORK IN PROGRESS. DURING THE ASSESSMENT PROCEEDINGS, THE AO FOUND THAT AS PER THE FIXED ASSET SCHEDULE, THE O PENING CAPITAL WORK IN PROGRESS WAS RS.1,00,47,480/ - AND THE ADDITION TO THE EXTENT OF RS.4,38,11,868/ - WAS MADE. AFTER EXAMINING THE BALANCE SHEET, THE AO FOUND THAT RS.3,65,70,657/ - WAS TOTAL FUNDS BORROWED WHICH INCLUDES BOTH SECURED AS WELL AS UNSECURE D LOANS AND, CONSEQUENTLY, HE WORKED OUT THE PROPORTIONATE INTEREST TO BE CAPITALIZED AT RS. 32,203/ - . IN APPEAL, THE CIT(A) DELETED THE SAME AFTER RELYING UPON THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. RELIANCE UTILITIES AND POWER LTD., 313 ITR 340 AND ALSO UPON THE DECISION OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR A.Y.2008 - 09, OBSERVING AS UNDER : - 2. 3 I HAVE CAREFULLY CONSIDERED THE IMPUGNED ASSESSMENT ORDER AND THE SUBMISSION OF THE APPELLANT ALONG WITH THE MATERIALS AVAILABLE IN PAPER - BOOK. IT IS THE CONTENTION OF THE APPELLANT THAT THE INVESTMENT IN CAPITAL WORK IN PROGRESS IS OUT OF ITS OWN FUNDS AND NOT FROM BORROWED FUNDS. I FIND FROM THE BALANCE SHEET THERE WAS A HUGE INCREASE IN GENERAL RESERVE OF THE APPELLANT BY RS19,24,17,587/ - OVER THE PAST 3 YEARS. THE GENERAL RESERVE AS ON 31ST MARCH 2006 WAS RS24,98,38,97 AND DUE TO THE SURPLUS GENERATED DURING THE FINANCIAL YEAR ENDED 31ST MARCH 2007 TO 2009, IT ROSE TO RS 44,22,56,574 / - AS ON 31ST MARCH 2010. THE APPELL ANT HAD NOT TAKEN ANY LOANS DURING THIS YEAR AND IN FACT THE ITA NO. 6411 / 1 3 3 TOTAL LOANS HAVE COME DOWN. FURTHER ON PERUSAL OF SCHEDULE 'C' OF THE BALANCE S HEET IT WAS FOUND THAT THE SECURED LOANS TAKEN BY THE APPELLANT COMPRISE OF CASH CREDITS(CC) AND VEHICLE LOANS. THE SECURITY GIVEN TO CC WAS ONLY IN RESPECT OF THE ASSETS SITUATED AT BHANDUP AND IT DID NOT INCLUDE THE ASSETS OF DEHRADUN WHICH SHOWS THAT THE CC WAS NOT TAKEN FOR THE PURPOSE OF ACQUIRING THE ASSETS OF DEHRADUN. FROM THE AFORESAID FACTS, IT IS CLEAR THAT. THE ADDITION MADE TO CWIP DURING THE YEAR UNDER CONSIDERATION WAS ONLY FROM IT'S OWN FUNDS. IN VIEW OF THIS THE CONTENTION OF THE APPELLANT IS ACCEPTABLE. 2.4 THE AR OF THE APPELLANT HAD RELIED ON THE DECLSLON OF HON'BLE ITAT IN APPELLANT'S OWN CASE FOR A.Y.2008 - 09 VIDE ITS ORDER DATED 29 - 06 - 2012 IN ITA NO.3364/M/2011. THE FINDING OF THE HON'BLE ITA T IN PARA 2.3 OF ITS ORDER IS REPRODUCED HEREUNDER: - 2.3. WE HAVE PERUSED THE RECORD AND CONSIDERED THE RIVAL CONTENTIONS ACCORDINGLY. THE DISPUTE IS REGARD ING ATTRIBUTION OF THE PART OF INTEREST EXPENDITURE OF RS. 85.86/ - LA KHS TOWARDS THE CAPITAL WIP. THE ASSESSEE HAD BORROWINGS AS WELL AS OWN FUNDS WHICH WERE MIXED AND THEREFORE IT WAS NOT POSSIBLE TO PIN POINT AS TO WHICH FUNDS WERE UTILIZED TOWARDS CAPI TAL. WIP. THE LOWER AUTHORITIES THEREFORE ATTRIBUTED INTEREST AT THE AVERAGE RATE OF INTEREST OF 7% TO THE AVERAGE WIP WHICH INCLUDED OPENING BALANCE OF RS. 3.16 CRARES AND THUS MADE DISALLOWANCE OF RS. 23,67,420 / - CIT (A) HAS CONFIRMED THE DISALLOWANCE. IT HAS BEEN ARGUED BY THE ASSESSEE THAT IT HAD SUFFICIENT FUNDS TO EXPLAIN THE ADDITION TO CAPITAL WIP DURING THE YEAR AND THEREFORE NO DISALLOWANCE COULD BE MADE. AFTER CAREFUL CONSIDERATION OF SUBMISSIONS OF THE ASSESSEE AND MATE RI AL PLACED ON RECORD, WE F IND SUBSTANCE IN THE ARGUMENT ADVANCED BY THE LEARNED AR. THERE IS OPENING WIP OF RS. 3.16 CR O RES IN RELATION TO WHICH NO DISALLOWANCE OF INTEREST HAD BEEN MADE IN THE P RECEDING YEAR WHICH MEANS THAT CAPITAL WIP TO THAT EXTENT HAD BEEN ACCEPTED BY THE DEPA RTMENT AS EXPLAINED FR O M OWN FUNDS. THEREFORE NO DISALLOWANCE OF INTEREST CAN BE MADE IN RELATION TO THE OPENING WIP. THE ADDITION DURING THE YEAR IS ONLY RS. 66.50 LAKH. THE CAPITAL AND RESERVE OF THE ASSESSEE HAD INCREASED DURING THE YEAR OF RS.10 CRORES AND INCREASE IN LOANS DURING THE Y E AR WAS ONLY OF RS. 3 CRO R E. MOREOVER, THE ASSESSEE DURING THE YEAR HAD EA RNED PROFIT OF RS. 14 CR O RES. THEREFORE, IN OUR VIEW THE CAPITAL ADDITION DURING THE YEAR IS EASILY EXPLAINED OUT OF OWN FUNDS. WE THEREFORE SEE NO REASON FOR ANY DISALLOWANCE ON ACCOUNT OF INTEREST. THE ORDER OF CIT (A) CONFIRMING THE DISALLOWANCE IS THEREFORE SET ASIDE AND THE CLAIM OF THE ASSESSEE IS ALLOWED'. 2.5 SINCE THERE IS NO CHANGE IN THE FACTS AND CIRCUMSTANCES, I RESPECTFULLY FOLLOW THE DECISION OF HON'BLE IT AT. THE APPELLANT FURTHER RELIED ON THE DECISION OF JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. RELIANCE UTILITIES AND POWER LTD. REPORTED IN 313 ITR 340. I FIND THIS DECISION SQUARELY APPLIES TO THE FACTS OF THIS C A SE. ITA NO. 6411 / 1 3 4 2.6 I N VIEW OF THE ABOVE DISCUSSION, THE ADDITION MADE BY THE A O IS DELETED. THIS GROUND OF APPEAL IS ALLOWED. 3. BEFORE US, LD DR SUBMITTED THAT THE ASSESSEE HA D NOT DISCHARGED ITS ONUS TO PROVE THE CORRECTNESS OF ITS CLAIM. THE ASSESSEE WAS HAVING SECURED AND UNSECURED FUNDS . EVEN THE ASSESSEE COULD NOT PROVE THAT THE INTEREST BEARING FUNDS WER E USED ONLY FOR THE PURPOSE OF BUSINESS WITHOUT UTILIZING THE SAME TOWARDS THE CAPITAL EXPENDITURE. THEREFORE, THE AO WAS JUSTIFIED IN MAKING THE ADDITION. 4. ON THE OTHER HAND, LD. AR SUBMITTED THAT THE SECURITY OF THE CASH CREDITS WAS ONLY IN RESPECT OF THE ASSETS SITUATED AT MUMBAI UNIT AND DID NOT INCLUDE THE ASSETS AT DEHRADUN , ITSELF , IS ENOUGH EVIDENCE TO SHOW THAT THE CASH CREDITS WERE NOT TAKEN FOR THE PURPOSE OF ACQUIRING THE ASSETS OF DEHRADUN. THEREFORE, NO LOANS WHATSOEVER WERE TAKEN FOR THE PURPOSE OF ACQUIRING CAPITAL WORK IN PROGRESS. FURTHER, LD. AR SUBMITTED THAT THE VERY SAME ISSUE IS SQUARELY COVERED BY THE DECISION OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR THE A.Y.2008 - 09 RENDERED IN ITA NO.3364/M/2011, DATED 29 - 6 - 2012 . LD. AR ALSO RELIED ON THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF RELIANCE UTILITIES AND POWER LTD. (SUPRA). 5. WE HAVE HEARD THE PARTIES AT LENGTH AND CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. FROM THE BALANCE SHEET , IT IS EVIDENT THAT THERE WAS A HUGE INCREASE IN GENERAL RESERVE OF THE ASSESSEE OVER THE PAST 3 YEARS. THE ASSESSEE HAD NOT TAKEN ANY LOANS DURING THIS YEAR AND ITA NO. 6411 / 1 3 5 IN FACT THE TOTAL LO ANS HAVE COME DOWN. FURTHER WE FOUND THAT THE SECURED LOANS TAKEN BY THE ASSESSEE COMPRISE OF CASH CREDITS AND VEHICLE LOANS. THE SECURITY GIVEN TO CASH CREDIT WAS ONLY IN RESPECT OF THE ASSETS SITUATED AT BHANDUP UNIT AND IT DID NOT INCLUDE THE ASSETS OF DEHRADUN UNIT WHICH SHOWS THAT THE CASH CREDIT WAS NOT TAKEN FOR THE PURPOSE OF ACQUIRING THE ASSETS OF DEHRADUN UNIT. THEREFORE, IT IS CLEAR THAT THE ADDITION MADE TO CWIP DURING THE YEAR UNDER CONSIDERATION WAS ONLY FROM ITS OWN FUNDS. ON SIMILAR SET OF CIRCUMSTANCES, THE TRIBUNAL HAS DECIDED THE ISSUE IN ASSESSEES OWN CASE FOR THE A.Y.2008 - 09. WE, THEREFORE, SEE NO REASON TO INTERFERE IN THE FINDINGS OF THE CIT(A) AND THE SAME IS HEREBY UPHELD. 6. GROUND NO.2 IS IN REGARD TO ALLOWING 60% DEPRECIATION O N UPS. 7. LD. AR SUBMITTED THAT THIS ISSUE IS COVERED BY THE DECISION OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR THE A.Y.2008 - 09. WE HAVE GONE THROUGH THE ORDER OF LOWER AUTHORITIES AND THE ORDER OF THE TRIBUNAL AS WELL. WE FOUND THAT THE TRIBUNAL HAS ALRE ADY DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE. THE RELEVANT OBSERVATION OF THE TRIBUNAL IS AS UNDER : - 3.1. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE RECORDS AND CONSIDERED THE MATTER ACCORDINGLY. THE DISPUTE IS REGARDING THE RATE OF DEPRECIATION ON U PS USED BY THE ASSESSEE FOR WORKING OF COMPUTERS. THE ASSESSEE HAS CLAIMED DEPRECIATION @ 60% TREATING THE UPS AS AN INTEGRAL PART OF COMPUTER. THE AUTHORITIES BELOW HAVE HOWEVER ALLOWED DEPRECIATION AT THE NORMAL RATE OF 15%. THE LEARNED AR HAS ARGUED THA T DEPRECIATION @ 60% SHOULD BE ALLOWED FOLLOWING THE DECISION OF SPECIAL BENCH OF TRIBUNAL IN CASE OF DCIT VS. DATACRAFT INDIA LTD (SUPRA) AND JUDGMENT OF HONBLE HIGH COURT OF DELHI IN CASE OF CIT VS. ORIENT CERAMICS & INDUSTRIES LTD (56 DTR 396) . WE HAV E CAREFULLY PERUSED THE SAID DECISION OF TRIBUNAL IN CASE OF DCIT VS. DATACRAFT INDIA LTD (SUPRA). IN THAT CASE, THE ISSUE WAS ALLOWABILITY OF DEPRECIATION @ 60% ON ROUTERS AND ITA NO. 6411 / 1 3 6 SWITCHES. THE SPECIAL BENCH NOTED THAT THE FUNCTION OF A ROUTER WAS TO RECEIVE DATA FROM ONE COMPUTER AND MAKE IT AVAILABLE TO ANOTHER COMPUTER FOR VIEWING OR FURTHER PROCESSING. ROUTERS ALSO HELP IN TRANSFER OF DATA FROM NETWORK TO COMPUTER. THE SPECIAL BENCH ALSO NOTED THAT SWITCHES WERE SHORTER VERSION OF ROUTERS WHICH PERFORM SIM ILAR FUNCTIONS WITHIN A LIMITED SPHERE. THE SPECIAL BENCH THEREFORE HELD THAT ROUTERS AND SWITCHES COULD BE CLASSIFIED AS COMPUTER HARDWARE WHEN THEY ARE USED ALONG WITH THE COMPUTER AND ACCORDINGLY HELD THAT DEPRECIATION HAS TO BE ALLOWED @ 60%. THE DECIS ION OF SPECIAL BENCH IS THEREFORE DISTINGUISHABLE AND NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE. HOWEVER, HONBLE HIGH COURT OF DELHI IN CASE OF CIT VS. ORIENT CERAMICS & INDUSTRIES LTD (SUPRA) FOLLOWING THE EARLIER JUDGMENT IN CASE OF CIT VS. BSES Y AMUNA POWERS LTD DATED 31ST AUGUST, 2010 IN ITA NO. 1267 HAVE TAKEN THE VIEW THAT DEPRECIATION @ 60% HAS TO BE ALLOWED IN CASE OF UPS. NO CONTRARY JUDGMENT OF THE JURISDICTIONAL HIGH COURT OR THE APEX COURT HAS BEEN BROUGHT TO OUR NOTICE. WE THEREFORE RESP ECTFULLY FOLLOWING THE JUDGMENT OF HONBLE HIGH COURT OF DELHI IN CASE OF ORIENT CERAMICS & INDUSTRIES LTD (SURPA), SET ASIDE THE ORDER OF CIT (A) AND ALLOW THE CLAIM OF ASSESSEE. 8. RESPECTFULLY, FOLLOWING THE AFORESAID ORDER OF THE COORDINATE BENCH OF THE TRIBUNAL, WE DO NOT FIND ANY ERROR IN THE FINDINGS OF THE CIT(A) IN THIS REGARD. 9. IN GROUND NO.3, THE REVENUE IS AGGRIEVED IN GRANTING DEDUCTION IN RESPECT OF ADJUSTMENT UNDER SECTION 145A OF THE ACT. 10. AS PER THE AO, THE ASSESSEE HAD NOT SHOWN THAT THERE WERE GOODS LYING IN THE STOCK BELONGED TO EARLIER YEAR FOR WHICH NO EXCISE/SALES TAX COULD BE PAID BEFORE DEDUCTION U/S.43B , THEREFORE, THERE WILL BE NO DEDUCTION IN THE SUCCEEDING YEAR. AFTER ANALYZING THE GUIDELINES OF ICAI AND RELYING UPON TH E DECISION OF THE TRIBUNAL IN THE CASE OF HAWKINS COOKER LTD., THE AO REJECTED THE CLAIM OF ASSESSEE IN REGARD TO DEDUCTION U/S. 145A AND ADDED THE SAME TO THE INCOME OF THE ASSESSEE . IN APPEAL, THE CIT(A) RELYING UPON THE ORDER OF THE TRIBUNAL IN ASSESSEE S OWN CASE ITA NO. 6411 / 1 3 7 FOR A.Y.2009 - 10 , DELETED THE ADDITION SO MADE BY THE AO AFTER OBSERVING AS UNDER : - 4.4 IT IS A FACT THAT THE APPELLANT HAD BEEN CONSISTENTLY FOLLOWING THE ADJUSTMENT AS PER SECTION 145A OF THE I.T.ACT. IN THE PAST WHENEVER THERE WAS INCREASE I N PROFIT DUE TO ADJUSTMENT U/S.145A, THE SAME HAD BEEN OFFERED TO TAX AND WHENEVER THERE WAS DECREASE IN THE PROFIT THE SAME WAS REDUCED WHICH HAS BEEN ACCEPTED BY THE DEPARTMENT. IN FACT DURING THE ASSESSMENT YEAR 2007 - 08, THERE WAS DECREASE IN PROFITS AN D THE TREATMENT OF THE APPELLANT WAS ACCEPTED U/S 143(3) OF THE ACT. HENCE, I DID NOT FIND ANY REASON AS TO WHY THE AO REFUSED TO ALLOW THE DEDUCTION CLAIMED BY THE APPELLANT BECAUSE OF THE ABOVE ADJUSTMENT. THE AO HAD CONFUSED HIMSELF BY INVOKING PROVISIO NS OF SEC.43B WHILE MAKING THE ADJUSTMENT U/S.145A SECTIO N 43B IS A SEPARATE CODE BY ITSELF. THE DEDUCTION/DISALLOWANCE UNDER THIS SECTION IS INDEPENDENT OF SEC.145A FURTHER, THE APPELLANT HAD NEVER CLAIMED THE PAYMENT U/S.43B SEPARATELY ON ACCOUNT OF EXCI SE DUTY ARID SALE TAX IN CLOSING WORK - IN - PROGRESS AND FINISHED GOODS WHICH ARE ACCRUED AS PER PROVISIONS OF SEC.145A 4.5 THE APPELLANT RELIED ON THE DECISION OF PREDECESSOR CIT(A) FOR AY.2009 - 10 ON THIS ISSUE. WHILE ADJUDICATING GROUND NO.4, THE THEN CIT (A) HAD GIVEN A RELIEF TO THE APPELLANT. THE FINDING IS IN PARA 5.2 OF HIS ORDER. WHEN TH E APPELLANT HAD BEEN CONSISTENTLY FOLLOWING THE SYSTEM OF ACCOUNTING THE AO IS NOT PERMITTED TO DISTURB THE SAME. IN LIGHT OF THE ABOVE FINDING, THE ADDITION MADE BY T HE AO IS HEREBY DELETED. THIS GROUND OF APPEAL IS ALLOWED . 11. ON A WARY PERUSAL OF THE ORDERS OF AUTHORITIES BELOW, WE FOUND THAT THIS ISSUE IS DECIDED BY THE TRIBUNAL IN ASSESSEES OWN CASE FOR THE A.Y.200 9 - 10 . THE RELEVANT OBSERVATION OF THE TRIBUNAL IS AS UNDER : - 9. WE HAVE HEARD THE PARTIES, AND PERUSED THE MATERIAL ON RECORD. THE ASSESSEE ADMITTEDLY FOLLOWS EXCLUSIVE METHOD OF ACCOUNTING. IT IS, THEREFORE, REQUIRED TO FURNISH PER ITS AUDIT REPORT (VIDE PARA 12 THEREOF) THE EFFECT OF THE DEVIATION ON THE PROFIT OR LOSS WITH REFERENCE TO SECTION 1 45A OF THE ACT, AND WHICH IT PROVIDES PER ANNEXURE 8 TO THE TAR (PB PGS.78 - 87). THE SAME, AS STATED, RESULTS IN A DECREASE IN PROFIT AT RS.26.37 LACS, DETAILED AT ANNEXURE 8 TO TAR (PB PGS. 87 - 89), BEING IN RESPECT OF MOD VAT (RS.16.44 LACS) AND VAT (RS.9.93 1ACS). WE FAIL TO OBSERVE ANY CONTROVERSY HERE; SECTION 145A BEING MANDATORY IN ITS APPLICATION. AS SUCH, IRRESPECTIVE AND NOTWITHSTANDING THE METHOD OF ACCOUNTING BEING REGULARLY FOLLOWED BY THE ASSESSEE IN COMPUTING THE BUSINESS INCOME ASSESSABLE TO TAX U/S.28, SECTION 145A, TO THE EXTENT ITA NO. 6411 / 1 3 8 APPLICABLE, WOULD HAVE TO BE GIVEN EFFECT TO. WHETHER THE SAME RESULTS IN AN INCREASE IN THE PROFIT FOR A PARTICULAR YEAR OR A DECREASE, IS ANOTHER MATTER ALTOGETHER, AN D TOWARD WHICH WE OBSERVE NO ADVERSE FINDING BY THE A.O. IN THE ABSENCE OF ANY INFIRMITY OR ERROR HAVING BEEN FOUND BY THE REVENUE, WE FIND NO REASON TO DISTURB THE SAME, WHICH IS IN FACT UNEXCEPTIONAL AND HAS FOUND FAVOUR WITH THE ID. CIT(A) ON THE SAME B ASIS. THE SAME IS ACCORDINGLY CONFIRMED. WE DECIDE ACCORDINGLY . IN VIEW OF THE ABOVE DECISION OF THE TRIBUNAL IN THE OWN CASE OF THE ASSESSEE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CIT(A) ON TH I S ISSUE AND THE SAME IS ACCORDINGLY UPHELD . 1 2 . I N THE RESULT, APPEAL OF THE REVENUE IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 29/07 / 201 5 . SD/ - SD/ - ( G.S.PANNU ) ( SANJAY GARG ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI ; DATED 29 /07/2015 PKM , . / PS COPY OF THE ORDER FORWARDED TO : BY ORDER , (ASSTT. REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//