DCIT, Circle - 6, Kolkata, Kolkata V. M/s. Century Enka Ltd., Kolkata

ITA 665/KOL/2012

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 4839 (ITAT-KOLKATA)
• Duration Of Justice: 4 year(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-05-2016
• Appeal Filed By: Department
• Bench Allotted: B
• Next Hearing Date: 12-05-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 25-04-2012
• Court: TRIBUNAL
• Department Lawyers: A K SINHA; NIRAJ KUMAR
• Assessee Lawyers: AKASH MANSINKA
• Keywords: Depreciation; Additional depreciation; Earning of tax free income
• Section: 14A; 115JB; 32

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: KOL KATA [BEFORE SHRI N. V. VASUDEVAN, JM & SHRI M. BALAGAN ESH, AM] I.T.A NO.665/KOL/2012 ASSESSMENT YEAR: 2008-09 DEPUTY COMMISSIONER OF INCOME-TAX, VS. M/S. CENTU RY ENKA LIMITED CIRCLE-6, KOLKATA (PAN: AABCC2491D) ( APPELLANT ) ( RESPONDENT ) & I.T.A NO.335/KOL/2012 ASSESSMENT YEAR: 2008-09 M/S. CENTURY ENKA LIMITED VS. DEPUTY COMMISSIONE R OF INCOME-TAX, CIRCLE-6, KOLKATA (APPELLANT) (RESPONDENT) DATE OF HEARING: 12.05.2016 DATE OF PRONOUNCEMENT: 18.05.2016 FOR THE REVENUE: SHRI NIRAJ KUMAR, CIT, DR & SHRI A. K. SINHA, JCIT, SR. DR FOR THE ASSESSEE: SHRI AKASH MANSINKA, FCA ORDER PER SHRI M. BALAGANESH, AM: BOTH THIS CROSS APPEALS BY REVENUE AND ASSESSEE ARE ARISING OUT OF ORDER OF CIT(A)-VI, KOLKATA VIDE APPEAL NO. 219/CIT(A)-VI/CI R-6/10-11/KOL DATED 15.01.2012. ASSESSMENT WAS FRAMED BY DCIT, CIRCLE-6, KOLKATA U/ S. 143(3)/115WE(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS TH E ACT) FOR AY 2008-09 VIDE HIS ORDER DATED 31.12.2010. SINCE BOTH THE APPEALS ARE ARISING OUT OF COMMON ORDER OF CIT(A), WE DISPOSE THEM OFF BY THIS COMMON ORDER. FIRST WE TAKE UP ITA NO. 665/KOL/2012 (REVENUES A PPEAL) 2. REVENUES APPEAL IS DELAYED BY 10 DAYS AND CONDO NATION PETITION HAS BEEN FILED EXPLAINING THE REASON FOR CONDONATION OF DELAY. LD . AR DID NOT OBJECT FOR CONDONING THE DELAY. HENCE WE CONDONE THE DELAY AND ADMIT THE RE VENUES APPEAL FOR HEARING. 3. THE ONLY ISSUE TO BE DECIDED IN THIS APPEAL OF R EVENUE IS THAT WITH REGARD TO THE ALLOWANCE OF LEAVE ENCASHMENT OF RS.1,47,66,197/-. 4. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE LD. CIT(A) HAD ALLOWED THE CLAIM O F THE ASSESSEE IN RESPECT OF 2 ITA NO.665/K/2012 & ITA NO. 335/K/2012 M/S. CENTURY ENKA LIMITED. AY 2008-09 PROVISION MADE FOR LEAVE ENCASHMENT BY PLACING RELI ANCE ON THE DECISION OF THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF EXIDE INDUSTRIE S LTD. REPORTED IN VS. UNION OF INDIA (2007) 292 ITR 470 (CAL) BUT LD. SR. DR BEFORE US A RGUED THAT SUBSEQUENTLY HON'BLE SUPREME COURT HAS STAYED THIS JUDGMENT OF HON'BLE J URISDICTIONAL HIGH COURT VIDE ORDER DATED 08-05-2009 BY FOLLOWING OBSERVATIONS:- PENDING HEARING AND FINAL DISPOSAL OF THE CIVIL AP PEALS, DEPARTMENT IS RESTRAINED FROM RECOVERING PENALTY AND INTEREST WHICH HAS ACCRUED T ILL DATE. IT IS MADE CLEAR THAT AS FAR AS THE OUTSTANDING INTEREST DEMAND AS OF DATE IS CONCE RNED, IT WOULD BE OPEN TO THE DEPARTMENT TO RECOVER THAT AMOUNT IN CASE CIVIL APP EAL OF THE DEPARTMENT IS ALLOWED. WE FURTHER MAKE IT CLEAR THAT THE ASSESSEE WOULD, D URING THE PENDENCY OF THIS CIVIL APPEAL, PAY TAX AS IF SECTION 43B(F) IS ON THE STATUE BOOK BUT AT THE SAME TIME IT WOULD BE ENTITLED TO MAKE A CLAIM IN ITS RETURNS. IN VIEW OF THE ABOVE, LD. COUNSEL FOR THE ASSESSEE FAIRLY STATED THAT LET HON'BLE SUPREME COURT DECIDE THE ISSUE AND BY THAT TIME THE MATTER CAN BE REMITTED BACK TO THE FILE OF AO FOR FRESH ADJUDICATION IN TERM OF THE DECISION OF H ON'BLE SUPREME COURT. ON THIS, LD. CIT DR HAS NOT OBJECTED TO THE SAME. ACCORDINGLY, WE SET ASIDE THIS ISSUE TO THE FILE OF THE AO TO AWAIT THE DECISION OF HON'BLE SUPREME COU RT AND DECIDE THE ISSUE ACCORDINGLY. THIS ISSUE OF REVENUES APPEAL IS REMI TTED BACK TO THE FILE OF AO AND IS ALLOWED FOR STATISTICAL PURPOSES. NOW, ITA NO. 335/KOL/2012 (ASSESSEES APPEAL): 5. THE FIRST ISSUE TO BE DECIDED IN THIS APPEAL IS AS TO WHETHER THE ASSESSEE IS ENTITLED TO CLAIM THE LEFT OVER PORTION OF ADDITIONAL DEPREC IATION OF RS.9,02,49,544/- BEING THE CARRY FORWARD FIGURE FROM THE PREVIOUS YEAR U/S. 32 (1)(IIA) OF THE ACT. 6. BRIEF FACTS OF THIS ISSUE ARE THAT THE ASSESSEE INSTALLED VARIOUS FIXED ASSETS DURING THE AY 2007-08 AND HAD PUT TO USE FOR LESS THAN 180 DAYS AND ACCORDINGLY, CLAIMED ADDITIONAL DEPRECIATION AT 50% OF 20% I.E. AT 10% I N ACCORDANCE WITH THE PROVISIONS OF SECTION 32(1)(IIA) OF THE ACT IN AY 2007-08. DURIN G THE AY 2008-09 I.E. THE ASSESSMENT YEAR UNDER APPEAL, THE ASSESSEE CLAIMED THE REMAINI NG 50% OF THE ADDITIONAL DEPRECIATION I.E. (REMAINING 10%) IN THE SUM OF RS. 9,02,49,544/- AND INCLUDED THE SAME IN INCOME-TAX DEPRECIATION CLAIMED BY THE ASSESSEE. THE LD. AO DISALLOWED THE SAME IN THE ASSESSMENT WHICH WAS ALSO UPHELD BY THE LD. CIT (A) ON FIRST APPEAL. AGGRIEVED, ASSESSEE IS IN APPEAL BEFORE US. 3 ITA NO.665/K/2012 & ITA NO. 335/K/2012 M/S. CENTURY ENKA LIMITED. AY 2008-09 7. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE LD. AR STATED THAT THE LD. CIT(A) RELIED ON THE DECISION OF HIS PREDECESSOR IN THE CASE OF M/S. BIRLA CORPORATION LTD. FOR AY 2007-08 AND UPHELD THE ADDITION MADE BY THE LD. AO. THE LD. AR PLACED ON RECORD THE COPY O F THE DECISION OF THE COORDINATE BENCH OF THIS TRIBUNAL IN THE CASE OF BIRLA CORPORA TION LTD. VS. DCIT IN ITA NO. 683/KOL/2011 FOR AY 2007-08 DATED 08.12.2014, WHERE IN THIS TRIBUNAL HELD THAT THE ASSESSEE IS ENTITLED TO CLAIM THE REMAINING PORTION OF 50% ADDITIONAL DEPRECIATION IN THE SUBSEQUENT YEAR. HE ALSO PLACED ON RECORD ANOTHER DECISION OF COORDINATE BENCH OF THIS TRIBUNAL IN ASSESSEES OWN CASE FOR AY 2006-07 REPO RTED IN (2015) 154 ITD 426 (KOLKATA), WHICH IN TURN PLACED RELIANCE ON THE DEC ISION OF BIRLA CORPORATION LTD., SUPRA. THE DECISIONS CITED BY LD. AR WERE FAIRLY CONCEDED BY THE LD. DR. WE FIND THAT THE ISSUE INVOLVED IS SQUARELY COVERED BY THE DECISION OF COORDINATE BENCH BY THIS TRIBUNAL IN ASSESSEES OWN CASE REPORTED IN (2015) 154 ITD 426 (KOLKATA), WHEREIN IT WAS HELD AS UNDER: THE ISSUE ON PROPOSITION OF LAW REGARDING ALLOWAN CE OF REMAINING ADDITIONAL DEPRECIATION IN THE NEXT ASSESSMENT YEAR U/S. 32(1) (IIA) OF THE ACT WAS COVERED IN FAVOUR OF ASSESSEE AND AGAINST REVENUE BY THE DECISION OF COO RDINATE BENCH OF ITAT KOLKATA A BENCH IN THE CASE OF BIRLA CORPORATION LTD. VS. DCI T IN ITA NO. 683/KOL/2011 FOR THE ASSESSMENT YEAR 2007-08 DATED 8-12-2014, WHEREIN IT WAS HELD THAT EXTRA DEPRECIATION ALLOWABLE U/S. 32(1)(IIA) IS AN EXTRA INCENTIVE WHI CH HAS BEEN EARNED AND CALCULATED IN THE YEAR OF ACQUISITION BUT RESTRICTED FOR THAT YEAR TO 50% ON ACCOUNT OF USAGE. THE SO EARNED INCENTIVE MUST BE MADE AVAILABLE IN THE SUBSEQUENT YEAR. THE OVERALL DEDUCTION OF DEPRECIATION U/S. 32 SHALL DEFINITELY NOT EXCEED TH E TOTAL COST OF MACHINERY AND PLANT. THUS, ASSESSEE IS ENTITLED FOR THE BALANCE 50% ADDITIONAL DEPRECIATION IN VIEW OF SEC. 32(1)(IIA) OF THE ACT IN THE NEXT ASSESSMENT YEAR FOR REMAINING U NUTILIZED ADDITIONAL DEPRECIATION. RESPECTFULLY FOLLOWING THE AFORESAID DECISION, WE A LLOW THE GROUND NO. 1 AS RAISED BY THE ASSESSEE. 8. THE NEXT ISSUE TO BE DECIDED IN THIS APPEAL IS A S TO WHETHER THE LD. CIT(A) IS JUSTIFIED IN UPHOLDING THE DISALLOWANCE MADE BY THE LD. AO U/S. 14A OF THE ACT READ WITH RULE 8D OF THE I. T. RULES, 1962 (HEREINAFTER REFERRED AS THE RULES) IN THE SUM OF RS.11,05,019/- IN THE FACTS AND CIRCUMSTANCES OF TH E CASE. 9. BRIEF FACTS OF THE ISSUE ARE THAT THE ASSESSEE D ERIVED DIVIDEND INCOME OF RS.21,40,700/- OUT OF TOTAL INVESTMENTS OF RS.3.19 CR. THE LD. AO DIRECTLY RESORTED TO APPLY PROVISIONS OF RULE 8D(2)(II) AND (III) OF THE RULES AND MADE DISALLOWANCE OF 4 ITA NO.665/K/2012 & ITA NO. 335/K/2012 M/S. CENTURY ENKA LIMITED. AY 2008-09 RS.11,05,019/- IN THE ASSESSMENT. ON FIRST APPEAL, THE LD. CIT(A) UPHELD THE ADDITION MADE BY THE LD. AO. AGGRIEVED, ASSESSEE IS IN APPE AL BEFORE US. 10. THE LD. AR ARGUED THAT FIRSTLY NO SATISFACTION WAS RECORDED BY THE LD. AO IN TERM OF RULE 8D(1) OF THE RULES HAVING REGARD TO TH E ACCOUNTS OF THE ASSESSEE. IT IS NOT IN DISPUTE THAT THE ASSESSEE HAD NOT MADE ANY DISAL LOWANCE OF THE EXPENSES U/S. 14A OF THE ACT. THE ASSESSEE STATED THAT IT HAD NOT INCUR RED ANY EXPENDITURE FOR THE PURPOSE OF EARNING DIVIDEND INCOME AND ADMITTED THAT THE MAJOR PORTION OF THE INVESTMENTS WERE MADE IN KESORAM INDUSTRIES LTD. TO THE TUNE OF RS.3 .04 CR. WAY BACK AS IN FY 1995-96. IT WAS ARGUED THAT WITHOUT RECORDING SATISFACTION I N TERMS OF RULE 8D(1) , THE LD. AO CANNOT MECHANICALLY PROCEED TO RULE 8D(2) OF THE RU LES AND MAKE DISALLOWANCE U/S. 14A OF THE ACT THEREON. 11. SECONDLY, IT WAS ARGUED THAT THE ASSESSEE HAD S UFFICIENT OWN FUNDS IN THE SUM OF RS.263.36 CR. AS ITS OWN FUNDS WAY BACK AS IN FY 19 95-96 REPRESENTED BY SHARE CAPITAL AND RESERVES AND SURPLUS AND OUT OF THIS, ONLY A ME AGER SUM OF RS.3.04 CR. WAS MADE AS INVESTMENTS IN FY 1995-96. IN THIS RESPECT, ASSE SSEE HAS GIVEN A CHART, WHICH WE REPRODUCE HERE UNDER: PARTICULARS FY 07-08 FY 06-07 FY 05-06 FY 04-05 FY 03-04 FY 02-03 FY 95-96 SHAREHOLDERS FUND SHARE CAPITAL RESERVES & SURPLUS 20.05 443.06 20.05 442.58 20.05 440.26 28.64 532.84 28.64 500.14 28.64 462.72 23.25 240.11 TOTAL : 463.11 462.63 460.31 561.48 528.78 491.36 263.36 LONG TERM INVESTMENT KESORAM INDUSTRIES LTD. KESORAM INSURANCE MANAGEMENT LTD. BHARUCH ENVIRO INFRASTRUCTURE LTD. VASAVADATTA SERVICES PVT. LTD. MMA CETP COOP. SOCIETY LTD. 3.04 0.01 0.01 0.01 0.12 3.04 0.01 0.01 0.01 0.12 3.04 0.01 0.01 0.01 0.12 3.04 0.01 0.01 0.01 0.12 3.04 0.01 0.01 0.01 0 3.04 0.01 0.01 0 0 3.04 0 0 0 0 T OTAL 3.19 3.19 3.19 3.19 3.07 3.06 3.04 NUMBER OF TIMES SHARE CAPITAL IS MORE THAN INVESTMENT 145 145 144 176 172 161 87 IT WAS ARGUED FROM THE AFORESAID TABLE THAT THE BO RROWED FUNDS WERE UTILIZED ONLY FOR THE PURPOSE OF REGULAR BUSINESS OF THE ASSESSEE AND NO PART OF THE BORROWED FUNDS WERE UTILIZED FOR THE PURPOSE OF MAKING INVESTMENTS. HE NCE, THE PROVISION OF RULE 8D(2)(II) OF THE RULES COULD NOT BE INVOKED FOR THE PURPOSE OF MAKING DISALLOWANCE. 12. THIRDLY, IT WAS ARGUED THAT EVEN ASSUMING DISAL LOWANCE U/S. 14A OF THE ACT READ WITH RULE 8D(2) OF THE RULES ARE TO BE INVOKED THEN THE INVESTMENTS YIELDING DIVIDEND 5 ITA NO.665/K/2012 & ITA NO. 335/K/2012 M/S. CENTURY ENKA LIMITED. AY 2008-09 INCOME ALONE SHOULD BE CONSIDERED FOR THE PURPOSE O F MAKING THE DISALLOWANCE AND THE INVESTMENTS WHICH HAD NOT DERIVED ANY DIVIDEND INCO ME HAVE TO BE IGNORED FOR THE PURPOSE OF COMPUTATION U/S. 14A OF THE ACT. HE PLA CED ON RECORD THE COMPUTATION OF THE SAME AND ACCORDING TO HIM, EVEN ASSUMING WITHOUT C ONCEDING DISALLOWANCE IS TO BE MADE, THE SAME IS TO BE RESTRICTED ONLY TO RS.10,8 84/-. THE LD. AR PLEADED VARIOUS DECISIONS OF THE COORDINATE BENCHES OF VARIOUS TRIB UNALS IN SUPPORT OF HIS VARIOUS CONTENTIONS INCLUDING THE DECISION OF JURISDICTIONA L HIGH COURT. 13. IN RESPONSE TO THIS THE LD. DR ARGUED THAT IN T HE INSTANT CASE THE ASSESSEE HAD NOT MADE ANY CLAIM OF EXPENSES AS TO HAVE INCURRED FOR THE PURPOSE OF EARNING ANY EXEMPT INCOME. HENCE, ACCORDING TO HIM, THERE IS NO REQUI REMENT FOR RECORDING ANY SATISFACTION U/S. 14A(2) OF THE ACT . H E RELIED ON THE FINDINGS OF THE LD. CIT(A) WITH REG ARD TO THE AVAILABILITY OF ANY FUNDS WITH THE ASSESSEE. HE AR GUED THAT THE FUNDS IN THE INSTANT CASE WERE INEXTRICABLY MIXED IN THE SAME BANK ACCOUNT AN D ONUS SHIFTS ON THE ASSESSEE TO ESTABLISH THE NEXUS OF INVESTMENTS WITH THE AVAILAB ILITY OF OWN FUNDS. 14. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD INCLUDING THE VARIOUS CASE LAWS RELIED UPON BY BOTH THE SIDES. WE FIND FROM THE FACTS OF THE INSTANT CASE THAT THE LEARNED AO HAS NOT EXAMIN ED THE ACCOUNTS OF THE ASSESSEE AND THERE IS NO SATISFACTION RECORDED BY THE LEARNED AO ABOUT THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE AND WITHOUT THE SAME , HE INVOKED RULE 8D (2) OF IT RULES. WHILE REJECTING THE CLAIM OF ASSESSEE WITH REGARD TO EXPENDITURE IN RELATION TO EXEMPT INCOME, THE LEARNED AO HAS TO INDICATE COGENT REASONS FOR THE S AME. WE FIND THAT THE LEARNED AO HAD STRAIGHT AWAY EMBARKED UPON COMPUTING DISALLOWA NCE UNDER RULE 8D(2) OF THE RULES. WE FIND THAT THE CASE LAWS RELIED UPON BY TH E LEARNED AR ON THE DECISION OF THE JURISDICTIONAL HIGH COURT ARE DIRECTLY ON THIS POIN T AND IN FAVOUR OF THE ASSESSEE. CIT VS ASHISH JHUNJHUNWALA IN G.A.NO. 2990 OF 2013 IN ITAT NO. 157 OF 2013 DATED 8.1.2014 RENDERED BY CALCUTTA HIGH COURT 'WHILE REJECTING THE CLAIM OF THE ASSESSEE WITH RE GARD TO EXPENDITURE OR NO EXPENDITURE, AS THE CASE MAY BE, IN RELATION TO EXEMPTED INCOME, THE AO HAS TO INDICATE COGENT REASONS FOR THE SAME. FROM THE FACTS OF THE PRESENT CASE, IT IS NOTICED THAT THE AO HAS NOT CONSIDERED THE CLAIM OF THE ASSESSEE AND STRAIGHT A WAY EMBARKED UPON COMPUTING DISALLOWANCE UNDER RULE 8D OF THE RULES ON PRESUMIN G THE AVERAGE VALUE OF INVESTMENT AT % OF THE TOTAL VALUE. IN VIEW OF THE ABOVE AND RES PECTFULLY FOLLOWING THE COORDINATE BENCH DECISION IN THE CASE OF J.K. INVESTORS (BOMBA Y) LTD., SUPRA, WE UPHOLD THE ORDER OF CIT (A)'. 6 ITA NO.665/K/2012 & ITA NO. 335/K/2012 M/S. CENTURY ENKA LIMITED. AY 2008-09 CIT VS R.E.I. AGRO LTD IN GA 3022 OF 2013 IN ITAT 161 OF 2013 DATED 23.12.2013 RENDERED BY CALCUTTA HIGH COURT THE ASSESSING OFFICER ALSO DISALLOWED THE EXPENDIT URE UNDER SECTION 14A OF THE INCOME TAX ACT, 1961 WITHOUT FIRST RECORDING THAT HE WAS N OT ITA NOS..1146, 1138/KOL/2012-C- AM INTEGRATED COAL MINING LTD 9 SATISFIED WITH THE CORRECTNESS OF THE CLAIM AS REGARDS THE CLAIM THAT NO EXPENDITURE WAS MADE BY THE ASS ESSEE. CHALLENGING THE ORDER OF THE TRIBUNAL, THE PRESENT APPEAL HAS BEEN FILED. WE HAV E HEARD MR.BHOWMIK AND ARE OF THE OPINION THAT NO POINT OF LAW HAS BEEN RAISED. THERE FORE, THIS APPEAL IS DISMISSED. HENCE, WE HOLD THAT THE ACTION OF THE LD. AO IN DIR ECTLY EMBARKING ON RULE 8D(2) OF THE RULES IS NOT APPRECIATED AND HENCE NO DISALLOWANCE U/S. 14A OF THE ACT COULD BE MADE IN THE FACTS OF THE INSTANT CASE. 15. FROM THE AFORESAID CHART REPRODUCED IN PARA 11 ABOVE, WE ALSO FIND THAT THE ASSESSEE HAS GOT SUFFICIENT OWN FUNDS WHICH ARE SEV ERAL TIMES MORE THAN THE INVESTMENTS MADE BY THE ASSESSEE. HENCE, IT CAN BE SAFELY CONC LUDED THAT BORROWED FUNDS HAVE NOT BEEN UTILIZED FOR THE PURPOSE OF MAKING INVESTMENTS . ACCORDINGLY, WE HOLD THAT THE PROVISIONS OF RULE 8D(2)(II) OF THE RULES COULD NOT BE INVOKED IN THE FACTS AND CIRCUMSTANCES OF THE CASE. IN THIS REGARD, WE PLA CE RELIANCE ON THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. RE LIANCE UTILITIES & POWER LTD. REPORTED IN 313 ITR 340 (BOM) . WE ALSO ARE IN AGREEMENT WITH THE ARGUMENTS OF T HE LD. AR THAT INVESTMENTS YIELDING DIVIDEND INCOME ALONE ARE TO BE CONSIDERED FOR THE PURPOSE OF MAKING DISALLOWANCE U/S. 14A OF THE ACT READ WITH RULE 8D OF THE RULES. HOWEVER, THIS ASPECT WOULD BECOME INFRUCTUOUS IN VI EW OF OUR FINDING RECORDED HEREINABOVE THAT PROVISIONS OF RULE 8D(2) OF THE R ULES COULD NOT BE INVOKED IN THE FACTS AND CIRCUMSTANCES OF THE CASE FOR WANT OF SAT ISFACTION IN TERMS OF RULE 8D(1) OF THE RULES BY THE LD. AO. IN VIEW OF THE AFORESAID FIND INGS AND DECIDED JUDICIAL PRECEDENTS, WE ALLOW GROUND NOS. 7 TO 10 RAISED BY THE ASSESSEE . WE ALSO FIND THAT GROUND NO. 11 RAISED BY THE ASSESSEE WOULD BECOME INFRUCTUOUS IN VIEW OF OUR DECISION GIVEN FOR GROUND NOS. 7 TO 10. 16. THE NEXT ISSUE TO BE DECIDED IN THIS APPEAL IS AS TO WHETHER DISALLOWANCE U/S. 14A OF THE ACT COULD BE MADE TO THE BOOK PROFIT COMPUTE D U/S. 115JB OF THE ACT. 17. IN THIS REGARD WE HAVE ALREADY HELD THAT NO DIS ALLOWANCE U/S. 14A OF THE ACT COULD BE MADE IN THE FACTS AND CIRCUMSTANCES OF THE CASE. ACCORDINGLY, GROUND NOS. 12 AND 13 RAISED BY THE ASSESSEE ARE ALLOWED. 7 ITA NO.665/K/2012 & ITA NO. 335/K/2012 M/S. CENTURY ENKA LIMITED. AY 2008-09 18. GROUND NO. 14 RAISED BY THE ASSESSEE IS ONLY CO NSEQUENTIAL IN NATURE AND DOES NOT REQUIRE ANY ADJUDICATION. 19. IN THE RESULT, THE APPEAL OF REVENUE IS ALLOWED FOR STATISTICAL PURPOSES AND THAT OF THE ASSESSEE IS PARTLY ALLOWED. 20. ORDER IS PRONOUNCED IN THE OPEN COURT ON 18.05 .2016 SD/- SD/- (N. V. VASUDEVAN) (M. BALAGANESH) JUDICIAL MEMBER ACCOUNTAN T MEMBER DATED : 18TH MAY, 2016 JD.(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1 . APPELLANT - DCIT, CIRCLE-6, KOLKATA 2 RESPONDENT M/S. CENTURY ENKA LIMITED, BIRLA BUILDI NG, 9/1, R. N. MUKHERJEE ROAD, KOLKATA-700 001.. 3 . THE CIT(A), KOLKATA 4. 5. CIT , KOLKATA DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, ASSTT. REGISTRAR .