ACIT, Circle 1(1), Chandigarh V. M/s. Essen Deinki, Plot No.22, Chandigarh

ITA 704/CHANDI/2010

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 60861 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 11 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-05-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 21-05-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 28-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N K SAINI
• Assessee Lawyers: B M KHANNA
• Keywords: Revenue expenditure; Capital expenditure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH A CHANDIGARH BEFORE SHRI T.R. SOOD, AM AND MS. SUSHMA CHOWLA, JM ITA NO. 704/CHD/2012 ASSESSMENT YEAR: 2007-08 A.C.I.T. V M/S ESSEN DEINKI CIRCLE 1(1) PLOT NO. 22 CHANDIGARH INDUSTRIAL AREA CHANDIGARH AAAFE 3493 K (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI N.K. SAINI RESPONDENT BY: SHRI B.M. KHANNA DATE OF HEARING: 21.05.2012 DATE OF PRONOUNCEMENT: 24.05.2012 ORDER PER T.R. SOOD, A.M IN THIS APPEAL THE REVENUE HAS RAISED THE FOLLOWIN G GROUNDS: 1 ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAD ERRED IN GIVING THE RELIEF OF RS. 32,61,829/- ON AC COUNT OF INTEREST OF RS. 45,24,042/- ON FLIMSY GROUNDS U/S 36(1)(III) NON CH ARGING OF INTEREST AGAINST SALES OF RS. 140,00,000/-. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE L D. CIT(A) HAD ERRED IN GIVING THE RELIEF OF RS. 45,57,784/- ON AC COUNT OF DISALLOWANCE MADE BY THE ASSESSING OFFICER AS THE ASSESSEE HAD A LREADY HAVING THE PART ON WHICH THE ASSESSEE SOUGHT THE EXPENSES INCU RRED ON R&D ACCOUNT. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE L D. CIT(A) HAD ERRED IN GIVING THE RELIEF OF RS. 4,68,828/- ON ACC OUNT OF DIFFERENCE IN VALUATION STOCK AS THERE WAS NO EXPLANATION PROVIDE D BYTEH ASSESSEE REGARDING THE UNDER VALUATION OF THE CLOSING STOCK DURINGTHE CORUSE OF ASSESSMENT PROCEEDINGS. 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAD ERRED IN GIVING THE RELIEF OF RS. 1,81,709/- ON ACC OUNT OF ADDITION MADE BY THE ASSESSING OFFICER FOR NON DEPOSING THE AMOUN T IN THEIR RESPECTIVE ACCOUNT ON OR BEFORE THE DUE DATE. 2. GROUND NO. 1 - AFTER HEARING BOTH THE PARTIES WE FIND THAT THE ASSESSING OFFICER HAD ORIGINALLY DISALLOWED A SUM OF RS. 45,2 4,042/- OUT OF INTEREST PAID U/S 36(1)(III) OF THE ACT BECAUSE THE SAME WAS NOT FOR BUSINESS PURPOSES AS THE ASSESSEE HAD GIVEN INTEREST FREE ADVANCES AMOUNTING TO RS. 1.20 CRORES TO ITS SISTER CONCERNS. 2 3. ON APPEAL THE LD. CIT(A) GAVE RELIEF AMOUNTING T O RS. 32,61,829/- AND CONFIRMED THE BALANCE DISALLOWANCE. 4. THE ASSESSEE AS WELL AS THE REVENUE FILED APPEAL S BEFORE THE TRIBUNAL. SOMEHOW THE ASSESSEES APPEAL WAS HEARD AND THE OBJ ECTIONS OF THE ASSESSEE WERE SET ASIDE TO THE FILE OF ASSESSING OFFICER FOR REWORKING OF THE DISALLOWANCE. IN PURSUANCE OF THE ORDER OF THE TRIBUNAL AND ALSO AFTER CONSIDIERING THE DECISION OF HON'BLE PUNJAB & HARYANA HIGH COURT IN ABHISHEK INDUSTRIES (SUPRA) THE ASSESSING OFFICER AFTER CONSIDERING THE FACTS HAS REWORKED THE DISALLOWANCE AT RS. 4,62,825/- WHICH HAS BEEN ACCEP TED BY THE ASSESSEE. THEREFORE, ACCORDING TO THE LD. COUNSEL OF THE ASSE SSEE THE PRESENT GROUND HAS BECOME INFRUCTUOUS. 5. ON THE OTHER HAND, THE LD. DR FOR THE REVENUE SU BMITTED THAT SINCE ONLY ASSESSEES APPEAL WAS SET ASIDE, THIS ISSUE SHOULD ALSO BE SET ASIDE TO THE FILE OF THE ASSESSING OFFICER. 6. AFTER CONSIDERING THE SUBMISSIONS WE ARE OF THE OPINION THAT SINCE THE ASSESSING OFFICER HAS ALREADY REWORKED THE DISALLOW ANCE CONSIDERING THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN CA SE OF CIT V. ABHISHEK INDUSTRIES, 286 ITR 1 AS WELL AS THE DIRECTIONS OF THE TRIBUNAL AND MADE DISALLOWANCE ACCORDINGLY WHICH HAS BEEN ACCEPTED BY THE ASSESSEE, THEREFORE, THIS GROUND HAS BECOME INFRUCTUOUS AND IS DISMISSED ACCORDINGLY. 7. GROUND NO. 2 AFTER HEARING BOTH THE PARTIES WE FIND THAT DURI NG ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTICE D THAT THE ASSESSEE HAS CLAIMED EXPENDITURE ON RESEARCH AND DEVELOPMENT WHI CH WAS OF CAPITAL NATURE. THE ASSESSEE WAS ASKED TO FURNISH THE DETA ILS OF THE SAME. IN RESPONSE IT WAS MAINLY STATED THAT THE ASSESSEE WAS HAVING IN-HOUSE R&D UNITS WHICH WAS RECOGNIZED BY THE DEPARTMENT OF SCI ENTIFIC AND INDUSTRIAL RESEARCH, GOVERNMENT OF INDIA, MINISTRY OF SCIENCE AND TECHNOLOGY, NEW DELHI. THE FIRM WAS HAVING ITSOWN TECHNOLOGY FOR D EVELOPMENT OF NEW PRODUCTS 3 AS IMPORT SUBSTITUTION AS WELL AS THE DEVELOPING PR ODUCTS FOR FOREIGN MARKET. IT WAS STATED THAT THE FIRM HAS DEVELOPED A NUMBER OF HIGH TECH PRODUCTS. THE ASSESSEE WAS ASKED TO FURNISH THE DETAILS OF QUANTI TY AND AMOUNT OF 14 PIN DOUBLE DECKER PREPARED/MANUFACTURED IN THE CURRENT YEAR AND IN THE SUBSEQUENT YEAR AS WELL AS THE BASIS OF ALLOCATION OF EXPENSES TO R&D AND COMPLETE NAME AND ADDRESS, DESIGNATION, SALARY AND QUALIFICATION OF R&D STAFF. . IN RESPONSE VIDE LETTER DATED 22.8.2009 IT WAS ST ATED AS UNDER: THE FIRM IS HAVING AN IN-HOUSE R&D UNIT RECOGNISED BY THE DEPARTMENT OF SCIENTIFIC AND INDUSTRIAL RESEARCH GOVERNMENT OF INDIA, MINISTRY OF SCIENCE AND TECHNOLOGY, NEW DELHI SINCE 1976 (PHOTOCOPY OF CERTIFICATE ENCLOSED). THE FIRM IS NEITHER HAVING ANY TECHNICAL COLLABORAT ION NOR HAS PURCHASED ANY TECHNOLOGY COLLABORATION NOR HAS PURCHASED ANY TEC HNOLOGY FROM OUTSIDE. THE FIRM IS USING ITS OWN TECHNOLOGY DEVELOPED IN HOUSE AND HAS DEVELOPED A NUMBER OF STATE OF THE ART IMPORT SUBSTITUTION PROD UCTS FOR DOMESTIC AND INTERNATIONAL MARKET. THE FIRM HAD RECEIVED A NUMB ER OF AWARDS AS DETAILED BELOW (PHOTOCOPIES ENCLOSED). THE FIRM HAS DEVELOPED A NUMBER OF HI TECH PRODUCTS SUCH AS 14 PIN DOUBLE DECKER, RELAY SOCKET, 48 X 96 PENAL METER, 23 WAY 2 MM MALE AND FEMALE CONNECTOR, PROXIMITY SENSOR, LOW PROFILE BOX HEADER S, POWER SUPPLY, DIGITAL TIMERS & CLOSE TYPE TERMINAL STRIPS ETC. FOR EXPORT S AND DOMESTIC MARKET. COPY OF THE CATALOG IS ENCLOSED. THE CAPITAL ITEMS PURC HASED DURING THE YEAR ARE FOR R&D USE ONLY AND NOT FOR REGULAR PRODUCTION. THE F IRM HAS INCURRED CAPITAL EXPENDITURE OF RS. 45,57,784/- FOR THE PURCHASE OF EQUIPMENT/TOOLS AND REVENUE EXPENDITURE OF RS. 2,43,44,861/- ON PAYMENT OF WAGE S, SALARY AND PURCHASE OF RAW MATERIAL/COMPONENTS. DETAILS OF EXPENDITURE AR E ENCLOSED. THE ASSESSING OFFICER MADE FURTHER INQUIRIES AND FO UND THAT BILLS FOR PURCHASE OF ITEMS FOR RESEARCH AND DEVELOPMENT WERE RECEIVED IN THE MONTHS OF FEBRUARY AND MARCH, 2007. ON VERIFICATION OF SALES HE FOUND THAT THE ASSESSEE HAD ALREADY SOLD SIMILAR ITEMS WHICH WERE SAID TO H AVE BEEN DEVELOPED ON 1.7.2006 TO M/S HASTI ELECTRO CONTROL, PADAPOLE, GA NDHI ROAD, AHMEDABAD. SIMILARLY ON 8.11.2006 ALSO SOME OTHER ITEMS WERE S OLD TO SOME OTHER FIRMS. THEREFORE, HE CONCLUDED THAT ITEMS FOR WHICH RESEAR CH AND DEVELOPMENT CAPITAL EXPENDITURE HAD BEEN CLAIMED WERE ALREADY D EVELOPED AND HAVE BEEN SOLD BY THE ASSESSEE. ACCORDINGLY HE WAS OF THE VI EW THAT NO RESEARCH WAS CARRIED OF THESE ITEMS AND ACCORDINGLY CLAIM OF TH E R&D WAS REJECTED. 8. ON APPEAL BEFORE THE LD. CIT(A), IT WAS MAINLY S UBMITTED AS UNDER:- 4 IN ORDER TO KEEP ABREAST WITH THE LATEST TECHNICAL PRODUCT, THE ASSESSEE HAVE TO HAVE STRONG R&D CENTRE FOR DEVELOPMENT OF TOOLS AND DIES FOR THE NEW PRODUCTS. IN THE LINE OF THE BUSINESS CARRIED BY T HE ASSESSEE, R&D ACTIVITIES ARE THE BACKBONE OF THE BUSINESS. THE ASSESSEE HAD , IN THE PREVIOUS YEAR, INCURRED EXPENDITURE FOR DEVELOPMENT OF VARIOUS PRO DUCTS FOR WHICH CAPITAL EXPENDITURE HAD BEEN INCURRED WHICH HAS BEEN ALLOWE D AS DEDUCTION IN ALL THE PREVIOUS ASSESSMENT U/S 143(3). THE R&D ACTIVITIES CARRIED ON IN-HOUSE BY THE ASSESSEE ARE APPROVED BY THE DEPARTMENT OF SCIENTIF IC AND INDUSTRIAL RESEARCH, MINISTRY OF SCIENCE & TECHNOLOGY, GOVERNMENT OF IND IA. THE ASSESSEE ARE REQUIRED TO FURNISH COMPLETE REPORT TO THE SAID DEP ARTMENT FOR THE PRODUCTS DEVELOPED BY THE ASSESSEE, THE COST INCURRED THEREO N. THE R&D ACTIVITIES CARRIED ON BY THE ASSESSEE ARE ALSO INSPECTED BY TH E DEPARTMENT OF SCIENCE AND TECHNOLOGY BEFORE GRANTING APPROVALS/RENEWALS. THE CERTIFICATE ISSUED BY THE G.O.I. IS PRIMA FACIE ACCEPTANCE OF THE IN-HOUS E R&D FACILITIES CREATED BY THE ASSESSEE WHICH SHOULD HAVE BEEN HONORABLE ACCEP TED BY THE ASSESSING OFFICER. THE COMPONENTS OR PRODUCTS ARE MANUFACTURED DURING TRIAL RUN ARE SUPPLIED TO THE CUSTOMERS FOR CARRYING OUT THE TRIAL RUN BY THE M ON THEIR PLANT AND MACHINERY. AFTER THE PRODUCTS ARE APPROVED, THE TO OLS & DIES ARE CAPITALIZED. DURING THE COURSE OF AUDIT OF NTPC, A ROTOR WHICH W AS INSTALLED WAS KEPT IN WORK IN PROCESS ACCOUNT AND PUT TO TRIAL RUNS. A C OMMITTEE OF EXPERTS WAS CONSTITUTED WHICH LAID DOWN THE CRITERIA THAT ROTOR SHOULD RUN UNINTERRUPTED FOR 180 DAYS, THEN ONLY THE ROTOR WILL BE COMMISSIONED AND ON COMMISSIONING THE ROTOR WAS CAPITALIZED. DURING THE PERIOD OF THE TR IAL RUN, THERE WERE VARIOUS INTERRUPTIONS AND THE MACHINERY HAD TO BE STOPPED A ND FURTHER EXPENDITURE WERE INCURRED. THE ASSESSEE IS MANUFACTURING THE TOOLS, DIES AND F IXTURES FOR THE DEVELOPMENT OF NEW PRODUCTS IN HOUSE. ASSESSEE IS DEBITING THE EXPENDITURE INCURRED FOR THE DEVELOPMENT OF TOOLS AND DIES TO T HE CAPITAL WORK IN PROGRESS ACCOUNT FROM TIME TO TIME. THE TOOLS AND DIES FOR THE DEVELOPMENT OF NEW PRODUCTS ARE DEVELOPED IN THE R&D DEPARTMENT AND TH E QUANTITIES OF THE PRODUCTS PRODUCED DURING TRIAL RUNS ARE DISPATCHED TO CUSTOMERS FOR THEIR RESPONSE REGARDING QUALITY, SPECIFICATIONS AND MARK ET ACCEPTABILITY. AFTER THE FINAL APPROVAL OF THE PRODUCTS FROM THE CUSTOMERS C OMMERCIAL PRODUCTION IS STARTED AND THE TOOLS AND THE DIES USED FOR R&D ARE CHARGED TO RESEARCH & DEVELOPMENT. BILLS OF SALES DURING TRIAL AND SALES MADE IN THE SUBSEQUENT YEAR ARE ENCLOSED. SALE OF TRIAL PRODUCTS AND LATER SUB SEQUENT CAPITALIZATION OF THE EXPENDITURE UNDER R&D CANNOT LEAD TO A NEGATIVE CON CLUSION AS DRAWN BY THE ASSESSING OFFICER. 9. THE LD. CIT(A) FOUND FORCE IN THE SUBMISSIONS OF THE ASSESSEE AND WAS OF THE OPINION THAT SINCE THE ASSESSEE WAS HAVING R ECOGNISED R&D UNIT AND WAS RECOGNISED BY THE DEPARTMENT OF SCIENTIFIC AND INDUSTRIAL RESEARCH AND THE ASSESSEE HAS CARRIED OUT THE SOME RESEARCH ACTI VITIES, THEREFORE, THE CLAIM WAS ALLOWED. 10. BEFORE US THE LD. DR FOR THE REVENUE STRONGLY S UPPORTED THE ORDER OF ASSESSING OFFICER AND CONTENDED THAT SINCE THE ASSE SSEE WAS ALREADY SELLING THE PRODUCTS WHICH WERE SAID TO BE UNDER DEVELOPMEN T, IT BECOMES CLEAR THAT NO RESEARCH WAS BEING DONE BECAUSE THE ASSESSEE WAS ALREADY SELLING SUCH PRODUCTS. 5 11. ON THE OTHER HAND, THE LD. COUNSEL OF THE ASSES SEE CONTENDED THAT IN ORDER TO KEEP ABREAST WITH THE LATEST TECHNOLOGY TH E ASSESSEE HAD ESTABLISHED STRONG R&D UNIT WHICH WAS DULY RECOGNISED BY DEPART MENT OF SCIENTIFIC AND INDUSTRIAL RESEARCH, GOVERNMENT OF INDIA, MINISTRY OF SCIENCE AND TECHNOLOGY, NEW DELHI. THE ASSESSEE IS REQUIRED TO FURNISH CO MPLETE REPORT TO THE SAID DEPARTMENT FOR THE PRODUCTS DEVELOPED BY THE ASSESS EE, COST INCURRED THEREON AND SUCH ACTIVITIES ARE INSPECTED BY THE DEPARTMENT OF SCIENTIFIC AND INDUSTRIAL RESEARCH, GOVERNMENT OF INDIA, MINISTRY OF SCIENCE AND TECHNOLOGY BEFORE GRANTING APPROVALS/RENEWALS. THE CERTIFICATE GRANT ED BY THE GOVERNMENT IS PRIMA FACIE ACCEPTANCE OF THE IN-HOUSE R&D CREATED BY THE ASSESSEE. IT WAS ALSO SUBMITTED THAT COMPONENTS OF PRODUCTS WERE MAN UFACTURED DURING TRIAL RUN WHICH WERE BEING SUPPLIED TO THE CUSTOMERS FOR CARR YING OUT TRIAL RUN ON THEIR PLANT AND MACHINERY. AFTER THE PRODUCTS ARE APPROV ED, THE TOOLS AND DIES WERE CAPITALIZED. THE ASSESSING OFFICER HAS DISALLOWED THE DEDUCTION BY OBSERVING THAT SINCE THE ASSESSEE HAD ALREADY SOLD THESE PROD UCTS, THEREFORE, THE TECHNOLOGY WAS WITH THE ASSESSEE. HE POINTED OUT T HAT NORMALLY WHILE CARRYING OUT THE SCIENTIFIC RESEARCH, A PROTYPE IS DEVELOPED , WHICH IS FORWARDED TO THE PROSPECTIVE BUYERS FOR ANALYZING THE PRODUCT AND GE TTING THEIR COMMENTS ON THEM. THE DATA COLLECTED IS ANALYSED AND THEREAFTE R ONLY THE TOOL OF THAT PRODUCT IS FINALIZED. SAMPLE SALES OF SUCH PROTYPE SHOULD NOT HAVE BEEN CONCLUDED BY THE ASSESSING OFFICER THAT IT IS SALE OF COMMERCIAL PRODUCTIONS. IF THE ASSESSEE HAD TECHNOLOGY THEN THE ASSESSEE WOULD HAVE SOLD SUCH GOODS IN A LARGE VOLUME AND EVEN IN EARLIER YEARS. HE ALSO SUBMITTED THAT SIMILAR EXPENDITURE IS INCURRED FOR PRODUCTION OF AN ITEM O F SCIENTIFIC R&D WAS ALLOWED IN THE EARLIER YEARS EVEN IN THE ASSESSMENT FRAMED U/S 143(3). 12. WE HAVE HEARD THE RIVAL SUBMISSIONS CAREFULLY A ND FIND FORCE IN THE SUBMISSIONS OF THE LD. COUNSEL OF THE ASSESSEE. DE VELOPMENT OF A NEW PRODUCT THROUGH RESEARCH IS A CONTINUOUS PROCESS BECAUSE TE CHNOLOGY IS CHANGING VERY FAST WITH THE TIMES. FOR EXAMPLE IN CASE OF A CAR ORIGINALLY A CAR WAS DEVELOPED ABOUT 100 YEARS BACK BUT THE PRESENT DAY CAR HAS CO ME UP THROUGH RESEARCH 6 EFFORTS OF VARIOUS ORGANIZATIONS IN DIFFERENT COUNT RIES AND NEW MODELS OF CARS HAVE BEEN INTRODUCED IN THE WORLD BECAUSE OF SUCH R ESEARCH EFFORTS. RESEARCH IS STILL GOING ON TO FIND OUT TO DEVELOP NEW MODELS OF CARS WHICH CAN RUN FOR EXAMPLE, OTHER FUELS THAN PETROL PRODUCTS OR WHICH ARE LESS POLLUTANT AND FUEL EFFICIENT. THEREFORE, IT IS CLEAR THAT RESEARCH IS A CONTINUOUS PROCESS. EVEN IF THE ASSESSEE HAD DEVELOPED SOME PROTYPE PIN DOUBLE DECKER THEY MAY STILL REQUIRE FURTHER IMPROVEMENTS. MERE SELLING OF PRO TYPE OF PRODUCTION WOULD NOT SHOW THAT THE ASSESSEE ALREADY HAD THE TECHNOLOGY O F THE SAME PRODUCTION.. THEREFORE, IN OUR OPINION, THE LD. CIT(A) HAS CORRE CTLY DECIDED THIS ISSUE IN FAVOUR OF THE ASSESSEE PARTICULARLY BY OBSERVING T HAT R&D IS A LONG PROCESS. THEREFORE, WE FIND NOTHING WRONG IN THE ORDER AND CONFIRM THE SAME. 13 GROUND NO. 3 AFTER HEARING BOTH THE PARTIES WE FIND THAT DURI NG ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTIC ED FROM THE VALUATION OF CLOSING STOCK FURNISHED TO THE BANK THAT THE VALUAT ION GIVEN TO THE BANK WAS HIGHER AND ACCORDINGLY THE DIFFERENCE WAS ADDED TO THE INCOME OF THE ASSESSEE. 14. ON APPEAL BEFORE THE LD. CIT(A), IT WAS MAINLY SUBMITTED THAT VALUATION GIVEN TO THE BANKERS HAS NO CO-RELATION WITH THE AC TUAL VALUE TO BE ADOPTED FOR THE BALANCE SHEET PURPOSES. BANKERS ARE GENERALLY GIVEN THE MARKET VALUE OF STOCK WHEREAS THE ACTUAL VALUE IS SHOWN AT THE LOWE R OF COST OR NET REALIZABLE VALUE IN THE ACCOUNTS. 15. THE LD. CIT(A) FOLLOWING THE DECISION OF CHANDI GARH BENCH IN CASE OF ITO V. LUVKUSH HOSIETY FACTORY, 37 CTR 71, DECIDED THE ISSUE IN FAVOUR OF ASSESSEE BY OBSERVING THAT IT WAS A CASE OF HYPOTHE CATION OF STOCK. THEREFORE, THERE CAN BE DIFFERENCE IN VALUATION. 16. BEFORE US THE LD. DR FOR THE REVENUE SUPPORTED THE ORDER OF ASSESSING OFFICER. 7 17. ON THE OTHER HAND, THE LD. COUNSEL OF THE ASSES SEE SUPPORTED THE APPELLATE ORDER. 18. AFTER CONSIDERING THE RIVAL SUBMISSIONS WE FIND THAT THERE WAS NO DIFFERENCE IN THE QUANTITY GIVEN TO THE BANK AND SH OWN IN THE BALANCE SHEET. MOREOVER THE STOCK WAS NOT PLEDGED WITH THE BANK AN D IT WAS ONLY HYPOTHECATED AND THE CHANDIGARH BENCH OF THE TRIBUN AL IN CASE OF ITO V. LUVKUSH HOSIERY FACTORY (SUPRA) HAS DECIDED THE CAS E IN FAVOUR OF ASSESSEE AND ACCORDINGLY WE CONFIRM THE ORDER OF THE LD. CI T(A). 19. GROUND NO. 4 ORIGINALLY THIS ADDITION WAS MADE ON ACCOUNT OF LATE PAYMENT OF EPF AND ESI DUES. VIDE ASSESSMENT ORDER DATED 28.7.2011 THE ASSESSING OFFICER HAS ALREADY DELETED THIS DISALLOW ANCE FOLLOWING THE DECISION OF HON'BLE SUPREME COURT IN CASE OF CIT V. ALOM EXT RUSIONS LTD., 319 ITR 306 (S.C) AS WELL AS THE DECISION OF HON'BLE PUNJAB & H ARYANA HIGH COURT IN CASE OF CIT V. NUCHEM LTD., ITA NO. 323 OF 2009 (P&H). SINCE RELIEF HAS BEEN ALLOWED BY THE ASSESSING OFFICER FOLLOWING THE DECI SION OF HON'BLE JURISDICTIONAL HIGH COURT, THEREFORE, THIS GROUND HAS BECOME INFRUCTUOUS AND ACCORDINGLY THE SAME IS DISMISSED. 20. IN THE RESULT, APPEAL FILED BY THE REVENUE IS D ISMISSED. ORDER PRONOUNCED ON 24 .5.2012 SD/- SD/- (SUSHMA CHOWLA) (T.R. SOOD) JUDICIAL MEMBER ACCOUNTANT M EMBER DATED: 24.5.2012 SURESH COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT/THE C IT(A)/ THE DR 8