Escorts Ltd., New Delhi V. DCIT, Circle- 11(1), New Delhi

ITA 7623/DEL/2017

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 8808 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 2 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-03-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 20-12-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: LEARNED MS NIDHI SRIVASTAVA
• Keywords: Transfer pricing; International transaction; Rule of consistency; Royalty expenses; Tax effect; TDS; Set aside
• Section: 115JB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: B NEW DELHI BEFORE SHRI O.P. KANT, ACCOUNTANT MEMBER AND MS. SUCHITRA KAMBLE, JUDICIAL MEMBER [THROUGH VIDEO CONFERENCING] ITA NO.398/DEL./2018 ASSESSMENT YEAR: 2009-10 ADDL. CIT, SPECIAL RANGE-3, NEW DELHI VS. M/S. ESCORTS LTD., 11, SCINDINA HOUSE, CONNAUGHT PLACE, NEW DELHI PAN :AAACE0074B (APPELLANT) (RESPONDENT) AND ITA NO.7623/DEL./2017 ASSESSMENT YEAR: 2009-10 M/S. ESCORTS LTD., CORPORATE TAXATION, 15/5, MATHURA ROAD, FARIDABAD VS. DCIT, CIRCLE-11(1), NEW DELHI PAN : AAACE0074B (APPELLANT) (RESPONDENT) ORDER PER O.P. KANT, AM: ABOVE CROSS APPEALS BY THE REVENUE AND THE ASSESSEE ARE DIRECTED AGAINST ORDER DATED 31/10/2017 PASSED BY T HE LEARNED DEPARTMENT BY MS. NIDHI SRIVASTAVA, CIT(DR) SH. RAJESH KUMAR, SR.DR ASSESSEE BY SHRI R.M. MEHTA, CA DATE OF HEARING 15.03.2021 DATE OF PRONOUNCEMENT 19.03.2021 2 ITA NO.398/DEL./2018 & 7623/DEL./2017 COMMISSIONER OF INCOME-TAX (APPEALS)-44, NEW DELHI [IN SHORT THE LD. CIT(A)] FOR ASSESSMENT YEAR 2009-10. THE GROUNDS RAISED BY THE REVENUE AND THE ASSESSEE IN THEIR RESPECTIVE APPEALS ARE REPRODUCED AS UNDER: (I) GROUNDS OF APPEAL OF THE REVENUE: 1. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERR ED IN LAW AND ON THE FACTS OF THE CASE IN DELETING THE ADDITION O F RS.1,39,00,000/- MADE BY THE AO ON ACCOUNT OF DISAL LOWANCE OF ROYALTY EXPENDITURE. 2. THE APPELLANT CRAVES LEAVE TO MODIFY, ADD OR FOR EGO ANY GROUND(S) OF APPEAL AT ANY TIME BEFORE OR DURING THE HEARING OF THIS APPEAL. (II) GROUNDS OF APPEAL OF THE ASSESSEE: 1. THE LEARNED CIT(A) HAS ERRED IN LAW AND FACTS BY UPHOLDING THE ACTION OF AO/TPO IN REJECTING A COMPARABLE CONSIDER ED BY THE APPELLANT IN THE COMPARABILITY ANALYSIS. 2. THE LEARNED CIT(A) ERRED BY NOT ACCEPTING THE AP PELLANTS PLEA THAT A COMPARABLE (I.E. A COMPANY WHOSE FINANCIAL S TATEMENTS WERE FOR A PERIOD OF NINE MONTHS) SHOULD NOT BE REJ ECTED PARTICULARLY WHEN IT MET THE CRITERIA FOR SELECTION AS COMPARABLE. 3. THE LEARNED CIT(A) HAS ERRED IN LAW AND FACTS BY UPHOLDING THE DISALLOWANCE OF RS.1,58,512/- ON ACCOUNT OF PRIOR P ERIOD EXPENSES IGNORING THE PLEA OF APPELLANT THAT THE EXPENSES AC CRUED DURING THE RELEVANT ASSESSMET YEAR EVEN THOUGH PERTAINING TO THE PREVIOUS ACCOUNTING PERIOD. 4. THAT THE APPELLANT RESERVES TO ITSELF, THE RIGHT TO ADD, ALTER, AMEND, SUBSTITUTE AND/OR WITHDRAW ANY GROUND(S) OF APPEAL ON OR BEFORE THE DATE OF HEARING. 2. THE BRIEFLY STATED FACTS OF THE CASE ARE THAT THE ASSESSEE COMPANY IS ENGAGED IN THE BUSINESS OF MANUFACTURING AND SALE OF TRACTORS, SHOCKERS, RAILWAY EQUIPMENT ETC. AND OTHE R TRADING ACTIVITIES. FOR THE YEAR UNDER CONSIDERATION, THE A SSESSEE FILED RETURN OF INCOME ON 30/09/2009, DECLARING NIL INCOM E UNDER REGULAR PROVISIONS OF THE INCOME-TAX ACT, 1961 (IN SHORT THE ACT) AND BOOK PROFIT OF 27,77,81,818/- IN TERMS OF SECTION 115JB OF THE ACT. THE RETURN OF INCOME FILED BY THE ASSESSEE WAS SELECTED 3 ITA NO.398/DEL./2018 & 7623/DEL./2017 FOR SCRUTINY ASSESSMENT. THE ASSESSING OFFICER NOTI CED INTERNATIONAL TRANSACTIONS ENTERED INTO BY THE ASSE SSEE WITH ASSOCIATED ENTERPRISES (AES), AND ACCORDINGLY HE RE FERRED THE MATTER OF DETERMINATION OF THE ARMS-LENGTH PRICE O F THOSE INTERNATIONAL TRANSACTIONS TO THE LEARNED TRANSFER PRICING OFFICER (TPO). THE LEARNED TPO PROPOSED AN ADDITION OF 1,55,00,000/- TO THE VALUE OF THE INTERNATIONAL TRANSACTION REPOR TED BY THE ASSESSEE. THE ASSESSING OFFICER PASSED A DRAFT ASSE SSMENT ORDER ON 28/02/2013, WHEREIN HE PROPOSED TRANSFER PRICING ADDITION OF 1,55,00,000/-, ADDITION ON ACCOUNT OF DISALLOWANCE OF ROYALTY EXPENSES OF 1,39,00,000/- AND OTHER ADDITIONS . AS THE ASSESSE E DID NOT FILE OBJECTION BEFORE THE LEARNED DISPUTE R ESOLUTION PANEL (DRP), WITHIN THE STIPULATED PERIOD OF 30 DAYS, THE ASSESSING OFFICER PASSED THE ASSESSMENT ORDER ON 29/04/2013 D ETERMINING TOTAL INCOME AT 3,01,58,760/- UNDER NORMAL PROVISIONS OF THE ACT. AGGRIEVED, THE ASSESSEE FILED APPEAL BEFORE TH E LEARNED CIT(A), WHO PARTLY ALLOWED THE APPEAL. AGGRIEVED, B OTH THE ASSESSEE AND REVENUE ARE BEFORE US BY WAY OF RAISIN G THE RESPECTIVE GROUNDS IN THEIR APPEALS. 3. BEFORE US, BOTH THE PARTIES APPEARED THROUGH VIDEO CONFERENCING FACILITY. THE ASSESSEE FILED A PAPER-B OOK ELECTRONICALLY AS WELL AS PHYSICALLY. 4. AT THE OUTSET, THE LEARNED DR SUBMITTED THAT TAX EF FECT INVOLVED IN THE APPEAL OF THE REVENUE IS LESS THAN THE TAX EFFECT PRESCRIBED FOR FILING APPEAL BEFORE THE INCOME TAX APPELLATE TRIBUNAL ( IN SHORT THE TRIBUNAL), AND THEREFORE THE APPEAL FILED THE REVENUE BE TREATED AS WITHDRAWN IN TERMS OF THE CBDT CIRCULAR NO. 17/2019 DATED 08 TH AUGUST, 2019. 4 ITA NO.398/DEL./2018 & 7623/DEL./2017 5. THE LEARNED COUNSEL OF THE ASSESSEE, ON THE OTHER HAND, SUBMITTED THAT THE ISSUE IN DISPUTE IS COVERED IN F AVOUR OF THE ASSESSEE BY DECISION OF THE TRIBUNAL IN EARLIER YEA RS AND THE LEARNED CIT(A) HAS ALSO ALLOWED THE ISSUE IN DISPUT E IN FAVOUR OF THE ASSESSEE FOLLOWING THE DECISION OF THE TRIBUNAL IN ASSESSMENT YEAR 2004-05. 6. WE HAVE HEARD RIVAL SUBMISSION OF THE PARTIES. IN V IEW OF THE SUBMISSION OF THE LEARNED DR, THE APPEAL OF THE REV ENUE IS DISMISSED AS WITHDRAWN, WITH THE LIBERTY TO FILE AP PLICATION FOR RECALLING THE APPEAL, IN CASE THE TAX EFFECT IS FOU ND TO BE MORE THAN THE PRESCRIBED TAX EFFECT IN THE RELEVANT CBDT CIRCULAR OR THE CASE IS COVERED IN ANY OF THE EXCEPTIONS IN SAID CI RCULAR. ACCORDINGLY, THE APPEAL OF THE REVENUE IS DISMISSED . 7. AS FAR AS APPEAL OF THE ASSESSEE IS CONCERNED, THE LEARNED COUNSEL OF THE ASSESSEE BEFORE US SUBMITTED THAT GR OUND NO. 1 & 2 OF THE APPEAL WERE NOT PRESSED BY THE ASSESSEE AN D ACCORDINGLY BOTH THESE GROUNDS ARE DISMISSED AS INFRUCTUOUS. 8. AS FAR AS GROUND NO. 3 OF THE APPEAL IS CONCERNED, THE LEARNED COUNSEL OF THE ASSESSEE REITERATED THE SUBM ISSIONS MADE BEFORE THE LEARNED CIT(A) AND REFERRED TO VARIOUS P AGES OF THE PAPER-BOOK . HE ALSO RELIED ON THE DECISION OF THE TRIBUNAL IN ITA NO. 4235/DEL./2014, DATED 09/03/2018 FOR ASSESSMENT YEAR 2005-06. 8.1 THE LEARNED DR, ON THE OTHER HAND, RELIED ON THE O RDER OF THE LOWER AUTHORITIES. 8.2 WE HAVE HEARD RIVAL SUBMISSION OF THE PARTIES ON TH E ISSUE DISPUTE AND PERUSED THE RELEVANT MATERIAL ON RECORD . WE FIND THAT THE ASSESSING OFFICER HAS DISALLOWED PRIOR PERIOD E XPENSES OF 5 ITA NO.398/DEL./2018 & 7623/DEL./2017 1,58,512/- ON THE GROUND THAT SAME PERTAIN TO EARLI ER YEARS. OUT OF THE PRIOR PERIOD EXPENSES DISALLOWED, THE EXPENS ES OF 1,35,491/- PERTAIN TO RED DIVISION AND 23,021/- PERTAIN TO ASP DIVISION. BEFORE THE LD. CIT(A), THE ASSESSEE MADE DETAILED SUBMISSION WITH BREAKUP OF THE EXPENSES AND JUSTIFY ING AS HOW THE EXPENSES CRYSTALLIZED IN THE YEAR UNDER CONSIDE RATION. THE LD. CIT(A) FOLLOWING THE ORDER OF THE HIS PREDECESSOR A ND SUSTAINED THE DISALLOWANCE. THE RELEVANT FINDING OF THE LD. C IT(A) IS REPRODUCED AS UNDER: 8.1 THE APPELLANT MADE THE FOLLOWING SUBMISSIONS D URING THE COURSE OF APPELLATE PROCEEDINGS:- THE STATUTORY AUDITORS IN THEIR TAX AUDIT REPORT M ENTIONED PRIOR PERIOD EXPENDITURE OF RS.1,58,512/- PERTAINING TO T HE FOLLOWING DIVISIONS OF THE COMPANY I) RED - RS.1,35,491/- II) ASP - RS. 23,021/- THE DIVISION-WISE DETAILS OF SUCH EXPENSES WERE FIL ED ALONG WITH PHOTOCOPIES OF RELEVANT BILLS. DETAILED EXPLANATION WAS GIVEN TO THE ASSESSING OFFICER WITH EVIDENCES. THE ITEM- WIS E EXPLANATION GIVEN TO THE ASSESSING OFFICER IS REPRODUCED BELOW: - ENGINEERING DIVISION (RED) A) THE EXPENDITURE OF RS.42,000/- ON ACCOUNT OF PRO FESSIONAL CHARGES PERTAINS TO BILL NO.BCL/C.R/ESCORTS/06-12/2 007-08 DATED 30.04.2008 OF BRAHMA DUTTA CHAMBERS OF LAW FO R PROFESSIONAL CHARGES FOR THE MONTH OF SEPTEMBER 200 7 TO MARCH, 2008. THE LIABILITY TO PAY THIS EXPENDITURE AROSE I N THE ASSESSMENT YEAR 2009-10 ON ACCOUNT OF THE BILL HAVI NG BEEN ISSUED BY THE PARTY DURING THE ASSESSMENT YEAR 2009 -10. ACCORDINGLY, THERE IS NO CASE FOR ANY DISALLOWANCE OF THIS EXPENDITURE AS A PRIOR PERIOD EXPENDITURE. B) THE EXPENDITURE OF RS.43,491/- PERTAINS TO PACKI NG, FREIGHT AND FORWARDING CHARGES AS PER BILLS OF M/S AKG PACK ERS (PVT.) LTD. THESE BILLS WERE RAISED BY THE PARTY IN NOVEMB ER, 2007 BUT WERE RECEIVED LATE IN THE STORES DEPARTMENT. SUCH B ILLS ARE ALWAYS 6 ITA NO.398/DEL./2018 & 7623/DEL./2017 SUBJECT TO VERIFICATION AT VARIOUS LEVELS AND ULTIM ATELY FORWARDED TO THE ACCOUNTS DEPARTMENT OF THE COMPANY FOR PROCE SSING AND PAYMENT. AFTER COMPLETE VERIFICATION BY VARIOUS FUN CTIONARIES, THE BILLS WERE RECEIVED IN THE FINANCE DEPARTMENT IN OC TOBER, 2008 AND WERE ACCORDINGLY PROCESSED AND VOUCHED ON 11.12 .2008. IT WILL NOT BE OUT OF PLACE TO MENTION THAT IN A COMPA NY OF THIS SIZE WITH VAST MAGNITUDE OF TRANSACTIONS, IT IS NOT POSS IBLE TO ACCOUNT FOR SMALL VALUE TRANSACTIONS AT THE CLOSE OF THE YE AR WITHOUT PROPER PROCESSING AND VERIFICATION AT VARIOUS STAGES. THE ACCOUNTING IS DONE ONLY AFTER FINAL APPROVALS ARE RECEIVED FOR PA YMENT OF THE BILLS. C) THE EXPENDITURE OF RS. 50,000/- PERTAINS TO PROF ESSIONAL CHARGES BILL OF MR.A.S. CHANDHIOK. THE BILL DATED 0 5.01.2008 OF THE PARTY WAS RECEIVED BY THE LEGAL DEPARTMENT OF T HE COMPANY AND WAS SUBJECT TO VERIFICATION. THE LEGAL DEPARTME NT DID NOT VERIFY AND APPROVED THE BILL FOR PAYMENT TILL THE F INALIZATION OF ACCOUNT FOR THE YEAR ENDED 31.03.2008. THE BILL WAS FINALLY PASSED AND APPROVED FOR PAYMENT BY THE LEGAL DEPART MENT IN NOVEMBER, 2008 AND ACCORDINGLY VOUCHED IN THE BOOKS OF ACCOUNT ON 29.11.2008. THE LIABILITY TO PAY THIS EXPENDITUR E AROSE DURING THE ASSESSMENT YEAR 2009-10 AND ACCORDINGLY THE SAM E HAS BEEN RIGHTLY BOOKED. THERE IS NO CASE FOR ANY DISAL LOWANCE OF THIS EXPENDITURE AS A PRIOR PERIOD EXPENSE. ENGINEERING DIVISION (ASP) THE EXPENDITURE OF RS.23,021/- PERTAINS TO VARIOUS SMALL VALUE PURCHASES MADE AT THE ASP DIVISION OF THE COMPANY TOWARDS THE END OF THE ACCOUNTING YEAR 2007-08. AS PER PROCEDUR E, SUCH BILLS ARE VERIFIED, PROCESSED AND THEN APPROVED FOR PAYME NT THE APPROVAL FOR THESE EXPENSES WAS RECEIVED BY THE FIN ANCE DEPARTMENT DURING THE ASSESSMENT YEAR 2009-10 AND A CCORDINGLY BOOKED IN THE ACCOUNTS DURING THE ASSESSMENT YEAR 2 009-10. AS ALREADY EXPLAINED ABOVE, THERE IS VAST MAGNITUDE OF SMALL VALUE TRANSACTIONS AND IT IS ALWAYS NOT POSSIBLE TO CREAT E LIABILITY FOR SUCH EXPENDITURE AT THE CLOSE OF THE FINANCIAL YEAR DUE TO NON- RECEIPT OF APPROVED BILLS IN THE FINANCE DEPARTMENT . THERE IS NO CASE FOR ANY DISALLOWANCE OF THIS AMOUNT. 8.2 I HAVE PERUSED THE ORDER OF THE ASSESSING OFFI CER WHO HAS OBSERVED AS FOLLOWS:- FROM THE TAX AUDIT REPORT IT IS OBSERVED THAT THE ASSESSEE HAS DEBITED A SUM OF RS. 1,58,512 BEING PRIOR PERIOD EX PENSES IN THE P AND L ACCOUNT WHERE AS THE ASSESSEE HAS BEEN FOLL OWING THE MERCANTILE SYSTEM OF ACCOUNTING. THEREFORE, THE ASS ESSEE WAS ASKED TO FILE THE DETAILS OF PRIOR PERIOD EXPENSES. IN RESPONSE TO 7 ITA NO.398/DEL./2018 & 7623/DEL./2017 WHICH THE ASSESSEE HAS FILED ITS REPLY DATED 27/02/ 2013. FROM THE DETAILS FILED IT IS NOTICE THAT AN AMOUNT OF RS . 1, 35, 491 PERTAINS TO RED DIVISION AND RUPEES 23,021 TO ASP D IVISION AND THEN SPHERE RAISED IN REGARD TO CONSULTANCY CHARGES , SERVICE CHARGES ETC.IN VIEW OF THE ABOVE, IT IS CLEAR THAT THE ASSESSEE HAS DEBITED AN AMOUNT OF RS. 1,58,512 BEING PRIOR PERIO D EXPENSES WHICH IS INCLUDED UNDER THE HEAD CONSULTANCY CHARGE S, SERVICE CHARGES ETC. THEREFORE, SAME IS BEING DISALLOWED AN D ADDED BACK TO THE TOTAL INCOME OF THE ASSESSEE. 8.3 I HAVE ALSO PERUSED THE ORDER OF THE CIT(A) FO R AY 2007 - 08 WHERE IT HAS BEEN OBSERVED AS FOLLOWS AT PARA 4.3: - I HAVE CONSIDERED THE ASSESSMENT ORDER, WRITTEN SU BMISSION AND ORAL ARGUMENTS OF THE IN THE PAPER BOOK, LEARNED AR HAS FILED COPY OF THE AUDIT REPORT EVIDENCING THAT PREVIOUS Y EAR EXPENDITURE ARE UNDER THE HEAD SALES AND ADMINISTRATIVE EXPENSE S. NO BREAKUP OF THE SALES AND ADMINISTRATIVE EXPENSES BE ING PRIOR PERIOD EXPENSES HAS BEEN FILED BEFORE THE ASSESSING OFFICER OR EVEN BEFORE THE APPELLATE PROCEEDINGS. THE EXPLANATION OF THE LD. AR THAT FOR A BUSINESS O F LARGE VOLUME, IT IS NOT POSSIBLE TO DRILL MINOR EXPENSES AT THE T IME OF CLOSING OF ACCOUNTS AND MAKE PROVISION THEREOF FOR WHICH THERE ARE VARIOUS REASONS SUCH AS LATE RECEIPT OF BILLS, DELAY IN PRO CESSING OF BILLS IN VARIOUS DEPARTMENTS ETC. IN MOST CASES, THE LIABILI TY TO PAY SUCH EXPENDITURE HAS CRYSTALLIZE AND SUBSEQUENT PERIOD D UE TO NEGOTIATION, DISPUTES ETC. I HAVE CONSIDERED THE ARGUMENTS. THE ARGUMENTS ARE GENERAL IN NATURE AND NOT SPECIFIC TO LD. AR. ANY PARTICULAR I TEMS OF EXPENSES DISALLOWED AS PRIOR PERIOD EXPENSES. ONCE AUDITOR HAS CERTIFIED THAT THESE EXPENSES ARE PRIOR PERIOD EXPE NSES THEN SUCH EXPENDITURE CANNOT BE ALLOWED UNLESS PROVED OTHERWI SE, AS BOOKS OF ACCOUNTS OF A COMPANY ARE ADMITTEDLY PREPARED ON ACCRUAL BASIS. LD. ARS ARGUMENT THAT SUCH TYPE OF EXPENSES BE ALL OWED BY CIT(A) IN EARLIER AYS CANNOT HELP THE APPELLANT AS SUCH ASSESSMENT YEAR IS SEPARATELY ASSESSMENT UNIT AND F ACTS ARE DIFFERENT. CONSIDERING ENTIRES STANCES OF THE CASE, I HEREBY CONFIRM THE ADDITION MADE BY THE ASSESSING OFFICER. THE GROUND OF APPEAL IS DISMISSED. 8.4 I HAVE CONSIDERED THE FACTS AND THE CIRCUMSTANC ES OF THE CASE AND PERUSED THE ORDER OF THE ASSESSING OFFICER AS WELL AS THE SUBMISSIONS OF THE APPELLANT. THE MATERIAL FACTS OF THE CASE ARE 8 ITA NO.398/DEL./2018 & 7623/DEL./2017 THE SAME IN THE INSTANT YEAR ALSO. IN ACCORDANCE WI TH THE PRINCIPLE OF CONSISTENCY AND RESPECTFULLY FOLLOWING THE ORDER OF THE CIT(A) IN AY 2011-12, THE ADDITION MADE BY THE AO IS CONFIRME D . THE GROUND OF APPEAL IS DISMISSED. 8.3 THE ASSESSEE IS FOLLOWING MERCANTILE SYSTEM OF ACC OUNTING. PRIOR PERIOD EXPENSE ARE GENERALLY THOSE EXPENSES W HICH ARE RELATING TO THE CURRENT YEAR IN THE SENSE THEY ARE CRYSTALLIZED DURING THE YEAR, THOUGH RELATING TO ACTIVITIES OF A N EARLIER YEAR. FOR ACCOUNTING PURPOSES THESE ARE GENERALLY KNOWN A S PRIOR PERIOD ITEMS AND REQUIRED TO BE SHOWN SEPARATELY. N ORMALLY, WHERE MERCANTILE SYSTEM OF ACCOUNTING IS FOLLOWED, EXPENSES RELATING TO RELEVANT YEAR ARE ACCOUNTED FOR IN THAT YEAR. HOWEVER, PRIOR PERIOD EXPENSES HAD TO BE ALLOWED IN SUBSEQUE NT YEARS IF THOSE EXPENSES ARE CRYSTALLIZED IN THAT YEAR. 8.4 IN THE SUBMISSION BEFORE THE LEARNED CIT(A), WHICH HAVE BEEN REITERATED BEFORE US, THE ASSESSEE HAS CONTEND ED THAT BILL IN RESPECT OF PROFESSIONAL CHARGES OF 42,000/-WAS RECEIVED ON 30/04/2008 . THE LEARNED COUNSEL BEFORE US REFERRED TO PAGE NO. 7 OF THE PAPER-BOOK, WHICH IS A COPY OF THE SAID BI LL AND SUBMITTED THAT BILL WAS PROCESSED FINALLY ON 19/01/ 2009 BY THE FINANCE DIVISION, BEFORE TRAVELLING THROUGH VARIOUS DEPARTMENT OF THE ASSESSEE COMPANY. REGARDING OTHER BILLS OF 43,491/-; 50,000; AND 23,021 ALSO SIMILAR SUBMISSIONS HAVE BEEN MADE BY THE LEARNED COUNSEL OF THE ASSESSEE. 8.5 WE FIND THAT TRIBUNAL JAIPUR BENCH IN THE CASE OF S TATE BANK OF BIKANER AND JAIPUR VS ACIT 2014, REPORTED IN 166 TTJ 244 HELD THAT EXPENSES OF THE PREVIOUS YEAR ARE ALL OWABLE IN THE RESPECTIVE YEAR TO WHICH THEY PERTAINED BUT INFORMA TION AS REGARD 9 ITA NO.398/DEL./2018 & 7623/DEL./2017 TO SUCH EXPENSES WITH EVIDENCE WAS RECEIVED BY THE ASSESSEE FROM THE VARIOUS BRANCHES AFTER CLOSING OF BOOKS OF ACCO UNTS, AND HENCE SAME ARE ALLOWABLE DURING THE YEAR UNDER CONS IDERATION. BEFORE US ALSO, THE GENUINENESS OF THE EXPENSES HAS NOT BEEN DOUBTED BY THE LOWER AUTHORITIES. SINCE IN THE INST ANT CASE THE BILLS FOR EXPENSES UNDER CONSIDERATION HAVE BEEN PR OCESSED BY VARIOUS DIVISIONS OF THE ASSESSEE AND FINALLY APPRO VED IN THE YEAR UNDER CONSIDERATION, AND THUS, RESPECTFULLY FOLLOWI NG THE DECISION OF THE TRIBUNAL IN THE CASE OF STATE BANK OF BIKANE R AND JAIPUR (SUPRA), THE LIABILITY FOR THE EXPENSES WAS FINALLY SETTLED AND CRYSTALLISED IN THE YEAR UNDER CONSIDERATION. ACCOR DINGLY, WE SET ASIDE THE FINDING OF THE LD. CIT(A) ON THE ISSUE IN DISPUTE AND DELETE THE ADDITION MADE BY THE ASSESSING OFFICER F OR PRIOR PERIOD EXPENSES OF 1,58,512/-. THE GROUND OF THE APPEAL OF THE ASSESSEE IS ACCORDINGLY ALLOWED. 9. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMIS SED WHEREAS THE APPEAL OF THE ASSESSEE IS ALLOWED PARTL Y. ORDER PRONOUNCED IN THE OPEN COURT ON 19 TH MARCH, 2021 SD/- SD/- (SUCHITRA KAMBLE) (O.P. KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 19 TH MARCH, 2021. RK/- (DTDS) COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI