ACIT, Hyderabad V. M/s BHC Agro (India)Pvt.Ltd., Hyderabad

ITA 773/HYD/2008

• Counselvise Citation: [2011] 119 COUNSELVISE.COM (IT) 7131 (ITAT-HYDERABAD)
• Duration Of Justice: 3 year(s) 6 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-11-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 14-02-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 30-04-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B V RAO
• Keywords: Revenue expenditure; Capital expenditure
• Section: 43B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD BEFORE SHRI CHANDRA POOJARI, A.M AND SMT. ASHA VIJAYARAGHAVAN,J.M ITA NO.773/HYD/2008 ASSESSMENT YEAR 2004-05 ACIT, CIRCLE - 1(1), HYDERABAD. VS M/S. BHC AGRO (INDIA) PVT. LTD., HYDERABAD. (PAN: AAACB 8214 E) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI B.V. RAO RESPONDENT BY : NONE DATE OF HEARING: 14-11-2011. DATE OF PRONOUNCEMENT: -11-2011. O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER: THIS APPEAL PREFERRED BY THE REVENUE IS DIRECTED AG AINST THE ORDER OF THE CIT (A)-II, HYDERABAD DATED 13-3-2008 AND IT PERTAINS TO THE ASSESSMENT YEAR 2004-05 2. THE REVENUE RAISED THE FOLLOWING GROUNDS BEFORE US:- 1. THE CIT (A) OUGHT TO HAVE UPHELD THE ACTION OF THE AS SESSING OFFICER AS THE EXPENDITURE INCURRED WAS FOR TECHNIC AL KNOW- HOW AND NOT FOR TECHNICAL CONSULTANCY. ITA NO.773/HYD/2008 M/S. BHC AGRO INDIA PVT. LTD., HYD. L.L ========================== 2 2. THE CIT (A) OUGHT TO HAVE UPHELD THE FACT THAT THE TEC HNOLOGY TRANSFER CONFERRED AN ENDURING BENEFIT ON THE ASSES SEE AND IS IN THE NATURE OF CAPITAL EXPENDITURE. 3. DESPITE NOTICE, THERE WAS NO APPEARANCE O N BEHALF OF THE ASSESSEE-RESPONDENT DURING THE COURSE OF HEARING OF THIS APPEAL. HENCE, WE HAVE PROCEEDED TO DISPOSE OF THE MATTER E X PARTE AFTER HEARING THE LEARNED DEPARTMENTAL REPRESENTATIVE. IN THIS CASE, THE CIT (A) ALLOWED THE APPEAL OF THE ASSESSEE BY PLACING R ELIANCE ON THE EARLIER ORDER OF THE CIT (A) PASSED IN ITA NO.0006/CIT (A)- II/HYD/06-07 DATED 30-3-2007 WHEREIN HE ALLOWED THE CLAIM OF THE ASSES SEE HOLDING THAT THE PAYMENT WAS MADE FOR USE OF THE TECHNOLOGY AND NOT FOR ANY OUTRIGHT ACQUISITION. AS SUCH HE HELD THAT THE EXP ENDITURE HAS NOT BROUGHT ANY ENDURING BENEFIT AND THEREFORE IT IS IN THE NATURE OF REVENUE EXPENDITURE. AGAINST THIS FINDING OF THE CIT (A), T HE REVENUE HAS NOT FILED ANY APPEAL BEFORE HIGHER FORUM. WE FIND THAT THE REVENUE APPEAL IN ITA NO.674/HYD/2007 FOR ASSESSMENT YEAR 2003-04 BEFORE THE ITAT, IT HAS RAISED ONLY ONE GROUND RELATING TO THE ALLOW ABILITY OF PF CONTRIBUTION MADE BEFORE DUE DATE OF FILING OF THE RETURN AS PER THE PROVISIONS OF SECTION 43B OF THE ACT. IT WAS HELD THAT THE PAYMENTS CANNOT BE ALLOWED FOR THE ASSESSMENT YEAR 2003-04 A S THE PAYMENT HAS BEEN MADE IN THE FINANCIAL YEAR 2004-05. THIS BEIN G SO, THE ISSUE RAISED BY THE REVENUE WITH REGARD TO THE ALLOWABI LITY OF KNOW-HOW AS CAPITAL EXPENDITURE HAS BEEN ALREADY CONCLUDED AND REACHED ITS FINALITY IN ASSESSMENT YEAR 2003-04. THEREFORE, THE REVENUE CANNOT RAISE THIS GROUND BEFORE THE TRIBUNAL FOR ASSESSMENT YEAR 2004 -05 WITHOUT CHALLENGING THE ORDER OF THE CIT (A) FOR ASSESSMENT YEAR 2003-04 BECAUSE IN THE PRESENT ASSESSMENT YEAR UNDER CONSID ERATION, THE CIT (A) ONLY RELIED ON THE EARLIER ORDER OF HIS PREDECE SSOR FOR ASSESSMENT ITA NO.773/HYD/2008 M/S. BHC AGRO INDIA PVT. LTD., HYD. L.L ========================== 3 YEAR 2003-04. IN VIEW OF THE ABOVE, WE ARE INCLINED TO AGREE WITH THE FINDINGS OF THE CIT (A) FOR THE YEAR UNDER CONSIDER ATION AND REJECT THE GROUNDS RAISED BY THE REVENUE. 4. IN THE RESULT, THE APPEAL FILED BY THE REVENUE S TANDS DISMISSED. ORDER PRONOUNCED IN THE COURT ON 22 -11-2011 . SD/ - (SMT. ASHA VIJAYARAGHAVAN) SD/ - (CHANDRA POOJARI) JUDICIAL MEMBER. ACCOUNTANT MEMBER. DT/- 22 -11-2011. COPY FORWARDED TO: 1. ACIT, CIR - 1(3), 4 TH FLOOR, AAYAKAR BHAVAN, HYDERABAD. 2. M/S. BHC AGRO (INDIA) PVT. LTD., PLOT NO .519 - H, ROAD NO.28, JUBILEE HILLS, HYDERABAD - 500 033. 3. CIT(A)-II, HYDERABAD. 4. CIT, AP, HYDERABAD. 5. THE D.R., ITAT, HYDERABAD. JMR*