ACIT, Cir.-3, Nanded V. Bhagyalaxmi Mahila Sah. Bank Ltd., Nanded

ITA 793/PUN/2011

• Counselvise Citation: [2012] 120 COUNSELVISE.COM (IT) 0020 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 3 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-09-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 24-09-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 10-06-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANN KAPTHUAMA
• Assessee Lawyers: S P JOSHI; KIRTI JOSHI
• Keywords: Business expenditure; Revised return
• Section: 143(3); 37(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND R.S. PADVEKAR, JUDICIAL MEMBER ITA NO. 793/PN/2011 (ASSESSMENT YEAR: 2007-08) ASSTT. CIT CIR. 3, NANDED .. APPELLANT VS. BHAGYALAXMI MAHILA SAHAKARI BANK LTD., MAHAVEER CHOWK, NANDED. PAN AAAAT 9610 Q RESPONDENT C.O. NO. 57/PN//2011 ARISING OUT OF ITA NO. 793/PN/2011 (ASSESSMENT YEAR: 2007-08) BHAGYALAXMI MAHILA SAHAKARI BANK LTD., MAHAVEER CHOWK, NANDED. PAN AAAAT 9610 Q CROSS OBJECTOR VS. ASSTT. CIT CIR. 3, NANDED APPELLANT IN APPEAL ASSESSEE BY: SHRI S.P. JOSHI AND MS. KIRTI JOSHI DEPARTMENT BY: MS. ANN KAPTHUAMA ORDER PER G.S. PANNU, A.M.: THE APPEAL BY THE REVENUE AND THE CROSS OBJECTION BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF THE COMM ISSIONER OF INCOME-TAX (APPEALS)- AURANGABAD DATED 7-2-2011 WHI CH, IN TURN, HAVE ARISEN FROM ORDER DATED 30-12-2009 PASSED BY THE ASSESSING OFFICER, UNDER SECTION 143(3) OF THE INCOME-TAX ACT , 1961 (IN SHORT THE ACT), PERTAINING TO THE ASSESSMENT YEAR 2007-0 8. 2. THE REVENUE IN ITS APPEAL HAS RAISED THE FOLLOWI NG GROUNDS: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LD. CIT(A) AURANGABAD WAS NOT JUSTIFIED IN DELE TING ADDITION MADE ON ACCOUNT OF STICKY ADVANCES OF RS. 36,97,369/-. THE LD. CIT(A) ERRED IN HOLDING THAT RATIO OF THE HONBLE APEX COURTS DECISION IN THE CASE OF UC O BANK VS. CIT (1991) 237 ITR 889 (SC) IS APPLICABLE TO 2 ITA NO 793/PN/11 BHAGYA LAXMI MAHILA SAH. BANK A.Y. 2007-08 THE INSTANT CASE WHICH LAYS DOWN THAT INTEREST ON A LOAN WHOSE RECOVERY IS DOUBTFUL AND WHICH HAS NOT BEEN RECOVERED BY THE ASSESSEE BANK FOR LAST THREE YEARS BUT HAS NOT BEEN KEPT IN A SUSPENSE ACCOUNT AND HAS NOT BEEN BROUGHT TO P & L A/C OF THE ASSESSEE COULD NO T BE INCLUDED IN THE INCOME OF THE ASSESSEE. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) AURANGABAD DID NOT CONSIDER THE CIRC ULAR NO. F.201/81/84 ITA-II DATED 9-10-1984 MINUTELY, WH ICH REVEALS THAT THE CIRCULAR HAS LAID DOWN TWO CONDITI ONS FOR AVAILING THE BENEFIT OF THE CIRCULAR I.E. (1) THE A SSESSEE SHOULD BE A BANKING COMPANY AND (2) SUCH INTEREST SHOULD HAVE REMAINED UNCOVERED FOR CONSECUTIVELY FO R THREE PREVIOUS YEARS. IT IS OBSERVED THAT THE ASSE SSEE HAS NOT FULFILLED BOTH THE CONDITIONS. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) AURANGABAD WAS NOT JUSTIFIED IN DELE TING THE ADDITION MADE AT RS.95,86,440/- ON ACCOUNT OF INTEREST ACCRUED ON DEPOSITS WITH NANDED DIST. CENT RAL CO-OP. BANK LTD., WRONGLY HOLDING THAT THE SAID INT EREST WHICH HAS NOT BEEN CREDITED TO P & L A/C HAS TO BE TAXED ON RECEIPT BASIS. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) AURANGABAD WAS NOT JUSTIFIED IN DELE TING THE ADDITION MADE AT RS. 24,31,102/- ON ACCOUNT OF PAYMENT OF EX-GRATIA ON THE GROUND THAT SUCH A PAYM ENT OF EX-GRATIA IS A BENEFIT WHICH THE ASSESSEE HAS TO PASS ON TO THE EMPLOYEES, AND THE SAME IS ALLOWABLE U/S 37(1) EVEN THOUGH IT IS IN EXCESS OF LIMITS FIXED UNDER B ONUS ACT. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) AURANGABAD WAS NOT JUSTIFIED IN DELE TING THE ADDITION MADE ON ACCOUNT OF LEAVE 4ENCASHMENT A T RS. 7,73,584/-. THE LD. CIT(A) HAS ERRED IN RELYIN G ON THE ASSESSEES SUBMISSION THAT THE AMOUNT OF LEAVE ENCASHMENT HAS ACTUALL7Y BEEN PAID TO THE EMPLOYEES AND DEDUCTION TO THIS EXTENT IS ALLOWABLE TO THE ASSESSEE. 3. AT THE OUTSET, IT IS COMMON GROUND THAT GROUNDS NO. 1 AND 2 OF THE APPEAL RAISED BY THE REVENUE ARE COVERED IN FAV OUR OF THE ASSESSEE BY THE DECISION OF CO-ORDINATE BENCH OF TH E TRIBUNAL IN THE CASE OF ACIT CIR. 3, NANDED VS. OSMANABAD JANTA SAH AKARI BANK LTD. LATUR IN ITA NO. 795/PN/2011 FOR A.Y. 2007-08 DATED 31-8-2012 WHEREIN THE ISSUE HAS BEEN DECIDED BY OBSERVING AS UNDER: IN THE CASE BEFORE US, ADMITTEDLY, ASSESSEE HAS DI RECTLY TAKEN THE INTEREST TO THE BALANCE SHEET AND IT IS N OT ROUTED THROUGH THE P & L A/C. MOREOVER, THE ISSUE OF THE TAXABILITY OF THE INTEREST ON THE STICKY LOSSES/ADV ANCES, IS 3 ITA NO 793/PN/11 BHAGYA LAXMI MAHILA SAH. BANK A.Y. 2007-08 COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION O F THE CO-ORDINATE BENCHES IN THE CASE OF DY. CIT VS. THE DURGA CO-OPERATIVE URBAN BANK LTD., VIJAYAWADA IN I TA NO. 511/VIZAG/2010 DATED 10-3-2011 AND KARNAVATI CO - OP. BANK LTD., VS. DY. CIT (134 ITD 486 (AHMEDABAD) . WE FIND NO REASON TO INTERFERE WITH THE REASONED OR DER OF THE LD. CIT(A) AND ACCORDINGLY THE SAME IS CONFIRME D. IN THE RESULT, THE REVENUES GROUND IS DISMISSED. SINCE THE FACTS OF THE PRESENT CASE ARE ON AN IDENT ICAL FOOTING, FOLLOWING THE AFORESAID DECISION OF THE TRIBUNAL IN THE CASE OF OSMANABAD JANTA SAH. BANK LTD. (SUPRA), GROUNDS OF APPEAL NO. 1 AND 2 ARE DECIDED IN FAVOUR OF THE ASSESSEE AND AGA INST THE REVENUE. 4. IN SO FAR AS GROUND NO. 3 IS CONCERNED, THE FACT S ARE THAT THE ASSESSEE-BANK VIDE ITS RETURN ORIGINALLY FILED ON 2 -11-2007 DECLARED INCOME AT RS. 1,61,00,330/- WHICH WAS SUBSEQUENTLY REVISED ON 24-4-2008 WHEREIN THE TOTAL INCOME DECLARED WAS RED UCED TO RS. 1,36,18,290/-. THE ASSESSING OFFICER NOTICED T HAT ON AN AMOUNT OF RS. 95,86,440/- REPRESENTING INTEREST ON FDRS WI TH NANDED DISTRICT CO-OP. CENTRAL CO-OP. BANK LTD (IN SHORT N DCC BANK) HAD NOT BEEN RECEIVED BECAUSE IT WAS UNDER FINANCIAL PR OBLEMS. THE ASSESSING OFFICER HOWEVER, WAS OF THE OPINION THAT SINCE ASSESSEE- BANK HAD ADOPTED MERCANTILE SYSTEM OF ACCOUNTING, T HE INTEREST ON FDRS WITH NDCC BANK ACCRUED WITH PERIOD OF TIME AND THEREFORE, INTEREST OF RS. 95,86,440/- PERTAINING TO THE YEAR UNDER CONSIDERATION WAS LIABLE TO BE TAXED IN THIS YEAR ITSELF ON ACCRU AL BASIS. ACCORDINGLY, A SUM OF RS. 95,86,440/- REPRESENTING INTEREST ON FDRS WITH NDCC BANK FOR THE YEAR UNDER CONSIDERATION WAS ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 5. IN APPEAL, THE ASSESSEE MADE VARIOUS SUBMISSIONS , INTER ALIA, POINTING OUT THAT THE RESERVE BANK OF INDIA HAS INV OKED SECTION 35A 4 ITA NO 793/PN/11 BHAGYA LAXMI MAHILA SAH. BANK A.Y. 2007-08 OF THE R.B.I. ACT, IN THE CASE OF NDCC BANK WHEREBY NDCC BANK WAS BARRED FROM ACCEPTING ANY DEPOSITS/GIVING LOANS AND ALSO RESTRAINED THE BANK FROM ACCEPTING THE CASH IN SAVI NG OR CURRENT ACCOUNTS. CONSIDERING THE AFORESAID, THE CIT(A) HA S DELETED THE ADDITION BY MAKING THE FOLLOWING DISCUSSION IN PARA 5.3 OF HIS ORDER. I HAVE CONSIDERED FACTS OF THE CASE, AOS ORDER, APPELLANTS SUBMISSION AND POSITION OF LAW. IT HAS BEEN SUBMITTED BY THE APPELLANT THAT INTEREST ON FDR WIT H NDCC BANK, NANDED HAS NOT ACCRUED AS THE NDCC BANK HAS BEEN BARRED BY THE RBI FROM REPAYING THE EXISTI NG DEPOSITS. IT HAS BEEN SUBMITTED THAT THE INVESTMEN TS ARE ALSO SUBJECT TO THE PRUDENTIAL NORMS ON INCOME RECOGNITION. IT IS OBVIOUS THAT THE INTEREST ON SU CH INVESTMENT HAS TO BE TREATED SAME AS INTEREST ON NPA/BAD AND DOUBTFUL DEBT. THE RBI CIRCULAR HAS COVERED INTEREST ON BOTH OF THESE FACTS, THE INTERE ST OF RS. 95,86,440/- WHICH HAS NOT BEEN CREDITED TO THE PROFIT AND LOSS ACCOUNT HAS TO BE TAXED ON RECEIPT BASIS WHENEVER IT IS RECEIVED FOR THE REASONS MENTIONED I N PRECEDING PARAGRAPHS. HOWEVER, THE ASSESSING OFFIC ER MAY ADD THE INTEREST ON ACCRUAL BASIS WHENEVER THE NDCC BANK IS ALLOWED BY THE RBI TO REPAY THE DEPOSI TS OR THE INTEREST TO THE APPELLANT BANK. HENCE THE A DDITION IS DELETED SUBJECT TO ABOVE OBSERVATIONS. 6. BEFORE US, THE LEARNED DR APPEARING FOR THE REV ENUE REITERATED THE GROUNDS OF APPEAL RAISED BY THE REVE NUE WHICH IS TO THE EFFECT THAT THE CIT(A) WAS WRONG IN DELETING T HE ADDITION WITH REGARD TO INTEREST ON DEPOSITS WITH NDCC BANK BY W RONGLY OBSERVING THAT SUCH INTEREST HAS NOT BEEN CREDITED TO THE P & L A/C. THE LEARNED DR FURTHER SUBMITTED THAT THE CIT(A) WA S WRONG IN HOLDING THAT SUCH INCOME WAS TO BE TAXED ON RECEIPT BASIS. ON THE OTHER HAND, THE LEARNED REPRESENTATIVE FOR THE RESP ONDENT-ASSESSEE SUBMITTED THAT THE CIT(A) WAS JUSTIFIED IN DELETING THE ADDITION, INASMUCH AS EVEN AS PER THE PRUDENTIAL NORMS AND IN COME RECOGNITION POLICY LAID DOWN BY THE RESERVE BANK OF INDIA, NO INCOME CAN ACCRUE TO THE BANK ON SUCH DEBTS WHICH A RE DOUBTFUL OF RECOVERY, INASMUCH AS THERE WAS A MORATORIAM ON THE NDCC BANK TO ACCEPT/REFUND THE DEPOSITS. 5 ITA NO 793/PN/11 BHAGYA LAXMI MAHILA SAH. BANK A.Y. 2007-08 7. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS. IN THIS CASE, THE DISPUTE IS WITH RESPECT TO AN AMOUNT OF R S. 95,86,440/- WHICH IS STATED TO BE INTEREST ON FDRS PLACED WITH NDCC BANK. IN THE REVISED RETURN FILED BY THE ASSESSEE ON 24-4-20 08 WHICH WAS ACCOMPANIED BY A REVISED P & L A/C, THE INTEREST OF RS. 95,86,440/- ON FDRS WITH NDCC BANK WAS NOT ACCOUNTED FOR AS INC OME. THE ASSESSING OFFICER HOWEVER, ASSESSED THE SAME IN THE YEAR UNDER CONSIDERATION ON THE GROUND THAT THE ASSESSEE WAS F OLLOWING MERCANTILE SYSTEM OF ACCOUNTING AND THUS, SUCH INCO ME INDEED ACCRUED IN THE HANDS OF THE ASSESSEE. THE CIT(A) H OWEVER, HAS NOTICED ASSESSEES PLEA THAT THE RESERVE BANK OF IN DIA HAD INVOKED THE PROVISIONS OF SECTION 35A OF THE R.B.I. ACT AS A RESULT OF WHICH NDCC BANK WAS RESTRAINED FROM DOING EVEN ROUTINE BU SINESS OF ACCEPTING DEPOSITS/GIVING LOANS AND NDCC BANK WAS F URTHER RESTRAINED FROM ACCEPTING CASH IN SAVING OR CURRENT ACCOUNT OR REPAYING EXISTING DEPOSITS. THE CIT(A), IN THIS BA CKGROUND HAS INFERRED THAT THE INTEREST AMOUNT OF RS. 95,86,440/ - ON FDRS WITH NDCC BANK CANNOT BE TAXED TILL SUCH TIME NDCC BANK IS ALLOWED BY THE RESERVE BANK OF INDIA TO CARRY ON THE BUSINESS TRANSACTIONS OF ACCEPTING OF FRESH DEPOSITS AND REPAYING OF EXISTIN G DEPOSITS. THE CIT(A)HAS FURTHER DIRECTED THAT THE ASSESSING OFFIC ER MAY TAX THE INTEREST ON FDRS ON ACCRUAL BASIS WHENEVER NDCC BAN K IS ALLOWED BY THE RESERVE BANK OF INDIA TO CARRY OUT ITS ROUTI NE BUSINESS TRANSACTIONS. IN OUR CONSIDERED OPINION, THERE IS NO DISPUTE TO THE FACTUAL POSITION THAT THE NDCC BANK IS RESTRAINED F ROM CARRYING ON ROUTINE BUSINESS TRANSACTIONS, INTER ALIA, WHICH PE RTAINS TO ACCEPTING FRESH DEPOSITS AND/OR REPAYING EXISTING DEPOSITS, ETC. AS A CONSEQUENCE, IT IS QUITE CLEAR THAT THERE IS A GENU INE IMPAIRMENT ON THE PART OF THE ASSESSEE TO EARN THE IMPUGNED AMOUN T OF INTEREST ON FDRS WITH NDCC BANK. IN THIS BACKGROUND, THE ULTIMA TE DIRECTION OF 6 ITA NO 793/PN/11 BHAGYA LAXMI MAHILA SAH. BANK A.Y. 2007-08 THE CIT(A) THAT THE ASSESSING OFFICER MAY TAX THE I NTEREST ON ACCRUAL BASIS, WHENEVER NDCC BANK IS ALLOWED BY THE RESERVE BANK OF INDIA TO REPAY DEPOSITS OR INTEREST TO THE ASSES SEE, IS REASONABLE AND CANNOT BE FAULTED WITH. WE ACCORDINGLY FIND NO JUSTIFIABLE REASONS TO UPHOLD THE ACTION OF THE ASSESSING OFFIC ER IN TAXING THE AMOUNT OF RS. 95,86,440/- IN THE YEAR UNDER CONSIDE RATION. THUS THE REVENUE FAILS ON THIS GROUND OF APPEAL. 6. GROUND NO. 4 RELATES TO DELETION OF ADDITION MAD E ON ACCOUNT OF PAYMENT OF EX-GRATIA AMOUNTING TO RS. 24,31,102 /-. THE ASSESSING OFFICER OBSERVED THAT THE SAID PAYMENT IS VOLUNTARY AND NOT A STATUTORY OBLIGATION OF THE ASSESSEE. ACCORD ING TO THE ASSESSING OFFICER SINCE THE IMPUGNED AMOUNT IS NOT COVERED UNDER PAYMENT OF BONUS ACT OR FACTORIES ACT, HE DISALLOWE D THE SAME AND ADDED IT TO THE TOTAL INCOME OF THE ASSESSEE. IN A PPEAL, THE CIT(A) DIRECTED THE ASSESSING OFFICER TO VERIFY THE FACTS AND ALLOW THE DEDUCTION IF PAYMENT HAS BEEN MADE, BY OBSERVING AS UNDER: I HAVE CONSIDERED FACTS OF THE CASE, AOS ORDER, APPELLANTS SUBMISSION AND POSITION OF LAW. AS PER LAW THE EX-GRATIA PAYMENT, IN EXCESS OF THE LIMITS PRES CRIBED UNDER THE PAYMENT OF BONUS ACT EITHER U/S 36(1)(II) OR SECTION 37(1) OF THE ACT, IS ALLOWABLE AS BUSINESS EXPENDITURE ALTHOUGH THE PAYMENT DOES NOT COVER CONTRACTUAL OR CUSTOMARY PAYMENT. IN THIS REGARD RELIANCE IS ALSO PLACED ON THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. MAINA ORE TRANSPORT (P) LTD. 218 CTR 653 (BOM). IN THIS CASE THE HONBLE COURT HAS UPHELD THE DECISION OF THE HONBL E TRIBUNAL AND HELD AS UNDER THAT EX GRATIA PAYMENT IN EXCESS OF THE LIMITS PRESCRIBED UNDER THE PAYMENT O F BONUS ACT, 1965, IS ALLOWABLE AS BUSINESS EXPENDITU RE, ALTHOUGH THE PAYMENT DID NOT COVER CONTRACTUAL PAYM ENT OR CUSTOMARY PAYMENT, HENCE, IF PAYMENT IS MADE ON ACCOUNT OF EX-GRATIA FOR WHOLLY AND EXCLUSIVE FOR T HE PURPOSE OF THE BUSINESS THEN IT IS ALLOWABLE EXPEND ITURE. HOWEVER, SAME IS ALLOWABLE ON ACTUAL PAYMENT BASIS, NOT ON THE BASIS OF PROVISIONS. IN THE PRESENT CAS E THE ASSESSEE HAS MADE PROVISION FOR EX-GRATIA HOWEVER, THERE IS NO SUPPORTING DOCUMENT FOR PAYMENT. HENCE , AO IS DIRECTED TO VERIFY THE FACTS AND ALLOW THE DE DUCTION IF PAYMENT HAS BEEN MADE. THE GROUND IS ALLOWED SUBJECT TO VERIFICATION. 7 ITA NO 793/PN/11 BHAGYA LAXMI MAHILA SAH. BANK A.Y. 2007-08 7. HAVING HEARD THE RIVAL SUBMISSIONS AND PERUSED T HE MATERIAL ON RECORD, WE FIND NO ERROR ON THE PART OF THE CIT( A) IN GIVING A DIRECTION TO THE ASSESSING OFFICER TO VERIFY THE FA CTS AND THEN ALLOW THE DEDUCTION SUBJECT TO PAYMENT HAVING BEEN MADE. WE UPHOLD THE ORDER OF THE CIT(A) ON THIS ISSUE. 8. THE NEXT GRIEVANCE OF THE REVENUE IS WITH REGARD TO ACTION OF THE CIT(A) IN DELETING THE ADDITION OF RS. 7,73,584 /- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF LEAVE ENCASHMENT. THE ASSESSING OFFICER HAS DISALLOWED THE EXPENDITURE BY OBSERVING THAT IT PERTAINED TO PRIOR PERIOD, HENCE NOT LIABLE TO BE ALLOWED IN THE CURRENT YEAR ON PAYMENT BASIS. THE CIT(A) HAS SINCE DELETED THE AD DITION BY NOTICING THE SUBMISSION OF THE ASSESSEE AS CONTAINE D IN PARA 8.1 OF IMPUGNED ORDER TO THE EFFECT THAT THE IMPUGNED AMO UNT OF EXPENDITURE ON LEAVE ENCASHMENT HAS ACTUALLY BEEN P AID DURING THE YEAR. 9. BEFORE US, THE LEARNED DR HAS NOT DISPUTED THE F ACTUM OF ASSESSEE HAVING ACTUALLY PAID OUT THE LEAVE ENCASHM ENT EXPENSES AMOUNTING TO RS. 7,73,584/-. AT THE TIME OF HEARIN G BEFORE US, THE LEARNED COUNSEL FOR THE RESPONDENT ASSESSEE REFERRE D TO PAGE 38 OF THE PAPER BOOK WHEREIN IS PLACED A LEDGER ACCOUNT O F LEAVE SALARY PAYABLE. THE LEARNED COUNSEL EXPLAINED THAT DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD NOT MADE ANY PROVIS ION FOR ITS ANTICIPATED LEAVE ENCASHMENT LIABILITY AND IN THIS REGARD POINTED OUT THAT THE OPENING BALANCE OF THE PROVISION FOR LEAVE ENCASHMENT AT RS. 21,59,637/- WAS THE SAME AS ON 31-3-2007 I.E. A T THE END OF THE YEAR ALSO. THE ACCOUNT STATEMENT SHOWS THAT THE EXP ENDITURE CLAIMED AND ACTUALLY PAID DURING THE YEAR AMOUNTED TO RS. 7,73,584/- WHICH REFLECTS THE LIABILITY ARISING DUR ING THE YEAR ITSELF 8 ITA NO 793/PN/11 BHAGYA LAXMI MAHILA SAH. BANK A.Y. 2007-08 AND IT HAS BEEN ACTUALLY PAID. IN THIS VIEW OF AB OVE FACTUAL MATRIX, WE FIND THAT THE CIT(A) MADE NO ERROR IN DELETING T HE ADDITION FOR THE REASONS STATED IN HIS ORDER. ON THIS GROUND, REVEN UE FAILS. 10. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISS ED. 11. COMING TO THE CROSS OBJECTION FILED BY THE ASSE SSEE, IT SUPPORTS THE ORDER OF THE CIT(A) AND NO NEW GROUNDS HAVE BEEN RAISED. SO, THE CROSS OBJECTION FILED BY THE ASSES SEE IS DISMISSED AS INFRUCTUOUS. 12. IN THE RESULT, BOTH, THE APPEAL OF THE REVENUE AND THE CROSS OBJECTION FILED BY THE ASSESSEE ARE DISMISSED. DECISION PRONOUNCED IN THE OPEN COURT ON 27 TH SEPTEMBER 2012. SD/- SD/- (R.S. PADVEKAR) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE, DATED: 27 TH SEPTEMBER 2012 ANKAM COPY TO:- ASSESSEE DEPARTMENT THE CIT (A) AURANGABAD THE CIT AURANGABAD THE DEPARTMENTAL REPRESENTATIVE, A BENCH, I.T .A.T., PUNE. BY ORDER //TRUE COPY// SR. P.S. I.T.A.T., PUNE