DCIT, Jaipur V. RAJASTHAN STATE BEVERAGES CORPORATION LIMITED, Jaipur

ITA 795/JPR/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 5444 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-02-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 25-11-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: B M DASOT CA DHK
• Keywords: Competent authority; Revenue expenditure
• Section: 43B

Judgement Text

ITA NO. 795/JP/2014 THE DCIT, CIRCLE- 6, JAIPUR VS. M/S. THE RAJASTHA N STATE BEVERAGES CORPORATION LTD. 1 VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH VKJ-IH-RKSYKUH] U;KF;D LNL; ,OA JH FOE FLAG ;KN O] YS[KK LNL; DS LE{K BEFORE:SHRI R.P.TOLANI, JM & SHRI VIKRAM SINGH YADA V, AM VK;DJ VIHY LA-@ ITA NO. 795/JP/2014 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2011-12 THE DCIT CIRCLE- 6 KOTA CUKE VS. M/S. THE RAJASTHAN STATE BEVERAGES CORPORATION LTD., IST FLOOR, D-BLOCK, VITTA BHAWAN, JANPATH, JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: AACCR 9522 R VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SHRI M.S. MEENA, CIT -DR FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI B.M. DASOT, CA LQUOKBZ DH RKJH[K@ DATE OF HEARING : 16/02/2016 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 18 /02/2016 VKNS'K@ ORDER PER R.P. TOLANI, JM:- THE REVENUE HAS FILED AN APPEAL AGAINST THE ORDER OF THE LD. CIT(A)-II, JAIPUR DATED 25-09-2014 FOR THE ASSESSMENT YEAR 201 1-12 WHEREIN FOLLOWING GROUNDS HAVE BEEN RAISED BY THE REVENUE. (I) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) ERRED IN DELETIN G THE ADDITION OF RS. 29.00 CRORES MADE BY THE AO BY DISALLOWING T HE PAYMENT OF PRIVILEGE FEES WITHOUT APPRECIATING THE FACT THAT SAID PAYMENT WAS APPLICATION OF INCOME OR APPROPRIA TION OF PROFIT AND ALSO THE FACT THAT THESE EXPENSES ARE OF CAPITAL NATURE. ITA NO. 795/JP/2014 THE DCIT, CIRCLE- 6, JAIPUR VS. M/S. THE RAJASTHA N STATE BEVERAGES CORPORATION LTD. 2 (II)(A) WHETHER ON THE FACTS AND IN THE CIRCUMSTANC ES OF THE CASE AND IN LAW THE LD. CIT(A) ERRED IN DELETIN G THE ADDITION OF RS. 16,99,447/- MADE FOR DEPOSITING THE EMPLOYEE S CONTRIBUTION TO PF BEYOND THE PRESCRIBED TIME LIMIT PROVIDED IN THE RESPECTIVE ACTS. (B) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE AND IN LAW THE LD. CIT(A) ERRED IN HOLDING THAT EMPLOYEES CONTRIBUTION TO PF ARE GOVERNED BY THE PR OVISION OF SECTION 43B AND NOT BY SECTION 36(1)(VA) R.W.S. 24( X) OF I.T. ACT. 2.1 AT THE OUTSET OF THE HEARING, THE LD. AR OF THE ASSESSEE REGARDING GROUND NOS. 1 AND 2 OF THE REVENUE (SUPRA) RELIED ON THE ORDER DATED 24-09-2015 OF ITAT JAIPUR BENCH IN ITA NO. 968/JP/2 013 FOR THE ASSESSMENT YEAR 2010-11 IN ASSESSEE'S OWN CASE WHER EIN SIMILAR ISSUES HAVE BEEN DECIDED AGAINST THE REVENUE BY FOLLOWING OBSER VATION OF COORDINATE BENCH (AT PARA 4 TO 5 RELATING TO GROUND NO. 1 AND PARA 6 TO 7 RELATING TO GROUND NO. 2). 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE GROUND PERTAINS TO PAYMENT OF PRIVILEGE FEES HAS BEEN ALLOWED AS REVENUE EXPENDITURE BY THI S BENCH OF THE TRIBUNAL IN THE MATTER OF RAJASTHAN STATE BEVERAGES CORPORATION LTD. IN ITA NO. 540/JP/2011 FOR THE A.Y. 2007-08 AND ALSO I N ITA NO. 166/JP/2012 FOR THE A.Y. 2008-09. THE RELEVANT FIN DING OF THE TRIBUNAL FOR THE A.Y. 2007-08 VIDE ITS ORDER DATED 21.10.2011 IN ITA NO. 540/JP/2011 IS REPRODUCED AS UNDER :- 14. THE LD. CIT(A) AFTER CONSIDERING THE OBSERVATIO N DELETED THE ADDITION AFTER OBSERVING AS UNDER:- ITA NO. 795/JP/2014 THE DCIT, CIRCLE- 6, JAIPUR VS. M/S. THE RAJASTHA N STATE BEVERAGES CORPORATION LTD. 3 IN THE PRESENT CASE THE ASSESSEE COMPANY WAS GRANTED EXCLUSIVE PRIVILEGES FOR WHOLESALE TRADE OF INDIAN MADE FOREIGN LIQUOR AND BEER IN THE STATE OF RAJAST HAN FOR THE FINANCIAL YEAR 2006-07 UNDER THE PROVISIONS OF THE RAJASTHAN EXCISE ACT, 1950 BY COMPETENT AUTHORITY U NDER THE SAID ACT. IN EXERCISE OF ITS POWERS U/S 30 AND 42 OF THE RAJASTHAN EXCISE ACT, 1950, THE COMPETENT AUTHO RITY UNDER THE SAID ACT HAS LEVIED A PRIVILEGES FEES OF RS. 15 CRORES FOR FINANCIAL YEAR 2006-07 VIDE ITS ORDER NO . F.4(5)/FD/EX/2005 DATED 28-03-2007 UPON THE ASSESSE E COMPANY IN LIEU OF GRANTING THE SAID PRIVILEGES. IN VIEW OF THESE FACTS AND FOLLOWING THE ORDER OF HON'BLE TRI BUNAL FOR ASSESSMENT YEAR 2006-07, I DIRECT THE AO TO DEL ETE THE ADDITION OF RS. 15 CRORES. THIS GROUND OF APPEAL IS ALLOWED. 15 AFTER HEARING BOTH THE PARTIES, WE FEEL THAT ISS UE BEFORE US STANDS COVERED BY THE ORDER OF THE TRIBUN AL IN THE CASE OF THE ASSESSEE FOR EARLIER YEARS AND HENC E WE DECLINE TO INTERFERE IN THE FINDING OF THE LD. CIT( A). THE ABOVE REFERRED PARAS 14 & 15 OF THE TRIBUNALS ORDER IN ITA NO. 540/JP/2011 FOR A.Y. 2007-08 HAS ALSO BEEN RELIED U PON BY THE TRIBUNAL WHILE DECIDING THE APPEAL OF THE ASSESSEE FOR THE S UBSEQUENT ASSESSMENT YEAR 2008-09 IN ITA NO. 166/JP/2012 DECIDED ON 28.1 1.2014. 5. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IN RESPECT OF THE ISSUE PERTAINS TO PAYMENT OF PRIVILEGE FEES OF RS. 24,00,00,000/- PAID TO THE ST ATE GOVERNMENT, WE FIND THAT THE ISSUE IS SQUARELY COVE RED BY THE DECISION OF THIS BENCH (SUPRA) IN EARLIER YEARS. RESPECTFULLY FOLLOWING THE EARLIER DECISIONS OF THE TRIBUNAL ON THE SAME I SSUE, THIS GROUND OF THE REVENUE IS DISMISSED. 6. WITH REGARD TO GROUND NO. 2(A) AND 2(B) RELATI NG TO DELETION OF ADDITION OF RS. 22,23,566/- IN RESPECT OF DEPOSI TING THE ESI AND PF, THE ITA NO. 795/JP/2014 THE DCIT, CIRCLE- 6, JAIPUR VS. M/S. THE RAJASTHA N STATE BEVERAGES CORPORATION LTD. 4 LD. D/R HAS RELIED UPON THE ORDER OF AO. HOWEVER, LD. CIT (A) HAS ALLOWED THE PAYMENT OF ESI AND PF CONTRIBUTIONS VIDE PARA 3. 3 OF HIS ORDER FOLLOWING THE ORDER OF HIS PREDECESSOR FOR THE A.Y. 2008-09. THE LD. COUNSEL FOR THE ASSESSEE CONTENDED THAT THE ASSESSE E DEPOSITED THE PAYMENT OF PF AND ESI BEFORE THE DUE DATE OF FILING OF RETURN FOR THE IMPUGNED ASSESSMENT YEAR WHICH IS IN ACCORDANCE WIT H THE PROVISIONS OF SECTION 43B OF THE ACT. THE LD. COUNSEL FOR THE AS SESSEE RELIED UPON THE DECISION OF APEX COURT IN THE MATTER OF CIT VS. VIN AY CEMENT, 213 CTR 268 AND ALSO RELIED UPON THE JUDGMENT IN THE CASE O F CIT VS. P.M. ELECTRONICS LTD., 313 ITR 161, CIT VS. AIMIL LTD. & OTHERS., 321 ITR 508 7. WE HAVE HERD RIVAL CONTENTIONS AND PERUSED THE M ATERIAL ON RECORD. WE FIND THAT THE JUDGMENT OF HONBLE SUPREM E COURT (SUPRA) IS SQUARELY APPLICABLE TO THE QUESTION RAISED IN GROUN D NO. 2(A) AND 2(B) IN FAVOUR OF THE ASSESSEE. MOREOVER, THE ISSUE RAISED BY THE REVENUE IN RESPECT OF GROUND NO. 2(A) AND 2(B) WERE ALSO RAISE D IN THE EARLIER YEARS AND THE DECISION OF THIS BENCH OF THE TRIBUNAL IS A LSO AVAILABLE IN THIS REGARD, IN FAVOUR OF THE ASSESSEE. HENCE, THE GROUN DS RAISED BY THE REVENUE ARE DEVOID OF ANY MERIT AND, THEREFORE, THE SAME ARE DISMISSED. 2.2 THE LD. DR SUPPORTED THE ORDER AO. 2.3 WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IT EMERGES FROM THE RECORD THA T THE ISSUES RAISED BY THE DEPARTMENT IN THE YEAR UNDER CONSIDERATION ARE IDEN TICAL TO THE FACTS AND CIRCUMSTANCES OF THE CASE WHICH HAVE BEEN DECIDED B Y THE COORDINATE BENCH AGAINST THE DEPARTMENT. THUS BOTH ISSUES ARE SQUARE LY COVERED FROM ITAT ORDER DATED 24-09-2015 IN ITA NO. 968/JP/2013 FOR T HE ASSESSMENT YEAR 2010-11 IN ASSESSEE'S OWN CASE. IN VIEW OF ABOVE DE LIBERATION, THE APPEAL OF THE DEPARTMENT IS DISMISSED. ITA NO. 795/JP/2014 THE DCIT, CIRCLE- 6, JAIPUR VS. M/S. THE RAJASTHA N STATE BEVERAGES CORPORATION LTD. 5 3.0 IN THE RESULT, APPEAL OF REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 18 /02/201 6. SD/- SD/- FOE FLAG ;KNO VKJ-IH-RKSYKUH (VIKRAM SINGH YADAV) (R.P.TOLANI) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 18 /02/ 2016 *MISHRA VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- THE DCIT, CIRCLE- 6, JAIPUR 2. IZR;FKHZ@ THE RESPONDENT-M/S. THE RAJASTHAN STATE BEVERAGES CORPORATION LTD. 3. VK;DJ VK;QDRVIHY ) @ CIT(A) 4. VK;DJ VK;QDR@ CIT 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO.795/JP/2014) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR