WOCKHARDT HOSPITALS LTD., MUMBAI V. DCIT 10(1), MUMBAI

ITA 805/MUM/2011

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3905 (ITAT-MUMBAI)
• Duration Of Justice: 5 year(s) 6 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-08-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Next Hearing Date: 12-05-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 28-01-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S K BEPARI
• Assessee Lawyers: DANESH BAFNA
• Keywords: Capital asset; Depreciation; Business expenditure; Earning of tax free income; Bad and doubtful debts; Valuation report; Onus to prove
• Section: 234B; 14A; 115JB; 37(1); 32

Judgement Text

G IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ./ I.T.A. NO. 805 /MUM/2011 ( / ASSESSMENT YEAR : 2008-09) ./ I.T.A. NO. 3002 /MUM/2013 ( / ASSESSMENT YEAR : 2009-10) M/S WOCKHARDT HOSPITALS LTD., WOCKHARDT TOWERS, BANDRA-KURLA COMPLEX, BANDRA(E), MUMBAI 400051. / V. DEPUTY COMMISSIONER OF INCOME TAX RANGE 10(1), AAYAKAR BHAVAN, MUMBAI-400 020 ./ PAN : AAACW3342G ( / APPELLANT ) .. ( / RESPONDENT ) ASSESSEE BY SHRI DANESH BAFNA REVENUE BY : SHRI S.K. BEPARI D.R. / DATE OF HEARING : 12.05.2016 / DATE OF PRONOUNCEMENT : 08-08-2016 / O R D E R PER RAMIT KOCHAR, ACCOUNTANT MEMBER THESE TWO APPEALS FILED BY THE ASSESSEE COMPANY FO R THE ASSESSMENT YEARS 2008-09 AND 2009-10 ARE DIRECTED AGAINST TWO SEPARATE ORDERS OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS), MUMBA I (HEREINAFTER CALLED THE CIT(A)) DATED 15-11-2010 AND 09-01-2013 FOR A SSESSMENT YEARS 2008- 09 AND 2009-10 RESPECTIVELY , THE APPELLATE PROCEED INGS BEFORE THE LEARNED CIT(A) ARISING FROM THE TWO SEPARATE ASSESSMENT ORD ERS DATED 16-04-2010 AND 28-12-2011 FOR ASSESSMENT YEARS 2008-09 AND 200 9-10 RESPECTIVELY PASSED BY THE LEARNED ASSESSING OFFICER (HEREINAFTE R CALLED THE AO) U/S ITA 805/M/11 & 3002/M/2013 2 143(3)(II) OF THE INCOME TAX ACT,1961 (HEREINAFTER CALLED THE ACT) . BOTH THE APPEALS ARE HEARD TOGETHER AND DISPOSED OF BY US BY THIS COMMON ORDER. 2. FIRST WE SHALL TAKE UP THE ASESSEE COMPANYS APP EAL IN ITA NO. 805/MUM/2011 FOR THE ASSESSMENT YEAR 2008-09. THE F OLLOWING GROUNDS OF APPEAL ARE RAISED BY THE ASSESSEE COMPANY IN ITA NO . 805/MUM/2011 FOR THE ASSESSMENT YEAR 2008-09 IN THE MEMO OF APPEAL FILED WITH THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI (HEREINAFTER CALLED THE TRIBUNAL) WHICH READS AS UNDER:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) - 22, MUMBAI ['CIT(A)'] ERRED IN CONFIRMING DISALLOWANCE OF DEPRECIATION OF RS. 14,76,563 ON THE 'MANAGEMENT RIGHTS' ACQUIRED BY THE APPELLANT DURIN G THE YEAR ENDING 31 MARCH 2005 AND CAPITALISED AS INTANGIBLES. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AN D IN LAW, THE LEARNED CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF PROPORTIONATE DEPRECIATION AMOUNTING TO RS. 12,29,860/- ON THE ADDI TION OF ASSETS SUCH AS UPS, SWITCHES AND CABLES, TO THE BLOCK OF 'C OMPUTERS'. THE LEARNED CIT(A) OUGHT TO HAVE ACCEPTED THE CLAIM O F DEPRECIATION @ 60% ON THESE ASSETS AS AGAINST 15%, SINCE THESE ARE PE RIPHERALS AND ESSENTIAL PART OF COMPUTERS. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AN D IN LAW, THE LEARNED CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF INTEREST AMOUNTING TO RS.92,83,374 PAID ON BORROWINGS UTILISED FOR THE PURPOSE OF ACQUISITION OF 100% SHARE CAPITAL OF KANISHKA HOUS ING DEVELOPMENT CO. LTD. THE LEARNED CIT(A) OUGHT TO HAVE ALLOWED DEDUCTION FO R INTEREST UNDER THE PROVISIONS OF SECTION 36(1 )(III) OF THE INCOME- TAX ACT, 1961 ('IT ACT') BEING INCURRED FOR THE PURPOSE OF BUSINESS. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AN D IN LAW, THE LEARNED CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF INTEREST ON BORROWING AMOUNTING TO RS. 21,52,125 ON THE PRESUMPTIO N THAT BORROWED FUND WERE UTILISED FOR PROVIDING INTEREST FR EE FUNDS TO M/S. PALANPUR HOLDINGS AND INVESTMENTS PRIVATE LIMITED. ITA 805/M/11 & 3002/M/2013 3 THE LEARNED CIT(A) FURTHER ERRED IN OBSERVING THAT THE APPELLANT HAS NOT SUBMITTED ANY DETAILS TO PROVE THE NEXUS THAT OWNED FUND S WERE UTILIZED FOR MAKING THE ADVANCE. 5. WITHOUT PREJUDICE TO GROUND NO. 4 ABOVE, THE LEARNED CIT(A) ERRED IN NOT APPRECIATING THAT IN THE ABSENCE OF ANY D IRECT NEXUS OF BORROWED FUND BEING UTILISED FOR AMOUNTS ADVANCED, TH E APPELLANT'S CONTENTION HAS TO BE ACCEPTED THAT ONLY OWNED FUNDS AR E UTILISED FOR THE PURPOSE. 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AN D IN LAW, THE LEARNED CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF INTEREST ON BORROWING AMOUNTING TO RS. 4,79,958 ON THE PRESUMPTI ON THAT BORROWED FUND WERE UTILISED FOR NON-BUSINESS PURPOSE , I.E. INVESTMENT IN MUTUAL FUNDS. THE LEARNED CIT(A) FURTHER ERRED IN OBSERVING THAT THE APPELLANT HAS NOT SUBMITTED ANY DETAILS TO PROVE THE NEXUS THAT OWNED FUND S WERE UTILISED FOR MAKING INVESTMENT. 7. WITHOUT PREJUDICE TO GROUND NO. 6 ABOVE, THE LEARNED CIT(A) ERRED IN NOT APPRECIATING THAT IN THE ABSENCE OF ANY D IRECT NEXUS OF BORROWED FUND BEING UTILISED FOR MAKING INVESTMENT, THE APPELLANT'S CONTENTION HAS TO BE ACCEPTED THAT ONLY OWNED FUNDS AR E UTILISED FOR THE PURPOSE. 8. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AN D IN LAW, THE LEARNED CIT(A) ERRED IN CONFIRMING THE FOLLOWING AD DITIONS MADE BY TO THE BOOK PROFIT COMPUTED UNDER SECTION 115JB OF THE IT ACT, ON THE PREMISE THAT THESE ARE UNASCERTAINED LIABILITIES: A. PROVISION FOR DOUBTFUL DEBTS OF RS. 15,29,058 B. PROVISION FOR GRATUITY OF RS. 42,17,911 C. PROVISION FOR LEAVE ENCASHMENT OF RS. 17,53,115 THE LEARNED CIT(A) ERRED IN OBSERVING THAT THE APPELLA NT HAS NOT EXPLAINED THE BALANCES AS PER THE FINANCIAL STATEMENTS AND ACTUARIAL VALUATION REPORTS. 3. THE BRIEF FACTS IN THIS CASE ARE THAT THE ASSESS EE COMPANY IS ENGAGED IN THE BUSINESS OF SETTING UP AND RUNNING A HOSPITAL A ND HAS EXPERTISE IN MANAGEMENT OF HEALTH CENTRES AND FACILITIES. ITA 805/M/11 & 3002/M/2013 4 4. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, IT WAS OBSERVED BY THE AO THAT THE ASSESSEE COMPANY HAS CLAIMED DEPRECIATION OF RS. 14,76,563/- ON THE MANAGEMENT RIGHTS ACQUIRED BY THE ASSESSEE DURI NG THE YEAR ENDING 31 ST MARCH, 2005 AND CAPITALIZED AS INTANGIBLES. THE A. O. DISALLOWED THE SAME IN THIS PREVIOUS YEAR ALSO WHICH CLAIM WAS DISALLOWED BY THE AO IN THE EARLIER YEARS ALSO ON THE SAME GROUNDS THAT THE ASSESSEE CO MPANY CLAIM OF PURCHASING MANAGEMENT RIGHTS OF NAGPUR HOSPITAL IS NOTHING BUT PREMIUM PAID FOR MANAGEMENT AGREEMENT, WHICH WAS A NON DEPR ECIABLE CAPITAL ASSET, WHICH WAS CONFIRMED BY THE LD. CIT(A) IN THE FIRST APPEAL FILED BY THE ASSESSEE COMPANY . IT WAS SUBMITTED BEFORE THE LEARNED CIT( A) THAT AS PER TERMS OF THE AGREEMENT, THE ASSESSEE COMPANY HAS ACQUIRED SIGNIF ICANT COMMERCIAL AND BUSINESS RIGHTS FROM DR. BAIS SURGICAL AND MEDICAL INSTITUTE PRIVATE LIMITED FOR A PERIOD OF 10 YEARS , EXTENDABLE FOR ANOTHER T WO TERMS OF 10 YEARS AT THE OPTION OF THE PARTIES. THE ASSESSEE COMPANY SUBMIT TED THAT AS PER PROVISIONS OF SECTION 32(1)(II) OF THE ACT, AN TAX-PAYER WHO H AS ACQUIRED INTANGIBLE RIGHTS AFTER 01-04-1998 BEING KNOW-HOW, PATENTS, COPY RIGH TS, TRADE MARKS , LICENSES AND FRANCHISE AND ANY OTHER BUSINESS OR CO MMERCIAL RIGHTS OF SIMILAR NATURE IS ELIGIBLE TO CLAIM DEPRECIATION ON SUCH IN TANGIBLE. THE LEARNED CIT(A) REJECTED THE CONTENTIONS ON THE GROUNDS THAT MANAGE MENT RIGHTS ARE NOT SPECIFICALLY INCLUDED IN SECTION 32(1)(II) OF THE A CT AND SUCH RIGHTS CANNOT BE CLAIMED AS COMMERCIAL RIGHTS OF SIMILAR NATURE. THE LEARNED CIT(A) ALSO HELD THAT THE ASSESSEE COMPANY HAS CAPITALIZED THE PAYME NTS MADE FOR THE ACQUISITION OF MANAGEMENT RIGHTS IN ITS BOOKS OF AC COUNTS AND HENCE THE SAME IS NOT ALLOWABLE AS EXPENSES U/S 37(1) OF THE ACT. 5. AGGRIEVED BY THE ORDER OF THE LD. CIT(A) , THE A SSESSEE COMPANY IS IN APPEAL BEFORE THE TRIBUNAL. 6. AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE COMPANY SUBMITTED THAT THIS GROUND IS SQUARELY COVERED BY THE DECISION OF THE MUMBAI TRIBUNAL IN ITA 805/M/11 & 3002/M/2013 5 ASSESSEE COMPANYS OWN CASE IN ITA NO. 2376-2378/MU M/2011 FOR THE ASSESSMENT YEARS 2005-06 TO 2007-08 VIDE CONSOLIDAT ED ORDERS DATED 10 TH JULY, 2015 READ WITH ORDERS IN M.A. NO. 207 TO 209/ MUM/2015 ARISING OUT OF ITA NO. 2376 TO 2378/MUM/2011 FOR THE ASSESSMENT YE ARS 2005-06 TO 2007- 08 VIDE ORDERS IN MA DATED 04-02-2016 , WHEREBY THE MUMBAI TRIBUNAL ALLOWED THE CLAIM OF THE ASSESSEE COMPANY FOR DEPRE CIATION ON MANAGEMENT RIGHTS. 7. THE LD. D.R. FAIRLY SUBMITTED THAT THE ISSUE IS COVERED AGAINST THE REVENUE BY AFORE-STATED ORDERS OF THE MUMBAI TRIBUN AL IN ASSESSEE COMPANYS OWN CASE FOR THE ASSESSMENT YEAR 2005-06 TO 2007-08. 8. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND PER USED THE MATERIAL AVAILABLE ON RECORD INCLUDING THE AFORE-STATED MUMB AI TRIBUNAL ORDERS. WE FIND THAT AS SUBMITTED BY THE LD. COUNSEL FOR THE A SSESSEE COMPANY , THIS GROUND IS COVERED IN FAVOUR OF THE ASSESSEE COMPANY BY THE DECISION OF CO- ORDINATE BENCH OF THIS TRIBUNAL IN ASSESSEE COMPANY S OWN CASE IN ITA NO. 2376-2378/MUM/2011 VIDE ORDERS DATED 10-07-2015 REA D WITH ORDERS IN MA NO. 207 TO 209/MUM/2015 DATED 04-02-2016. THE TRIBU NAL HAS NOTED THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF SM IFS SECURITIES LTD. REPORTED IN 348 ITR 302 WHEREBY THE HONBLE SUPREME COURT HELD THAT INTANGIBLE ASSETS IN THE FORM OF GOODWILL IS ELIGIB LE FOR CLAIM OF DEPRECIATION. THE RELEVANT PORTION OF THE AFORE-STATED MUMBAI TRI BUNALS ORDER DATED 04-02- 2016 ARE REPRODUCED BELOW:- 4. WE HAVE CONSIDERED RIVAL CONTENTIONS AND GONE T HROUGH THE ORDER OF THE TRIBUNAL DATED 10-7-2015, WHEREIN AT PARA 10 , THE TRIBUNAL HAS RESTORED ASSESSEES GROUND FOR CLAIM OF DEPRECIATIO N ON MANAGEMENT RIGHTS FOR DECIDING AS PER THE ORDER OF THE TRIBUNA L IN ASSESSEES OWN CASE IN THE PRECEDING YEAR. HOWEVER, THERE IS NO OR DER OF THE TRIBUNAL IN ASSESSEES OWN CASE, THEREFORE, IT AMOUNTS TO MISTA KE APPARENT FROM RECORD. THE TRIBUNAL IN ITS ORDER DATED 10-7-2015 AT PARA 9 HAS QUOTED ITA 805/M/11 & 3002/M/2013 6 VARIOUS DECISIONS OF THE HONBLE HIGH COURTS AND TR IBUNAL, WHEREIN DEPRECIATION WAS ALLOWED IN CASE OF INTANGIBLE ASSE TS. ACCORDINGLY, WE RECTIFY THE ORDER DATED 10-7-2015 TO THE EXTENT OF OBSERVATION MADE IN PARA 10 OF THE ORDER AND DIRECT THE AO TO ALLOW ASS ESSEES CLAIM OF DEPRECIATION FOLLOWING THE DECISIONS OF HONBLE HIG H COURT AND TRIBUNAL QUOTED IN PARA 9 OF OUR ORDER, DATED 10-7-2015. BEF ORE PARTING WITH THE MATTER, IT IS PERTINENT TO MENTION THAT RECENTLY TH E HONBLE SUPREME COURT IN THE CASE OF SMIFS SECURITIES LTD., 348 ITR 302, HELD THAT INTANGIBLE ASSETS IN THE FORM OF GOODWILL IS ELIGIBLE FOR CLAI M OF DEPRECIATION. RESPECTFULLY FOLLOWING THE AFORE-STATED DECISION OF THE CO-ORDINATE BENCH OF THIS TRIBUNAL IN AFORE-STATED ORDERS, WE ALLOW THE CLAIM OF DEPRECIATION OF RS.14,76,563/- ON MANAGEMENT RIGHTS MADE BY THE ASS ESSEE COMPANY. THIS DISPOSES OF GROUND NO. 1 RAISED BY THE ASSESSEE COM PANY IN THE GROUNDS OF APPEAL FILED IN MEMO OF APPEAL WITH THE TRIBUNAL. W E ORDER ACCORDINGLY. 9. THE NEXT GROUND RELATES TO DISALLOWANCE OF PROPO RTIONATE DEPRECIATION ON FIXED ASSETS AMOUNTING TO RS. 12,29,860/- ON THE ADDITIONS OF ASSETS SUCH AS UPS, SWITCHES AND CABLES, TO THE BLOCK OF COMPU TERS.. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE A.O. OBSERVED THAT T HE ASSESSEE COMPANY HAS CLAIMED DEPRECIATION ON THE FIXED ASSETS IN THE BLO CK OF COMPUTERS INCLUDING VARIOUS ASSETS WHICH ARE IN THE NATURE OF ELECTRICA L SWITCHES, PLANT/MACHINERY OR OFFICE EQUIPMENTS, DETAILS OF WHICH ARE AS UNDER :- SR. NO. PARTICULARS DATE AMOUNT (180 DAYS) I. 500VA UPS 30.11.2007 2,496 II. CABLE DTE MALE 10.10.2007 4,068 III. CABLE DTE MALE 30.11.2007 4,068 IV. CABLE DTE MALE 25.01.2008 4,068 V. CAT CABLE 30.11.2007 5,148 VI. CABLE CAT5 31.10.2007 5,350 VII. BATTERIES FOR UPS 31.03.2008 32,868 VIII. SUPPLY OF UPS 31.10.2007 39,870 IX. 10KVA UPS 10.10.2007 40,378 X. MODULAR ROUTER 10.10.2007 56,740 XI. MODULAR ROUTER 30.11.2007 56,740 ITA 805/M/11 & 3002/M/2013 7 XII. MODULAR ROUTER 25.01.2008 59,010 XIII. PROJECTOR 26.10.2007 66,375 XIV. MODULAR ROUTER 10.10.2007 78,384 XV. 6KVA UPS 31.10.2007 82,000 XVI. 6KVA UPS 26.10.2007 82,000 XVII. 6KVA UPS 30.11.2007 82,000 XVIII. 6KVA UPS 10.10.2007 1,05,149 XIX. 7.5 KVA UPS 25.10.2007 1,30,000 XX. PIPES & RACKS 10.10.2007 1,34,712 XXI. UPS SYSTEM 31.10.2007 1,81,641 XXII. CAT-6 CABLES 04.02.2008 3,99,636 XXIII. CABLE TRAYS 25.10.2007 4,75,437 XXIV. PIPES & RACKS 25.10.2007 5,43,251 XXV. UPS SYSTEM 30.11.2007 5,67,596 XXVI. BATTERIES FOR UPS 31.03.2008 5,97,600 XXVII. SWITCHES 31.03.2008 7,84,462 XXVIII. UPS 10.10.2007 8,45,000 TOTAL 54,66,047 DEPRECIATION @60%/2 16,39,814 DEPRECIATION @15%/2 4,09,954 EXCESS CLAIM 12,29,860 AS PER THE AO, THE FIXED ITEMS LIKE UPS, ROUTERS, S WITCHES AND CABLES, ARE NOT COMPUTERS AND HENCE INELIGIBLE FOR CLAIM OF DEPRECI ATION @60%. THE AO OBSERVED THAT THE ASSESSEE COMPANY HAS CLAIMED DEPR ECIATION @60% DEPRECIATION INSTEAD OF 15%. THE A.O. WAS OF THE O PINION THAT ROUTERS ARE USED TO CONNECT DIFFERENT CABLE LINES OF TELEPHONE/ INTERNET AND UPS IS JUST A BATTERY/INVERTER WHICH SUPPLIES ELECTRIC POWER TO T HE COMPUTER IN CASE OF SUDDEN POWER FAILURE WHILE CABLE AND SWITCHES ARE E LECTRICAL ITEMS , AND HENCE THE A.O. CONCLUDED THAT NONE OF THE ITEMS ARE IN THE NATURE OF COMPUTER THEREFORE THE CLAIM OF 60% DEPRECIATION IS UNJUSTIFIED. AGGRIEVED BY THE ASSESSMENT ORDER OF THE A.O., THE ASSESSEE COMP ANY FILED ITS FIRST APPEAL BEFORE THE LD. CIT(A) AND SUBMITTED THAT UPS, PRINT ER, MODEM, SWITCHES AND ROUTERS ARE INTEGRAL PART OF THE COMPUTER AND ENTIT LED FOR DEPRECIATION @ 60%. THE ASSESSEE COMPANY RELIED ON THE DECISION OF ITAT , MUMBAI BENCH IN THE CASE OF DCIT V. DATACRAFT INDIA LTD., [2010] 40 SOT 295 (MUM) AND ITAT,DELHI IN THE CASE OF ACIT V. CNICOM SYSTEMS INDIA PRIVATE LIMITED IN ITA NO. 1543(DEL)/2008 DATED 13.04.2009. THE LD. CIT(A) CO NSIDERED THE SUBMISSION ITA 805/M/11 & 3002/M/2013 8 OF THE ASSESSEE COMPANY AND HELD THAT THE ASSESSEE COMPANY IS ENTITLED TO DEPRECIATION @ 60% ON ROUTERS ONLY , BUT HOWEVER TH E ITEMS LIKE UPS, CABLE, BATTERIES, PROJECTOR, PIPES AND RACKS, TRAYS, SWITC HES ETC. THE ASSESSEE FAILED TO PROVE THAT THEY ARE PARTS OF THE COMPUTER, HENCE, D EPRECIATION IS NOT ALLOWABLE @ 60%. AGGRIEVED BY THE APPELLATE ORDER OF THE LD. CIT(A), THE ASSESSEE COMPANY IS IN SECOND APPEAL BEFORE THE TRIBUNAL. 10. THE LD. COUNSEL FOR THE ASSESSSEE COMPANY SUBMI TTED THAT UPS, CABLES, ELECTRICAL SWITCHES ETC. ARE INTEGRAL PARTS OF THE COMPUTER AND SHOULD BE CONSIDERED TO BE PERIPHERALS WHICH ARE REQUIRED TO RUN THE COMPUTER AND THESE ASSETS ARE ELIGIBLE FOR DEPRECIATION @ 60%. THE LD. COUNSEL RELIED ON THE FOLLOWING JUDICIAL DECISIONS:- 1. DCIT V. DATACRAFT INDIA (P) LTD., [2010] 40 SOT 295 (MUM)(SB) 2. IBAHN INDIA (P.) LTD. V. DCIT, ITA NO. 4932/MUM/201 5 3. AMERICAN EXPRESS SERVICES INDIA LTD. V. DCIT, (2013 ) 57 SOT 22(DEL-TRIB). 4. GE CAPITAL BUSINESS PROCESS MANAGEMENT SERVICES (P. ) LTD. V. ACIT, (2016) 136 ITD 239 (DEL-TRIB). 5. ACIT V. GLOBAL HEALTHLINE (P.) LTD., ITA NO. 3319/D EL/2012 (DEL- TRIB.) 11. THE LD. D.R., ON THE OTHER HAND, RELIED UPON TH E ORDER OF THE LEARNED CIT(A). 12. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND AL SO PERUSED THE MATERIAL AVAILABLE ON RECORD INCLUDING THE CASE LAWS. WE HA VE OBSERVED THAT THE ASSESSEE COMPANY HAS CLAIMED DEPRECIATION ON CERTAI N ASSETS WHICH WERE ACQUIRED BY THE ASSESSEE COMPANY BEING IN THE NATU RE OF UPS, ROUTERS, SWITCHES AND CABLES, PROJECTOR, PIPES AND RACKS ETC . FOR WHICH THE ASSESSEE ITA 805/M/11 & 3002/M/2013 9 COMPANY IS CLAIMING DEPRECIATION @ 60%. HOWEVER, T HE SAME WAS DENIED BY THE A.O. THE LD. CIT(A) ALLOWED DEPRECIATION @ 60% ON ROUTERS. IN OUR CONSIDERED VIEW, THE ASSESSEE COMPANY ACQUIRED THE FIXED ASSETS AND IF THE SAME ARE FORMING AN INTEGRAL PARTS OF THE COMPUTER SYSTEM WHICH CAN BE USED ALONG WITH A COMPUTER AND WHEN THEIR FUNCTIONS CAN BE INTEGRATED WITH A COMPUTER, DEPRECIATION IS TO BE ALLOWED @ 60%. H OWEVER IT SHOULD BE SEGREGATED AS INDICATED ABOVE AND AS SUCH WE SET AS IDE MATTER BACK TO THE FILE OF THE A.O. WITH A DIRECTION TO REVIEW THE ENTIRE L IST OF FIXED ITEMS AND THE ITEMS WHICH ARE AN INTEGRAL PARTS OF THE COMPUTERS WHICH CAN BE USED ALONG WITH A COMPUTER AND WHEN THEIR FUNCTIONS CAN BE INT EGRATED WITH A COMPUTER, THE DEPRECIATION IS TO BE ALLOWED @ 60% AND FOR THE REST OF THE ITEMS IN THE LIST, DEPRECIATION @ 15% MAY BE ALLOWED. THIS DISPO SES OF GROUND NO. 2 RAISED BY THE ASSESSEE COMPANY IN THE GROUNDS OF APPEAL FI LED IN MEMO OF APPEAL WITH THE TRIBUNAL.WE ORDER ACCORDINGLY. 13. THE NEXT GROUND RELATES TO DISALLOWANCE BY THE A.O. OF INTEREST AMOUNTING TO RS. 92,83,374/- PAID ON BORROWINGS FOR THE PURPOSE OF ACQUISITION OF 100% SHARE CAPITAL OF KANISHKA HOUSI NG DEVELOPMENT CO. LTD.(HERIENAFTER CALLED KANISHKA) , WHICH WERE CO NFIRMED BY THE LD.CIT(A).IT WAS OBSERVED BY THE AO THAT THE ASSESSEE COMPANY HA S MADE INVESTMENT OF RS.13,93,90,000/- IN A SUBSIDIARY COMPANY M/S KANIS HKA. THE ASSESSEE COMPANY SUBMITTED THAT THE SAID INVESTMENT WAS MADE TO ACQUIRE 100% SHAREHOLDING OF KANISHKA WHICH HAD A HUGE PIECE OF LAND, WHICH WAS REQUIRED FOR CONSTRUCTING HOSPITAL. THE SAID LAND HAS BEEN U TILIZED FOR CONSTRUCTING HOSPITAL AND THE SAME HAS BEEN LEASED TO THE ASSESS EE COMPANY BY KANISHKA. THE AO OBSERVED THAT KANISHKA HAS CONSTRUCTED THE H OSPITAL WITH INTERESTS FREE FUNDS FROM ASSESSEE COMPANY BY WAY OF CAPITAL CONTRIBUTION TO ACQUIRE 100% CONTROLLING INTEREST, WHILE ASSESSEE COMPANY B ORROWED INTEREST BEARING FUNDS AND CHARGED THE INTEREST AS REVENUE EXPENDITU RE WHILE COMPUTING INCOME CHARGEABLE TO TAX . THE SAID KANISHKA LEASED BACK THE HOSPITAL TO THE ITA 805/M/11 & 3002/M/2013 10 ASSESSEE COMPANY FOR CERTAIN CONSIDERATION. THE AO DISALLOWED THE INTEREST ON PROPORTIONATE BASIS AS THE ASSESSEE COMPANY HAD MIXED POOL OF OWN FUNDS AND INTEREST BEARING BORROWED CAPITAL, AGGREGATING TO RS.92,83,374/-. THE LEARNED CIT(A) UPHELD THE DISALLOWANCE FOLLOWING TH E PRECEDING YEARS ORDER FOR ASSESSMENT YEAR 2004-05 PASSED BY LEARNED CIT(A ). 14. AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE COMPANY SUBMITTED THAT THIS ISSUE IS SQUARELY COVERED BY THE DECISION OF T HE CO-ORDINATE BENCH OF THIS TRIBUNAL IN ASSESSEE COMPANYS OWN CASE IN ITA NO. 2376 TO 2378/MUM/2011 FOR THE ASSESSMENT YEARS 2005-06 TO 2 007-08 VIDE ORDERS DATED 10 TH JULY, 2015. THE LD. D.R. RELIED UPON THE ORDER OF THE LEARNED CIT(A). 15. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND AL SO PERUSED THE MATERIAL AVAILABLE ON RECORD INCLUDING THE AFORE-STATED ORDE RS OF THE TRIBUNAL DATED 10- 07-2015. WE FIND THAT THE TRIBUNAL IN ASSESSEES O WN CASE IN ITA NO. 2376 TO 2378/MUM/2011 FOR ASSESSMENT YEARS 2005-06 TO 2007- 08 VIDE ORDERS DATED 10 TH JULY, 2015 HAS SET ASIDE THE MATTER BACK TO THE FI LE OF THE A.O. FOR DECIDING THE SAME AFRESH IN ACCORDANCE WITH LAW. T HE TRIBUNAL IN THE AFORE- STATED ORDER OBSERVED AS UNDER:- 4. THE NEXT ISSUE PERTAINS TO DISALLOWANCE OF INTE REST PAID ON BORROWINGS UTILIZED FOR PURPOSE OF ACQUISITION OF 1 00% SHARE CAPITAL OF KANISHKA HOUSING DEVELOPMENT CO. LTD. 5. IT WAS CONTENDED BY LD. AR THAT NO DISALLOWANCE UNDER SECTION 14A CAN BE MADE SINCE THE ASSESSEE HAS NOT EARNED ANY D IVIDEND INCOME. FOR THIS PURPOSE RELIANCE WAS PLACED ON THE FOLLOWI NG DECISIONS :- I) CIT VS.DELITE ENTERPRISES, ITA NO.110/2009(BOM) II) CIT VS.WISDOM TEXTILE INDUSTRIES LTD., 319 ITR 204(P&H) III) CIT VS. SHIVAM MOTORS (P) LTD., ITA NO.88/2014 (ALL) IV) CIT VS. MASCOT FOOTCARE, ITA NO.67/2014(P&H) ITA 805/M/11 & 3002/M/2013 11 V) CIT VS. LAKHANI MARKETING INC., ITA NO.970/2008 (P&H) VI) CIT VS. CORRETCH ENERGY P.LTD., ITA NO.239/2014 (GUJ) VII) HOLCIM (INDIA) PVT. LTD. VS. DCIT, 37 CCH 423( DEL) VIII) AVSHESH MERCANTILE P. LTD.,148 TTJ 607(MUM) IX) SHREE SHAMKAMAL FINANCE & LEASING CO. P. LTD., 21 SOT 42 (MUM) AND X) ACIT VS. LAFARGE INDIA HOLDINGS (P) LTD.,19 SOT 121 (MUM) 6. IT WAS FURTHER BROUGHT TO OUR NOTICE THAT ASSESSEE HAS ACQUIRED SHARES OF KANISHKA IN ORDER TO ACQUIRE ITS LAND TO BUILD-UP HOSPITAL ON IT. THE INVESTMENTS WERE NOT MADE WITH THE INTEN TION OF EARNING DIVIDEND INCOME NOR ANY DIVIDEND WAS EARNED DURING THE YEAR AS WELL AS IN FUTURE YEARS. IN THESE CIRCUMSTANCES, BY RELYING ON THE FOLLOWING THE DECISIONS, LD. AR CONTENDED THAT NO D ISALLOWANCE SHOULD BE MADE U/S.36(1)(III) OF THE ACT :- I) ACIT VS. CHOICE TRADING CORP.LTD., 90 ITD 1 II) ATE ENTERPRISES LTD. VS. JCIT, 102 ITD 110; AND III) ACIT VS. LAFARGE INDIA HOLDINGS (P) LTD. 7. WE HAVE CONSIDERED RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ASSESSEE HAS CLAIMED TO HAVE INVESTMENT FOR ACQUIRI NG LAND FOR CONSTRUCTING ITS HOSPITAL. ON SUCH INVESTMENT, NEIT HER DURING THE YEAR NOR IN THE FUTURE YEARS ASSESSEE HAS EARNED ANY DIVIDEN D INCOME. KEEPING IN VIEW THE JUDICIAL PRONOUNCEMENTS REFERRED BY THE LD . AR, WE RESTORE THE MATTER BACK TO THE FILE OF AO FOR DECIDING AFRESH A S PER LAW. 16. RESPECTFULLY FOLLOWING THE AFORE-STATED DECISIO N OF THE CO-ORDINATE BENCH OF THIS TRIBUNAL IN ASSESSEES OWN CASE IN PRECEDIN G ASSESSMENT YEAR AS DETAILED ABOVE, WE SET ASIDE AND RESTORE THE ISSUE BACK TO THE FILE OF THE A.O. FOR DECIDING THE ISSUE AFRESH AS PER LAW AS INDICAT ED IN THE AFORE-STATED TRIBUNALS ORDER IN ITA NO. 2376-78/MUM/2011 DATED 10-07-2015. THIS DISPOSES OF GROUND NO. 3 RAISED BY THE ASSESSEE COM PANY IN THE GROUNDS OF APPEAL FILED IN MEMO OF APPEAL WITH THE TRIBUNAL. W E ORDER ACCORDINGLY. 17. THE NEXT ISSUE IS WITH RESPECT TO THE DISALLOWA NCE OF INTEREST ON BORROWING BY THE AO AMOUNTING TO RS. 21,52,125/- ON ACCOUNT OF INTEREST FREE ITA 805/M/11 & 3002/M/2013 12 FUNDS BEING UTILIZED FOR PROVIDING INTEREST FREE FU NDS TO M/S PALANPUR HOLDINGS AND INVESTMENTS PVT. LTD. IN THIS REGARD, THE A.O. OBSERVED THAT A LOAN OF RS. 5,80,00,000/- WAS GIVEN TO M/S PALANPUR HOLDINGS & INVESTMENTS P. LTD. ON WHICH NO INTEREST WAS CHARGED BY THE ASS ESSEE COMPANY. THE ASSESSEE COMPANY SUBMITTED THAT THE LOAN WAS GIVEN FOR THE PURPOSE OF BUILDING A HOSPITAL IN PALANPUR AND THE FUNDS WERE GIVEN OUT OF ASSESSEE COMPANYS OWN FUNDS. IT WAS SUBMITTED THAT IN THE P RESENCE OF MIXED FUNDS AVAILABILITY, THE ASSESSEE COMPANY HAS OPTION OF BE NEFICIAL APPROPRIATION . THE A.O. WAS OF THE OPINION THAT IT WAS NOT PROVED BY THE ASSESSEE COMPANY THAT THE SAID SUM WAS GIVEN OUT OF OWN FUNDS, THUS , THE ONUS TO PROVE ANY CLAIM MADE BY THE ASSESSEE COMPANY LIES ON THE ASSE SSEE COMPANY, WHICH THE ASSESSEE COMPANY IS NOT ABLE TO DISCHARGE. THE A.O. ALSO OBSERVED THAT IN THE PRECEDING YEAR, SIMILAR ISSUE WAS DISCUSSED AND IT WAS HELD THAT THE FUNDS OF THE BUSINESS WERE A MIX OF INTEREST BEARIN G BORROWED FUNDS AS WELL AS OWN FUNDS AND HENCE DISALLOWANCE WAS COMPUTED ON THE BASIS OF AVERAGE RATE OF INTEREST. IN THE APPELLATE PROCEEDINGS BEFO RE THE LD. CIT(A), THE ASSESSEE SUBMITTED THAT THE SAID AMOUNT WAS ADVANCE D NOT FROM ANY BORROWINGS FROM THE THIRD PARTY AND THE SAME HAD BE EN SOURCED FROM ASSESSEE COMPANYS OWN FUNDS. IT WAS SUBMITTED THA T THE INTENTION OF THE ASSESSEE COMPANY WAS TO ASSIST IN BUILDING A HOSPIT AL IN PALANPUR AND TO GET THE RIGHTS FOR ITS OPERATION AND MANAGEMENT. IT WA S SUBMITTED THAT THE A.O. HAS NOT PROVED ANY DIRECT NEXUS BETWEEN THE INTERES T BEARING BORROWED FUNDS AND THE ADVANCED AMOUNT. THE ASSESSEE COMPANY HAS ALSO FURNISHED A CHART WHEREIN IT WAS STATED THAT THE SOURCES OF FUNDING W ERE MADE OUT OF REMITTANCES/ RECEIPT FROM THE CUSTOMER BY BANGALORE BRANCH. THE LD. CIT(A) OBSERVED THAT THESE ENTRIES ARE NEITHER SUPPORTED B Y ANY BANK STATEMENT OR LEDGER ACCOUNT OF THE PARTIES NOR THE NAME AND DETA ILS AND NATURE OF TRANSACTION. THE LD. CIT(A) ACCORDINGLY REJECTED T HE CLAIM OF THE ASSESSEE COMPANY. THE ASSESSEE COMPANY FILED SECOND APPEAL W ITH THE TRIBUNAL. ITA 805/M/11 & 3002/M/2013 13 18. BEFORE THE TRIBUNAL, THE LD. COUNSEL FOR THE AS SESSEE COMPANY SUBMITTED THAT THE ASSESSEE COMPANY HAS ADVANCED A SUM OF RS. 5.80 CRORES TO M/S PALANPUR HOLDINGS & INVESTMENTS PVT. LTD. AS INTEREST FREE FUNDS FOR SETTING UP A HOSPITAL IN PALANPUR. THE A.O. OBSERV ED THAT THE INTEREST FREE ADVANCES WERE SOURCED FROM MIXED FUNDS ONLY INCLUDI NG THE INTEREST BEARING FUNDS HENCE DISALLOWANCE WAS MADE ON AVERAGE RATE O F INTEREST. THE ASSESSEE COMPANY SUBMITTED THAT IT HAS SUFFICIENT OWN FUNDS WHICH WERE REFLECTED IN THE BALANCE SHEET , OUT OF WHICH THE LOANS AND ADVA NCES WERE GIVEN. THE ASSESSEE COMPANY DREW OUR ATTENTION TO PAPER BOOK P AGE 167 AND SUBMITTED THAT THE FUNDS WERE RECEIVED FROM VARIOUS CUSTOMERS FROM THE BANGALORE BRANCH AND NO INTEREST WERE PAID ON THESE FUNDS. T HE LD. COUNSEL ALSO DREW OUR ATTENTION TO PAPER BOOK PAGE 6 WHICH IS AUDITED BALANCE SHEET OF THE ASSESSEE COMPANY AS AT 31-03-2008, WHEREBY IT CONTE NDED THAT OWN FUNDS AMOUNTING TO RS. 218 CRORES WERE AVAILABLE WHILE LO ANS AND ADVANCES WERE TO THE TUNE OF RS. 65 CRORES AND INVESTMENTS WERE TO T HE TUNE OF RS. 13.93 CRORES AS AT 31-03-2008 , WHICH SHOWS THAT THE ASSESSEE C OMPANY HAS SUFFICIENT OWN FUNDS. THE LD. D.R., ON THE OTHER HAND, RELIED ON THE ORDER OF THE A.O. 19. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND AL SO PERUSED THE MATERIAL AVAILABLE ON RECORD. WE HAVE OBSERVED THAT THE ASS ESSEE COMPANY HAS STATED THAT THE ASSESSEE COMPANY HAD ADVANCED AN AMOUNT OF RS. 5.80 CRORES TO M/S PALANPUR HOLDINGS & INVESTMENTS PVT. LTD. AS IN TEREST FREE FUNDS FOR SETTING UP A HOSPITAL IN PALANPUR. THE CONTENTION O F THE ASSESSEE COMPANY IS THAT IT IS FOR THE PURPOSE OF THE BUSINESS. THE AS SESSEE COMPANY ALSO SUBMITTED THAT IT HAS DEPLOYED THE SAID LOAN OF RS. 5.8 CRORES OUT OF ITS OWN FUNDS. TO SUPPORT THE CONTENTION, THE ASSESSEE COM PANY RELIED UPON THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CA SE OF CIT V. RELIANCE UTILITIES AND POWER LIMITED(2009) 313 ITR 340(BOM. HC) AS WELL AS THE DECISION OF CIT V. HDFC BANK LIMITED IN ITA NO 330 OF 2012 ((2014) 366 ITR 505(BOM. HC) ) AND CIT V. HDFC BANK LIMITED(WP NO. 1753 OF 2016)((2016) ITA 805/M/11 & 3002/M/2013 14 67 TAXMANN.COM 42(BOM.HC). KEEPING IN VIEW OF THE F ACTS AND CIRCUMSTANCES OF THE CASE, WE ARE INCLINED TO SET ASIDE AND RESTO RE THE MATTER TO THE FILE OF THE A.O. FOR VERIFICATION OF THE CONTENTIONS OF THE ASSESSEE COMPANY AND THE AO IS DIRECTED TO DECIDE THE MATTER IN THE LIGHT OF THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF RELIANCE UTILITIES AND POWER LTD. (SUPRA) AND HDFC BANK LTD. (SUPRA). THIS DISPOSES OF GROUND NO. 4 AND 5 RAISED BY THE ASSESSEE COMPANY IN THE GROUNDS OF APPEAL FILED IN MEMO OF APPEAL WITH THE TRIBUNAL.WE ORDER ACCORDINGLY. 20. THE NEXT GROUND I.E. GROUND NO. 6 AD 7 RELATES TO THE DISALLOWANCE OF INTEREST ON BORROWING OF RS. 4,79,958/- ON THE PRES UMPTION THAT BORROWED FUNDS WERE UTILIZED FOR NON-BUSINESS PURPOSE I.E. I NVESTMENT IN MUTUAL FUNDS. THE ASSESSEE INVESTED RS.41,00,67,000/- DUR ING THE YEAR IN MUTUAL FUNDS WHICH WAS SOLD BEFORE THE END OF THE YEAR. I T WAS SUBMITTED THAT THE INVESTMENTS HAVE BEEN MADE OUT OF INTERNAL ACCRUALS AND THE BORROWED FUNDS HAVE NOT BEEN UTILIZED FOR THE PURPOSE. THE ASSESSE E COMPANY COULD NOT PROVE THAT THE INTEREST FREE FUNDS WERE UTILISED FOR MAKI NG INVETSMENT AND IT WAS A MIXED POOL OF FUNDS WHEREBY THE ASSESSEE COMPANY HA D INTEREST BEARING BORROWED FUNDS ALSO AND THE AO MADE DISALLOWANCE OF RS.4,79,958/- TOWARDS INTEREST@6.66% , WHICH WAS CONFIRMED BY LEARNED CIT(A). 21. AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE COMPANY SUBMITTED THAT THIS ISSUE IS COVERED BY THE DECISION OF THE TRIBUN AL IN ASSESSEE COMPANYS OWN CASE IN ITA NO. 2376 TO 2378/MUM/2011 FOR ASSE SSMENT YEARS 2005-06 TO 2007-08 VIDE ORDERS DATED 10 TH JULY, 2015. THE LD. D.R. RELIED UPON THE ORDER OF THE A.O. 22. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND AL SO PERUSED THE MATERIAL AVAILABLE ON RECORD INCLUDING THE AFORE-STATED ORDE R OF THE TRIBUNAL DATED 10- 07-2015. WE FIND THAT THE TRIBUNAL IN ASSESSEE COM PANYS OWN CASE IN ITA ITA 805/M/11 & 3002/M/2013 15 NO. 2376 TO 2378/MUM/2011 FOR ASSESSMENT YEARS 2005 -06 TO 2007-08 VIDE ORDERS DATED 10 TH JULY, 2015 HAS SET ASIDE THE MATTER BACK TO THE FI LE OF THE A.O. FOR DECIDING THE SAME AFRESH IN TERMS OF THE J UDICIAL PRONOUNCEMENTS CITED THEREIN. THE TRIBUNAL IN THE AFORE-STATED ORD ER DATED 10-07-2015 OBSERVED AND HELD AS UNDER:- 23. THE NEXT GRIEVANCE OF THE ASSESSEE RELATES TO DISALLOWANCE OF INTEREST EXPENDITURE U/S.14A AMOUNTING TO RS.18,00, 412/-. THE AO APPLIED RULE 8D AND COMPUTED THE DISALLOWANCE. IT W AS BROUGHT TO OUR NOTICE THAT ASSESSEES OWNED FUNDS ARE MORE THAN TH E INVESTMENT MADE DURING THE YEAR, THEREFORE, NO DISALLOWANCE IS WARR ANTED. FOR THIS PURPOSE RELIANCE WAS PLACED ON THE DECISION OF RELI ANCE UTILITIES & POWER LTD., 313 ITR 340 AND HDFC BANK LTD., ITA NOS. 4529 /MUM/2005 &ORS.. KEEPING IN VIEW THE PROPOSITION OF LAW LAID DOWN IN ABOVE JUDICIAL PRONOUNCEMENTS, WE RESTORE THE MATTER BACK TO THE F ILE OF AO FOR DECIDING AFRESH IN TERMS OF ABOVE JUDICIAL PRONOUNCEMENTS. **** **** 27. THE GROUND TAKEN FOR A.Y. 2007-08 ARE COMMON AS DISCUSSED IN THE ASSESSMENT YEAR 2005-06. WITH REGARD TO THE GROUND TAKEN FOR DISALLOWANCE OF INTEREST U/S 14A AMOUNTING TO RS. 3 ,54,011/- , FOLLOWING THE REASONING GIVEN HEREINABOVE, WE RESTORE THE MAT TER BACK TO THE FILE OF AO FOR DECIDING AFRESH. RESPECTFULLY FOLLOWING THE AFORE-STATED DECISION OF THE CO-ORDINATE BENCH OF THIS TRIBUNAL, WE SET ASIDE AND RESTORE THE ISSUE B ACK TO THE FILE OF THE A.O. FOR DE NOVO DETERMINATION OF THE ISSUE AFRESH IN TERMS OF THE JUDICIAL PRONOUNCEMENTS AS INDICATED IN THE AFORE-STATED TRI BUNAL ORDER DATED 10-07- 2015 IN ASSESSEE COMPANYS OWN CASE. THIS DISPOSES OF GROUND NO. 6 AND 7 RAISED BY THE ASSESSEE COMPANY IN THE GROUNDS OF AP PEAL FILED IN MEMO OF APPEAL WITH THE TRIBUNAL.WE ORDER ACCORDINGLY. 23. THE NEXT GROUND RELATES TO THE ADDITIONS MADE T O THE BOOK PROFIT COMPUTED U/S 115JB OF THE ACT ON ACCOUNT OF PROVISI ON FOR DOUBTFUL DEBTS OF ITA 805/M/11 & 3002/M/2013 16 RS. 15,29,058, PROVISION FOR GRATUITY OF RS. 42,17, 911 AND PROVISION FOR LEAVE ENCASHMENT OF RS. 17,53,115/-. THE A.O. HAS DISALL OWED THE PROVISION FOR DOUBTFUL DEBTS OF RS. 15,29,058/-, AND ADDED THE SA ME TO THE NET PROFIT AS PER P&L A/C TO ARRIVE AT THE BOOK PROFIT U/S 115JB OF THE ACT IN VIEW OF AMENDED PROVISIONS, WHICH WAS CONFIRMED BY THE LD. CIT(A) KEEPING IN VIEW AMENDMENT IN THE ACT IN EXPLANATION 1 CLAUSE (I) TO SECTION 115JB OF THE ACT ADDED BY THE FINANCE ACT 2009 W.E.F. 1-4-2001. WI TH RESPECT TO THE PROVISION FOR GRATUITY OF RS. 42,17,911/- AND PROVI SION FOR LEAVE ENCASHMENT OF RS.17,53,115/-, IT WAS CONTENDED BEFORE THE LD. CIT(A) THAT THE ASSESSEE COMPANY HAS MADE PROVISION BASED UPON THE ACTUARIAL VALUATION CARRIED OUT BY THE COMPANYS APPOINTED ACTUARY WHICH IS BASED O N THE MANDATORY ACCOUNTING STANDARD AS 15 ISSUED BY ICAI AND THESE ARE ASCERTAINED LIABILITIES TO COMPUTE ACTUAL PROFIT AND IS DEBITED TO PROFIT AND LOSS ACCOUNT, WHICH IS DETERMINED KEEPING IN VIEW THE EMPLOYEES RETIREMENT AGE, LENGTH OF SERVICE, COMPENSATION ETC. OF THE EMPLOYEES AND CAN NOT BE CATEGORIZED AS UNASCERTAINED LIABILITIES, HENCE, THE SAME CANNOT B E ADDED BACK AS PER EXPLANATION 1 CLAUSE (C) TO SECTION 115JB OF THE AC T. THE LD CIT(A) REJECTED THE CONTENTION OF THE ASSESSEE COMPANY ON THE GROUN D THAT THE LIABILITY WAS NOT ASCERTAINED PROPERLY BY THE ASSESSEE COMPANY AS PER THE ACTUARIAL VALUATION REPORT SUBMITTED BY THE ASSESSEE COMPANY. 24. ON APPEAL BEFORE THE TRIBUNAL, THE LD. COUNSEL FOR THE ASSESSEE COMPANY SUBMITTED THAT THIS ISSUE IS COVERED IN FAV OUR OF THE ASSESSEE COMPANY BY THE DECISION OF THE TRIBUNAL IN ASSESSEE S OWN CASE IN ITA NO. 2376 TO 2378/MUM/2011 FOR ASSESSMENT YEARS 2005-06 TO 2007-08 VIDE ORDERS DATED 10 TH JULY, 2015 AS FAR AS PROVISION FOR GRATUITY AND LE AVE ENCASHMENT IS CONCERNED, WHILE LD COUNSEL RELIED UP ON DECISION OF MUMBAI TRIBUNAL IN THE CASE OF TAINWALA CHEMICALS AND PLAS TICS INDIA LIMITED V. ACIT IN ITA NO. 3338/MUM/2008 FOR ASSESSMENT YEAR 2004-0 5 VIDE ORDERS DATED 27-4-2011 TO CONTEND THAT PROVISION FOR DOUBTFUL DE BT CANNOT BE ADDED TO THE ITA 805/M/11 & 3002/M/2013 17 PROFIT AND PER PROFIT AND LOSS ACCOUNT TO ARRIVE AT BOOK PROFIT U/S 115JB OF THE ACT . THE LD. D.R. RELIED UPON THE ORDER OF THE LEARNED CIT(A). 25. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND AL SO PERUSED THE MATERIAL AVAILABLE ON RECORD INCLUDING THE ORDERS OF THE TRI BUNAL RELIED UPON. WE HAVE OBSERVED THAT INCOME TAX ACT,1961 WAS AMENDED BY FI NANCE ACT, 2004 W.E.F 1-4-2001 BY SUBSTITUTION OF CLAUSE (I) OF EXPLANATI ON1 TO SECTION 115JB OF THE ACT WHEREBY THE AMOUNT OR AMOUNTS SET ASIDE AS PROV ISION FOR DIMINUTION IN THE VALUE OF ANY ASSET IS TO BE ADDED BACK TO THE P ROFIT OF THE ASSESSEE AS PER PROFIT AND LOSS ACCOUNT TO ARRIVE AT BOOK PROFIT U/ S 115JB OF THE ACT WHICH IS CLEARLY APPLICABLE TO PROVISION FOR DOUBTFUL DEBT O F RS. 15,29,058/- DEBITED TO PROFIT AND LOSS ACCOUNT BY THE ASSESSEE AND THE SAM E IS ORDERED TO BE ADDED BACK TO PROFIT AS PER PROFIT AND LOSS ACCOUNT TO DE TERMINE BOOK PROFIT AS PER AMENDED PROVISION OF SECTION 115JB OF THE ACT. THIS GROUND OF APPEAL RAISED BY THE ASSESSEE COMPANY IS THEREFORE DISMISSED. WE ORDER ACCORDINGLY. WE FIND THAT THE TRIBUNAL IN ASSESSEE COMPANYS OWN CASE IN ITA NO. 2376 TO 2378/MUM/2011 FOR THE ASSESSMENT YEARS 2005-06 TO 2 007-08 VIDE ORDERS DATED 10 TH JULY, 2015 HAD DELETED THE ADDITIONS SO MADE BY TH E A.O. WITH RESPECT TO THE PROVISION FOR GRATUITY AND LEAVE ENC ASHMENT BY TREATING THE SAME AS ASCERTAINED LIABILITY. THE RELEVANT PORTION OF THE TRIBUNAL ORDER IS REPRODUCED BELOW:- 20. THE NEXT GRIEVANCE OF REVENUE RELATES TO DELETI NG DISALLOWANCE OF PROVISION FOR LEAVE ENCASHMENT AND PROVISION FOR GR ATUITY. WE FOUND THAT PROVISION WAS MADE FOR THE LIABILITIES PERTAINING T O THE YEARS UNDER CONSIDERATION. THESE LIABILITIES WERE CRYSTALISED DURING THE YEAR AND WERE PERTAINING TO THE YEAR UNDER CONSIDERATION. SINCE T HE PROVISION WAS MADE ON THE BASIS OF ACTUAL OPERATION AND IS AN ASCERTAI NED LIABILITY ALLOWABLE AS BUSINESS EXPENDITURE, THEREFORE, THERE IS NO INF IRMITY IN THE ORDER OF CIT(A) FOR CONSIDERING THE PROVISION MADE FOR LEAVE ENCASHMENT AND GRATUITY AS ASCERTAINED LIABILITIES NOT INCLUDIBLE WHILE COMPUTING PROFIT ITA 805/M/11 & 3002/M/2013 18 U/S.115JB. THERE IS NO INFIRMITY IN THE ORDER OF CI T(A). OUR VIEW IS SUPPORTED BY THE FOLLOWING DECISIONS : I) CIT VS. ENCHJAY FORGINGS LTD., 251 ITR 15; II) CIT VS. NATIONAL HYDRO ELECTRIC POWER CORPORATI ON LTD., 45 DTR 117; AND III) DRESSER VALUE INDIA PRIVATE LTD. VS.ACIT, 30 S OT 495. RESPECTFULLY FOLLOWING THE DECISION OF THE CO-ORDIN ATE BENCH OF THIS TRIBUNAL IN AFORE-STATED DECISION, WE HOLD THAT PROVISIONS F OR GRATUITY OF RS.42,17,911/- AND PROVISION FOR LEAVE ENCASHMENT O F RS.17,53,115/- BASED ON ACTUARIAL VALUATION CONDUCTED BY THE ACTURIAL IS AN ASCERTAINED LIABILITY WHICH SHALL NOT BE ADDED TO PROFIT OF THE ASSESSEE AS PER PROFIT AND LOSS ACCOUNT TO COMPUTE BOOK PROFIT U/S 115JB OF THE ACT , AND WE ALLOW THIS GROUND RAISED BY THE ASSESSEE COMPANY WITH RESPECT TO PROVISION FOR GRATUITY AND LEAVE ENCASHMENT. WE ORDER ACCORDINGLY. 26. IN THE RESULT APPEAL FILED BY THE ASSESSEE COMP ANY IN ITA NO.805/MUM/2011 FOR THE ASSESSMENT YEAR 2008-09 IS PARTLY ALLOWED AS INDICATED ABOVE. 27. THE FOLLOWING GROUNDS OF APPEAL ARE RAISED BY T HE ASSESSEE COMPANY IN ITA NO. 3002/MUM/2013 FOR THE ASSESSMENT YEAR 2009- 10 IN THE MEMO OF APPEAL FILED WITH THE INCOME TAX APPELLATE TRIBUNAL , MUMBAI (HEREINAFTER CALLED THE TRIBUNAL) WHICH READS AS UNDER:- GROUND 1: DISALLOWANCE OF DEPRECIATION ON MANAGEMENT RIGHTS: RS. 11,07,422/-. 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE AN D IN LAW, THE HON'BLE COMMISSIONER OF INCOME TAX (APPEALS) - 21 [ CIT(A)] ERRED ITA 805/M/11 & 3002/M/2013 19 IN UPHOLDING THE ACTION OF THE ASSISTANT COMMISSION ER OF INCOME TAX - 10(1), MUMBAI (THE AO') IN DISALLOWING DEPREC IATION OF RS. 11,07,422/- ON THE 'MANAGEMENT RIGHTS' ACQUIRED BY THE APPELLANT DURING THE YEAR ENDING MARCH 31, 2005, ON THE ALLEGED GROUND THAT SUCH PAYMENT WAS NOTHING BUT PREMIUM PA ID FOR MANAGEMENT AGREEMENT, WHICH WAS A NON-DEPRECIABLE C APITAL ASSET. 2. THE APPELLANT PRAYS THAT THE ADDITION OF RS. 11, 07,422/- BE DELETED AND THE AO BE DIRECTED TO ALLOW DEPRECIATIO N ON THE ABOVE AS CLAIMED BY THE APPELLANT. GROUND 11: DISALLOWANCE OF DEPRECIATION UNDER SECTION 32 OF THE ACT, AT A HIGHER RATE ON ADDITION S MADE TO FIXED ASSETS IN AY 2008-09 AMOUNTING TO RS. 15,37,326/-: 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE AN D IN LAW, THE CIT(A) ERRED IN DISALLOWING DEPRECIATION AT A HIGHE R RATE (I.E. 60%) CLAIMED U/S. 32 OF THE ACT AMOUNTING TO RS. 15,37,3 26/- ON ADDITION OF VARIOUS FIXED ASSETS TO THE BLOCK OF 'C OMPUTERS', ON THE ALLEGED PREMISE THAT SUCH ADDITIONS WERE IN NAT URE OF ELECTRICAL SWITCHES, PLANT & MACHINERY, OFFICE EQUI PMENT OR SOFTWARE. 2. THE APPELLANT PRAYS THAT THE AFORESAID DISALLOWA NCE U/S. 32 OF THE ACT AMOUNTING TO RS. 15,37,326/- BE DELETED. GROUND ILL: DISALLOWANCE OF DEPRECIATION UNDER SECTION 32 OF THE ACT AMOUNTING TO RS. 5,35,427/-, AT A HIGHER RATE ON ADDITIONS MADE TO COMPUTERS IN AY 2009-10: 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE AN D IN LAW, THE CIT{A) ERRED IN UPHOLDING THE ACTION OF THE AO IN DISALLOWING DEPRECIATION AT A HIGHER RATE CLAIMED U/S. 32 OF TH E ACT AMOUNTING TO RS. 5,35,427/- ON ADDITION OF VARIOUS FIXED ASSETS MADE TO THE BLOCK OF 'COMPUTERS', ON THE ALLEGED PR EMISE THAT SUCH ADDITIONS WERE FOR THE ITEMS LIKE UPS, ROUTERS , SWITCHES AND CABLES, SOFTWARE, PIPES AND LABOUR CHARGES WHICH CA NNOT BE ADDED TO THE BLOCK OF 'COMPUTERS'. ITA 805/M/11 & 3002/M/2013 20 2. THE APPELLANT PRAYS THAT THE AFORESAID DISALLOWA NCE U/S. 32 OF THE ACT AMOUNTING TO RS. 5,35,427/- BE DELETED. GROUND IV: DISALLOWANCE OF INTEREST EXPENDITURE UNDER SECTION 36(1)(III) /14A OF THE ACT AMOUNTING TO RS. 1,66,96,008/-: 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE A ND IN LAW, THE CIT{A) ERRED IN UPHOLDING THE ACTION OF THE AO IN DISALLOWING THE INTEREST EXPENDITURE AMOUNTING TO RS. 1,66,96,0 08/-, ON THE ALLEGED GROUND THAT THE INTEREST EXPENDITURE PAID O N BORROWINGS AND CLAIMED UNDER SECTION 36(1)(III) OF THE ACT BY THE APPELLANT CORRESPONDS TO THE AMOUNTS UTILIZED (IN AN EARLIER) TOWARDS PURPOSES WHICH ARE NOT IN RESPECT OF THE APPELLANT' S BUSINESS AND HENCE ARE NOT ALLOWABLE AS DEDUCTION U/S. 36 (L)(II I) / 14A OF THE ACT. 2. THE APPELLANT PRAYS THAT THE AFORESAID DISALLOWA NCE U/S. 36(1)(III) / 14A OF THE ACT, AMOUNTING TO RS. 1,66, 96,008/- BE DELETED OR BE APPROPRIATELY REDUCED. GROUND V: DISALLOWANCE UNDER SECTION 14A OF THE ACT READ WITH RULE 8D OF THE INCOME TAX RULES (THE RULES') AMOUNTING TO RS. 6,96,950/-: 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE AN D IN LAW, THE CIT(A) ERRED IN UPHOLDING THE ACTION OF THE AO IN DISALLOWING A SUM OF RS. 6,96,950/- AS EXPENSES INCURRED TOWARDS EARNING EXEMPT INCOME U/S. 14A OF THE ACT READ WITH RULE 8D OF INCOME TAX RULES, 1962 ('THE RULES'). 2. THE APPELLANT PRAYS THAT THE AFORESAID DISALLOWA NCE U/S. 14A OF THE ACT R.W.R. 8D OF THE RULES OF RS. 6,96,950/- BE DELETED OR BE APPROPRIATELY REDUCED. GROUND VI: DISALLOWANCE UNDER SECTION 36(1)(VA) R.W .S. 2(24)(X) AND TAXING OF EMPLOYEES CONTRIBUTION TO PROVIDENT FUND UNDER THE HEAD INCOME FROM OTHER SOURCES AMOUNTING TO RS. 31,02,711/-: ITA 805/M/11 & 3002/M/2013 21 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE AN D IN LAW, THE CIT(A) ERRED IN GIVING THE DIRECTION THAT ONLY IF THE PAYMENT IS MADE WITHIN THE GRACE PERIOD OF FIVE DAYS, THE SAME SHALL BE ALLOWED AND IMPLIED HOLDING THAT IF PAYMENT IS MADE BEYOND THE GRACE PERIOD, IT SHALL BE DISALLOWED. 2. THE APPELLANT PRAYS THAT THE AFORESAID ADDITION OF RS. 31,02,711/- BE DELETED. GROUND VII: DEDUCTION FOR PROVISION FOR FBT OF RS 82,01,157 FROM PROFIT BEFORE TAX: 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE AN D IN LAW, THE CIT(A) , WHILE COMPUTING THE BOOK PROFIT U/S. 1 15JB OF THE ACT, ERRED IN UPHOLDING THE ACTION OF THE AO FOR NO T GRANTING DEDUCTION OF RS 82,01,157 ON ACCOUNT OF PROVISION F OR FRINGE BENEFIT TAX ('FBT) AS CLAIMED IN THE RETURN OF INCO ME, TO THE LOSS AS PER PROFIT & LOSS ACCOUNT OF RS. 36,13,64,742/- WITHOUT APPRECIATING THE FACT THAT THE LOSS OF RS. 36,13,64 ,742/- WAS BEFORE CLAIMING THE SAID PROVISION. 2. THE APPELLANT PRAYS THAT THE LEARNED AO BE DIREC TED TO GRANT DEDUCTION FOR AFORESAID PROVISION FOR FBT AMO UNTING TO RS. 82,01,157/- WHILE COMPUTING THE BOOK PROFIT U/S. 11 5JB. GROUND VIII: ADDITION OF PROVISION FOR WEALTH TAX F OR CALCULATION OF BOOK PROFIT UNDER SECTION 115JB OF THE ACT AMOUNTING TO RS. 95,938/-: 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE AN D IN LAW, THE CIT (A) ERRED IN UPHOLDING THE ACTION OF THE AO IN ADDING BACK THE PROVISION FOR WEALTH TAX AMOUNTING TO RS. 95,93 8/- TO COMPUTE THE BOOK PROFIT U/S 115JB OF THE ACT. 2. THE APPELLANT PRAYS THAT THE ADDITION OF AFORESA ID PROVISION FOR WEALTH TAX AMOUNTING TO RS. 95,938/- BE DELETED WHILE COMPUTING THE BOOK PROFIT U/S. L15JB. ITA 805/M/11 & 3002/M/2013 22 GROUND IX: ADDITION OF PROVISION FOR DOUBTFUL DEBTS FOR CALCULATION OF BOOK PROFIT UNDER SECTION 115JB OF THE ACT AMOUNTING TO RS. 46,07,618/-: 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE AN D IN LAW, THE (CIT(A) ERRED IN UPHOLDING THE ACTION OF THE AO IN ADDING BACK PROVISION FOR DOUBTFUL DEBTS AMOUNTING TO RS. 46,07 ,618/- TO COMPUTE THE BOOK PROFIT U/S L15JB OF THE ACT. 2. THE APPELLANT PRAYS THAT THE AFORESAID ADDITION OF PROVISION FOR DOUBTFUL DEBTS AMOUNTING TO RS. 46,07,618/- MAD E TO COMPUTE BOOK PROFIT U/S. 115JB OF THE ACT BE DELETE D WHILE COMPUTING THE BOOK PROFIT U/S. 115JB. GROUND X: ADDITION OF PROVISION FOR GRATUITY FOR CALCULATION OF BOOK PROFIT UNDER SECTION 115JB OF THE ACT AMOUNTING TO RS. 31,86,681/-: 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE AN D IN LAW, THE CIT (A) ERRED IN UPHOLDING THE ACTION OF THE AO IN ADDING BACK PROVISION FOR GRATUITY AMOUNTING TO RS. 31,86,681/- TO COMPUTE THE BOOK PROFIT U/S 115JB OF THE ACT. 2. THE APPELLANT PRAYS THAT THE DISALLOWANCE OF AFO RESAID PROVISION FOR GRATUITY AMOUNTING TO RS. 31,86,681/- BE DELETED WHILE COMPUTING THE BOOK PROFIT U/S. 115JB. GROUND XI: ADDITION OF PROVISION FOR LEAVE ENCASHMENT FOR CALCULATION OF BOOK PROFIT UNDER SECTION 115JB OF THE ACT AMOUNTING TO RS. 12,82,436 /-: 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE A ND IN LAW, THE CIT (A) ERRED IN UPHOLDING THE ACTION OF THE AO IN ADDING BACK PROVISION FOR LEAVE ENCASHMENT AMOUNTING TO RS. 12, 82,436/- TO COMPUTE THE BOOK PROFIT U/S. 115JB OF THE ACT. 2. THE APPELLANT PRAYS THAT THE ADDITION OF AFORESA ID PROVISION FOR LEAVE ENCASHMENT AMOUNTING TO RS. 12,82,436/- B E DELETED WHILE COMPUTING THE BOOK PROFIT U/S. 115JB. ITA 805/M/11 & 3002/M/2013 23 GROUND XII: ADDITION OF AMOUNT CALCULATED UNDER SECTION 14A OF THE ACT AMOUNTING TO RS. 1,73,92,958 /- IN COMPUTING BOOK PROFIT UNDER SECTION 115JB OF THE ACT: 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE AN D IN LAW, THE CIT (A) ERRED IN UPHOLDING THE ACTION OF THE AO IN ADDING BACK INTEREST AND OTHER EXPENSES DISALLOWED U/S. 14A OF THE ACT AMOUNTING TO RS. 1,73,92,958/- WHILE COMPUTING THE BOOK PROFIT U/S. 115JB OF THE ACT. 2. THE APPELLANT PRAYS THAT THE AFORESAID ADDITION OF RS. 1,73,92,958/- BE DELETED WHILE COMPUTING THE BOOK P ROFIT U/S. 115JB. GROUND XIII: LEVY OF INTEREST UNDER SECTION 234B AN D 234C OF THE ACT: 1. THE AO ERRED IN LEVYING INTEREST U/S. 234B AND 2 34C OF THE ACT. 2. THE APPELLANT PRAYS THAT THE AFORESAID ADDITION BE DELETED. 28. WITH RESPECT TO GROUND NO. I REGARDING DISALLOW ANCE OF DEPRECIATION ON MANAGEMENT RIGHTS AMOUNTING TO RS.11,07,422/- ACQUI RED BY THE ASSESSEE DURING THE YEAR ENDED 31-03-2005, THE FACTS AND CIR CUMSTANCES OF THE ISSUE ARE SIMILAR TO THE ISSUES IN ASSESSEE COMPANYS APP EAL NO. ITA NO.805/MUM/2011 FOR THE ASSESSMENT YEAR 2008-09 WHI CH IS ADJUDICATED BY US IN PRECEDING PARAS VIDE THIS COMMON ORDER, HENC E, OUR DECISION IN ITA NO. 805/MUM/2011 FOR THE ASSESSMENT YEAR 2008-09 VIDE T HIS COMMON ORDER SHALL APPLY MUTATIS MUTANDIS TO THE ASSESSEE COMPAN YS APPEAL IN ITA NO. 3002/MUM/2013 FOR THE ASSESSMENT YEAR 2009-10 WHERE IN THE FACTS ARE IDENTICAL . WE ALLOW THIS GROUND OF APPEAL FILED BY THE ASSESSEE COMPANY IN THE MEMO OF APPEAL FILED WITH THE TRIBUNAL. WE ORDE R ACCORDINGLY. ITA 805/M/11 & 3002/M/2013 24 29. WITH RESPECT TO GROUND NO. II AND III REGARDING DISALLOWANCE OF DEPRECIATION AT HIGHER RATES I.E. 60% CLAIMED U/S 3 2 OF THE ACT ON ADDITION TO FIXED ASSETS TO THE BLOCK OF COMPUTERS BEING ITEM S SUCH AS SWITCHES, UPS, PLANT AND MACHINERY , OFFICE EQUIPMENTS OR SOFTWARE , THE FACTS AND CIRCUMSTANCES OF THE ISSUE ARE SIMILAR TO THE ISSUE S IN ASSESSEE COMPANYS APPEAL NO. ITA NO.805/MUM/2011 FOR THE ASSESSMENT Y EAR 2008-09 WHICH IS ADJUDICATED BY US IN PRECEDING PARAS VIDE THIS COM MON ORDER, HENCE, OUR DECISION IN ITA NO. 805/MUM/2011 FOR THE ASSESSMENT YEAR 2008-09 VIDE THIS COMMON ORDER SHALL APPLY MUTATIS MUTANDIS TO T HE ASSESSEE COMPANYS APPEAL IN ITA NO. 3002/MUM/2013 FOR THE ASSESSMENT YEAR 2009-10 WHEREIN THE FACTS ARE IDENTICAL . THUS, THIS ISSUE IS RESTO RED BACK TO THE FILE OF AO FOR FRESH DETERMINATION AS INDICATED IN OUR AFORE-STATE D ORDER FOR ASSESSMENT YEAR 2008-09. WE ORDER ACCORDINGLY. 30. GROUND NO. IV IS WITH REGARD TO THE DISALLOWANC E OF INTEREST EXPENDITURE U/S 36(1)(III)/14A OF THE ACT AMOUNTING TO RS. 1,66 ,96,008/- BEING EXPENSES INCURRED WHICH ARE NOT FOR BUSINESS PURPOSES WITH R ESPECT TO INVESTMENT OF RS.13,93,90,000/- IN A SUBSIDIARY COMPANY KANISHKA TO ACQUIRE 100% CONTROLLING STAKE .THE FACTS AND CIRCUMSTANCES OF T HE ISSUE ARE SIMILAR TO THE ISSUES IN ASSESSEE COMPANYS APPEAL IN ITA NO.805/ MUM/2011 FOR THE ASSESSMENT YEAR 2008-09 WHICH IS ADJUDICATED BY US IN PRECEDING PARAS VIDE THIS COMMON ORDER, HENCE, OUR DECISION IN ITA NO. 8 05/MUM/2011 FOR THE ASSESSMENT YEAR 2008-09 VIDE THIS COMMON ORDER SHAL L APPLY MUTATIS MUTANDIS TO THE ASSESSEE COMPANYS APPEAL IN ITA NO . 3002/MUM/2013 FOR THE ASSESSMENT YEAR 2009-10 WHEREIN THE FACTS ARE I DENTICAL . THUS, THIS ISSUE IS RESTORED BACK TO THE FILE OF AO FOR FRESH DETERM INATION AS INDICATED IN OUR AFORE-STATED ORDER FOR ASSESSMENT YEAR 2008-09. WE ORDER ACCORDINGLY. 31. GROUND NO. V IS WITH REGARD TO THE DISALLOWANCE OF INDIRECT EXPENDITURE I.E. ADMINISTRATIVE AND OTHER EXPENDITURE INCURRED FOR EARNING EXEMPT INCOME ITA 805/M/11 & 3002/M/2013 25 U/S14A OF THE ACT READ WITH RULE 8D(2)(III) OF INCO ME TAX RULES, 1962 AMOUNTING TO RS. 6,96,950/- @ 0.50% OF AVERAGE INVE STMENT OF RS.13,93,90,000/- . THE RULE 8D OF INCOME TAX RULE S, 1962 IS HELD TO BE APPLICABLE FROM ASSESSMENT YEAR 2008-09 BY HONBLE BOMBAY HIGH COURT IN THE CASE OF GODREJ AND BOYCE MANUFACTURING COMPANY LIMITED REPORTED IN (2010) 328 ITR 81(BOM. HC) . WE DO NOT FIND ANY IN FIRMITY IN DISALLOWANCE AS MADE BY THE AO AND CONFIRMED BY THE LEARNED CIT(A). WE CONFIRM AND SUSTAIN THE ADDITION AND DISMISS THE GROUND RAISED BY THE A SSESSEE COMPANY.WE ORDER ACCORDINGLY. 32. GROUND NO. VI IS REGARDING DISALLOWANCE OF EMPL OYEES CONTRIBUTION TO PF U/S 36(1)(VA) R.W.S. 2(24)(X) OF THE ACT AND TAX ING THE EMPLOYEE CONTRIBUTION TO THE TUNE OF RS.31,02,711/ UNDER THE HEAD INCOME FROM OTHER SOURCES . THE A.O. OBSERVED THAT THE EMPLOYEES PR OVIDENT FUND PAYMENT HAS NOT BEEN PAID BY THE ASSESSEE COMPANY WITHIN THE ST IPULATED DUE DATE UNDER THE PF ACT AS PER EXPLANATION TO SECTION 36(1)(VA) OF THE ACT, HENCE, THE PAYMENTS MADE AFTER THE DUE DATE AS PROVIDED UNDER THE PF ACT WERE TREATED AS INCOME OF THE ASSESSEE U/S 2(24)(X) OF THE ACT A ND TAXED UNDER THE HEAD INCOME FROM OTHER SOURCES AMOUNTING TO RS. 31,02,71 1/-. ON APPEAL, THE LD. CIT(A) DIRECTED THE A.O. TO RE-COMPUTE THE DISALLOW ANCE BY ALLOWING OF PAYMENT OF EMPLOYEES CONTRIBUTION MADE TO THE PROVI DENT FUND WHICH HAD BEEN MADE BY THE ASSESSEE COMPANY WITHIN THE GRACE PERIOD OF FIVE DAYS ALLOWED UNDER THE PF ACT. THE ASSESSEE COMPANY CHA LLENGED THE ORDER OF THE LD. CIT(A) BEFORE THE TRIBUNAL AND SUBMITTED THAT T HIS ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE HONB LE BOMBAY HIGH COURT IN THE CASE OF HINDUSTAN ORGANICS CHEMICALS LTD., ITA NO.399 OF 2012. THE ASSESSEE COMPANY ALSO SUBMITTED THAT THIS ISSUE HAS BEEN DECIDED BY THE TRIBUNAL IN ASSESSEE COMPANYS OWN CASE IN ITA NO. 2376-2378/MUM/2011 FOR ASSESSMENT YEARS 2005-06 TO 2007-08 VIDE ORDER DATED 10 TH JULY, 2015. ITA 805/M/11 & 3002/M/2013 26 33. WE FIND THAT THE TRIBUNAL IN ASSESSEE COMPANYS OWN CASE IN ITA NO. 2376 TO 2378/MUM/2011 FOR ASSESSMENT YEARS 2005-06 TO 2007-08 VIDE ORDERS DATED 10 TH JULY, 2015 DELETED THE ADDITIONS SO MADE BY THE A. O. AND CONFIRMED BY THE LD. CIT(A). THE RELEVANT PORTION O F THE AFORE-STATED TRIBUNAL ORDER IS REPRODUCED BELOW:- 21. THE ASSESSEE IN ITS APPEAL FOR A.Y.2006-07, I S AGGRIEVED FOR DISALLOWANCE OF EMPLOYEES CONTRIBUTION TO THE PROVI DENT FUND AMOUNTING TO RS.55,519/- IS COVERED BY THE DECISION OF HONBL E SUPREME COURT IN THE CASE OF ALOM EXTRUSION AND ALSO BY THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF HINDUSTHAN ORGANICS CHEMICALS LTD., ITXA NO.399/2012 AND ALSO BY THE DECISION OF HONBLE DEL HI HIGH COURT IN THE CASE OF ONWARD TECHNOLOGIES LTD., ITA NO.5235/MUM/2 010. IN VIEW OF THESE JUDICIAL PRONOUNCEMENTS WE DO NOT FIND ANY ME RIT FOR DISALLOWANCE OF EMPLOYEES CONTRIBUTION OF RS.55,519/-. RESPECTFULLY FOLLOWING THE DECISION OF THE CO-ORDIN ATE BENCH OF THIS TRIBUNAL, WE ALLOW THIS GROUND RAISED BY THE ASSESSEE COMPANY AND DIRECT THAT THE EMPLOYEES CONTRIBUTION TOWARDS PROVIDENT FUND PAID BY THE ASSESSEE COMPANY BEFORE THE DUE DATE PRESCRIBED UNDER THE INCOME TAX ACT,1961 FOR FILING RETURN OF INCOME U/S 139(1) OF THE ACT BE ALLOWED O F WHICH THE PAYMENT DETAILS ARE DULY REFLECTED IN THE ASSESSMENT ORDER PARA 9.1. WE ALLOW THIS GROUND OF APPEAL FILED BY THE ASSESSEE COMPANY . WE ORDER ACCORDINGLY. 34. THE NEXT ISSUE RELATE TO NOT GRANTING OF DEDUCT ION FOR PROVISION FOR FRINGE BENEFIT TAX OF RS. 82,01,157/- AS CLAIMED IN RETURN OF INCOME , TO THE LOSS AS PER PROFIT AND LOSS ACCOUNT OF RS.36,13,64, 762/- WITHOUT APPRECIATING THE FACT THAT THE LOSS OF RS.36,13,64,762/- WAS BEF ORE CLAIMING THE DEDUCTION OF SAID PROVISION OF FBT. THE AO ADDED THE FBT AMOU NT TO THE PROFIT AS PER P&L ACCOUNT TO ARRIVE AT BOOK PROFIT U/S 115JB OF T HE ACT. THE LD. CIT(A), HOWEVER, DIRECTED THE A.O. TO FOLLOW CIRCULAR NO. 8 OF 2005 DATED 29 TH AUGUST, 2005 ISSUED BY THE CBDT IN QUESTION NO. 103 WHERE I T IS STATED BY THE CBDT ITA 805/M/11 & 3002/M/2013 27 THAT FOR THE COMPUTATION OF BOOK PROFIT U/S 115JB O F THE ACT, FRINGE BENEFIT TAX IS AN ALLOWABLE DEDUCTION FOR COMPUTATION OF BO OK PROFIT U/S 115JB OF THE ACT AND ACCORDINGLY ALLOWED THE GROUND RAISED BY TH E ASSESSEE COMPANY BEFORE THE LD. CIT(A). THE LD. COUNSEL FOR THE ASS ESSEE COMPANY SUBMITTED THAT THE ASSESSEE COMPANY HAS ALREADY REDUCED THE F BT WHILE COMPUTING THE BOOK PROFIT U/S 115JB OF THE ACT AS PER THE RETURN OF INCOME FILED. HE DREW OUR ATTENTION TO AUDITED PROFIT AND LOSS ACCOUNT WH ICH IS PLACED AT PAGE 7 OF PAPER BOOK WHERE LOSS BEFORE TAX AS PER AUDITED PRO FIT AND LOSS ACCOUNT IS RS. 361364742/- AND THE ASSESSEE MADE ADJUSTMENT OF FBT WHICH IS REFLECTED AFTER PROFIT BEFORE TAXES IN AUDITED PROFIT AND L OSS TO ARRIVE AT PROFIT AFTER TAX AND THE ASSESSEE INCREASED THE LOSS AS PER PROFIT A ND LOSS ACCOUNT BY FBT AMOUNT OF RS.82,01,157/- OF ITS OWN IN COMPUTATION OF INCOME TO ARRIVE AT BOOK PROFIT U/S 115JB OF THE ACT WHICH WAS STATED B Y THE ASSESSEE TO BE CORRECTLY DONE AS PER CIRCULAR NO 8 OF 2005 DATED 2 9-08-2005 ISSUED BY CBDT TO ARRIVE AT BOOK PROFIT U/S 115JB OF THE ACT . THE SAID CIRCULAR NO 08/2005 DATED 29-08-2005 IS REPRODUCED HEREUNDER: CIRCULAR FINANCE ACT, 2005 - FBT FINANCE ACT, 2005 - EXPLANATORY NOTES ON THE PROVIS IONS RELATING TO FRINGE BENEFIT TAX CIRCULAR NO. 8/2005, DATED 29-8-2005 THE FINANCE ACT, 2005 HAS INTRODUCED A NEW LEVY, NA MELY, FRINGE BENEFIT TAX (HEREAFTER REFERRED TO AS FBT) ON THE VALUE OF CERTAIN FRINGE BENEFITS. THE PROVISIONS RELATING TO LEVY OF THIS TAX ARE CON TAINED IN CHAPTER XII-H (SECTIONS 115W TO 115WL) OF THE INCOME-TAX ACT, 196 1. THIS CIRCULAR SEEKS TO PROVIDE A HARMONIOUS, PURPOSIVE AND CONTEX TUAL INTERPRETATION OF ITA 805/M/11 & 3002/M/2013 28 THE PROVISIONS OF THE FINANCE ACT, 2005 RELATING TO THE FBT SO AS TO FURTHER THE OBJECTIVE OF THIS LEVY. **** **** WHETHER FBT WOULD BE ALLOWABLE DEDUCTION WHILE COMP UTING BOOK PROFIT UNDER SECTION 115JB? 103. FBT IS A LIABILITY QUA EMPLOYER. IT IS AN EXPENDITU RE LAID OUT OR EXPENDED WHOLLY AND EXCLUSIVELY FOR THE PURPOSES OF THE BUSINESS OR PROFESSION OF THE EMPLOYER. HOWEVER, SUB-CLAUSE (IC ) OF CLAUSE (A) OF SECTION 40 OF THE INCOME-TAX ACT EXPRESSLY PROHIBIT S THE DEDUCTION OF THE AMOUNT OF FBT PAID, FOR THE PURPOSES OF COMPUTING T HE INCOME UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION. THIS PROHIBITION DOES NOT APPLY TO THE COMPUTATION OF BOOK PROFIT FOR T HE PURPOSES OF SECTION 115JB. ACCORDINGLY, THE FBT IS AN ALLOWABLE DEDUCTI ON IN THE COMPUTATION OF BOOK PROFIT UNDER SECTION 115JB OF THE INCOME-TAX ACT. THE COMPUTATION OF INCOME IS PLACED AT PAPER BOOK P AGE 75 AND IT WAS SUBMITTED THAT THE A.O. HAS ADJUSTED THE SAID AMOUN T OF FBT IN THE PROFIT BEFORE TAX TO REDUCE LOSSES TO ARRIVE AT BOOK PROFI T U/S 115JB OF THE ACT WHICH HAS LED TO DOUBLE JEOPARDY I.E. INSTEAD OF IN CREASING LOSS BEFORE TAX AS PER CBDT CIRCULAR AS SET OUT ABOVE, THE AO REDUCED THE LOSSES TO ARRIVE AT BOOK PROFIT U/S 115JB OF THE ACT , WHICH HAS LED T O DOUBLE ADDITION OF THE SAME AMOUNT . WE FIND MERIT IN THE CONTENTION OF TH E ASSESSEE COMPANY AFTER GOING THROUGH THE RECORDS BEFORE US AND HAVE OBSERV ED THAT THE ASSESSEE COMPANY IS ENTITLED FOR DEDUCTION OF FBT TO ARRIVE AT THE BOOK PROFIT FOR THE PURPOSES OF COMPUTATION OF BOOK PROFIT U/S 115JB O F THE ACT. ON THE OTHER ITA 805/M/11 & 3002/M/2013 29 HAND THE A.O. HAS REDUCED THE LOSSES BY AMOUNT OF F BT INSTEAD OF INCREASING LOSSES TO ARRIVE AT BOOK PROFIT U/S 115JB WHICH HAS LED TO DOUBLE JEOPARDY TO THE ASSESSEE COMPANY. THUS, KEEPING IN VIEW OF THE AFORE-STATED CBDT CIRCULAR, THE A.O. IS DIRECTED TO RE-COMPUTE THE LO SSES U/S 115JB OF THE ACT WHEREBY THE FBT WILL BE ALLOWED TO BE ADDED TO THE LOSSES PRIOR TO TAX AS REFLECTED IN THE AUDITED PROFIT AND LOSS ACCOUNT TO INCREASE THE LOSS TO ARRIVE AT THE BOOK PROFIT U/S 115JB OF THE ACT. WE ORDER ACCO RDINGLY. 35. THE NEXT GROUND IS WITH RESPECT TO THE ADDITION OF PROVISION FOR WEALTH TAX FOR COMPUTATION OF BOOK PROFIT U/S 115JB OF THE ACT AMOUNTING TO RS. 95,938/-. THE AO MADE ADJUSTMENT TO PROFIT(LOSS) A S PER PROFIT AND LOSS ACCOUNT BY ADDING THE PROVISION FOR WEALTH TAX OF R S.95,938/-TO ARRIVE AT BOOK PROFIT COMPUTED U/S 115JB OF THE ACT , WHICH G ROUND OF APPEAL WAS DISMISSED BY THE LEARNED CIT(A) AND THE ACTION OF T HE AO WAS UPHELD/SUSTAINED BY THE LEARNED CIT(A) . THE ASSES SEE FILED SECOND APPEAL WITH THE TRIBUNAL. THE ASSESSEE CONTENDED THAT IT H AS CORRECTLY INCREASED THE PROVISION FOR WEALTH TAX TO ARRIVE AT THE BOOK PROF IT(LOSS) U/S 115JB OF THE ACT AS THE SAME IS TO BE ALLOWED AS DEDUCTION FROM PROF IT(LOSS) BEFORE TAX. THE ASSESSEE DREW OUR ATTENTION TO AUDITED PROFIT AND L OSS ACCOUNT PLACED AT PAPER BOOK PAGE 7 AND COMPUTATION OF THE INCOME WHI CH IS PLACED AT PAPER BOOK PAGE 75. THE A.O. DISALLOWED THE CLAIM WHICH HAS BEEN CONFIRMED BY THE LD. CIT(A) FOR COMPUTATION OF THE BOOK PROFIT U /S 115JB OF THE ACT. THE LD. COUNSEL RELIED UPON THE FOLLOWING JUDICIAL PRON OUNCEMENTS:- 1. CIT V. ECHJAY FORGINGS (P.) LTD., (2001) 166 CTR 10 0 (BOM) 2. JCIT V. USHA MARTINE INDUSTRIES LTD., (2001) 251 IT R 15 (BOM) 3. DCIT V. MICROLABS LTD., (2015) 70 SOT 774 (BANG-TRI B) THE LEARNED DR RELIED UPON ORDERS OF THE AUTHORITIE S BELOW. WE HAVE GONE THROUGH THE JUDGMENTS RELIED UPON BY THE ASSESSEE A ND WE ARE INCLINED TO ITA 805/M/11 & 3002/M/2013 30 AGREE WITH THE ASSESSEE ON MERITS AND THIS GROUND O F APPEAL IS THEREFORE ALLOWED. WE ORDER ACCORDINGLY. 36. GROUND NO. IX IS WITH RESPECT TO THE ADDITION O F PROVISION FOR DOUBTFUL DEBTS FOR CALCULATION OF BOOK PROFIT U/S 115JB OF T HE ACT AMOUNTING TO RS.46,07618/-. THE FACTS AND CIRCUMSTANCES OF THE I SSUE ARE SIMILAR TO THE ISSUES IN ASSESSEE COMPANYS APPEAL IN ITA NO.805/ MUM/2011 FOR THE ASSESSMENT YEAR 2008-09 WHICH IS ADJUDICATED BY US IN PRECEDING PARAS VIDE THIS COMMON ORDER, HENCE, OUR DECISION IN ITA NO. 8 05/MUM/2011 FOR THE ASSESSMENT YEAR 2008-09 VIDE THIS COMMON ORDER SHAL L APPLY MUTATIS MUTANDIS TO THE ASSESSEE COMPANYS APPEAL IN ITA NO . 3002/MUM/2013 FOR THE ASSESSMENT YEAR 2009-10 WHEREIN THE FACTS ARE I DENTICAL . THUS, THIS GROUND OF APPEAL RAISED BY THE ASSESSEE COMPANY LAC KS MERIT AND IS HEREBY DISMISSED AND DECIDED AGAINST THE ASSESSEE COMPANY. WE ORDER ACCORDINGLY. 37. GROUND NO. X IS WITH RESPECT TO THE ADDITION FO R PROVISION FOR GRATUITY FOR COMPUTATION OF BOOK PROFIT U/S 115JB OF THE ACT AMOUNTING TO RS.46,07,618. THE FACTS AND CIRCUMSTANCES OF THE IS SUE ARE SIMILAR TO THE ISSUES IN ASSESSEE COMPANYS APPEAL IN ITA NO.805/ MUM/2011 FOR THE ASSESSMENT YEAR 2008-09 WHICH IS ADJUDICATED BY US IN PRECEDING PARAS VIDE THIS COMMON ORDER, HENCE, OUR DECISION IN ITA NO. 8 05/MUM/2011 FOR THE ASSESSMENT YEAR 2008-09 VIDE THIS COMMON ORDER SHAL L APPLY MUTATIS MUTANDIS TO THE ASSESSEE COMPANYS APPEAL IN ITA NO . 3002/MUM/2013 FOR THE ASSESSMENT YEAR 2009-10 WHEREIN THE FACTS ARE I DENTICAL . THUS, THIS ISSUE RAISED BY THE ASSESSEE COMPANY IN GROUNDS OF APPEAL IS ALLOWED IN FAVOUR OF THE ASSESSEE COMPANY. WE ORDER ACCORDINGLY. 38. GROUND NO. XI IS REGARDING ADDITION OF PROVISIO N FOR LEAVE ENCASHMENT FOR COMPUTATION OF BOOK PROFIT U/S 115JB OF THE AC T AMOUNTING TO RS.12,82,436/-. THE FACTS AND CIRCUMSTANCES OF THE ISSUE ARE SIMILAR TO THE ITA 805/M/11 & 3002/M/2013 31 ISSUES IN ASSESSEE COMPANYS APPEAL IN ITA NO.805/ MUM/2011 FOR THE ASSESSMENT YEAR 2008-09 WHICH IS ADJUDICATED BY US IN PRECEDING PARAS VIDE THIS COMMON ORDER, HENCE, OUR DECISION IN ITA NO. 8 05/MUM/2011 FOR THE ASSESSMENT YEAR 2008-09 VIDE THIS COMMON ORDER SHAL L APPLY MUTATIS MUTANDIS TO THE ASSESSEE COMPANYS APPEAL IN ITA NO . 3002/MUM/2013 FOR THE ASSESSMENT YEAR 2009-10 WHEREIN THE FACTS ARE I DENTICAL . THUS, THIS ISSUE RAISED BY THE ASSESSEE COMPANY IN GROUNDS OF APPEAL IS ALLOWED IN FAVOUR OF THE ASSESSEE COMPANY. WE ORDER ACCORDINGLY. 39. GROUND NO. XII IS REGARDING ADDITION OF AMOUNT COMPUTED U/S 14A AMOUNTING TO RS. 1,73,92,958/- IN COMPUTING BOOK PR OFIT U/S 115JB OF THE ACT. THIS GROUND IS CONSEQUENTIAL TO GROUND NO. IV & V OF THIS APPEAL, WHEREIN WE UPHELD THE ADDITION OF RS.6,96,950/- MAD E BY THE AO AND AS SUSTAINED BY LEARNED CIT(A) U/S 14A OF THE ACT READ WITH RULE 8D(2)(III) OF INCOME TAX RULES, 1962 , WHILE THE ADDITION OF RS.1 ,66,96,008/- IS SET ASIDE AND RESTORED TO THE FILE OF THE AO FOR DECIDING AFR ESH , AS SET OUT IN PRECEDING PARAS OF THIS ORDER. IN PRINCIPLE WE CONFIRM THE O RDER OF THE LEARNED CIT(A) THAT THE DISALLOWANCE COMPUTED U/S 14A SHALL BE ADD ED TO ARRIVE AT THE BOOK PROFIT U/S 115JB OF THE ACT. HENCE, WE SET ASIDE TH IS ISSUE TO THE FILE OF THE A.O. FOR QUANTUM DISALLOWANCE AFTER DECIDING DE-NOV O OF THE ISSUE OF ALLOWABILITY OF INTEREST EXPENDITURE OF RS.1,66,96, 008/- AS DETAILED ABOVE , WHILE THE ADDITION TO THE TUNE OF RS.6,96950/- ALRE ADY STOOD CONFIRMED BY US . WE HOLD THAT THE DISALLOWANCE MADE U/S 14A OF THE A CT WILL BE ADDED TO THE BOOK PROFIT U/S 115JB OF THE ACT. WE WILL ALSO LIKE TO REFER TO THE DECISION OF MUMBAI TRIBUNAL IN THE CASE OF DCIT V. VIRAJ PROFIL ES LIMITED IN ITA NO. 4439/ MUM/2013 VIDE ORDERS DATED 21.10.2015 REPORTE D IN (2015) 64 TAXMANN.COM 52(MUM) WHERE BOTH OF US WERE MEMBERS O F THE BENCH PASSING THE SAID ORDER , WHICH UPHELD THE ABOVE SAID PROPOS ITION OF LAW VIDE DETAILED ORDER THAT DISALLOWANCE MADE U/S 14A OF THE ACT IS TO BE ADDED BACK FOR ITA 805/M/11 & 3002/M/2013 32 ARRIVING BOOK PROFIT U/S 115JB OF THE ACT IN VIEW O F CLAUSE(F) TO EXPLANATION 1 TO SECTION 115JB(2) OF THE ACT. WE ORDER ACCORDINGL Y. 40. IN THE RESULT APPEAL FILED BY THE ASSESSEE COMP ANY IN ITA NO.3002/MUM/2013 FOR THE ASSESSMENT YEAR 2009-10 IS PARTLY ALLOWED AS INDICATED ABOVE. 41. IN THE RESULT, BOTH THE APPEALS FILED BY THE AS SESSEE IN ITA N0. 805/MUM/2011 FOR THE ASSESSMENT YEAR 2008-09 AND IT A NO. 3002/MUM/2013 FOR THE ASSESSMENT YEAR 2009-10 ARE P ARTLY ALLOWED AS INDICTED ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 8 TH AUGUST , 2016. # $% &' 08-08-2016 ( ) SD/- SD/- (JOGINDER SINGH) (RAMIT KOCHAR) JUDICIAL MEMBER ACCOUNTANT MEMBER $ MUMBAI ; & DATED 08-08-2016 [ .9../ R.K. R.K. R.K. R.K. , EX. SR. PS !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. : ( ) / THE CIT(A)- CONCERNED, MUMBAI 4. : / CIT- CONCERNED, MUMBAI 5. =>( 99?@ , ?@ , $ / DR, ITAT, MUMBAI G BENCH 6. (BC D / GUARD FILE. / BY ORDER, = 9 //TRUE COPY// / ( DY./ASSTT. REGISTRAR) , $ / ITAT, MUMBAI