DEPUTY COMMISSIONR OF INCOME TAX, CIRCLE-6, Jaipur V. RAJASTHAN RENEWABLE ENERGY CORPORATION LTD., Jaipur

ITA 816/JPR/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2004 (ITAT-JAIPUR)
• Duration Of Justice: 4 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-03-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2014-2015
• Appeal Filed On: 06-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VARINDER MEHTA
• Assessee Lawyers: P C PARWAL CA DHK
• Keywords: Diversion of income
• Section: 43B; 37(1)

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKWO] U;KF;D LNL; ,O A JH HKKXPUN KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI BHAGCHAND, A M VK;DJ VIHY LA- @ ITA NO. 816/JP/2017 FU/KZKJ.K O'K Z @ ASSESSMENT YEARS : 2014-15. DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE-6, JAIPUR. CUKE VS. M/S. RAJASTHAN RENEWABLE ENERGY CORPN. LTD., AKSHAY URJA BHAWAN, YUDHISTIR MARG, C-SCHEME, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO. AAACL 3171 C VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SHRI VARINDER MEHTA (CIT) FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI PC PARWAL (CA) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 15.03.2018 ?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 19/03/2018 VKNS'K@ ORDER PER SHRI VIJAY PAL RAO, J.M. THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 23.08.2017 OF LD. CIT (A)-2, JAIPUR FOR THE ASSESSMENT YEAR 2014- 15. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL :- I) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW, THE CIT (APPEALS) WAS JUSTIFIED IN DELETING THE ADDITION OF RS. 20,00,000/- MADE BY DISALLOWING CONTRIBUTION TO STATE RENEWAL FUND. II) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW, THE CIT (APPEALS) WAS JUSTIFIED IN DELETING THE ADDITION OF RS. 4,25,,000/- MADE FOR DEPOSITING THE EMPLOYEES CONTRIBUTION TO PF & ESI BEYOND THE PRESCRIBED TIME LIMIT PROVID ED IN THE RESPECTIVE ACTS. 2 ITA NO. 816/JP/2017 RAJASTHAN RENEWAL ENERGY CORPN. LTD., JAIPUR. III) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW, THE CIT (APPEALS) WAS JUSTIFIED IN HOLDING THAT THE EMPLOYEES CONTRIBUTION TO PF & ESI ARE GOVERNED BY THE PROVISIONS OF SECTION 43B AND NOT BY SECTION 36(1)( VA) R.W.S. 2(24)(X) OF THE INCOME TAX ACT, 1961. IV) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW, THE CIT (APPEALS) WAS JUSTIFIED IN DELETING THE ADDITION OF RS. 2,00,00,000/- MADE BY THE AO BY DISALLOWING CON TRIBUTION OF ENERGY CONSERVATION FUND. V) THE APPELLANT CRAVES ITS RIGHTS TO ADD, AMEND OR AL TER ANY OF THE GROUNDS ON OR BEFORE THE HEARING. 2. GROUND NO. 1 IS REGARDING THE ADDITION MADE BY T HE AO ON ACCOUNT OF CONTRIBUTION OF STATE RENEWAL FUND WAS DELETED BY T HE LD. CIT (A). 3. WE HAVE HEARD LD. D/R AS WELL AS THE LD. A/R AND CONSIDERED THE RELEVANT MATERIAL ON RECORD. THE ASSESSEE COMPANY HAS DEBIT ED A SUM OF RS. 20,00,000/- AS CONTRIBUTION TO STATE RENEWAL FUND IN THE PROFIT & LOSS ACCOUNT. THE AO DISALLOWED THE SAID AMOUNT ON THE GROUND THAT IT IS NOT COVERE D UNDER THE PROVISIONS OF SECTION 37(1) OF THE IT ACT. ON APPEAL, THE LD. CIT (AP PEALS) HAS ALLOWED THE CLAIM OF THE ASSESSEE BY FOLLOWING THE EARLIER ORDERS FOR TH E ASSESSMENT YEARS 2011-12 AND 2012-13. AT THE OUTSET, WE NOTE THAT THIS TRIBUNAL IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2011-12 VIDE ORDER DATED 18.08.2017 IN ITA NO. 202/JP/2015 HAS CONSIDERED AND DECIDED THIS ISSUE IN PARA 3 TO 6 AS UNDER :- 3. IN GROUND NO. 1, THE REVENUE HAS CHALLENGED THE DELETING OF ADDITION OF RS. 20 LACS TOWARDS CONTRIBUTION TO THE STATE RENEWAL FUND. THE LD. AR SUBMITTED THAT THIS ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF ITAT, JAIPUR BENCH IN C ASE OF RAJASTHAN STATE SEED CORPORATION LTD. VS. ACIT IN ITA NO. 233 /JP/2009 ORDER 3 ITA NO. 816/JP/2017 RAJASTHAN RENEWAL ENERGY CORPN. LTD., JAIPUR. DATED 25.05.2009 FOR A.Y. 2009-10 WHICH HAS BEEN AF FIRMED BY THE HONBLE RAJASTHAN HIGH COURT IN THE CASE OF CIT VS RAJASTHAN STATE SEED CORPORATION LTD REPORTED IN 386 ITR 267. 4. THE RELEVANT FINDING OF THE LD CIT(A) WHERE HE H AS FOLLOWED THE DECISION OF THE COORDINATE BENCH IN CASE OF RAJASTH AN STATE SEED CORPORATION LTD IS REPRODUCED AS UNDER: 2.3.1 I HAVE PERUSED THE FACTS OF THE CASE, THE ASSESSMEN T ORDER AND THE SUBMISSION OF THE APPELLANT. THE FACT S OF THIS ISSUE ARE SIMILAR TO THE FACTS IN THE CASE OF M/S R AJASTHAN STATE SEEDS CORPORATION LTD. IN A.Y. 2006-07. IN THIS CAS E, THE ITAT, JAIPUR (IN ITA NO. 233/JP/2009) HAS DECIDED THE MAT TER IN FAVOUR OF THE ASSESSEE BY HOLDING AS UNDER- AS PER MEMORANDUM OF STATE RENEWAL FUND SET UP BY THE STATE GOVERNMENT, IT IS CREATED WITH THE OBJECT OF PROVIDING A SAFETY NET FOR THE WORKERS LIKELY TO BE AFFECTED BY RESTRUCTURING IN THE STATE PUBLIC ENTERPRISES. WE ARE THUS OF THE VIEW THAT CONTRIBUTION MADE TO THE SAID FUND IS SOLELY FOR TH E PURPOSE OF THE WELFARE AND BENEFIT OF THE EMPLOYEES. THE RAJAS THAN HIGH COURT IN CASE OF CIT V. RAJASTHAN SPINNING AND WEAV ING MILLS LIMITED 274 ITR 465 HAS OBSERVED THAT IT IS FOR THE ASSESSEE TO DECIDE WHETHER ANY EXPENDITURE SHOULD BE INCURRED I N COURSE OF BUSINESS. THE EXPENDITURE CAN BE INCURRED VOLUNTARI LY AND WITHOUT NECESSITY. ANY CONTRIBUTION MADE BY THE ASS ESSEE TO A PUBLIC WELFARE FUND WHICH IS CONNECTED OR RELATED WITH HIS BUSINESS IS AN ALLOWABLE DEDUCTION U/S 37. AGAIN T HE COURT IN THE CASE OF CIT V. SHRI RAJASTHAN SYNTEX LIMITED 22 1 CTR 410 (RAJ.) HELD THAT WHERE ASSESSEE GAVE CONTRIBUTION T O THE EMPLOYEES WELFARE FUND, THE SAME IS ALLOWABLE AS B USINESS EXPENDITURE. THE CASE RELIED BY AO OF CIT V. JODHPU R CO- OPERATIVE MARKETING SOCIETY 275 ITR 372 (RAJ.) IS DISTINGUISHABLE AS IN THIS CASE THE AMOUNT WAS SET APART FOR THE SHAREHOLDERS OF THE SOCIETY WHEREAS IN THE PRESENT CASE AMOUNT WAS PROVIDED FOR THE BENEFIT OF THE EMPLOYEES. IN V IEW OF THIS THE CONTRIBUTION MADE TO STATE RENEWAL FUND IS ALLO WABLE U/S 37(1). 4 ITA NO. 816/JP/2017 RAJASTHAN RENEWAL ENERGY CORPN. LTD., JAIPUR. 5. IN D.B APPEAL NO. 4/2006 DATED 29.04.2016, THE HONBLE RAJASTHAN HIGH COURT IN CASE OF PRINCIPAL CIT VS RAJASTHAN STATE SEED CORPORATION LTD HAS HELD AS UNDER: 9. INSOFAR AS THE EXPENDITURE INCURRED ON STATE RE NEWAL FUND IS CONCERNED, SAID EXPENDITURE ALSO GOES TO SHOW THAT THE RENEWAL FUND WAS SET UP BY THE STATE GOVERNMENT AND WAS CRE ATED WITH THE OBJECT OF PROVIDING A SAFETY NET FOR THE WORKER S LIKELY TO BE EFFECTED BY RESTRICTING IN THE STATE PUBLIC ENTERPR ISE AND THAT A FINDING OF FACT HAS BEEN RECORDED THAT THE CONTRIBU TION MADE TO THE STATE RENEWAL FUND IS SOLELY FOR THE PURPOSES O F THE WELFARE AND BENEFIT OF THE EMPLOYEES. IN OUR VIEW, IT IS F OR THE ASSESSEE TO DECIDE WHETHER ANY EXPENDITURE SHOULD BE INCURRE D IN THE COURSE OF BUSINESS AND EXPENDITURE OF THIS NATURE B EING FOR BUSINESS EXPEDIENCY IS CERTAINLY ALLOWABLE DEDUCTIO N UNDER SECTION 37(1) OF THE ACT. IN OUR VIEW, ANY NORMAL EXPENDITURE FOR THE WELFARE AND BENEFIT OF EMPLOYEES IS ALLOWAB LE EXPENDITURE UNDER SECTION 37(1), THE TRIBUNAL HAS C OME TO A FINDING OF FACT THAT IT WAS A LEGAL OBLIGATION OF T HE RESPONDENT ASSESSEE TOWARDS CONTRIBUTION OF THE SAID AMOUNT TO THE STATE RENEWAL FUND AND THERE BEING A LEGAL OBLIGATION AS WELL IN OUR VIEW THE TRIBUNAL HAS COME TO A CORRECT CONCLUSION. 6. IN THE PRESENT CASE, IT IS NOTED THAT THE STATE RENEWAL FUND WAS SET UP TO PROVIDE SAFETY TO THE EMPLOYEES WORKING U NDER THE STATE OWNED ENTITIES IN CASE OF RESTRUCTURING/WIND-UP/CLO SURE OF THE UNDERTAKING. BASED ON THE STUDY DONE BY THE STATE GOVERNMENT, THE ASSESSEE HAS PROVIDED AN AMOUNT OF RS 20 LACS FOR T HE PURPOSES OF WELFARE AND BENEFIT OF THE EMPLOYEES. THE FACTS OF THE CASE ARE THUS PARI-MATERIA TO THE FACTS OF THE CASE BEFORE THE HONBLE RAJAST HAN HIGH COURT IN CASE OF RAJASTHAN SEED CORPORATION LTD AND RESPECTFULLY FOLLOWING THE SAME, WE AFFIRM THE ORDER OF THE LD C IT(A) WHO HAS RIGHTLY DELETED THE DISALLOWANCE MADE BY THE AO TOW ARDS CONTRIBUTION TO STATE RENEWAL FUND. IN THE RESULT, THE GROUND N O. 1 OF THE REVENUES APPEAL IS DISMISSED. 5 ITA NO. 816/JP/2017 RAJASTHAN RENEWAL ENERGY CORPN. LTD., JAIPUR. THUS THIS ISSUE IS COVERED BY THE DECISION OF THE T RIBUNAL IN ASSESSEES OWN CASE. THEREFORE, FOLLOWING THE EARLIER ORDER OF THE TRIBU NAL, WE DO NOT FIND ANY ERROR OR ILLEGALITY IN THE ORDER OF LD. CIT (A) QUA THIS ISS UE. 4. GROUND NOS. 2 & 3 ARE REGARDING DISALLOWANCE MAD E BY THE AO IN RESPECT OF EMPLOYEES CONTRIBUTION TO PF AND ESI WAS DELETED B Y THE LD. CIT (A). 5. WE HAVE HEARD RIVAL SUBMISSIONS AND CONSIDERED R ELEVANT MATERIAL ON RECORD. WE NOTE THAT THIS ISSUE IS NOW COVERED BY THE DECIS ION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. STATE BANK OF BIK ANER & JAIPUR, 99 DTR 131 (RAJ.) AS WELL AS DECISION IN THE CASE OF CIT VS. JAIPUR V IDYUT VITRAN NIGAM LTD. 363 ITR 307 (RAJ.) AND FURTHER IN THE CASE OF CIT VS. UDAIP UR DUGDH UTPADAK SAHAKARI SANGH LTD. 366 ITR 163 (RAJ.). THIS TRIBUNAL IN ASSESSEE S OWN CASE FOR THE ASSESSMENT YEAR 2011-12 VIDE ORDER DATED 18.8.2017 HAS DECIDED THIS ISSUE IN PARA 7 TO 9 AS UNDER :- 7. IN GROUND NO. 2 OF THE REVENUES APPEAL, THE RE VENUE HAS CHALLENGED THE DELETION OF ADDITION OF RS. 1,24,442 /- MADE ON ACCOUNT OF LATE DEPOSITION OF EPF AFTER DUE DATE OF THE PF ACT. IN THIS REGARD, LD. AR SUBMITTED THAT IN VIEW OF THE FOLLOWING JUDI CIAL PRONOUNCEMENTS ON ALLOWABILITY OF DEDUCTION OF EMPLOYEES CONTRIBU TION TO PF AND OTHER FUNDS AFTER THE DUE DATES IN RESPECTIVE STATUTE BUT BEFORE THE DUE DATE OF FILING OF RETURN OF INCOME, CIT(A) HAS RIGHTLY D ELETED THE ADDITION AND THUS THE GROUND OF THE DEPARTMENT BE DISMISSED: -CIT VS. STATE BANK OF BIKANER & JAIPUR (2014) 363 ITR 70 (RAJ) -CIT VS. JAIPUR VIDYUT VITRAN NIGAM LTD. (2014) 363 ITR 307 (RAJ) 6 ITA NO. 816/JP/2017 RAJASTHAN RENEWAL ENERGY CORPN. LTD., JAIPUR. -CIT VS. UDAIPUR DUGDH UTPADAK SAHAKARI SANGH LTD. (2014) 366 ITR 163 (RAJ) 8. THE RELEVANT FINDING OF THE LD CIT(A) IS REPROD UCED AS UNDER:- 3.3 I HAVE PERUSED THE FACTS OF THE CASE, THE ASSE SSMENT ORDER AND THE SUBMISSIONS OF THE APPELLANT. ADMITTEDLY, C ONTRIBUTION TO PF HAS BEEN PAID BY THE APPELLANT, IN ALL INSTANCES , BEFORE THE DUE DATE OF FILING THE RETURN OF INCOME U/S 139(1). THIS FACT IS THEREFORE, NOT IN DISPUTE. IN VIEW OF THE JUDGMENTS OF THE RAJASTHAN HIGH COURT IN THE CASE JAIPUR VIDHYUT VIT HRAN NIGAM LTD, 265 CTR 62 (RAJ.), CIT VS. STATE BANK OF BIKAN ER & JAIPUR (2014) 99 DTR 131 (RAJ.), AND OTHER CASE LAWS ON TH IS ISSUE, THE CLAIM OF THE APPELLANT IS ALLOWABLE. ACCORDINGLY, T HIS DISALLOWANCE MADE BY THE ASSESSING OFFICER, IS DIRE CTED TO BE DELETED. THIS GROUND IS ALLOWED. 9. IN THE PRESENT CASE, ADMITTEDLY, EMPLOYEESS CO NTRIBUTION TO PF AMOUNTING TO RS 124,442 FOR THE MONTH OF AUGUST 201 0 HAS BEEN PAID BY THE APPELLANT ON 21.09.2010 WITHIN THE SAME FINA NCIAL YEAR 2010-11. THE ISSUE IS NO MORE RES INTEGRA IN LIGHT OF VARIOUS JUDICIAL PRONOUNCEMENTS OF THE HONBLE RAJASTHAN HIGH COURT REFERRED SUPRA. WE ACCORDINGLY AFFIRM THE ORDER OF THE LD CIT(A) WH O HAS RIGHTLY DELETED THE DISALLOWANCE MADE BY THE AO TOWARDS EMP LOYEES CONTRIBUTION TO PF. IN THE RESULT, THE GROUND NO. 2 OF THE REVENUES APPEAL IS DISMISSED. THEREFORE, WHEN THIS ISSUE IS ALREADY COVERED BY TH E BINDING PRECEDENTS OF HONBLE JURISDICTIONAL HIGH COURT AS WELL AS THE DECISION O F THIS TRIBUNAL IN ASSESSEES OWN CASE, THEN WE DO NOT FIND ANY ERROR OR ILLEGALITY I N THE ORDER OF LD. CIT (A) QUA THIS ISSUE. 6. GROUND NO. 4 IS REGARDING DISALLOWANCE MADE BY T HE AO ON ACCOUNT OF CONTRIBUTION OF ENERGY CONSERVATION FUND WAS DELETE D BY THE LD. CIT (A). 7 ITA NO. 816/JP/2017 RAJASTHAN RENEWAL ENERGY CORPN. LTD., JAIPUR. 7. WE HAVE HEARD LD. D/R AS WELL AS THE LD. A/R AND CONSIDERED THE RELEVANT MATERIAL ON RECORD. AT THE OUTSET, WE NOTE THAT AN IDENTICAL ISSUE HAS BEEN CONSIDERED BY THIS TRIBUNAL IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2008-09 AS WELL AS FOR THE ASSESSMENT YEAR 2012-13 VIDE ORD ER DATED 18.8.2017 IN ITA NO. 88/JP/2016 IN PARA 91 TO 94 AS UNDER :- 91. IN RESPECT OF GROUND NO. 7, THE REVENUE HAS CH ALLENGED THE ACTION OF LD CIT(A) IN DELETING DISALLOWANCE OF CON TRIBUTION TO ENERGY CONSERVATION FUND OF RS. 1 CRORE. BRIEF FACTS OF TH E CASE ARE THAT THE ASSESSEE CONTRIBUTED RS.1 CRORE TO STATE ENERGY CON SERVATION FUND TO BE SPENT ON CONSERVATION OF ENERGY AS AND WHEN REQU IRED. THE AO HELD THAT THE CONTRIBUTION SO MADE IS NOT WHOLLY & EXCLUSIVELY FOR ASSESSEE BUSINESS OF GENERATING RENEWABLE ENERGY. H E THEREFORE, DISALLOWED THE SAME. ON APPEAL, THE LD. CIT(A) BY R ELYING ON THE DECISION OF COORDINATE BENCH IN ASSESSEES OWN CASE IN ITA NO.983/JP/13 FOR AY 2008-09 DELETED THE DISALLOWANC E. 92. THE LD AR SUBMITTED THAT THE ISSUE IS COVERED B Y THE DECISION OF HONBLE ITAT IN ASSESSEES OWN CASE FOR AY 2008-09. IT WAS FURTHER SUBMITTED THAT THE CONTRIBUTION IS MADE TO RAJASTHA N STATE ENERGY CONSERVATION FUND CONSTITUTED AS PER SECTION 16 OF THE ENERGY CONSERVATION ACT, 2001. THE OBJECT OF THE FUND IS M ENTIONED AT PG 11- 12 OF THE CIT(A) ORDER. THE ASSESSEE IS INCORPORATE D WITH THE OBJECT OF PROMOTING THE NON CONVENTIONAL AND RENEWABLE ENERGY SOURCES AND THEREFORE THE CONTRIBUTION SO MADE IS WHOLLY & EXCL USIVELY FOR THE PURPOSE OF BUSINESS. OTHERWISE ALSO, ANY CONTRIBUTI ON MADE TO A STATUTORY FUND IS ALLOWABLE AS DEDUCTION AS HELD BY SUPREME COURT IN CASE OF CIT VS. NEW HORIZON SUGAR MILLS PVT. LTD.26 9 ITR 397 WHERE IT WAS HELD THAT AMOUNT SET APART TOWARDS MOLASSES STO RAGE RESERVE FUND IS TO BE EXCLUDED FROM ASSESSEES TOTAL INCOME ON T HE PRINCIPLE OF 8 ITA NO. 816/JP/2017 RAJASTHAN RENEWAL ENERGY CORPN. LTD., JAIPUR. DIVERSION OF INCOME BY OVERRIDING TITLE. IN VIEW OF ABOVE, CIT(A) HAS RIGHTLY DELETED THE DISALLOWANCE AND THUS THE GROUN D OF THE DEPARTMENT BE DISMISSED. 93. THE RELEVANT FINDING OF THE LD. CIT(A) ARE REPR ODUCED AS UNDER:- 5.3 I HAVE PERUSED THE FACTS OF THE CASE, THE ASS ESSMENT ORDER AND THE SUBMISSIONS OF THE APPELLANT. THE FACT OF T HIS ISSUE IS SIMILAR TO THE FACT IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2008-09, APPEAL NO. ITA NO. 983/JP/2013. THIS ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE AS FOLLOW:- THIS AMOUNT WAS PAID TOWARDS ENERGY CONVERSATION CONTRIBUTION FUND, WHICH IS STATUTORY LIABILITY AS PER PROVISIONS OF ENERGY CONSERVATION ACT, 2001. THE CASE LAW RELIED BY THE ASSESSEE OF THE JUDGMENT OF THE HONBLE JURISDICTIO NAL HIGH COURT IN THE CASE OF CIT VS. RAJ SHIPPING AND WEAVI NG MILLS LTD. (SUPRA) IS SQUARELY APPLICABLE IN THE CASE OF THE A SSESSEE WHEREIN IT HAS BEEN HELD THAT CONTRIBUTION TO THE F UND SET UP FOR PRODUCTS WHICH WAS ALSO THE BUSINESS OF THE ASSESSE E HAS DIRECT NEXUS TO THE ADVANCEMENT OF THE ASSESSEE BUSINESS. FOLLOWING THE ABOVE JUDGMENT, THE DISALLOWANCE ON A CCOUNT OF CONTRIBUTION TO ENERGY CONSERVATION FUND OF RS. 1,0 0,00,000/- MADE BY THE ASSESSING OFFICER IS DIRECTED TO BE DEL ETED. THIS GROUND IS ALLOWED. 94. UNDISPUTEDLY, THERE IS NO CHANGE IN THE FACTS A ND CIRCUMSTANCES OF THE CASE OR ANY AUTHORITY WHICH HAS BEEN BROUGHT TO OUR NOTICE SUBSEQUENT TO THE DECISION OF THE COORDINATE BENCH IN ASSESSEES OWN CASE IN AY 2008-09. RESPECTFULLY FOLLOWING THE DEC ISION OF THE COORDINATE BENCH REFERRED SUPRA, WE AFFIRM THE FIND INGS OF THE LD CIT(A) AND THE GROUND TAKEN BY THE REVENUE IS DISMI SSED. FOLLOWING THE EARLIER ORDER OF THIS TRIBUNAL IN ASS ESSEES OWN CASE, WE DO NOT FIND ANY ERROR OR ILLEGALITY IN THE ORDER OF LD. CIT (A) QUA THIS ISSUE. 9 ITA NO. 816/JP/2017 RAJASTHAN RENEWAL ENERGY CORPN. LTD., JAIPUR. 8. GROUND NO. 5 IS REGARDING THE ADDITION MADE BY T HE AO ON ACCOUNT OF PUBLICITY AND ADVERTISEMENT EXPENSES WAS DELETED BY THE LD. CIT (A). 9. WE HAVE HEARD THE LD. D/R AS WELL AS THE LD. A/R AND CONSIDERED THE RELEVANT MATERIAL ON RECORD. WE NOTE THAT THIS TRIBUNAL IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2012-13 VIDE ORDER DATED 18.8.2017 HAS CONSIDERED AND DECIDED THIS ISSUE IN PARA 100 TO 103 AS UNDER :- 100. IN RESPECT OF GROUND NO. 9, THE REVENUE HAS C HALLENGED THE ACTION OF LD CIT(A) IN DELETING DISALLOWANCE OF PUB LICITY AND ADVERTISEMENT EXPENSES OF RS. 3,25,71,656/- ON ACCO UNT OF TOPOGRAPHIC SURVEY, RECRUITMENTS, TECHNICAL INVESTI GATION, PRINTING OF ENERGY POLICY, INVITING TENDERS, ETC. THE AO OBSERV ED THAT THESE EXPENDITURES ARE IN THE NATURE OF DEVELOPMENT/EXPLO RATION OF NEW BUSINESS AND DISALLOWED THE SAME. THE LD. CIT(A) AF TER CONSIDERING THE NATURE OF THE EXPENDITURE WHICH LAR GELY RELATED TO PAYMENT TO ADVERTISEMENT, PRINTING & PUBLISHING AGE NCIES ALLOWED THE EXPENDITURE INCURRED BY THE ASSESSEE. 101. DURING THE COURSE OF HEARING, THE LD AR SUBMI TTED THAT THE OBJECT OF THE ASSESSEE IS TO PROMOTE AND FACILITATE ENERGY CONSERVATION MEASURES. FOR THIS PURPOSE IT CARRIES OUT MASS COMM UNICATION IN PUBLIC AWARENESS PROGRAMS BY PUBLICATION OF AKSHAY URJA SA NDESH ON QUARTERLY BASIS, DISTRIBUTING BROCHURES, LEAFLETS & HAND BILLS AND ADVERTISING THROUGH TV, RADIO, CABLE NETWORK, CINEM A SLIDES, DISPLAY BOARDS, HOARDINGS, ETC. AS A RESULT, ASSESSEE RECEI VED A SUM OF RS.16.77 CRORES AS REGISTRATION FEES FROM VARIOUS E NTREPRENEURS FOR SETTING RENEWABLE ENERGY PLANTS. ONLY AN AMOUNT OF RS.3.50 LACS IS INCURRED FOR TOPOGRAPHIC SURVEY WHICH IS ALSO A PAR T OF ITS BUSINESS ACTIVITY. HENCE, THE EXPENDITURE INCURRED BY THE AS SESSEE ON ADVERTISEMENT IS WHOLLY & EXCLUSIVELY FOR THE PURPO SE OF BUSINESS AND 10 ITA NO. 816/JP/2017 RAJASTHAN RENEWAL ENERGY CORPN. LTD., JAIPUR. THE SAME IS ALLOWABLE U/S 37(1). IN VIEW OF ABOVE, LD CIT(A) HAS RIGHTLY DELETED THE DISALLOWANCE AND THUS THE GROUND OF THE DEPARTMENT BE DISMISSED 102. THE RELEVANT FINDING OF THE LD. CIT(A) ARE REP RODUCED AS UNDER:- 7.3 I HAVE PERUSED THE FACTS OF THE CASE, THE ASSE SSMENT ORDER AND THE SUBMISSIONS OF THE APPELLANT. THE ASSESSING OFFICER HAS MADE THE DISALLOWANCE UNDER THIS HEAD AS HE FOUND T HAT THE EXPENDITURE HAD BEEN INCURRED FOR TOPOGRAPHIC SURVE Y, RECRUITS MEMBERS, TECHNICAL INVESTIGATIONS, PRINTING OF ENER GY POLICY AND INVITING TENDERS ETC. AND WAS OF THE OPINION THAT T HIS SEEMED IN THE NATURE OF NEW BUSINESS DEVELOPMENT AND EXPLORAT ION OF BUSINESS OPPORTUNITY. FURTHER, IT WAS ALSO FELT THA T THIS EXPENDITURE HAD INCREASED EXCEPTIONALLY DURING THE YEAR ALMOST 4 TIMES. IN THE PRESENT PROCEEDINGS, THE AR IN HIS WRITTEN S UBMISSIONS HAS STATED THAT THE ASSESSEE COMPANY BEING THE STAT E NODAL AGENCY OF THE MINISTRY OF NEW & RENEWABLE ENERGY DE PARTMENT, GOVT. OF INDIA, IS REQUIRED TO POPULARIZE THE USAGE OF RENEWABLE ENERGY SOURCE & POLICY DEPLOYMENT TOO. FURTHER, IN THE F.Y. 2010-11, THE STATE GOVERNMENT OF RAJASTHAN, ISSUED RAJASTHAN SOLAR ENERGY POLICY, 2 011 VIDE NOTIFICATION NO. F.20(6) ENERGY/2010 DATED 19.04.20 11 FOR THE PROMOTION THE SOLAR ENERGY IN RAJASTHAN, PRIOR TO E NACTMENT TO THIS POLICY, THE PROMOTION OF SOLAR ENERGY WAS BEIN G DONE UNDER THE POLICY FOR PROMOTING GENERATION OF ELECTRICITY THROUGH NON- CONVENTIONAL ENERGY SOURCES, 2004. THE COMPANY WAS ALSO APPOINTED AS NODAL AGENCY FOR SINGLE WINDOW CLEARANCE OF PROJECT OF SOLAR POWER PROJECT SET UP IN THE STATE OF RAJASTHAN, AS PER RAJASTHAN SOLAR ENER GY POLICY, 2011 AS NOTIFIED AND ISSUED BY THE GOVERNMENT OF RA JASTHAN ENERGY DEPARTMENT VIDE DATED 19.04.2011. THE LEDGER ACCOUNT OF THE EXPENDITURE HAS BEEN FILE D AND PERUSED. LARGELY, THE EXPENDITURE IS RELATED TO PAY MENT TO ADVERTISING AGENCIES AND PRINTING AND PUBLISHING AG ENCIES. A 11 ITA NO. 816/JP/2017 RAJASTHAN RENEWAL ENERGY CORPN. LTD., JAIPUR. SMALL AMOUNT OF 3.50 LAKHS APPROX. IS FIXED FOR TOP OGRAPHIC SURVEY GEO TECHNICAL INVESTIGATION WHICH HAS BEEN E XPLAINED BY AR AS IN PURSUANCE OF THE PROMULGATION OF THE NEW P OLICY. IN VIEW OF THE ABOVE THE DISALLOWANCE MADE BY THE A SSESSING OFFICER IS DELETED. 103. WE HAVE HEARD THE RIVAL CONTENTIONS AND PURUS ED THE MATERIAL AVAILABLE ON RECORD. ONE OF THE BUSINESS OBJECTS O F THE ASSESSEE COMPANY IS TO PROMOTE AND FACILITATE ENERGY CONSERV ATION AND POPULARIZE THE USAGE OF RENEWABLE ENERGY SOURCES & ENCOURAGE COMPANIES TO SET UP RENEWABLE ENERGY PLANTS. AS PA RT OF ITS ACTIVITIES, THE ASSESSEE COMPANY HAS INCURRED THE PUBLICITY AND ADVERTISEMENT EXPENDITURE DURING THE YEAR. THE LD CIT(A) HAS GIV EN A FINDINGS ON PERUSAL OF LEDGER ACCOUNT THAT THESE EXPENDITURE LA RGELY RELATED TO PAYMENT TO ADVERTISING AGENCIES AND PRINTING AND PU BLISHING AGENCIES. THE SAID FINDING OF THE LD CIT(A) REMAIN UNCONTROVE RTED BEFORE US. IN THE RESULT, WE CONFIRM THE ORDER OF THE LD CIT(A) A ND GROUND OF APPEAL TAKEN BY THE REVENUE IS DISMISSED. ACCORDINGLY IN VIEW OF THE DECISION OF THIS TRIBUNA L IN THE ASSESSEES OWN CASE, WE DO NOT FIND ANY ERROR OR ILLEGALITY IN THE ORDER OF TH E LD. CIT (A) QUA THIS ISSUE. 10. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 19/03/201 8. SD/- SD/- HKKXPUN FOT; IKY JKWO (BHAGCHAND) ( VIJAY PAL RAO ) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 19/03/2018. DAS/ 12 ITA NO. 816/JP/2017 RAJASTHAN RENEWAL ENERGY CORPN. LTD., JAIPUR. 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. RAJASTHAN RENEWABLE ENERGY CORP N. LTD., JAIPUR. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 816/JP/2017} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR