The ACIT,(OSD)Circle-8, Ahmedabad V. M/s. Suzlon Energy Limited, Ahmedabad

ITA 901/AHD/2011

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 6920 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 8 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-12-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 09-12-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 25-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Reopening of assessment; Difference of opinion; Change of opinion
• Section: 143(3); 14A; 115JB; 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD (BEFORE SHRI G.C.GUPTA VICE PRESIDENT & SHRI ANIL CHATURVEDI , A.M.) I. T. A. NO. 901 / AHD/ 20 1 1 (A SSESSMENT YEAR: 2007 - 08) THE A.C.I.T., (OSD) CIRCLE - 8, AHMEDABAD V/S SUZLON ENERGY LIMITED SUZLON HOUSE, 5, SHRIMALI SOCIETY, AHMEDABAD (APPELLANT) ( RESPONDENT) PAN: AADCS0472N APPELLANT BY : SHRI NIMESH YADAV, SR. D.R. RESPONDENT BY : SHRI TUSHAR P. HEMANI, A.R. ( )/ ORDER DATE OF HEARING : 09 - 12 - 2014 DATE OF PRONOUNCEMENT : 19 - 12 - 2014 PER SHRI ANIL CHATURVEDI,A.M. 1. THIS APPEAL FILED BY THE REVENUE IS AGAINST THE ORDER OF CIT(A) - XIV, AHMEDABAD DATED 30.12.2010 FOR A.Y. 2007 - 08. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER. 3. ASSESSEE IS A COMPA NY STATED TO BE ENGAGED IN THE BUSINESS OF MANUFACTURING OF WINDMILLS. ASSESSEE ELECTRONICALLY FILED ITS RETURN OF INCOME FOR A.Y. 07 - 08 ON 18.10.2007 DECLARING TOTAL INCOME OF RS. 219,29,91,128/ - . THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER THE ASSE SSMENT WAS FRAMED UNDER SECTION 143(3) VIDE ORDER DATED 30.07.2008 AND THE TOTAL INCOME WAS DETERMINED AT RS. 258,25,90,110/. SUBSEQUENTLY ON SCRUTINY OF THE RECORDS, A.O NOTICED THAT ASSESSEE WHILE CALCULATING TAXABLE INCOME U/S. 115JB , HAD REDUCED BOOK P ROFIT ITA NO 901/AHD/2011 . A.Y. 2007 - 08 2 BY RS. 2,42,00,000/ - ON ACCOUNT OF PROVISION FOR FBT WHICH AS PER A.O WAS IRREGULAR IN VIEW OF THE PROVISIONS OF SECTION 2(43). HE ALSO NOTICED THAT THE DISALLOWANCE OF RS. 2,66,38,938/ - MADE U/S. 14A DURING ASSESSMENT WAS REQUIRED TO BE ADDED TO THE BOOK PROFIT U/S . 115JB AS PER CLAUSE F BELOW EXPLANATION 1 TO SECTION 115JB WHICH WAS NOT DONE. HE WAS THEREFORE OF THE VIEW THAT ASSESSEE S INCOME HAS ESCAPED ASSESSMENT ON ACCOUNT OF AFORESAID ADJUSTMENTS AND ACCORDINGLY A NOTICE U/S. 148 OF THE ACT WAS ISSUED ON 26.3.2010 AND THEREAFTER ASSESSMENT WAS FRAMED U/S. 143(3) R.W. S. 147 OF THE ACT AND THE TOTAL BOOK PROFITS FOR THE PURPOSE OF MAT WAS D ETERMINED AT RS. 11 , 73 , 06 , 12 ,871/ - AS AGAINST THE BOOK PROFITS OF RS. 11,70,37,53,788/ - DETERMINED IN ORIGINA L ORDER OF ASSESSMENT. AGGRIEVED BY THE ORDER OF A.O, ASSESSEE CARRIED THE MATTER BEFORE CIT(A) WHO VIDE ORDER DATED 30.12.2010 GRANTED SUBSTANTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY THE ORDER OF CIT(A), REVENUE IS NOW IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS: - 1 THE LD. CIT(A) - XIV, AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN ALLOWING THE ASSESSEE'S GROUND OF APPEAL REGARDING THE VALIDITY OF RE - OPENING OF THE ASSESSMENT PROCEEDINGS U/S. 147 AND NOTICE U/S. 148 OF THE ACT. 2 THE LD. CIT(A) - X IV, AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN DIRECTING NOT TO ADDED BACK THE LIABILITY OF FBT OF RS.2,20,145/ - WHILE COMPUTING THE BOOK PROFIT U/S. 115JB OF THE ACT. 3 THE LD. CIT(A) - XIV, AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN DIRECTING THAT THE AMOUN T OF DISALLOWANCE U/S. 14A OF RS.2,66,38,938/ - CAN'T BE ADDED TO BOOK PROFIT WHILE WORKING OUT TAX LIABILITY UNDER THE PROVISIONS OF MAT AS THE SAID SECTION HAS NO APPLICABILITY BEYOND CHAPTER IV. WHILE COMPUTING THE BOOK PROFIT U/S. 115JB OF THE ACT. 1 S T GROUND IS WITH RESPECT TO VALIDITY OF REOPENING OF ASSESSMENT PROCEEDINGS U/S 147 OF THE ACT. 4. IN THE PRESENT CASE, THE NOTICE U/S 148 FOR REOPENING THE ASSESSMENT WAS ISSUED FOR THE REASONS THAT PROVISIONS FOR FBT AND DISALLOWANCE MADE U/S 14A WERE NO T ADDED TO THE BOOK PROFITS FOR THE PURPOSE OF CALCULATION OF MAT. 5. BEFORE US, LD. D.R SUBMITTED THAT FOR CALCULATING TAXAB LE INCOME U/S. 115JB OF THE ACT, T HE ASSESSEE HAS WRONGLY REDUCED BOOK PROFIT BY NOT INCLUDING PROVISION FOR FBT AND HAD ALSO NOT CO NSIDERED THE DISALLOWANCE MADE U/S. 14A OF THE ACT ITA NO 901/AHD/2011 . A.Y. 2007 - 08 3 WHICH HAD RESULTED INTO ESCAPEMENT OF INCOME AND THEREFORE THE A.O W AS FULLY JUSTIFIED IN RESORTING TO THE REOPENING OF THE ASSESSMENT. HE THUS SUPPORTED THE ORDER OF A.O. LD. A.R. ON THE OTHER HAND REITER ATED THE SUBMISSIONS MADE BEFORE A.O AND CIT(A) AND FURTHER SUBMITTED THAT DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS, THERE WAS APPLICATION OF MIND BY A.O ON BOTH THE POINTS ON WHICH THE REOPENING WAS RESORTED AND THAT NO TANGIBLE MA TERIAL WAS F OUND FOR INITIATING THE REOPENING OF ASSESSMENT. HE FURTHER SUBMITTED THAT THE REOPENING WAS MERELY ON ACCOUNT OF CHANGE OF OPINION WHICH WAS NOT PERMISSIBLE IN LAW . HE FURTHER SUBMITTED THAT A.O IN THE ORIGINAL ASSESSMENT HAD MADE DISALLOWANCE U/S. 14A AF TER ELABORATING DISCUSSION OF THE ISSUE AND IF THE A.O WAS OF THE VIEW THAT SUCH DISALLOWANCE WAS REQUIRED T O BE ADDED TO THE BOOK PROFITS WHILE COMPUTING BOOK PROFIT ALSO , HE COULD HAVE DONE SO AT THE STAGE OF ORIGINAL ASSESSMENT ITSELF. HE FURTHER SUBMIT TED THAT I F A.O FORGETS TO MAKE DISALLOWANCE U/S. 14A WHILE COMPUTING BOOK PROFIT , A.O CANNOT TAKE RECOURSE TO REASSESSMENT FOR RECTIFYING THE SUCH MISTAKE AT HIS END. HE ALSO PLACED RELIANCE ON THE DECISION OF CIT VS. KELVINATOR OF INDIA LTD. 320 ITR 561 (SC) AND THE DECISION OF HON BLE GUJARAT HIGH COURT IN THE CASE OF CLIANTHA RESEARCH LTD. VS. D.C.I.T (2013) 35 TAXMAN.COM 61 (GUJ). HE THUS SUPPORTED THE ORDER OF CIT(A). 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. WE FIND TH AT CIT(A) WHILE HOLDING THAT THERE WAS NO INCOME WHICH HAS ESCAPED ASSESSMENT SO AS TO ISSUE NOTICE U/S. 148 OF THE ACT HAS GIVEN A FINDING THAT DURING THE COURSE OF SCRUTINY, THE ASPECT OF COMPUTATION OF BOOK PROFIT HAVE BEEN ANALYZED AND AFTER DUE APPLIC ATION OF MIND, T HE A.O HAD DETERMINED THE FIGURE OF BOOK PROFIT FOR THE PUR POSE OF COMPUTATION OF MINIMUM ALTERNATIVE TAX. HE HAS FURTHER HELD THAT THE REOPENING IN THE PRESENT CASE TO BE A CASE OF CHA NGE OF OPINION AND THEREFORE IN VALID. BEFORE US NO MATE RIAL HAS BEEN PLACED ON RECORD TO CONTROVERT THE FINDINGS OF CIT(A) AND LD. A.R. WE FURTHER FIND THAT HON BLE GUJARAT HIGH COURT IN THE CASE OF CLIANTHA RESEARCH (SUPRA) HAS HELD HAS UNDER: - WHERE DURING ORIGINAL ASSESSMENT ASSESSEE'S CLAIM WAS PROCESSE D AT LENGTH AND AFTER CALLING FOR DETAILED EXPLANATION SAME WAS ACCEPTED, MERELY BECAUSE A CERTAIN ELEMENT OR ITA NO 901/AHD/2011 . A.Y. 2007 - 08 4 ANGLE WAS NOT IN MIND OF ASSESSING OFFICER WHILE ACCEPTING SUCH A CLAIM, COULD NOT BE A GROUND FOR ISSUING NOTICE UNDER SECTION 148 FOR REASSESSME NT 7. BEFORE US, REVENUE HAS BROUGHT ANY BINDING DECISION IN ITS SUPPORT NOR COULD POINT OUT ANY DISTINGUISHING FEATURE OF THE DECISION RELIED BY LD. A.R. IN VIEW OF THE AFORESAID FACTS, WE FIND NO REASON TO INTERFERE WITH THE ORDER OF CIT(A) AND THUS THIS GROUND OF REVENUE IS DISMISSED. 2 ND GROUND IS WITH RESPECT TO DIRECTING NOT TO ADD THE LIABILITY OF FBT OF RS. 2,20,145/ - . 8. A.O NOTICED THAT ASSESSEE HAD MADE PROVISION FOR FBT OF RS. 2,42,00,000/ - BUT HAD ACTUALLY PAID FBT OF RS. 2,39,7 9,855/ - AND THUS THE ACTUAL LIABILITY ON ACCOUNT OF FBT DISCHARGED BY THE ASSESSEE WAS LESS BY RS. 2,20,145/ - WHICH ACCORDING TO HIM WAS UNASCERTAINED LIABILITY AND THEREFORE SHOULD HAVE BEEN ADDED TO BOOK PROFITS. HE ACCORDINGLY ADDED THE SAME TO THE BOOK PROFIT WHILE CO MPUTING THE MAT AS PER SECTION 115JB OF THE ACT. AGGRIEVED BY THE ORDER OF A.O, ASSESSEE CARRIED THE MATTER BEFORE CIT(A) WHO DELETED THE ADDITION BY HOLDING AS UNDER: - 9. EVEN ON MERITS APPELLANT HAS MADE OUT AN ARGUABLE CASE. THE GROUND NO. 4 IS REGARDING P OSITIVE ADJUSTMENTS OF RS.2,20,145 / - UNDER CLAUSE (A) TO EXPLANATION 1 TO SECTION 115JB OF THE ACT. THE APPELLANT IN RESPECT OF WHICH VIDE LETTER DATED 05/05/2010 SUBMITTED AND EXPLAINED TO THE ASSESSING OFFICER THAT AS PER CBDT CIRCULAR NO.8 OF 2005, DAT ED 29/08/2005 VIDE FAQ NO. 103 IT PROVIDES THAT FBT IS NOT REQUIRED TO BE ADDED WHILE COMPUTING BOOK PROFITS U/S 115JB OF THE ACT AND THEREFORE NO POSITIVE ADJUSTMENT IS REQUIRED TO BE ADDED IN RESPECT THEREOF. THE ASSESSING OFFICER ACCEPTED THE CONTENTION OF THE APPELLANT, HOWEVER, HE FOUND THAT AS THE APPELLANT COMPANY HAS ACTUALLY PAID RS.2,39,79,855/ - IN RESPECT OF FBT PROVISION OF RS.2,42,00,000/ - BALANCE AMOUNT OF RS.2,20,145/ - IS REQUIRED TO BE ADDED UNDER CLAUSE (C) OF EXPLANATION 1 TO S.115JB BEING AMOUNT SET ASIDE TO PROVISION MADE FOR MEETING LIABILITIES OTHER THAN ASCERTAINED LIABILITIES. ACCORDINGLY THE ID. AO MADE POSITIVE ADJUSTMENTS OF RS.2,20,145/ - WHILE COMPUTING BOOK PROFIT OF THE APPELLANT COMPANY UNDER MAT PROVISIONS. THE APPELLANT SUBMI TS THAT FRINGE BENEFIT TAX WHETHER PAID OR PAYABLE OR PROVISION THEREOF IS NOT REQUIRED TO BE ADDED BACK WHILE COMPUTING BOOK PROFIT U/S 115JB OF THE ACT. THE APPELLANT FURTHER SUBMITS THAT PAID ALSO INCLUDES PAYABLE. FOR THIS PURPOSE RELIANCE IS PLACED ON THE DEFINITION OF THE TERM 'PAID' UNDER SECTION 43(2) OF THE ACT. THE AO ACCEPTED - THE CONTENTION OF THE - APPELLANT, HOWEVER, HE IS OF THE VIEW THAT UNPAID - AMOUNT OF RS.2,20,145/ - IN RESPECT OF FBT IS UNAS CERTAINED LIABILITY AND THOUGH I T IS NOT REQUIRED TO BE ADDED UNDER CLAUSE (A), THE SAME IS REQUIRED TO BE ADDED UNDER CLAUSE (C) OF EXPLANATION 1 TO SECTION 115JB OF THE ACT. THE APPELLANT COMPANY SUBMITS THAT IT IS WELL SETTLED LAW THAT THE AO CANNOT DO INDIRECTLY WHICH HE CANNOT DO DIRECTLY. I HOLD THAT THE ISSUE IS DIRECTLY COVERED IN FAVOUR OF THE APPELLANT BY THE CIRCULAR OF THE BOARD WHICH INTER ALIA HELD THAT FRINGE BENEFIT TAX WHETHER PAID OR PAYABLE OR PROVISION THEREOF IS NOT REQUIRED TO BE ADDED BACK WHILE COMPUTING BOOK PROFIT U/S 115JB OF THE A CT HENCE, THIS ADJUSTMENT TO THE FIGURE OF BOOK PROFIT IS HELD TO BE INVALID AND DIRECTED TO BE DELETED. THIS GROUND OF APPEAL IS THEREFORE, ALLOWED. EVEN OTHERWISE, THE APPELLANT ALTERNATIVELY SUBMITTED THAT IN ANY CASE MERELY BECAUSE PAYMENT OF FBT IS LE SSER T HAN THE AMOUNT OF PROVISIONS, IT CANNOT BE SAID THAT BALANCE UNPAID AMOUNT IS UNASCERTAINED OR CONTINGENT LIABILITY WHICH IS REQUIRED TO BE ADDED UNDER CLA USE (C) OF EXPLANATION 1 TO S. 115 JB OF THE ACT. THE APPELLANT SUBMITTED THAT IT IS AN ASCERTAI NED LIABILITY AS EVIDENT FROM THE BOOKS AND METHOD OF ITA NO 901/AHD/2011 . A.Y. 2007 - 08 5 QUANTIFICATION DOES NOT DECIDE THE ISSUE OF ASCERTAINMENT OR OTHERWISE OF THE LIABILITY AND THEREFORE, THE PROVISION FOR FBT IS REQUIRED TO BE EXCLUDED FOR THE PURPOSE OF DETERMINING THE BOOK PROFITS. R ELIANCE IS PLACED ON THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF BHARAT EARTH MOVER V/S. CIT 245 ITR 428 (S.C.) WHEREIN IT WAS HELD THAT PROVISION MADE BY THE ASSESSEE COMPANY FOR MEETING THE LIABILITY INCURRED BY IF UNDER THE LEAVE ENCASHMENT SCH EME PROPORTIONATE WITH THE ENTITLEMENT EARNED BY THE EMPLOYEE OF THE COMPANY, INCLUSIVE - OF THE - OFFICERS AND THE .STAFF, SUBJECT TO THE CEILING ON ACCUMULATION AS APPLICABLE ON THE RELEVANT DATE, WAS ENTITLED TO DEDUCTION OUT OF THE GROSS RECEIPTS IN THE AC COUNTING YEAR DURING WHICH THE PROVISION IS MADE FOR THE LIABILITY. THUS IT WAS HELD THAT THE LIABILITY WAS NOT A CONTINGENT LIABILITY. HENCE, EVEN OTHERWISE, FOLLOWING THE RATIO OF THE SAID DECISION, IN THE FACTS OF THE PRESENT CASE ALSO THE LIABILITY OF FBT HAVING BEEN CRYSTALLIZED AND QUANTIFIED IN THE BO OKS OF THE ACCOUNT THE SAME CAN NOT BE TREATED AS CONTINGENT LIABILITY AND THEREFORE THE; SAME CANNOT BE ADDED BACK TO THE AMOUNT OF BOOK PROFIT. THIS GROUND IS THEREFORE DECIDED IN FAVOUR OF THE APPELLA NT. 10. AGGRIEVED BY THE ORDER OF CIT(A), REVENUE IS NOW IN APPEAL BEFORE US. 11. BEFORE US, LD. D.R. SUPPORTED THE ORDER OF A.O. LD. A.R. ON THE OTHER HAND REITERATED THE SUBMISSIONS MADE BEFORE LOWER AUTHORITIES AND FURTHER SUBMITTED THAT EXPLANATION 2 TO S ECTION 115JB SPECIFIES WHAT SHALL BE INCLUDED IN INCOME TAX FOR THE PURPOSE OF CLAUSE ( A) OF EXPLANATION 1 TO SECTION 115JB WHICH DOES NOT PRESCRIBED FBT . THUS FBT DEBITED TO PROFIT AND LOSS ACCOUNT IS NOT REQUIRED TO BE ADDED BACK WHILE COMPUTING THE BOOK PROFIT. HE FURTHER SUBMITTED THAT CBDT CIRCULAR NO. 8/A/2005 DATED 29.08.2005 SPECIFICALLY PROVIDES THAT FBT NEED NOT BE ADDED BACK FOR COMPUTING BOOK PROFIT U/S. 115JB . W ITH RESPECT TO THE EXCESS OF PROVISION OVER THE ACTUAL PAID AMOUNT OF FBT PAID WHICH WAS TRE ATED AS UNASCERTAINED LIABILITY, H E SUBMITTED THAT IN THE SUBSEQUENT YEAR THE AMOUNT HAS BEEN PAID AND FURTHER THE ISSUE IS DIRECTLY COVERED BY THE DECISION OF BHARAT EARTH MOVER VS. CIT 245 ITR 428 (SC). HE THUS SUPPORTED THE ORDER OF CIT(A) . 12. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. WE FIND THAT CIT(A) WHILE DELETING THE ADDITION HAS INTERALIA HELD THAT THE ISSUE OF CONSIDERING FBT FOR THE PURPOSE OF MAT IS DIRECTLY COVERED IN FAVOUR OF THE ASSESSEE BY THE CIR CULAR OF THE BOARD DATED 29.08.2005 W HICH INTERALIA HOLDS THAT FBT WHETHER OR PAYABLE OR PROVISION THEREOF IS NOT REQUIRED TO BE ADDED BACK WHILE COMPUTING BOOK PROFIT U/S. 115JB OF THE ACT. HE HAS FURTHER GIVEN A FINDING THAT THE LIABILITY OF FBT HAVING B EEN CRYSTALLIZED AND QUANTIFIED IN THE ITA NO 901/AHD/2011 . A.Y. 2007 - 08 6 BOOKS OF ACCOUNT, THE SAME CANNOT BE TREATED AS CONTINGENT LIABILITY AND THEREFORE CANNOT BE ADDED BACK TO THE AMOUNT OF BOOK PROFIT. BEFORE US, REVENUE HAS NOT BROUGHT ANY MATERIAL ON RECORD TO CONTROVERT THE FINDING S OF CIT(A). IN VIEW OF THE AFORESAID FACTS, WE FIND NO REASON TO INTERFERE WITH THE ORDER OF CIT(A) AND THUS THIS GROUND OF REVENUE IS DISMISSED. 3 RD GROUND IS WITH RE SPECT TO DIRECTING THE DELETION OF DISALLOWANCE U/S 14A FROM BEING ADDED TO BOOK PRO FIT. 13. A.O NOTICED THAT DISALLOWANCE OF RS. 2,66,38,938/ - WAS MADE U/S 14A WHILE FRAMING ASSESSMENT U/S 143(3) AND THE DISALLOWANCE MADE BY A.O WAS ALSO CONFIRMED BY CIT(A). A.O WAS OF THE VIEW THAT THE DISALLOWANCE MADE U/S. 14A WAS REQUIRED TO BE ADDED TO THE BOOK P ROFIT IN TERMS OF CLAUSE F BELOW EXPLANATION 1 TO SECTION 115JB OF THE ACT. HE ACCORDINGLY ADDED THE SAME TO THE BOOK PROFIT. AGGRIEVED BY THE ORDER OF A.O, ASSESSEE CARRIED THE MATTER BEFORE CIT(A) WHO AFTER CONSIDERING THE SUBMISSIONS OF TH E ASSESSEE DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE BY HOLDING AS UNDER: - I HAVE GONE THROUGH THE SUBMISSION OF APPELLANT AND ALSO ORDER OF AO AND FOUND THAT THE SUBJECT AMOUNT OF DISALLOWANCE .HAS BEEN WORKED OUT BASED ON THE FORMULAE GIVEN IN RULE 8 D. AFTER GIVING DUE CONSIDERATION TO THE PROVISIONS OF SECTION 14A, SECTION 115JB AND THE JUDICIAL PRONOUNCEMENT RELIED UPON BY THE APPELLANT INCLUDING THAT OF APEX C OURT IN THE CASE OF APOLLO TYRES (SUPRA) AND HON'BLE DELHI TRIBUNAL IN THE CASE OF GOETZE (INDIA) LIMITED V CIT (2009) 32 SOT 101 (DELHI) I FIND MERIT IN THE ARGUMENT OF THE APPELLANT THAT THE AMOUNT OF DISALLOWANCE MADE U/S. 14A CANNOT BE ADDED TO BOOK PROFIT WHILE WORKING OUT TAX LIABILITY UNDER PROVISIONS OF MAT AS THE SAID SECTION HAS NO AP PLICABILITY BEYOND CHAPTER IV. IT IS WELL SETTLED THAT ONLY SUCH ADJUSTMENTS CAN BE MADE TO THE FIGURE OF BOOK PROFITS WHICH ARE PRESCRIBED UNDER THE SCHEME OF THE ACT, ADJUSTMENT OF DISALLOWANCE U/S 14A IS NOT ONE OF THE PRESCRIBED ADJUSTMENTS AND THEREFO RE, THE SAME IS HELD TO BE INVALID. IN VIEW OF THE SAME I ALLOW THIS GROUND OF APPEAL IN FAVOUR OF THE APPELLANT. 14. THUS A GGRIEVED BY THE ORDER OF CIT(A), REVENUE IS NOW IN APPEAL BEFORE US. 15. BEFORE US, LD. D.R. SUPPORTED THE ORDER OF CIT(A). ON THE O THER HAND LD. A.R. REITERATED THE SUBMISSIONS MADE BEFORE LOWER AUTHORITIES AND SUPPORTED THE ORDER OF CIT(A). HE ALSO PLACED RELIANCE ON THE DECISION IN THE CASE OF CADILA ITA NO 901/AHD/2011 . A.Y. 2007 - 08 7 PHARMACEUTICAL LTD. VS. ACIT ITA NOS. 1146 & 1518/A/2011 , ATUL LTD. VS. ACIT ITA NO . 8/A/2013. 16. WE HAVE HEARD THE RIVAL SUBMISSIONS AND P ERUSED THE MATERIAL ON RECORD. WE FIND THAT CIT(A) A FTER RELYING ON THE DECISION IN THE CASE OF APOLLO TY RES VS. CIT (2002) 255 ITR 273 (SC) AND THE DECISION OF DELHI TRIBUNAL IN THE CASE OF GOETZE INDI A LTD. VS. CIT (2009) 32 SOT 101 (DEL) HAS HELD THAT THE AMOUNT OF DISALLOWANCE MADE U/S 14A CANNOT BE ADDED TO BOOK PROFIT WHILE WORKING OUT THE TAX LIABILITY UNDER PROVISIONS OF MAT. BEFORE US, REVENUE HAS NOT BROUGHT ANY MATERIAL ON RECORD TO CONTROVERT THE FINDINGS OF CIT(A) NOR HAS BROUGHT ANY CONTRARY BINDING DECISION IN ITS SUPPORT. IN VIEW OF THE AFORESAID FACTS, WE FIND NO REASON TO INTERFERE WITH THE ORDER OF CIT(A) AND THUS THIS GROUND OF REVENUE IS DISMISSED. 17. IN THE RESULT, THE APPEAL OF REVEN UE IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 19 - 12 - 201 4 . SD/ - SD/ - (G.C.GUPTA) (ANIL CHATURVEDI) VICE PRESIDENT ACCOUNTANT MEMBER AHMEDABAD. TRUE COPY RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHMEDABAD