M/s J.K. Synthetics Ltd., Kanpur V. Astt. Commissioner of Income Tax-4, Kanpur

MA 136/LKW/2015

• Counselvise Citation: [2016] 124 COUNSELVISE.COM (IT) 3895 (ITAT-LUCKNOW)
• Duration Of Justice: 2 month(s) 7 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 14-01-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 01-01-2016
• Assessment Year: 1992-1993
• Appeal Filed On: 06-11-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SWATI RATNA
• Keywords: Depreciation; Rectification of order; Proportionate interest

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER M.A. NO.136/LKW/2015 (ARISING OUT OF I.T.A.NO.563/LKW/2010) ASSESSMENT YEAR:1992-93 & M.A. NO.137/LKW/2015 (ARISING OUT OF I.T.A.NO.633/LKW/2010) ASSESSMENT YEAR:1997-98 & M.A. NO.138/LKW/2015 (ARISING OUT OF I.T.A.NO.715/LKW/2010) ASSESSMENT YEAR:2000-01 & M.A. NO.139/LKW/2015 (ARISING OUT OF I.T.A.NO.537/LKW/2010) ASSESSMENT YEAR:1991-92 A.C.I.T.-4, KANPUR. VS. M/S J.K. SYNTHETICS LTD., KAMLA TOWER, KANPUR. PAN:AAACJ4988M (APPLICANT) (RESPONDENT) APPLICANT BY SHRI RAKESH GARG, ADVOCATE RESPONDENT BY SMT. SWATI RATNA, D. R. DATE OF HEARING 01/01/2016 DATE OF PRONOUNCEMENT 14/01/2016 O R D E R PER A. K. GARODIA, A.M. ALL THESE MISC. APPLICATIONS ARE FILED BY THE ASSE SSEE POINTING OUT CERTAIN APPARENT MISTAKES IN THE RESPECTIVE TRIBUNA L ORDERS AND ALL THESE MISC. APPLICATIONS WERE HEARD TOGETHER AND ARE BEIN G DISPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. [2] 2. FIRST WE TAKE UP MISC. APPLICATION NO.136/LKW/20 15. IN THIS MISC. APPLICATION, IT IS SUBMITTED BY THE ASSESSEE THAT W HILE DECIDING GROUND NO. 3 OF THE APPEAL FOR THE PRESENT YEAR, IT WAS HELD B Y THE TRIBUNAL THAT THIS ISSUE IS COVERED BY THE TRIBUNAL ORDER IN ASSESSEE S OWN CASE FOR ASSESSMENT YEAR 91-92 AS PER GROUND NO. 6 IN THAT Y EAR. THE TRIBUNAL HAS REPRODUCED PARA NO. 18 OF THE TRIBUNAL ORDER FOR AS SESSMENT YEAR 91-92 FOR THE PURPOSE OF DECIDING GROUND NO. 3 OF THE PRESENT YEARS APPEAL. THEREAFTER, IT IS POINTED OUT BY THE ASSESSEE IN TH E MISC. APPLICATION THAT GROUND NO. 3 OF THE PRESENT YEAR IS IN RELATION TO INTEREST FREE LOAN TO J.K. SATOH AGRICULTURAL MACHINES LTD. BUT PARA 18 OF THE TRIBUNAL ORDER, REPRODUCED BY THE TRIBUNAL, AS PER WHICH THIS GROUN D WAS DECIDED, IS IN RESPECT OF THE ISSUE RELATING TO EXPENSES INCURRED FOR KAMLA RETREAT. IT IS POINTED OUT THAT IN FACT GROUND NO. 2 IN ASSESSMENT YEAR 91-92 WAS ON THE SAME ISSUE I.E. THE ISSUE RELATING TO INTEREST FREE LOAN TO J.K. SATOH AGRICULTURAL MACHINES LTD., WHICH WAS DECIDED IN TH AT YEAR IN FAVOUR OF THE ASSESSEE VIDE PARA NO. 5 TO 7 OF THE TRIBUNAL ORDER IN ASSESSMENT YEAR 91- 92. 3. LEARNED D. R. OF THE REVENUE SUBMITTED THAT THER E IS NO APPARENT MISTAKE IN THE TRIBUNAL ORDER. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND GON E THROUGH THE TRIBUNAL ORDER FOR THE PRESENT YEAR AS WELL AS FOR THE ASSESSMENT YEAR 91- 92 IN I.T.A. NO.537/LKW/2010 DATED 30/06/2015 AND W E FIND THAT THE CONTENTION RAISED BY THE ASSESSEE IN THE MISC. APPL ICATION IS CORRECT. IN ASSESSMENT YEAR 91-92, GROUND NO. 2 OF THE APPEAL W AS REGARDING THE ISSUE RAISED BY THE ASSESSEE IN THE PRESENT YEAR AS PER G ROUND NO. 3. FOR THE SAKE OF READY REFERENCE, WE REPRODUCE PARA 5-7 OF T HE TRIBUNAL ORDER IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 91-92 A S UNDER: 5. GROUND NO. 2 OF THE APPEAL IS AS UNDER: [3] 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LD CIT (A) HAS ERRED IN ALLOWING RELIEF OF RS.35,37,90 2/- BEING THE DISALLOWANCE ON ACCOUNT OF PROPORTIONATE INTEREST O N INTEREST FREE LOANS TO M/S J. K. SATOH AGRICULTURAL MACHINES LIMITED WHILE THE ASSESSING OFFICER HAS ESTABLISHED THAT THE ADVA NCES HAD BEEN MADE TO THE SUBSIDIARY COMPANY OUT OF BANK OVE RDRAFT. 6. IT WAS AGREED BY BOTH SIDES THAT IDENTICAL ISSUE WAS RAISED IN THE APPEAL OF THE REVENUE FOR THE A.Y. 19 87 88 AS PER GROUND NO. 39 AND IN A.Y. 1990 91 AS PER GROU ND NO. 8. BOTH THESE APPEALS WERE HEARD ON 23.03.2015 & 27.04 .2015 RESPECTIVELY AND THEREFORE, IN THE PRESENT YEAR, TH IS GROUND CAN BE DECIDED ON SIMILAR LINE AS PER TRIBUNAL ORDERS I N THESE YEARS. 7. WE FIND THAT IN A.Y. 1987 88, THIS ISSUE WAS D ECIDED BY THE TRIBUNAL IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE AS PER PARA NO. 133 OF THE TRIBUNAL ORDER IN A. Y. 1987 88. ACCORDINGLY, IN THE PRESENT YEAR ALSO, THIS ISSUE I S DECIDED ON SIMILAR LINE AND THE GROUND NO. 2 OF THE REVENUE IS REJECTED. 5. FROM THE ABOVE PARAS FROM THE TRIBUNAL ORDER IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 91-92, WE FIND THAT THE ISSUE I NVOLVED IN THE PRESENT YEAR AS PER GROUND NO. 3 IS SQUARELY COVERED IN FAV OUR OF THE ASSESSEE BY THIS TRIBUNAL ORDER IN ASSESSEES OWN CASE FOR ASSE SSMENT YEAR 91-92 BUT INADVERTENTLY THE TRIBUNAL HAS REPRODUCED THE TRIBU NAL DECISION FOR ASSESSMENT YEAR 91-92 IN RESPECT OF GROUND NO. 6 IN THAT YEAR. GROUND NO. 6 IN ASSESSMENT YEAR 91-92 WAS REGARDING ADDITION O F RS.3,14,904/- ON ACCOUNT OF GUEST HOUSE MAINTENANCE IN KAMALA CASTLE AT MUSSORIE. HENCE, WE RECTIFY THE IMPUGNED TRIBUNAL ORDER AND PARA 10 & 11 OF THE IMPUGNED TRIBUNAL ORDER SHOULD BE SUBSTITUTED BY THE FOLLOWI NG PARA NO. 10 & 11. PARA 10: IT WAS AGREED BY BOTH THE SIDES THAT IDENT ICAL ISSUE WAS RAISED IN THE APPEAL OF THE REVENUE FOR ASSESSMENT YEAR 91- 92 AS PER GROUND NO. 2 AND THIS APPEAL WAS HEARD ON 01/05/2015 AND THEREFORE, IN THE PRESENT YEAR, THIS GROUND CAN BE DECIDED ON SIMILAR LINE AS PER TRIBUNAL ORDE R IN THAT YEAR. [4] PARA 11: WE FIND THAT IN ASSESSMENT YEAR 91-92, THI S ISSUE WAS DECIDED BY THE TRIBUNAL AS PER PARA 7 OF THE TRIBUN AL ORDER IN ASSESSMENT YEAR 91-92. ACCORDINGLY, IN THE PRES ENT YEAR ALSO, THIS ISSUE IS DECIDED ON SIMILAR LINE AND GRO UND NO. 3 OF THE REVENUE IS REJECTED. 6. IN THE RESULT, THE MISC. APPLICATION OF THE ASSE SSEE STANDS ALLOWED. 7. NOW WE TAKE UP MISC. APPLICATION NO.137/LKW/2015 . IN THIS MISC. APPLICATION, IT IS SUBMITTED THAT WHILE DECIDING GR OUND NO. 8, THE TRIBUNAL HAS REPRODUCED GROUND NO. 10 BY WAY OF INADVERTENT MISTAKE AND THEREFORE, THIS MISTAKE SHOULD BE RECTIFIED. ONE M ORE CONTENTION HAS BEEN RAISED THAT WHILE DECIDING GROUND NO. 9 ALSO, THE T RIBUNAL HAS REPRODUCED GROUND NO. 11 BY WAY OF INADVERTENT MISTAKE AND THE REFORE, THIS MISTAKE SHOULD ALSO BE RECTIFIED. 8. LEARNED D. R. OF THE REVENUE HAD NOTHING TO SAY. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FI ND THAT AS PER APPEAL MEMO, GROUND NO. 8 & 9 RAISED BY THE ASSESSE E IN THE PRESENT YEAR ARE AS UNDER: 8. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, LEARNED CIT(A) HAS ERRED IN DELETING THE ADDITION O F RS.9,24,481/- ON ACCOUNT OF PRESENTATION OF ARTICLE S EVEN THOUGH THE EXPENDITURE HIT BY SECTION 37(2A) OF THE ACT. 9. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, LEARNED CIT(A) HAS ERRED IN DELETING THE DISALLOWAN CE OF RS.98,55,289/- UNDER THE HEAD TRAVELLING EXPENSES E VEN THOUGH THESE EXPENSES WERE OF ENTERTAINMENT IN NATU RE AND HIT BY SECTION 37(2A) OF THE ACT. 10. WE ALSO FIND THAT BY MISTAKE, IN THE IMPUGNED TRIBUNAL ORDER, THE TRIBUNAL HAS REPRODUCED GROUND NO. 10 & 11 IN PLACE OF GROUND NO. 8 & 9 RESPECTIVELY AND HENCE, WE RECTIFY THIS APPARENT MI STAKE AND HOLD THAT PARA [5] NO. 329 TO 334 OF THE IMPUGNED TRIBUNAL ORDER SHOUL D BE SUBSTITUTED BY FOLLOWING PARA NO. 329 TO 334: PARA 329: GROUND NO. 8 IS AS UNDER: 8. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, LEARNED CIT(A) HAS ERRED IN DELETING THE ADDITION O F RS.9,24,481/- ON ACCOUNT OF PRESENTATION OF ARTICLE S EVEN THOUGH THE EXPENDITURE HIT BY SECTION 37(2A) OF THE ACT. PARA 330: IT WAS AGREED BY BOTH THE SIDES THAT IDEN TICAL ISSUE WAS RAISED IN THE APPEAL OF THE REVENUE FOR ASSESSMENT YEAR 91-92 AS PER GROUND NO. 4(B) AND THIS APPEAL WAS HE ARD ON 1 ST MAY, 2015 AND THEREFORE, IN THE PRESENT YEAR ALSO, THIS GROUND CAN BE DECIDED ON SIMILAR LINE AS PER T RIBUNAL ORDER IN ASSESSMENT YEAR 91-92. PARA 331: WE FIND THAT IN ASSESSMENT YEAR 91-92, TH IS ISSUE WAS DECIDED BY THE TRIBUNAL IN FAVOUR OF THE ASSESSEE A S PER PARA 17 OF THE TRIBUNAL ORDER IN ASSESSMENT YEAR 91 -92. ACCORDINGLY, IN THE PRESENT YEAR ALSO, THIS ISSUE I S DECIDED ON SIMILAR LINE AND GROUND NO. 8 OF THE REVENUE IS REJECTED. PARA 332: GROUND NO. 9 IS AS UNDER: 9. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, LEARNED CIT(A) HAS ERRED IN DELETING THE DISALLOWAN CE OF RS.98,55,289/- UNDER THE HEAD TRAVELLING EXPENSES E VEN THOUGH THESE EXPENSES WERE OF ENTERTAINMENT IN NATU RE AND HIT BY SECTION 37(2A) OF THE ACT. PARA 333: IT WAS AGREED BY BOTH THE SIDES THAT IDEN TICAL ISSUE WAS RAISED IN APPEAL OF THE REVENUE FOR ASSESSMENT YEAR 91- 92 AS PER GROUND NO. 6 IN THAT YEAR AND THIS APPEAL WAS HEARD ON 1 ST MAY, 2015 AND THEREFORE, IN THE PRESENT CASE ALSO THIS GROUND CAN BE DECIDED ON SIMILAR LINE AS PER TRIBUNAL ORDER IN ASSESSMENT YEAR 91-92. PARA 334: WE FIND THAT IN ASSESSMENT YEAR 91-92, TH IS ISSUE WAS DECIDED BY THE TRIBUNAL IN FAVOUR OF THE ASSESSEE A S PER PARA 32 OF THE TRIBUNAL ORDER IN THAT YEAR. ACCORD INGLY, IN THE PRESENT YEAR ALSO, THIS ISSUE IS DECIDED ON SIM ILAR LINE AND GROUND NO. 9 OF THE REVENUE IS REJECTED. [6] 11. NO OTHER MISTAKE HAS BEEN POINTED OUT IN THIS M ISC. APPLICATION AND WE HAVE ALREADY RECTIFIED BOTH THE MISTAKES POINTED BY THE ASSESSEE IN THE MISC. APPLICATION. 12. IN THE RESULT, THE MISC. APPLICATION OF THE ASS ESSEE STANDS ALLOWED. 13. NOW WE TAKE UP MISC. APPLICATION NO.138/LKW/201 5. IN THIS MISC. APPLICATION, IT IS SUBMITTED BY THE ASSESSEE THAT W HILE RAISING GROUND NO. 1 TO 9, 13 TO 18(A), 18(C) TO 24 AND 26 TO 29, THE RE VENUE HAS WRONGLY MENTIONED AMOUNTS WHICH ARE OF ASSESSMENT YEAR 2001 -02 AND THIS MISTAKE HAS OCCURRED BECAUSE THE ORDER OF CIT(A) IS A COMBINED ORDER FOR ASSESSMENT YEAR 99-2000, 2000-2001 AND 2001-02. TH E ASSESSEE HAS ENCLOSED THE GROUND-WISE CHART OF THE CORRECT AMOUN T AS WELL AS THE FIGURE WRONGLY TAKEN BY THE REVENUE IN THE GROUNDS OF APPE AL. THIS CHART IS AS UNDER: GROUND NO. HEAD CORRECT FIGURE SHOULD BE FOR A.Y. 2000-01 (RS.) FIGURE WRONGLY TAKEN BY REVENUE (RS.) 1 GUARANTEE CHARGES 2,26,688/- 1,28,500/- 2 GARDENING CHARGES 2,15,799/- 2,42,266/- 3 ARTICLES INTENDED FOR PRESENTATION 8,28,028/- 6,59,330/- 4 TRAVELLING EXPENSES 65,98,476/- 62,61,542/- 5 PROPORTIONATE INTEREST ON INTEREST FREE LOAN TO J.K. SATOH AGRICULTURAL MACHINES LTD. 6,73,808/- 6,76,524/- 6 CLUB EXPENSES 24,436/- 28,313/- 7 CHARGES GENERAL 41,41,512/- 46,47,049/- 8 EMPLOYEES WELFARE EXPENSES 75,35,196/- 80,69,962/- 9 SALES PROMOTION EXPENSES 1,04,25,014/- 96,89,124/- 13 OFFICE MAINTENANCE 7,22,500/- 6,80,000/- 14 ARCHITECT OF THE YEAR AWARD 7,38,527/- 4,67,286/- [7] 15 RECRUITMENT EXPENSES 80,000/- 70,000/- 16 LIABILITY U/S. 41(1) 2,46,89,721/- 1,34,25,433/- 17 TAXI HIRING CHARGES 2,52,920/- 1,59,192/- 18 (A) DEPRECIATION RELATABLE TO SCRAP DISCARDED MACHINERY 24,459/- 10,050/- 18(C) DEPRECIATION ON REPAIRS TO PLANT & MACHINERY TREATED AS CAPITAL IN EARLIER YEARS 39,156/- 29,369/- 19 REPAIRS TO PLANT & MACHINERY 82,92,593/- 79,19,257/- 20 REPAIRS TO BUILDING 95,31,427/- 1,12,01,522/- 21 SPORTS PROMOTION EXPENSES 1,000/- 41,000/- 22 TELEPHONE EXPENSES 16,25,570/- 11,73,496/- 23 REPAIRS TO OTHER ASSETS 52,510/- 66,197/- 24 GUEST HOUSE EXPENSES 25,65,048/- 16,79,852/- 26 KAMLA CASTLE AT MUSSORRIE 5,20,170/- 6,36,960/- 27 GUEST HOUSE TAKEN ON RENT 3,60,000/- 3,60,060/- 28 MESS EXPENSES 1,79,376/- 3,61,238/- 29 OTHER CONSULTANCY CHARGES 32,591/- 3,442/- 14. IT IS SUBMITTED IN THE MISC. APPLICATION THAT A JUST AND PROPER ORDER SHOULD BE PASSED TO RECTIFY THIS MISTAKE. 15. LEARNED D. R. OF THE REVENUE HAD NOTHING TO SAY . 16. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE H AVE EXAMINED THE GROUNDS OF APPEAL RAISED BY THE REVENUE AS WELL AS THE ORDER OF CIT(A). WE FIND THAT THE ORDER OF CIT(A) IS A COMBINED ORDE R FOR ASSESSMENT YEAR 1999-2000 TO 2001-2002 AND IN THE GROUNDS OF APPEAL FOR THE PRESENT YEAR I.E. ASSESSMENT YEAR 2000-2001, THE REVENUE HAS WRO NGLY MENTIONED THE FIGURES, WHICH ARE ACTUALLY RELEVANT TO ASSESSMENT YEAR 2001-2002 AND AS A RESULT, THE IMPUGNED ORDER IS ALSO ON THE BASIS OF WRONG AMOUNTS [8] MENTIONED IN THE GROUNDS OF APPEAL RAISED BY THE RE VENUE. UNDER THESE FACTS, WE FEEL IT PROPER THAT IN THE TRIBUNAL ORDER IN RESPECT OF GROUND NO. 1 TO 9, 13 TO 18(A), 18(C) TO 24 AND 26 TO 29, THE CO RRECT AMOUNT AS PER THE CHART, REPRODUCED ABOVE, SHOULD BE READ INSTEAD OF WRONG AMOUNT STATED BY THE REVENUE IN THE GROUNDS OF APPEAL AND REPRODU CED BY THE TRIBUNAL ALSO WHILE REPRODUCING THE GROUNDS RAISED BY THE RE VENUE. 17. IN THE RESULT, THE MISC. APPLICATION OF THE ASS ESSEE STANDS ALLOWED. 18. NOW WE TAKE UP MISC. APPLICATION NO.139/LKW/201 5. THE CONTENTS OF THIS MISC. APPLICATION ARE REPRODUCED BELOW: APPLICATION FOR RECTIFICATION OF MISTAKE APPARENT FROM RECORD ( PURSUANT TO SECTION 254 (2) OF THE INCOME TAX ACT, 1961) IN THE ABOVE MATTER, ABOVE NAMED RESPONDENT APPLICA NT BEG TO SUBMIT AS UNDER FOR KIND AND JUDICIOUS CONSIDERATIO N OF HON'BLE TRIBUNAL :- 1.1 ABOVE NAMED RESPONDENT ACKNOWLEDGES THE RECEIPT OF JUDICIOUS ORDER DATED 30.06.2015 OF HON'BLE TRIBUNA L PASSED IN THE ABOVE REVENUE'S APPEAL FOR ASSESSMENT YEAR 1991-92. THE SAID ORDER HAS BEEN SERVED UPON T HE APPLICANT ON 7 TH JULY, 2015. 1.2 WHILE DECIDING THE GROUND OF APPEAL NO. 1 RELATING TO SURPLUS RECEIPT OVER REFUNDS IN THE COPS DEPOSIT AC COUNT, IN REVENUE'S APPEAL FOR A.Y. 1991-92. HON'BLE TRIBUNAL HAVE HELD AS UNDER, VIDE PARA 2 TO 4 OF THE APPELLA TE ORDER COVERED BY THIS APPLICATION :- 2. GROUND NO. 1 OF THE APPEAL IS AS UNDER: '1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD CIT (A) HAS ERRED IN HOLDING THAT SURPLUS RECEIPTS OVER REFUNDS IN THE COPS DEPOSITS ACCOUNT WAS NOT THE INCOME OF THE ASSESSEE AND THEREBY DELETING THE ADDITION OF RS.14,11,260/-.' 3. IT WAS AGREED BY BOTH SIDES THAT IDENTICAL ISSUE WAS RAISED IN THE APPEAL OF THE REVENUE FOR THE A.Y. [9] 1987-88 AS PER GROUND NO. 1 AND IN A.Y. 1990-91 AS PER GROUND NO. 11. BOTH THESE APPEALS WERE HEARD ON 23.03.2015 & 227.04.2015 RESPECTIVELY AND THEREFORE, IN THE PRESENT YEAR, THIS GROUND CAN BE DECIDED ON SIMILAR LINE AS PER TRIBUNAL ORDERS I N THESE YEARS. 4. WE FIND THAT IN A.Y. 1987 - 88, THIS ISSUE WAS DECIDED BY THE TRIBUNAL IN FAVOUR OF THE REVENUE AND AGAINST THE ASSESSEE AS PER PARA NO. 3 OF THE TRIBUNAL ORDER IN A. Y. 1987 - 88. ACCORDINGLY, IN THE PRESENT YEAR ALSO, THIS ISSUE IS DECIDED ON SIMILAR LINE AND THE GROUND NO. 1 OF THE REVENUE IS ALLOWED. 1.3 FROM A PERUSAL OF THE ORDER OF HON'BLE TRIBUNAL FOR ASSESSMENT YEAR 1987-88 DATED 18.06.2015 ( AS PER GROUND NO. 1) IN ITA NO. 369/LKW/2010, IT MAY BE OBSERVED THAT IN ASSESSMENT YEAR 1987-88, THE FACTS OF THIS ISSUE WERE DIFFERENT TO THE FACTS OF A.Y. 1991 -92. IN THIS CONNECTION, KIND ATTENTION OF HON'BLE ITAT IS DRAWN TO THE ORDER OF ASSESSING OFFICER FOR A.Y. 1987-88 WHO, IN HER ORDER DATED 26.07.1994 AT PAGE 4-5, HELD AS UND ER (COPY OF RELEVANT EXTRACT OF THE ORDER IS ENCLOSED FOR READY REFERENCE ) :- 'SECURITY DEPOSIT OF COPS THE ASSESSEE IS IN THE PRACTICE OF ACCEPTING SECURITY DEPOSIT ON COPS FROM CUSTOMERS TO WHOM IT SENDS ITS COPS (AROUND WHICH YEARN IS WOUND) DURING ITS SALE OF YARN. THIS SECURITY DEPOSIT IS REFUNDED WHE N THE SAID COPS ARE RECEIVED BACK. IN THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAS RECEIVED RS.4,55,85,030/- AS SECURITY DEPOSIT OF CO PS AND A SUM OF RS.4,64,85,532/- WORTH OF SECURITY DEPOSIT HAS BEEN REFUNDED IN THIS YEAR. THEREFORE, THE EXCESS O F REFUNDS OVER RECEIPTS IS RS.9,00,502/-. IN EARLIER ASSESSMENT, YEARS, DEPARTMENT HAS TAKEN SECURITY DEPOSIT RECEIVED AGAINST COPS AS TRADING R ECEIPTS OF THE ASSESSEE COMPANY. CONSEQUENTLY, THE SECURITY DEPOSIT RECEIVED IN EXCESS OF THE REFUND HAS BEEN A DDED TO THE ASSESSEE'S INCOME. EVEN THOUGH SUCH ADDITION [10] MADE BY THE ASSESSING OFFICER HAS BEEN DELETED BY APPELLATE AUTHORITIES, THE DEPARTMENT HAS NOT ACCEP TED THE ORDERS OF APPELLATE AUTHORITIES AND HAS FILED REF/APPEAL AGAINST SUCH DELETIONS. IN THE YEAR UNDER CONSIDERATION, THERE IS EXCESS REFUND OVER RECEIPTS AND THE ASSESSEE HAS CLAIMED DEDUCTION IN RESPECT OF THIS EXCESS REFUND WHICH CO MES TO RS.9,00,502/- (4,64,85,532 - 4,55,85,030). DETAILS OF THE CALCULATION OF THIS SECURITY DEPOSIT HAS BEEN FILED VIDE ANNEX. 33 WHICH HAS BEEN EXAMINED. THE CLAIM OF THE ASSESSEE FOR A DEDUCTION OF RS.9,00,502 IS REFLECTED AS EVEN THIS STAND TAKEN BY THE ASSESSEE IN EARLIER YEARS HAS NOT BEEN ACCEPTED BY THE DEPARTMENT. HOWEVER, NO ADDITION IS MADE THIS YEAR BECAUSE REFUNDS EXCEED RECEIPTS.' 1.4 WHILE PASSING THE ORDER BY HON'BLE TRIBUNAL UNDER A BOVE GROUND NO. 1 RAISED BY THE REVENUE IN A.Y. 1987-88. THOUGH THE GROUND WAS TAKEN BY THE DEPARTMENT FOR SURPLUS RECEIPTS OVER REFUND IN THE COPS DEPOSIT AC COUNT (WHEREAS THE CORRECT POSITION WAS THAT THIS YEAR, E XCESS REFUND WERE MADE OVER RECEIPTS TOWARDS COPS DEPOSITS) BUT THE DECISION RENDERED BY HON'BLE TRIBUNAL WAS CORRECTLY RENDERED IN VIEW OF THE SIMILAR ORDER PAS SED BY THE TRIBUNAL IN ITA NO. 8824/D/92 FOR A.Y. 1986-87 WHEREIN THE ISSUE WAS DECIDED BY THE TRIBUNAL AGAIN ST THE ASSESSEE.(COPY OF RELEVANT EXTRACT OF ORDER PASSED BY ITAT IN A.Y. 1987-88 IS ENCLOSED FOR KIND AND READY REFERENCE). 1.5 THE GROUND RELATING TO COPS DEPOSITS RAISED BY THE REVENUE IN ITA NO. 457/LKW/2010 FOR A.Y. 1990-91 VI DE GROUND NO. 11 WHICH WAS FOLLOWED BY HON'BLE TRIBUNA L IN ITS ORDER FOR A.Y. 1991-92, READS AS UNDER : - '11. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE THE LD. CIT(A) HAS ERRED IN HOLDING THAT SURPLUS RE CEIPTS OVER REFUNDS IN THE COPS DEPOSITS ACCOUNT WAS NOT THE INCOME OF THE ASSESSEE AND THEREBY DELETING THE ADD ITION OFRS.31,47,981/-. ' [11] AS AGAINST THIS GROUND, HON'BLE TRIBUNAL HAS RENDER ED ITS DECISION VIDE ORDER DATED 26.06.2015 ( AT PAGE 12 P ARA 44-45), AS UNDER : 44. LEARNED D. R. OF THE REVENUE SUPPORTED THE ASSESSMENT ORDER WHEREAS LEARNED A. R. OF THE ASSES SEE SUPPORTED THE ORDER OF LEARNED CIT(A). HE ALSO SUBM ITTED THAT THIS ISSUE IS COVERED IN FAVOUR OF THE ASSESSE E BY THE TRIBUNAL ORDER IN ASSESSEE'S OWN CASE FOR ASSESSMEN T YEAR 1985-86 AND 1988-89 AND RELEVANT ORDERS ARE AVAILABLE IN PAPER BOOK. 45. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FI ND THAT THIS ISSUE IS COVERED IN FAVOUR OF THE ASSESSE E BY BOTH THE TRIBUNAL ORDERS CITED BY LEARNED A. R. OF THE ASSESSEE IN ASSESSEE'S OWN CASE FOR ASSESSMENT YEAR 1985-86 AND 1988-89. LEARNED D.R. OF THE REVENUE CO ULD NOT POINT OUT ANY DIFFERENCE IN FACTS IN THE PRESEN T YEAR AND THEREFORE, WE DO NOT FIND ANY REASON TO TAKE A CONTRARY VIEW. THIS GROUND IS REJECTED. 1.6 FROM THE PERUSAL OF THE ABOVE, IT BECOMES ABUNDANTL Y CLEAR THAT HON'BLE TRIBUNAL HAS PASSED ORDERS IN A. Y. 1987-88 & 1990-91 CORRECTLY WHERE IN BOTH ASSESSMEN T YEARS, A DIFFERENT SITUATION FROM EACH OTHER WAS TH ERE I.E. IN A.Y. 1987-88, THE REFUNDS WERE MADE IN EXCESS OF RECEIPTS OF COPS DEPOSITS AMOUNTING TO RS. 9,00,502 /- FOR WHICH CLAIM WAS MADE BY THE RESPONDENT APPLICANT, WHICH WAS NOT ALLOWED BY HON'BLE TRIBUNAL, WHEREAS IN A.Y. 1990-91. THE RECEIPTS WERE MORE THAN THE REFUN DS MADE AMOUNTING TO RS. 31,47,981/- WHICH WAS TREATED AS 'TRADING RECEIPT' BY THE DEPARTMENT AND ADDED TO TH E INCOME OF THE ASSESSEE COMPANY BUT THE ADDITION WAS DELETED BY LD. CIT(A) AND THE GROUND RAISED BY THE DEPARTMENT BEFORE HON'BLE ITAT AGAINST ORDER PASSED BY LD. CIT(A) WAS ALSO REJECTED. 1.7 IN THE ASSESSMENT YEAR 1991-92, THERE WERE SURPLUS RECEIPTS OVER REFUND IN THE COPS DEPOSIT ACCOUNT AMOUNTING TO RS.14,11,260/- FOR WHICH, THE ADDITION MADE BY AO BY TREATING IT AS 'TRADING RECEIPTS', WA S DELETED BY LD. CIT(A). HENCE THE ORDER PASSED BY HO N'BLE TRIBUNAL AGAINST THIS YEAR'S GROUND NO. 1 (SUPRA) T AKEN BY THE REVENUE IN ITS APPEAL, SHOULD HAVE BEEN REJE CTED BEING SIMILAR TO THE ASSESSMENT YEAR 1990-91, AS ST ATED ABOVE. [12] 2. IT IS FURTHER TO DRAW KIND ATTENTION OF HON'BLE TRIBUNAL THAT WHILE DECIDING GROUND NO. 12, THE GROUND NO. 1 1 HAS BEEN REPRODUCED, WHICH READS AS UNDER :- '48. GROUND NO. 12 OF THE REVENUE'S APPEAL IS AS UN DER: 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD CIT (A) HAS ERRED IN DELETING THE DISALLOWANCE OF RS.11,86,947/- UNDER THE HEAD REPAIRS TO BUILDING EXPENSES EVEN THOUGH THESE EXPENSES WERE OF CAPITAL IN NATURE.' 2.1 IN THIS CONNECTION, KIND ATTENTION OF HON'BLE T RIBUNAL IS INVITED THAT GROUND NO. 12 TAKEN BY THE DEPARTMENT IN ITS APPEAL FOR A.Y. 1991-92 READS, AS UNDER :- 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD CIT(A) HAS ERRED IN ALLOWING RELIEF OF RS.3,35,8 74/- ON ACCOUNT OF MESS EXPENSES IGNORING THAT THE EXPENDIT URE HIT BY PROVISIONS CONTAINED U/S. 37(4) OF THE INCOM E TAX ACT.' 3. THE ABOVE CONSTITUTES MISTAKE APPARENT FROM R ECORD RECTIFIABLE U/S. 254(2) OF THE ACT. 19. LEARNED A. R. OF THE ASSESSEE SUBMITTED THAT TH ESE ARE SOME FACTUAL MISTAKES IN THE TRIBUNAL ORDER, WHICH SHOULD BE REC TIFIED. 20. LEARNED D. R. OF THE REVENUE HAD NOTHING TO SAY . 21. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. REGA RDING GROUND NO. 1, WE FIND THAT THE FACTS ARE NOTED BY CIT(A) ON PAGE NO. 11 OF HIS ORDER. AS PER THE SAME, THE ASSESSEE HAS RECEIVED RS.6,73,29, 965/- TOWARDS SECURITY DEPOSIT OF COPS AND RS.6,59,18,705/- WAS REFUNDED T O THE CUSTOMERS ON ACCOUNT OF RETURN OF COPS. IN THIS MANNER, IN THE PRESENT YEAR, THERE IS EXCESS OF RECEIPT OVER REFUND BY RS.14,11,260/-. T HE TRIBUNAL HAS DECIDED THIS ISSUE IN THE PRESENT YEAR BY FOLLOWING THE TRI BUNAL ORDER IN ASSESSMENT YEAR 1987-88. THE FACTS IN ASSESSMENT YEAR 87-88 W ERE TOTALLY OPPOSITE. [13] IN THAT YEAR, THE ASSESSEE RECEIVED AN AMOUNT OF RS .4,55,85,030/- AS SECURITY DEPOSIT AND A SUM OF RS.4,64,85,532/- HAS BEEN REFUNDED. HENCE, IN THAT YEAR, THE REFUND WAS IN EXCESS OF RECEIPT B Y AN AMOUNT OF RS.9,00,502/- WHEREAS IN THE PRESENT YEAR, THE RECE IPT IS IN EXCESS OVER THE REFUND. IN ASSESSMENT YEAR 87-88, THE ASSESSEE CLA IMED DEDUCTION OF THE AMOUNT OF RS.9,00,502/-, WHICH WAS THE EXCESS AMOUN T OF REFUND OVER RECEIPT AND THIS CLAIM OF THE ASSESSEE WAS REJECTED BY THE TRIBUNAL. SIMILARLY IN ASSESSMENT YEAR 90-91, THE FACTS WERE SIMILAR TO THE FACTS IN THE PRESENT YEAR BECAUSE IN THAT YEAR ALSO, RECEIPTS WE RE MORE THAN THE REFUND BY AN AMOUNT OF RS.31,47,981/-, WHICH WAS TREATED B Y THE REVENUE AS TRADING RECEIPTS AND WAS ADDED TO THE INCOME OF THE ASSESSEE BUT ADDITION WAS DELETED BY CIT(A) AND THE GROUNDS RAISED BY THE DEPARTMENT BEFORE THE TRIBUNAL WAS REJECTED. HENCE, IN THE PRESENT Y EAR, THE ISSUE INVOLVED IS COVERED IN FAVOUR OF THE ASSESSEE BY THE TRIBUNAL O RDER IN ASSESSMENT YEAR 90-91 AND RESPECTFULLY FOLLOWING THE SAME, WE HOLD THAT THIS GROUND OF THE REVENUE IS LIABLE TO BE REJECTED AS HAS BEEN REJECT ED BY THE TRIBUNAL IN ASSESSMENT YEAR 90-91. ACCORDINGLY, GROUND NO. 1 I S REJECTED AND TO THIS EXTENT, THE IMPUGNED TRIBUNAL ORDER STANDS RECTIFIE D. 22. THE SECOND MISTAKE POINTED OUT BY THE ASSESSEE IS THAT WHILE DECIDING GROUND NO. 12, GROUND NO. 11 HAS BEEN REPR ODUCED. THIS CONTENTION IS ALSO FOUND CORRECT AFTER VERIFICATION OF RECORDS AND HENCE, WE HOLD THAT PARA 48 TO 50 OF THE IMPUGNED TRIBUNAL OR DER SHOULD BE SUBSTITUTED BY THE FOLLOWING PARAS: PARA 48. GROUND NO. 12 IS AS UNDER: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN ALLOWING RELIEF OF RS.3,35,874/- ON ACCOUNT OF MESS EXPENSES IGNORING THAT THE EXPENDITURE HIT BY PROVISIONS CONTAINED U/S 37( 4) OF THE I.T. ACT. [14] PARA 49 IT WAS AGREED BY BOTH THE SIDES THAT IDEN TICAL ISSUE WAS RAISED BY REVENUE IN ASSESSMENT YEAR 87-88 AS PER GROUND NO. 46 AND THIS APPEAL WAS HEARD ON 23/03/20 15 AND THEREFORE, IN THE PRESENT YEAR THIS GROUND CAN BE DECIDED ON SIMILAR LINE AS PER TRIBUNAL ORDER IN TH AT YEAR. PARA 50 WE FIND THAT IN ASSESSMENT YEAR 87-88, TH IS ISSUE WAS DECIDED BY TRIBUNAL IN FAVOUR OF THE ASSESSEE AND A GAINST THE REVENUE AS PER PARA 154 OF THE TRIBUNAL ORDER I N ASSESSMENT YEAR 87-88. NO DIFFERENCE IN FACTS CAN BE POINTED OUT BY REVENUE AND THEREFORE, WE DECLINE TO INTERFERE IN THE ORDER OF CIT(A) ON THIS ISSUE. GR OUND NO. 12 OF THE REVENUE IS REJECTED. 23. THERE IS NO OTHER MISTAKE POINTED OUT BY THE AS SESSEE IN THE MISC. APPLICATION AND WE HAVE ALREADY RECTIFIED THE TWO M ISTAKES POINTED OUT BY THE ASSESSEE. 24. IN THE RESULT, THE MISC. APPLICATION OF THE ASS ESSEE STANDS ALLOWED. 25. IN THE COMBINED RESULT, ALL THE FOUR MISC. APPL ICATIONS OF THE ASSESSEE ARE ALLOWED. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED:14/01/2016 *SINGH COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. CONCERNED CIT 4. THE CIT(A) 5. DR, ITAT, LUCKNOW ASSTT. REGISTRAR