Ashok Kumar Jain, v. ACIT Range II,

ITA 1115/DEL/2008 | 2001-2002
Pronouncement Date: 30-09-2011 | Result: Allowed

Appeal Details

RSA Number 111520114 RSA 2008
Assessee PAN ACTPJ8887D
Bench Delhi
Appeal Number ITA 1115/DEL/2008
Duration Of Justice 3 year(s) 6 month(s) 3 day(s)
Appellant Ashok Kumar Jain,
Respondent ACIT Range II,
Appeal Type Income Tax Appeal
Pronouncement Date 30-09-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 30-09-2011
Date Of Final Hearing 29-09-2011
Next Hearing Date 29-09-2011
Assessment Year 2001-2002
Appeal Filed On 27-03-2008
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : A : NEW DELHI BEFORE SHRI I.P. BANSAL JUDICIAL MEMBER AND SHRI K.G. BANSAL ACCOUNTANT MEMBER ITA NOS.1113 TO 1118/DEL/2008 ASSESSMENT YEARS : 1999-2000 2000-01 2001-02 2002-03 2003-04 2004 -05 SHRI ASHOK KUMAR JAIN PROP. JAINSON INTERNATIONAL EXPORTS OPP. EIDGAH GROUND MORADABAD. PAN : ACTPJ8887D VS. ACIT RANGE-II MORADABAD (UP). (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI K. SAMPATH & SHRI B. RAJ KUMAR ADVOCATES REVENUE BY : SHRI SALIL MISHRA & MRS. ANUSHA KHURANA SR.DRS ORDER PER BENCH: ALL THESE SIX APPEALS ARE FILED BY THE ASSESSEE IN RESPECT OF ASSESSMENT YEARS 1999-2000 TO 2004-05. IN ALL THESE APPE ALS COMMON ISSUE INVOLVED IS REGARDING GRANT OF BENEFIT OF DEDUCT ION U/S 80HHC ON DEPB IN VIEW OF AMENDMENT BROUGHT TO THE STATUTE IN THE PROVISIONS OF SECTION 80HHC WITH REGARD TO RECEIPTS ON DEPB. THE ASSESSEE IS A 100% EXPORTER AND CLAIMED DEDUCTION U/S 80HHC WITH R EGARD TO RECEIPT OF DEPB ALSO. SUCH BENEFIT WAS DENIED BY THE ASSESSING OFFICER IN VIEW OF THE AMENDMENT BROUGHT INTO THE STATUTE BY FINANCE ACT 2005 AS ACCORDING TO THE ASSESSING OFFICER THE ASSESSEE DO ES NOT FULFILL THE TWIN CONDITIONS LAID DOWN IN THE THIRD P ROVISO TO SECTION 80HHC (3). ITA NOS.1113 TO 1118/DEL/2008 2 2. APART FROM THE AFOREMENTIONED ISSUE FOR ASSESSMENT YEA RS 1999- 2000 AND 2000-01 IT IS ALSO THE CASE OF THE ASSESSEE THAT REASSESSMENT PROCEEDINGS HAVE WRONGLY BEEN CARRIED OUT. IT IS ALSO THE CASE OF THE ASSESSEE THOUGH SPECIFIC GROUND WAS RAISED BY THE ASSESSEE BEFORE THE CIT (A) WITHOUT DECIDING THE SAME LE ARNED CIT (A) HAS UPHELD THE REJECTION OF 80HHC BENEFIT ON DEPB. 3. APART FROM THE ABOVE ISSUES IN RESPECT OF ASSESSMENT YE ARS 2003-04 2004-05 THE ASSESSEE HAD CHALLENGED THE UPHOL DING OF DISALLOWANCE OF 10% ON TRAVELING EXPENSES IN GROUND NO .3 OF THE RESPECTIVE APPEALS WHICH ARE TO THE TUNE OF ` 1 50 00 0/- AND ` 23 150/- RESPECTIVELY. 4. FOR ASSESSMENT YEAR 2004-05 THE ASSESSEE VIDE GROUND NO .2 HAS ALSO CHALLENGED THE DISALLOWANCE OF 10% OF TELEPHO NE EXPENSES OF ` 13 300/- AND VIDE GROUND NO.4 THE ASSESSEE HAS CHALLEN GED THE DISALLOWANCE OF 10% OF EXPORT PROMOTION EXPENSES AMOUN TING TO ` 11 486/-. 5. SO AS IT RELATES TO THE ISSUE REGARDING DEDUCTION U /S 80HHC IT IS THE CASE OF LD. COUNSEL THAT THIS ISSUE THOUGH HAS BEEN D ECIDED BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. KALP ATARU COLOURS AND CHEMICALS (2010) 328 ITR 451 (BOM) BUT THE ISSUE I S YET PENDING WITH THE HONBLE ALLAHABAD HIGH COURT THEREFORE I T IS HIS REQUEST THAT FOR ALL THE YEARS THIS ISSUE MAY BE RESTORED BACK TO DEC IDE THE SAME EITHER IN THE LINE OF DECISION OF HONBLE BOMBAY HIG H COURT IN THE CASE OF CIT VS. KALPATARU COLOURS AND CHEMICALS (SUPRA) AND SIMULTANEOUSLY DIRECTIONS MAY ALSO BE GIVEN TO THE CONCERNED AUTHORI TY TO FOLLOW IF AT THE TIME OF DECIDING THE ISSUE THE DECISION OF THE HON BLE JURISDICTIONAL HIGH COURT COME. ITA NOS.1113 TO 1118/DEL/2008 3 6. SO AS IT RELATES TO THE ISSUE REGARDING REASSESSMENT RAI SED IN RESPECT OF ASSESSMENT YEAR 1999-2000 AND 2000-01 IT IS T HE CASE OF THE LEARNED AR THAT THE ASSESSEE HAVING RAISED SPECIFIC G ROUND OF VALIDITY OR OTHERWISE OF REASSESSMENT PROCEEDINGS BEFORE CIT (A) AND NO ADJUDICATION HAVING BEEN MADE BY HIM IT WILL BE PROPER IF THE MATTER IS RESTORED BACK TO HIS FILE TO DECIDE THAT ISSUE AS IF THE INITIATION OF RE-ASSESSMENT PROCEEDINGS ITSELF IS HELD INV ALID THEN THERE WILL BE NO NEED TO GO INTO THE MERITS OF THE CASE. H E SUBMITTED THAT LEARNED CIT (A) MAY ALSO BE DIRECTED TO RE-ADJUDICAT E ON THE ISSUE REGARDING GRANT OF DEDUCTION U/S 80HHC ON DEPB IN CA SE VALIDITY OF REASSESSMENT PROCEEDINGS IS UPHELD FOR THESE YEARS. 7. WITH REGARD TO OTHER DISALLOWANCES MADE ON ACCOUNT OF TRAVELING EXPENSES TELEPHONE EXPENSES AND EXPORT PROMOTION EXPEN SES IT IS THE SUBMISSION OF THE LEARNED AR THAT THESE DISALLOWANCE S HAVE BEEN MADE ONLY ON AD HOC BASIS AND THEREFORE THEY DESERVE S TO BE DELETED. IT IS IN THIS MANNER THE LEARNED AR CONCLUDED HIS AR GUMENTS. 8. ON THE OTHER HAND THE LEARNED DR RELIED UPON TH E ASSESSMENT ORDER AS WELL AS THE ORDER PASSED BY THE CIT (A) AND CO NTENDED THAT THE ASSESSEE HAVING NOT FULFILLED THE TWIN CONDITIONS LA ID DOWN IN THE THIRD PROVISO TO SECTION 80HHC (3) IT WAS RIGHTLY HEL D BY THE ASSESSING OFFICER AND CIT (A) THAT ADDITIONAL BENEFIT OF DEDU CTION U/S 80HHC COULD NOT BE GRANTED TO THE ASSESSEE ON DEPB. ON THE REST OF THE DISALLOWANCES SHE SUBMITTED THAT LD. ASSESSING OFFICER HAS R IGHTLY MADE THOSE DISALLOWANCES AND THEY HAVE RIGHTLY BEEN UP HELD BY THE CIT (A) AND THEREFORE THESE GROUNDS OF THE ASSESSEE SHOU LD BE DISMISSED. 9. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS IN THE LIGHT OF THE MATERIAL PLACED BEFORE US. SO AS IT RELATES TO TH E ISSUE REGARDING ITA NOS.1113 TO 1118/DEL/2008 4 GRANT OF DEDUCTION U/S 80HHC ON DEPB WE CONSIDER IT JUST AND PROPER TO RESTORE THIS ISSUE TO THE RESPECTIVE AUTHORITIES FOR T HE RELEVANT YEARS AS THE SAME HAS TO BE CONSIDERED IN THE LIGHT OF THE DE CISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. KALPATARU CO LOURS AND CHEMICALS (SUPRA) PARTICULARLY WHEN THE BENEFIT OF TH E SAID DECISION WAS NOT AVAILABLE WITH THE AUTHORITIES WHO HAVE DECID ED THESE ISSUES. FOR ASSESSMENT YEARS 1999-2000 AND 2000-01 AS THE ISSUE OF VALIDITY OR OTHERWISE OF REASSESSMENT PROCEEDINGS HAS NOT BEEN DECI DED BY THE CIT (A) AND FOR THE PURPOSE OF DECIDING THE ISSUE FOR THESE YEARS THE ISSUE HAVE TO BE RESTORED BACK TO THE FILE OF CIT (A) THEREFORE WE CONSIDER IT JUST AND PROPER TO RESTORE THE ISSUE OF GRAN T OF DEDUCTION U/S 80HHC ON DEPB ALSO TO HIS FILE AND IF THE VALIDITY O F REASSESSMENT PROCEEDINGS IS UPHELD BY HIM FOR THESE YEARS HE WILL R E-ADJUDICATE THE ISSUE REGARDING DEDUCTION U/S 80HHC KEEPING IN VIEW TH E DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. KALP ATARU COLOURS AND CHEMICALS (SUPRA). HE WILL ALSO TAKE INTO CONSIDER ATION THE DECISION OF HONBLE ALLAHABAD HIGH COURT IF THE SAME IS AVAILABLE WITH HIM WHILE DECIDING THESE ISSUES. FOR THESE YEARS NONE OF THE OTHER ISSUES IS INVOLVED. THESE APPEALS ARE RESTORED BACK TO TH E FILE OF THE CIT (A) WITH THE DIRECTIONS GIVEN HEREINABOVE AND F OR THESE YEARS THE APPEALS FILED BY THE ASSESSEE WILL BE CONSIDERED TO BE AL LOWED FOR STATISTICAL PURPOSES IN THE MANNER AFORESAID. 10. NOW COMING TO THE ASSESSMENT YEAR 2001-02 THE ON LY ISSUE IS REGARDING GRANT OF ADDITIONAL BENEFIT OF DEDUCTION U/S 80HHC ON DEPB. THE SAME IS RESTORED BACK TO THE FILE OF ASSESSING OFFICER WITH THE DIRECTIONS AS HAVE BEEN GIVEN ABOVE WHILE RESTORING TH IS ISSUE TO THE FILE OF CIT (A). FOR STATISTICAL PURPOSES THIS APPEAL I S TREATED AS ALLOWED IN THE MANNER AFORESAID. ITA NOS.1113 TO 1118/DEL/2008 5 11. FOR ASSESSMENT YEAR 2002-03 IN THIS APPEAL THOUGH T HE GROUNDS REGARDING VALIDITY OF REASSESSMENT PROCEEDINGS HAS BEEN T AKEN BUT IT HAS BEEN FOUND THAT NO SUCH GROUND HAS BEEN TAKEN BY T HE ASSESSEE BEFORE THE CIT (A) THEREFORE THIS GROUND DOES NOT A RISE OUT OF THE ORDER OF THE CIT (A) THEREFORE DISMISSED. THE REMAI NING ISSUE IS ONLY WITH REGARD TO GRANT OF ADDITIONAL BENEFIT OF DEDUC TION U/S 80HHC ON DEPB AND THE SAID ISSUE IS BEING RESTORED BACK TO THE FI LE OF ASSESSING OFFICER WITH THE SIMILAR DIRECTIONS AS HAVE BEEN GIVEN ABOVE WHILE RESTORING THE APPEAL FOR ASSESSMENT YEAR 2001-02 THEREF ORE THIS APPEAL IS CONSIDERED AS PARTLY ALLOWED FOR STATISTICAL P URPOSES IN THE MANNER AFORESAID. 12. NOW COMING TO THE APPEAL FOR ASSESSMENT YEAR 2003- 04 AND 2004-05 THE COMMON ISSUE REGARDING GRANT OF BENEFIT OF DEDUCTION U/S 80HHC ON DEPB IS RESTORED BACK TO THE FILE OF ASSESSING OFFICER WITH THE SIMILAR DIRECTIONS WHICH HAVE BEEN GIVEN FOR ASSESSME NT YEARS 2001-02 AND 2002-03. AS REGARDS THE ANOTHER ISSUE RAI SED WITH RESPECT TO DISALLOWANCE OF 10% OF TRAVELING EXPENSES AM OUNTING TO ` 1 50 000/- IT IS SEEN THAT THE TOTAL EXPENSES CLAIMED B Y THE ASSESSEE ON FOREIGN TOUR EXPENSES IS ` 42 05 180/- WHICH INCLUD E A SUM OF ` 35 10 000/- FOR FOREIGN CURRENCY. THE ASSESSING OFFICE R MADE AD HOC DISALLOWANCE OF ` 1 50 000/- ON THE GROUND THAT THE SAID EXPENDITURE MAY INCLUDE THE EXPENDITURE IN THE NATURE OF PERSONA L UTILIZATION LIKE DINNER LUNCH COFFEE STATIONERY HOTEL ETC. HOWE VER THE ASSESSING OFFICER HAS NOT BROUGHT OUT ANY SPECIFIC ITEMS UNDER D ISALLOWANCE. THE DISALLOWANCE HAS BEEN UPHELD BY THE CIT (A) WITH THE OBSERVATIONS THAT THE DISALLOWANCE IS ONLY TO THE EXTENT OF ` 4.27% OF THE TOTAL EXPENSES. 13. WE HAVE HEARD BOTH THE PARTIES ON THIS ISSUE. IN T HE ABSENCE OF ANY MATERIAL BEING BROUGHT ON RECORD THAT A PARTICU LAR EXPENSE WAS IN THE NATURE OF PERSONAL WE SEE NO JUSTIFICATION IN UPH OLDING THE ITA NOS.1113 TO 1118/DEL/2008 6 DISALLOWANCE SIMPLY FOR THE REASON THAT THE DISALLOWANC E IS ONLY 4.27% OF THE TOTAL EXPENSES. WE THEREFORE DELETE THE SAME . 14. SO AS IT RELATES TO THE DISALLOWANCE IN RESPECT OF ASSESSMENT YEAR 2004-05 OF ` 13 300/- IN RESPECT OF 10% OF TELEPHONE EXPENDITURES DISALLOWANCE OF 10% OF TRAVELING EXPENSES OF ` 23 150/ -AND 10% OF EXPORT PROMOTION EXPENSES OF ` 11 486/- AFTER HEARI NG BOTH THE PARTIES WE FIND THAT THESE EXPENDITURES ARE DISALLOWED ONLY ON AD HOC BASIS FOR WHICH THERE IS NO FOUNDATION LAID DOWN EITHE R BY THE ASSESSING OFFICER OR CIT (A) THEREFORE WE DELETE THESE DISALLOWANCES AND IN THIS MANNER GROUND NO.2 RAISED BY THE ASSESSEE W ITH REGARD TO THE DISALLOWANCE ON TRAVELING EXPENSES IN RESPECT OF ASSE SSMENT YEAR 2003-04 AND GROUND NOS.2 3 AND 4 FOR ASSESSMENT YEAR 20 04-05 RAISED IN RESPECT OF 10% OF TELEPHONE EXPENSES 10% OF TRAVELING EXPENSES AND 10% OF EXPORT PROMOTION EXPENSES ARE ALLOW ED AND THE ADDITIONS MADE IN THIS RESPECT ARE DELETED. 15. IN VIEW OF THE ABOVE DISCUSSION THE APPEALS IN RESP ECT OF ASSESSMENT YEARS 2003-04 AND 2004-05 ARE ALLOWED FOR STAT ISTICAL PURPOSES. 16. TO SUM UP: (I) THE APPEALS FOR ASSESSMENT YEARS 1999-2000 AND 2000-0 1 ARE ALLOWED FOR STATISTICAL PURPOSES IN THE MANNER AFORESAID. (II) THE APPEAL FOR ASSESSMENT YEAR 2001-02 IS ALLOWED F OR STATISTICAL PURPOSES. ITA NOS.1113 TO 1118/DEL/2008 7 (III) THE APPEALS FOR ASSESSMENT YEARS 2002-03 2003-04 A ND 2004-05 ARE PARTLY ALLOWED FOR STATISTICAL PURPOSES IN THE MANNER AFORESAID. THE ORDER PRONOUNCED IN THE OPEN COURT ON 30.09.20 11. SD/- SD/- [K.G. BANSAL] [I.P. BANSAL] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED 30.09.2011. DK COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ITAT TRUE COPY BY ORDER DEPUTY REGISTRAR ITAT DELHI BENCHES