M/s. Sri Mariamman Educational Health and Charitable Trust, Trichy v. ACIT, Trichy

IN THE INCOME-TAX APPELLATE TRIBUNAL CHENNAI D BENCH CHENNAI. BEFORE SHRI.U.B.S. BEDI J.M. & SHRI. B. RAMAKOTAIAH A.M. I.T.A. NOS.142 143 AND 144/MDS/2010 ASSESSMENT YEARS: 2005-06 06-07 AND 07-08 SRI MARIAMMAN EDUCATIONAL HEALTH AND CHARITABLE TRUST NO. 12 VTH MAIN ROAD RAMALINGANAGAR TRICHY 620 003 [PAN:AABTS0123M] VS. THE ASSISTANT COMMISSIONER OF INCOME TAX COMPANY CIRCLE II NO.4 WILLIAMS ROAD TRICHIRAPALLI 620001. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI V.D. GOPAL REVENUE BY : SHRI K.E.B. RANGAR AJAN JR. STANDING COUNSEL ORDER PER U.B.S. BEDI J.M . THESE THREE APPEALS OF THE ASSESSEE ARE DIRECTED AGAINST SEPARATE ORDERS PASSED BY THE LD. CIT(A) TIRUCHIRAPALLI DATED 24.12.2009 24.12.2009 AND 31.12.2009 READ WITH THREE DIFFERENT CORRIGENDUM ALL DATED 12.01.2010 FOR THE ASSESSMENT YEARS 2005-06 06-07 AND 07-08 RESPECTIVELY. 2. THESE APPEALS INVOLVE ID ENTICAL FACTS AND COMMON ISSUES THEREFORE BEING HEARD TOGETHER AND DISPOSED OF BY THIS SINGLE ORDER FOR THE SAKE OF CONVENIENCE. 3. IN ALL THE THREE APPEALS OF THE ASSESS EE FOLLOWING COMMON EFFECTIVE GROUNDS NO. II TO V HAVE BEEN RAISED: II. THE CIT(A) FAILED TO APPRECIA TE THE DIFFERENCE BETWEEN THE REVENUE DEDUCTION IN THE COMPUTATION OF INCO ME AND A SPECIAL EXEMPTION GRANTED BY THE ACT BASED ON APPLICATION OF SU CH INCOME FOR CHARITABLE PURPOSES AND THAT VARIOUS HIGH COUR TS HELD THAT DEPRECIATION IS A PROPER DEDUCTION IN COMPUTING INCOME OF A CHARITABLE INSTITUTION. III. THE CIT(A) OUGHT TO HAVE APPREC IATED THAT THE PA RLIAMENT GAVE EFFECT TO THE DECISIONS OF THE SUPREM E COURT IN ESCORTS LTD. V. UNION OF INDIA [1992] 199 ITR 43(SC) AND CIT V. HICO PRODUCTS P LTD. [1999] 247 ITR 797 (SC) BY INSERTING SUB-CLAUSE (IV) IN SECTION 35(2). THE SAID I.T.A. NOS.142 TO 144/MDS/10 2 SECTION AS WELL AS THE SAID DECISI ONS HAS NO APPLICATION TO A CHARITABLE INSTITUTION ASSESSED UNDER THE SPECIAL PROVISIONS OF SECTION 11 TO 13. IV. THE CIT(A) OUGHT TO HAVE APPR ECIATED THAT THE BOMBAY HIGH COURT IN CIT V INSTITUTE OF BANKING 264 ITR 110 UPHELD THE ALLOWANCE OF DEPRECIATION CLAIM TO CHARITABLE INST ITUTIONS EVEN AFTE R PRONOUNCEMENT OF THE ABOVE DECISIONS BY THE SUPREME COURT. V. THE CIT(A) OUGHT TO HAVE FOLLOWED THE DECISION OF THE JURISDICTIONAL HIGH COURT IN GOVINDU NAICKER ESTA TE V CIT (248 ITR 368) AND OTHER DECISIONS OF VARIOUS HIGH COURTS AND A LLOWED THE BENEFIT OF CARRY FORWARD OF EXCESS APPLICATION TO SUBSEQUENT YEARS. 4. THE CLAIM OF DEPRECIATION IN COMPUTI NG THE INCOME UNDER SECTION 11(1) OF THE INCOME TAX ACT AS MADE BY THE ASSESSEE WAS REJECTED BY THE ASSESSING OFFICER AND HIS ACTION HAS BEEN UPHELD BY TH E LD. CIT(A) BY DISMISSING THE APPEALS OF THE ASSESSEE FOR ALL THE THREE YEARS. AGAINST SUCH ORDER S OF THE LD. CIT(A) THE ASSESSEE HAS FILED FURTHER APPEAL. AT THE VERY OUTSET THE LD. C OUNSEL FOR THE ASSESSEE SHRI V.D. GOPAL SUBMITTED THAT THE ISSUE AGITATED IN THESE APPEALS IS COVERED BY THE DECISION OF D BENCH OF THE TRIBUNAL IN THE CASE OF DDIT (EXEMPTIONS) V. M/S. ST. JOHNS EDUCATIONAL TRUST IN ITA NOS. 987 TO 990/MDS/2010 DAT ED 18.10.2010 AND ALSO THE DECISION OF HONBLE PUNJAB & HARYANA HIGH C OURT AS REPORTED IN [2011] 330 ITR 16 (CIT V. MARKET COMMITTEE PIPLI) & [2011] 330 ITR 16 (P&H) (I N THE CASE OF CIT V TINY TOTS EDUCATION SOCIETY) AND ANOTHER DEC ISION OF B BENCH OF THE TRI BUNAL IN ITA NO. 640/MDS/2009 ( ITO(OSD) V. M/S. THE EDUCATIONAL TRUST OF THE SEVENTH DAY ADVENTISTS) WHICH HAS BEEN DISCUSSED IN THE ORDER OF THE B BENCH OF THE TRIBUNAL. SINCE THIS IS A COVERED ISSUE IT WAS THUS PRAYED THAT FOLLOWING EARLIER DECISIONS THE APPEALS OF THE ASSESSEE SHOULD BE ALLOWED FOR ALL THE THREE YEARS A ND TO THIS PLEA OF THE LD. COUNSEL FOR THE ASSESSEE THE LD. DR COULD NOT CONTROVERT TH IS FACTUAL ASPECT EX CEPT CONTENDING THAT DOUBLE DEDUCTION SHOULD NOT BE ALLOWED ONE FO R APPLICATION OF FUND AND OTHER FOR I.T.A. NOS.142 TO 144/MDS/10 3 DEPRECIATION AND TO COUNTER THIS SUBMISSION THE LD. COUNSEL FOR THE ASSESSEE STATED THAT THIS OBJECTION IS IRRELEVANT AND C ANNOT HOLD GOOD IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE IT WAS THUS PLEADED FOR ALLOWING THE APPEALS OF THE ASSESSEE. 5. WE HAVE HEARD BOTH THE SIDES AND CONSI DERED THE MATERIAL ON RECORD AS WELL AS PRECEDENTS RELIED UPON BY THE LD . COUNSEL FOR THE ASSESSEE AND FIND THAT SIMILAR ISSUE AROSE IN THE APPEALS OF T HE DEPARTMENT WHICH HAS BEEN DISCUSSED CONSIDERED AND DECIDED BY THE B BENCH OF THE TRIBUNAL (IN WHIC H ONE OF US IS PAR TY) AND VIDE ORDER DATED 18.10.2010 IN THE CASE OF DDIT (EXEMPTIONS) V. M/S. ST . JOHNS EDUCATIONAL TRUST (SUPRA) THE SAME HAS BEEN CONSIDERED AND DISCUSSED TO DETERMINE FROM PARA 3 ONWARDS TO TAKE DECISION IN FAVOUR OF THE ASSESSEE AND RELEVANT POR TION OF THE ORDER IS REPRODUCED AS UNDER: 3. BRIEFLY THE FACTS ARE THAT THE ASSE SSEE IS A TRUST RUNNING EDUCATIONAL TRUST AND REGISTERED U/S. 12A(A) OF THE INCOME TAX ACT 1961. 4. THE GROSS RECEIPTS AMOUNTS OF DEPRECIATION CLAIMED AND REASONS FOR DISALLOWANCE FOR RESPECTIVE YE ARS ARE GIVEN AS UNDER: (A) THE RETURN OF INCOME FILED FOR (I) ASSESSMENT YEAR 2004-05 DECLARES NIL INCOME AND GROSS RECEIPTS OF ` .18 95 45 440/- IN WHICH THE CL AIM OF DEPRECIATION MADE AT ` .2 72 85 356/- WHICH WAS COMPLETED AS NO DEMAND WHILE DISALLOWING THE DEPRECIATION CLAIM OF THE ASSESSEE THE ASSESSING OFFICER HAS STATED THAT WHEN THE ASSESSEE HAD CLAIMED THE COST OF ADDITIO N TO ASSETS AS APPLICATION OF FUNDS CLAIM OF DEPRECIATION ON THE SAME ASSETS COULD NOT BE ALLOWED. (B) THE RETURN OF INCOME FILED FOR (I) ASSESSMENT YEAR 2005-06 DECLARES NIL INCOME AND GROSS RECEIPTS OF ` . 22 17 53 309/- IN WHICH THE CLAIM OF DEPRECIATION MADE AT ` .2 82 17 782/- WHICH WAS COMPLETED AS NO DEMAND WHILE DISALLOWING THE DEPRECIATION CLAIM OF THE ASSESSEE THE ASSESSING OFFICER HAS STATED THAT WHEN THE ASSESSEE HAD CLAIMED THE COST OF ADDITIO N TO ASSETS AS APPLICATION OF FUNDS CLAIM OF DEPRECIATION ON THE SAME ASSETS COULD NOT BE ALLOWED. (C) THE RETURN OF INCOME FILED FOR (I) ASSESSMENT YEAR 2006-07 DECLARES NIL INCOME AND GROSS RECEIPTS OF ` .21 71 47 737/- IN WHICH THE CL AIM OF DEPRECIATION I.T.A. NOS.142 TO 144/MDS/10 4 MADE AT ` . 2 64 72 392/- WHICH WAS COMPLETED AS NO DEMAND WHILE DISALLOWING THE DEPRECIATION CLAIM OF THE ASSESSEE THE ASSESSING OFFICER HAS STATED THAT WHEN THE ASSESSEE HAD CLAIME D THE COST OF ADDITION TO ASSETS AS APPLICATION OF FUNDS CLAIM OF DEPRECIATI ON ON THE SAME ASSETS COULD NOT BE ALLOWED. (D) THE RETURN OF INCOME FILED FOR (I) ASSESSMENT YEAR 2007-08 DECLARES NIL INCOME AND GROSS RECEIPTS OF ` .23 53 18 947/- IN WHICH THE CL AIM OF DEPRECIATION MADE AT ` .2 49 35 874/- WHICH WAS COMPLETED AS NO DEMAND WHILE DISALLOWING THE DEPRECIATION CLAIM OF THE ASSESSEE THE ASSESSING OFFICER HAS STATED THAT WHEN THE ASSESSEE HAD CLAIMED THE COST OF ADDITIO N TO ASSETS AS APPLICATION OF FUNDS CLAIM OF DEPRECIATION ON THE SAME ASSETS COULD NOT BE ALLOWED. 5. ASSESSEE TOOK UP THE MATTERS IN APPEA L AND IT WAS CONTENDED BEFORE THE FIRST APPELLATE AUTHORITY THAT ORDERS OF THE ASSESSING OFFICER ARE NOT LEGALLY CORRECT BECAUSE HE HAS ERRED IN HO LDING THAT DEPRECIATION ON ASSETS SHOULD NOT BE TAKEN INTO ACCOUNT FOR DETE RMINING THE TOTAL INCO ME OF THE ASSESSEE TRUST THAT LD. ASSESSING OFFICER OUGHT TO HAVE FOLLOWED BO MBAY HIGH COURT DECISION IN THE CASE OF CIT VS. INSTITUTE OF BA NKING PERSONAL SOLUTI ON ( 264 ITR 110) AND PRAYED THAT APPEAL BE ALLOWED. 6. DURING THE APPELLATE PROCEEDINGS THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THE DETAILED WRITTEN SUBMISSION W HOSE SALIENT FEATURES WERE REPRODUCED BY THE LD. CIT(A) IN HIS ORDER IN PARA -5 OF HIS ORDER AND WHILE CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE IMPUG NED ORDER RIVAL SUBMISSIONS AND CASE LAWS RELIED UPON BY THE ASSESSEE AS WELL AS BY THE ASSESSING OFFICER THE ISSUE INVOLVED IN THIS CASE WA S DISCUSSED FROM PARA-7 & 8 IN APPEAL FOR ASSESSMENT YEAR 2004-05 AND CIT(A) HAS CONCLUDED TO DECIDE THE APPEAL IN FAVOUR OF THE ASSESSEE AS PER PARAS 9 TO 11 OF HIS ORDER FOR THE YEAR 2004-05 AS UNDER:- 9. IT COULD BE SEEN FROM THE JUDGEME NT OF THE HONBLE HIGH COURT OF BOMBAY REPORTED IN 264 ITR 110 WHEREIN THE ASSESS EE WAS THE TRUST AND IT DERIVED ITS INCOME FROM DEPRECIABLE ASSETS. THE A SSESSEE TOOK INTO ACCO UNT DEPRECIATION ON THOSE ASSETS IN COMPUTING THE INCOME OF THE TRUST. THE ITO HELD THAT DEPRECIATION COULD NOT BE TAKEN INTO A CCOUNT BECAUSE FULL CAPITAL EXPENDITURE HAD BEEN ALLOWED IN THE YEAR OF ACQUISITION OF THE ASSETS. THE ASSESSEE WENT IN APPEAL BEFORE THE APPELLATE ASSISTANT COMMISSIONER. TH E APPEAL WAS REJECTED. THE TRIBUNAL HOWEVER TOOK THE VIEW THAT WHEN THE ITO STATED THAT FULL EXPENDITURE HAD BEEN ALLOWED IN THE YEAR OF ACQUISITION OF THE A SSETS WHAT HE REALLY MEANT WAS THAT THE AMOUNT SPENT ON ACQUIRING THOSE ASSETS HAD BEEN TREATED AS APPLICATION OF INCOME OF THE TRUST IN THE YEAR IN WHICH THE INCOME WAS SPENT IN ACQUIRING THOSE ASSETS. THIS DID NOT MEAN THAT IN COMPUTING INCOME FROM THOSE ASSETS IN SUBSEQUENT YEARS DEPRECIATION IN RESPECT OF THOSE ASSETS CAN NOT BE TAKEN INTO ACCOUNT. THIS VIEW OF THE TRIBUNAL HAS BEEN CONFIRMED BY THE BOMBAY HIGH COURT IN THE ABOVE JUDGEMENT I.E. DIRECTOR OF INCOME-TAX(EXEMPTION) V. FRAMJEE I.T.A. NOS.142 TO 144/MDS/10 5 CAWASJEE INSTITUTE [1993] 109 CTR 463. HENCE THIS ISSUE WAS COVERED BY THE DECISION OF THE BOMBAY HIGH COURT IN TH E ABOVE JUDGEMENT. C ONSEQUENTLY THIS ISSUE WAS ANSWERED IN THE AF FIRMATIVE I.E. IN FAVOUR OF THE ASSESSEE AND AGAINST THE DEPARTMENT. 10. THE RATIO OF THE ABOVE MENTIONED DECISION REPORTED IN 264 ITR 110 (2003) IN THE CASE OF CIT VS. INSTITUTE OF B ANKING WHEREIN THE BOMBAY HIGH COURT HAS HELD THAT THE TRIBUNAL WAS RIGHT IN LAW IN DIRECTING THE ASSESSI NG OFFICER TO ALLOW DEPRECIATION ON THE ASSETS THE COST OF WH ICH HAS BEEN FULLY ALLOWED AS APPLICATION OF INCOME U/S.11 IN THE PAST YEARS SQ UARELY COVERED IN THE INSTANT CASE. 11. IN THE ADVENT OF THE ABOVE DISCUSSIONS AND RESPECTFULLY FOLLOWING THE DECISION OF THE HONBLE BOMBAY HIGH COUR T CITED SUPRA THE APPELLANT TRUST IS ELIGIBLE FOR CLAIM OF DEPRECI ATION ON THE ASSETS THE CO ST OF WHICH HAD BEEN FULLY ALLOWED AS APPLICATION OF IN COME U/S. 11 IN THE PAST YE ARS. THE ASSESSING OFFICER IS THEREFORE DIRECTED TO DELETE THE DISALLOWANCE OF ` .2 49 35 874/- MADE IN THE IMPUGNED ORDER AND REVISE THE ASSESSMENT ACCORDINGLY. THUS THE APPELLANT SUCCEEDS IN THE APPEAL. THE SAID ORDER WAS FOLLOWED IN THE SUBSE QUENT YEARS IN IDENTICAL MANNER WHEREIN CLAIM OF DEPRECIATION WAS DISALLOWED. 7. AGGRIEVED BY THESE ORDERS OF CIT(A) THE DEPARTMENT HAS COME UP IN APPEAL FOR ALL THE YEARS AND WHILE RELYING UPON ANOTHER SUPREME COURT DECISION IN THE CASE OF ESCORT LTD. (199 ITR 43 ) IT WAS CONTENDED THAT DOUBLE TAXATION CAN NOT BE ALLOWED UNLESS THERE IS EXPRESS PROVISION FOR THE SAME IN THE STATUTE AND WHILE REFERRING TO CIT(A)S ORDER IN THE CASE OF M/S.RANGALET CHURNI EDUCATIONAL TRUST CHENNAI WHICH HAS BEEN DECIDED IN FAVOUR OF THE DEPARTMENT IT WAS PLEADED FOR REVERSAL OF THE ORDER OF LD. CIT(A) FOR ALL THE FOUR YEARS AND TO UPHOLD THE ORDER OF THE ASSESSING OFFICER IN THIS REGARD. 8. LD. DR WHILE ARGUING THE APPEALS OF THE DEPARTMENT HAS MAINLY RELIED UPON HONBLE SUPREME COURT IN THE CASE OF M/S.ESCORT LT D. (SUPRA) TO PLEAD THAT WHEN INCOME OF THE ASSESSEE IS BEING ALLOWED AS APPLIC ATION OF FUND SO ALLOWANCE OF DEPRECIATION ON THE SAME WOULD TANTAMOUNT TO DOUBLE DEDUCTION WHICH IS NOT PERMISSIBLE THEREFORE THE ORDER OF THE LD . CIT(A) FOR ALL THE FOUR YEARS SHOULD BE REVERSED AND THAT OF ASSESSI NG OFFICER MAY BE RESTORED. 9. LD. COUNSEL FOR THE ASSESSEE WHILE RELYING UPON THE BASIS AND REASONING AS GIVEN BY THE LD.CIT(A) IN ALLOWING THE FIRST APPEALS OF THE ASSESSEE HAS PLEADED THAT THE SOLITARY ISSUE IN THESE APPEALS IS FULLY COVERED BY BOMBAY HIGH COURT DECISION AND LD. CIT(A) WHILE CONSIDERING ALL THE ASPECTS OF THE CASE AS WELL AS CASE LAWS CITED HAS RIGHTLY FOLLOWED THE VIEW OF THE HONBLE BOMBAY HIGH COURT WHICH WAS THE ONLY VIEW AV AILABLE AT THE TIME OF D ECIDING THE APPEALS AND NOW I.T.A. NOS.142 TO 144/MDS/10 6 ALSO HONBLE PUNJAB & HARYAN A HIGH COURT IN THE CASE OF CIT VS. M/S.TINY TOTS EDUCATION SOCIETY AS REPOR TED IN 2010-TIOL-550-HIGH COURT-P&H-IT VIDE ORDER DT.28 TH JULY 2010 UNDER SIMILAR FACTS HAS D ECIDED THE IDENTICAL ISSUE IN FAVOUR OF THE ASSESSEE AND WHILE ENCLOSING THE COPY OF THE JUDGEMENT OF HONBLE BOMBAY HIGH COURT AS WELL AS HON BLE PUNJAB & HARYANA HIGH COURT LD. COUNSEL FOR THE ASSESSEE HAS STRONGLY PLEADED THAT SI NCE THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE NOT BY ONE HIGH COURT BUT BY SECOND HI GH COURT ALSO IN WHICH SUPREME COURT DECISIONS CASE OF ES CORT LTD. VS. UOI AND OTHERS HAS BEEN DISCUSSED HAS CONCLUDED TO HOLD THE QUES TION PROPOSED IN FAVOUR OF THE ASSESSEE THEREFORE BEING COVERED THE MATTER ORDER OF THE CIT(A) FOR ALL THE YEARS ARE LIABLE TO BE UPHELD. IT WAS THUS URGED FO R UPHOLDING THE IMPUGNED ORDERS AND FOR DISMISSING ALL THE APPEALS OF THE REVENUE. 10. AFTER HEARING BOTH THE SIDES CONSID ERING THE MATERIAL AS WELL AS CASE LAWS CITED BY THE RIVAL SIDE WE FIND THAT IN THE RECENT JUDGEMENT OF THE HONBLE HIGH COURT OF PUNJAB & HARYANA IN THE CASE OF CIT VS. M/S.TINY TOTS EDUCATION SOCIETY (SUPRA) HAS CONCLUDED TO DECIDE THE ISSUE IN FAV OUR OF THE ASSESSEE AS PER PARAS 4 TO 7 AS UNDER:- 4. LD. COUNSEL FOR THE REVENUE SUBMITS THAT IN VIEW OF JUDGEMENT OF THE HONBLE SUPREME COURT IN ESCORTS LT D. AND ANOTHER V. UNION OF INDIA AND OTHERS [1993] 199 ITR 43 TH E ASSESSEE COULD NOT CL AIM DEDUCTION WHEN ITS INCOME WAS EXEMPT AS IT WILL AMOUNT TO GETTING DOUBLE BENEFIT. 5. WE ARE UNABLE TO ACCEPT THE SUBMISSION. 6. THE MATTER WAS DISCUSSED IN OUR RECENT JUDGEMENT DATED 5.7.2010 IN ITA NO.535 OF 2009 THE CIT KARNAL V. MARKET COMMITTEE PIPLI. AFTER REFERRING TO JUDGMENTS IN CIT V. SETH MANILAL RANCHHODDAS VISHRAM BHAWAN TRUST [1992] 198 ITR 598 (G UJ.) AND CIT V. INSTITUT E OF BANKING PERSONAL SELECTION (IBPS) (2003) 131 TAXMAN 386 (BOM.) CIT V. RAO BAHADUR CALAVALA CUNNAN CHETTY CHARITIES [1982] 135 ITR 485 (MAD.) CIT V. SOCIETY OF THE SISTERS OF ST. ANNE [1984] 146 ITR 28 (KAR) AND CIT V. RAIPUR PALLOTTINE SOCIETY [1989] 180 ITR 579 (M .P.) THE JUDGMENT OF THE HONBLE SUPREME COURT IN ESCORTS LTD. (SUPRA) WAS HELD NOT TO BE APPLICABLE TO THE SITUATION WHERE DEPRECIATION WAS CLAIME D BY A CHARITABLE INSTITUTION IN DETERMINING PERCENTAGE OF FUNDS APP LIED FOR THE PURPOSES OF CHARITABLE OBJECTS. IT WAS OBSERVED:-9. IN THE PR ESENT CASE THE ASSESSEE IS NOT CLAIMING DOUBLE DEDUCTION ON ACCOUNT OF DEPRECIA TION AS HAS BEEN SUGGESTED BY LD. COUNSEL FOR THE REVENUE. THE INCOME OF THE ASSESSEE BEING EXEMPT THE ASSESSEE IS ONLY CLAIMING THAT DEPRECIA TION SHOULD BE REDUCED FROM THE INCOME FOR DETERMINING THE PERCENTAGE OF F UNDS WHICH HAVE TO BE APPLIED FOR THE PURPOSES OF THE TRUST. THERE IS NO DOUBLE DEDUCTION CLAIMED BY THE ASSESSEE AS CANVASSED BY THE REVENUE. JUDGMENT OF THE HONBLE SUPREME COURT IN ESCORTS LTD AND ANOTHER (SUPRA) IS DISTI NGUISHABLE FOR THE ABOVE REASONS. IT I.T.A. NOS.142 TO 144/MDS/10 7 CAN NOT BE HELD THAT DOUBLE BENEFIT IS GIVEN IN ALLOWING CLAIM FOR DEPRECIATION FOR COMPUTING INCOME FOR PURPOSES OF SEC.11. THE QUESTIONS PROPOSED HAVE THUS TO BE ANSWERED AGAINST THE REVE NUE AND IN FAVOUR OF THE ASSESSEE. 7. IN VIEW OF ABOVE WE ARE UNABLE TO HOLD THAT THE QUESTIONS PROPOSED BY THE REVENUE ARE SUBSTANTIAL QUESTIONS OF LAW. SINCE THE ISSUE IS SQUARELY COVERED IN FA VOUR OF THE ASSESSEE AND DEPARTMENT HAS NOT BROUGHT ANY CONTRARY MATERIAL OR AN Y HIGHER COURTS ORDER IN ITS FAVOUR THEREFORE WE DO NOT FIND ANY INFIRMITY OR FLAW IN THE ORDERS OF THE CIT(A) IN THIS REGARD AS SUCH WHILE CONCURRING WITH THE CONCLUSION AS DRAWN BY THE CIT(A) WE UPHOLD HIS ORDERS AND DISMISS THE APPEAL S OF THE REVENUE BEING DEVOID OF ANY MERITS. 6. SINCE THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE AND DEPARTMENT HAS NOT BROUGHT ANY CONTRARY MATERIAL OR ANY HI GHER COURTS ORDER IN ITS FAVOUR THEREFORE WHILE FOLLOWING THE SAID DECISION WE ACCE PT ALL THE APPEALS OF THE ASSESSEE AN DIRECT THE ASSESSING OFFICER TO ALLOW THE CLAIM OF THE ASSESSEE IN THIS REGARD. 7. IN THE RESULT ALL THE THREE APPEA LS OF THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED SOON AFTER THE CONCLUSION OF HEARING ON 02.02.2011 SD/- SD/- (B. RAMAKOTAIAH) ACCOUNTANT MEMBER (U.B.S. BEDI) JUDICIAL MEMBER CHENNAI DATED THE. 02.02.2011 VM/- TO:THE ASSESSEE//A.O./CIT(A)/CIT/D.R.