Minda Corporation Ltd., New Delhi v. DCIT, New Delhi

ITA 1962/DEL/2012 | 2003-2004
Pronouncement Date: 31-07-2015 | Result: Partly Allowed

Appeal Details

RSA Number 196220114 RSA 2012
Assessee PAN AAACM0344C
Bench Delhi
Appeal Number ITA 1962/DEL/2012
Duration Of Justice 3 year(s) 3 month(s) 3 day(s)
Appellant Minda Corporation Ltd., New Delhi
Respondent DCIT, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 31-07-2015
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted E
Tribunal Order Date 31-07-2015
Date Of Final Hearing 27-07-2015
Next Hearing Date 27-07-2015
Assessment Year 2003-2004
Appeal Filed On 27-04-2012
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH E : NEW DELHI) BEFORE SHRI N.K. SAINI ACCOUNTANT MEMBER AND SHRI GEORGE GEORGE K JUDICIAL MEMBER ITA NO.1962/DEL./2012 (ASSESSMENT YEAR : 2003-04) M/S. MINDA CORPORATION LIMITED VS. DCIT CIRCLE 6 (1) 35A RAJASTHAN UDYOG NAGAR NEW DELHI. DELHI 110 033. (PAN : AAACM0344C) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI ROHIT JAIN ADVOCATE AND MS. DEEPASHREE RAO CA REVENUE BY : SHRI P. DAM KANUNJNA SENIOR DR DATE OF HEARING : 27.07.2015 DATE OF PRONOUNCEMENT : 31.07.2015 O R D E R PER GEORGE GEORGE K. JM : THIS APPEAL AT THE INSTANCE OF THE ASSESSEE IS DI RECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX-IX NEW DEL HI DATED 24.01.2012. THE RELEVANT ASSESSMENT YEAR IS 2003-04 . 2. THE ASSESSEE IN HIS GROUNDS OF APPEAL HAS RAISED TWO ISSUES NAMELY (I) WHETHER THE REOPENING OF ASSESSMENT IS VALID IN LAW; AND (II) WHETHER THE CIT (A) IS JUSTIFIED IN UPHOLDING THE DISALLOWA NCE OF RS.9 29 592/- ON ACCOUNT OF LEASE PAYMENT MADE BY THE ASSESSEE. ITA NO.1962/DEL./2012 2 3. BRIEF FACTS OF THE CASE ARE AS FOLLOWS. THE ASS ESSEE IS A PUBLIC LIMITED COMPANY ENGAGED IN THE BUSINESS OF MANUFACT URING OF AUTOMOBILE LOCK SETS. THE RETURN OF INCOME FOR THE RELEVANT A SSESSMENT YEAR WAS FILED ON 02.12.2003 DECLARING AN INCOME OF RS.2 78 95 579 /-. THE ASSESSMENT WAS TAKEN UP FOR SCRUTINY AND SCRUTINY ASSESSMENT U /S 143 (3) OF THE INCOME-TAX ACT 1961 WAS COMPLETED BY ORDER DATED 2 8.03.2006 ASSESSING TOTAL INCOME OF RS.3 18 14 069/-. THE ASSESSMENT W AS REOPENED U/S 147 AND REASSESSMENT WAS COMPLETED BY ORDER DATED 05.11 .2007 FIXING A TOTAL INCOME OF RS.4 16 49 460/-. AGAINST THE ORDER COMP LETED U/S 147 READ WITH SECTION 143 (3) ASSESSEE PREFERRED AN APPEAL TO THE CIT (A) AND ALSO A WRIT PETITION TO THE HONBLE DELHI HIGH COURT. THE HONBLE DELHI HIGH COURT BY JUDGMENT DATED 26.09.2011 QUASHED THE REAS SESSMENT ORDER ON THE GROUND THAT THE REASONS RECORDED SHOW ONLY A CH ANGE OF OPINION AND THE REASSESSMENT PROCEEDINGS ARE INVALID. 3.1 THEREAFTER A SECOND NOTICE DATED 19.03.2010 WA S ISSUED U/S 148 OF THE ACT. THE REASONS RECORDED FOR ISSUANCE OF NOTI CE DATED 19.03.2010 READS AS UNDER :- FROM THE RECORD IT IS FOUND THAT THE ASSESSEE IN ITS COMPUTATION OF INCOME HAD CLAIMED AND WAS ALLOWED DEDUCTION OF RS.24 88 202/- UNDER SECTION 37 OF TH E IT ACT. IT IS OBSERVED THAT THIS EXPENDITURE WAS INCURRED FOR ACQUIRING FIXED ASSETS (RS. 15 58 610/-) AND VEHICLES (RS. 9 29 592/-). AS THE EXPENDITURE CLAIMED BY THE ASSESSEE WAS OF CAPI TAL NATURE IT SHOULD HAVE BEEN DISALLOWED AND ADDED BACK TO THE T OTAL INCOME OF THE ASSESSEE. ITA NO.1962/DEL./2012 3 IT IS ALSO FOUND THAT DURING THE RELEVANT PREVIOUS YEAR ASSESSEE HAD INCREASED THE PROVISIONS TOWARDS EMPLO YEES RETIREMENT BENEFIT AMOUNTING TO RS.7 75 629/- (58 8 5 695 - 51 10 06) TO THE BALANCE SHEET. AS THIS AMOUNT WAS MERELY A PROVISION AND NOT ASCERTAINED LIABILITY IT WAS NOT AN ALLOWABLE DEDUCTION AND SHOULD HAVE BEEN ADDED BACK TO THE TO TAL INCOME OF THE ASSESSEE. IT IS ALSO FOUND THAT THE ASSESSEE COMPANY IN ITS COMPUTATION OF INCOME DEDUCTED A SUM OF RS.5 69 170 /- BEING INCOME IN RESPECT OF KEY MAN INSURANCE POLICY. ACCO RDING TO SECTION 10 (10D) ANY SUM RECEIVED UNDER A KEY MAN INSURANCE POLICY WILL NOT BE EXEMPT FROM TAX W.E.F 1 ST OCTOBER 1996. THUS THE DEDUCTION CLAIMED BY THE ASSESSEE SHOULD HAVE B EEN DISALLOWED AND ADDED TO THE TOTAL INCOME OF THE ASS ESSEE. IT IS ALSO FOUND THAT THE ASSESSEE COMPANY HAD CLAI MED AND WAS ALLOWED MANAGERIAL REMUNERATION AMOUNTING T O RS.41 54 400/- DURING THE PREVIOUS YEAR. THIS REMUN ERATION EXCEEDS THE LIMITS PRESCRIBED IN THE COMPANIES ACT. APPROVAL FROM THE CENTRAL GOVERNMENT AND SHARE HOLDERS OF T HE COMPANY WAS ALSO PENDING. AS THE EXPENDITURE IS NOT AN AUTHORIZED ONE IT SHOULD HAVE BEEN DISALLOWED AND ADDED BACK TO THE TOTAL INCOME OF THE ASSESSEE. I THEREFORE HAVE REASON TO BELIEVE THAT THE INCOM E OF RS.79 87 401/- HAS ESCAPED ASSESSMENT WITHIN THE ME ANING OF SECTION 147 OF THE IT ACT 1961 DUE TO OMISSION ON THE PART OF THE ASSESSEE TO INCLUDE THIS SUM INTO ITS INCOME FO R THE RELEVANT PREVIOUS YEAR. 3.2 PURSUANT TO THE NOTICE U/S 148 DATED 19.03.2010 THE REASSESSMENT WAS COMPLETED BY ORDER DATED 03.12.2010. IN THE RE ASSESSMENT ORDER DATED 03.12.2010 THE AO HAD MADE A DISALLOWANCE OF RS.9 29 592/- ON ACCOUNT OF THE LEASE PAYMENT MADE BY THE ASSESSEE AND RS.14 60 327/- ON ACCOUNT OF THE EXCESS MANAGERIAL REMUNERATION. AS REGARDS THE OTHER ADDITIONS PROPOSED IN THE REASONS RECORDED FOR REOPENING THE SAME WAS DROPPED ON ITA NO.1962/DEL./2012 4 ACCOUNT OF THE EXPLANATION GIVEN BY THE ASSESSEE IN THE COURSE OF REASSESSMENT PROCEEDINGS. 4. AGGRIEVED BY THE REASSESSMENT ORDER DATED 03.12. 2010 THE ASSESSEE PREFERRED AN APPEAL BEFORE THE FIRST APPELLATE AUTH ORITY CHALLENGING THE REASSESSMENT PROCEEDINGS AS WELL AS THE ISSUE ON M ERITS NAMELY DISALLOWANCE U/S 37 OF THE ACT AND EXCESS MANAGERIA L REMUNERATION PAID. THE CIT (A) REJECTED THE PLEA OF THE ASSESSEE THAT THE REASSESSMENT IS BAD IN LAW. AS REGARDS THE ISSUE ON MERITS THE CIT (A ) CONFIRMED THE DISALLOWANCE U/S 37 OF THE ACT AMOUNTING TO RS.9 29 592/-. THE CIT (A) ALSO CONFIRMED THE AOS ACTION IN DISALLOWING EXCES S MANAGERIAL REMUNERATION PAID. HOWEVER THE CIT (A) ACCEPTED T HE ALTERNATIVE PLEA OF THE ASSESSEE AND DIRECTED THE AMOUNT TO BE EXCLUDED FROM THE INCOME OF THE ASSESSEE IN THE NEXT ASSESSMENT YEAR. SINCE TH E ALTERNATIVE PLEA OF THE ASSESSEE WAS ACCEPTED WITH REFERENCE TO THE ADDITIO N OF RS.14 60 327/- THE ASSESSEE DID NOT CHALLENGE THE SAME BEFORE US. AS R EGARDS THE REJECTION OF ASSESSEES PLEA OF REOPENING OF REASSESSMENT AND IS SUE ON MERITS NAMELY THE DISALLOWANCE OF RS.9 29 592/- ON ACCOUNT OF PAY MENT OF LEASE AMOUNT THE ASSESSEE IS IN APPEAL BEFORE US RAISING THE FOL LOWING GROUNDS :- 1. THAT THE CIT(A) ERRED ON FACTS AND IN LAW IN UP HOLDING THE ORDER PASSED BY THE ASSESSING OFFICER UNDER SEC TION 143(3) READ WITH SECTION 147 OF THE INCOME-TAX ACT 1961 ( 'THE ACT') WHICH IS BEYOND JURISDICTION BAD IN LAW AND VOID-A B-INITIO 1.1 THAT THE CIT(A) ERRED ON FACTS AND IN LAW IN N OT APPRECIATING THAT THE ASSESSING OFFICER FAILED TO T AKE REQUISITE ITA NO.1962/DEL./2012 5 APPROVAL IN VIEW OF THE PROVISIONS OF SECTION 151 O F THE ACT FOR WHICH THE RE-ASSESSMENT PROCEEDINGS HAVE BEEN INITI ATED AND CONSEQUENTLY THE IMPUGNED ORDER IS ILLEGAL AND BAD IN LAW. 1.2 THAT THE CIT(A) ERRED ON FACTS AND IN LAW IN U PHOLDING THE INITIATION OF THE IMPUGNED REASSESSMENT PROCEED INGS WITHOUT APPRECIATING THAT PROCEEDINGS WERE INITIATE D ON MERE CHANGE OF OPINION WITHOUT FORMING A REASONABLE BELI EF OF ESCAPEMENT OF INCOME WHICH IS SINE QUA NON FOR ASS UMPTION OF VALID JURISDICTION. 1.3 THAT THE CIT(A) ERRED ON FACTS AND IN LAW IN N OT APPRECIATING THAT THERE BEING NO FAILURE ON THE PAR T OF APPELLANT TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECE SSARY FOR ASSESSMENT THE REASSESSMENT PROCEEDINGS WERE INITI ATED AFTER FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR WERE ILLEGAL AND BAD IN LAW AND THE IMPUGNED ORDER IS T HEREFORE LIABLE TO BE QUASHED. 2. THAT THE CIT(A) ERRED ON FACTS AND IN LAW IN UPH OLDING THE DISALLOWANCE OF RS. 9 29 592 ON ACCOUNT OF LEAS E PAYMENTS MADE BY THE APPELLANT. 4. LD. AR REITERATED THE SUBMISSIONS MADE BEFORE TH E INCOME-TAX AUTHORITIES. LD. DR ON THE OTHER HAND SUPPORTED THE ORDER OF THE CIT (A). 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. WE SHALL TAKE UP FOR CONSIDERATION THE ISS UE ON MERITS. THE BRIEF FACTS IN RELATION TO THE DISALLOWANCE ARE AS FOLLOWS. THE ASSESSEE COMPANY ACQUIRED VEHICLES WORTH RS.27 88 7 76/- ON FINANCIAL LEASE. IN TERMS OF ACCOUNTING STANDARD 19 -'LEASES ' (AS-19) ISSUED BY THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA ('I CAI') THE ASSETS ACQUIRED UNDER FINANCIAL LEASE WERE CAPITALIZED IN THE BOOKS OF ACCOUNTS AND CONSEQUENT LIABILITY THEREON WAS ALSO CREATED. HOWE VER FOR THE PURPOSES OF ITA NO.1962/DEL./2012 6 THE ACT THE LEASE RENTAL OF RS.9 29 592/- (APART FROM FINANCE CHARGES ALREADY DEBITED IN THE PROFIT AND LOSS ACCOUNT) PAI D BY THE ASSESSEE IN THE YEAR UNDER CONSIDERATION WAS CLAIMED AS DEDUCTION U NDER SECTION 37 OF THE ACT. THE AO DISALLOWED THE AFORESAID CLAIM OF DEDU CTION ON THE GROUND THAT SINCE THE PAYMENTS MADE BY THE ASSESSEE WAS IN THE NATURE OF A 'FINANCE LEASE' THE SAME WAS REQUIRED TO BE CAPITA LIZED AND NOT ALLOWABLE AS DEDUCTION UNDER SECTION 37 OF THE ACT. FURTHER DEPRECIATION WAS ALSO NOT ALLOWED ON THE PURPORTED COST OF THE FIXED ASSE T. 5.1 AFTER HAVING HEARD RIVAL SUBMISSIONS WE ARE OF THE VIEW THAT AS-19 ON ACCOUNTING FOR 'LEASES' ISSUED BY THE ICAI IS ON LY APPLICABLE FOR ACCOUNTING THE LEASE TRANSACTION IN THE BOOKS OF AC COUNTS. IT IS A SETTLED LAW THAT TREATMENT IN THE BOOKS OF ACCOUNTS IS NOT DETE RMINATIVE OF LIABILITY TOWARDS INCOME-TAX FOR THE PURPOSE OF THE ACT. THE LIABILITY UNDER THE ACT IS GOVERNED BY PROVISIONS OF THE ACT AND IS NOT DEP ENDENT ON THE TREATMENT FOLLOWED FOR THE SAME IN THE BOOKS OF ACCOUNTS. F OR ABOVE PROPOSITION REFERENCE IS MADE TO SUTLEJ COTTON MILLS LTD. VS. C IT: 116 ITR 1 (SC) AND KEDARNATH JUTE MFG. CO. LTD. VS. CIT: 82 ITR 363 (S C). AS-9 ON ACCOUNTING FOR LEASES CLASSIFIES LEASE TRANSACTIONS FOR ACCOUNTING PURPOSES AS UNDER: (I) FINANCE LEASE (II) OPERATING LEASE ITA NO.1962/DEL./2012 7 5.2 FINANCE LEASE IN AS-19 IS DESCRIBED AS A LEAS E THAT TRANSFERS SUBSTANTIALLY ALL THE RISKS AND REWARDS IN RESPECT OF OWNERSHIP OF AN ASSET; TITLE MAY OR MAY NOT BE TRANSFERRED UNDER SUCH LEAS E. AN OPERATING LEASE ON THE OTHER HAND IS DESCRIBED AS A LEASE OTHER TH AN A FINANCE LEASE. THE AFORESAID ACCOUNTING STANDARD PROVIDES THAT UNDER T HE FINANCE LEASE THE LESSEE SHOULD RECOGNIZE THE ASSET IN ITS BOOKS AND SHOULD CHARGE DEPRECIATION ON THE SAME. IN THE CASE OF OPERATING LEASE THE ACCOUNTING STANDARD PROVIDES THAT THE LESSEE SHOULD RECOGNIZE THE LEASE PAYMENTS AS AN EXPENSE IN THE PROFIT AND LOSS ACCOUNT AND THE L ESSOR SHOULD RECOGNIZE THE ASSET GIVEN ON LEASE AND CHARGE DEPRECIATION IN RESPECT OF THE SAME. THE AFORESAID DISTINCTION BETWEEN FINANCE LEASE AND OPERATING LEASE IS NOT RECOGNIZED UNDER THE ACT. UNDER THE PROVISIONS OF THE ACT DEPRECIATION IS ADMISSIBLE UNDER SECTION 32 OF THE ACT ONLY TO THE 'OWNER' OF THE ASSET. LEASE CHARGES PAID FOR THE USE OF THE ASSET WITHOU T ACQUIRING ANY OWNERSHIP RIGHTS IN THE SAME ARE ALLOWABLE AS REVE NUE EXPENDITURE UNDER SECTION 37 OF THE ACT. 5.3 THE CIRCULAR NO.2 OF 2001 DATED 09.02.2001 (247 ITR (ST.) 53) ISSUED BY THE CENTRAL BOARD OF DIRECT TAXES (CBDT) HAS OPINED THAT THE AFORESAID ACCOUNTING STANDARD ISSUED BY ICAI CREATI NG DISTINCTION BETWEEN FINANCE LEASE AND OPERATING LEASE WILL HAVE NO IMPL ICATIONS UNDER THE PROVISIONS OF THE ACT. THE RELEVANT EXCERPT OF THE SAID CIRCULAR ARE REPRODUCED HEREIN BELOW:- ITA NO.1962/DEL./2012 8 'UNDER THE INCOME-TAX ACT IN ALL LEASING TRANSACTI ONS THE OWNER OF THE ASSET IS ENTITLED TO THE DEPRECIATION IF THE SAME IS USED IN THE BUSINESS UNDER SECTION 32 OF THE INCOM E-TAX. THE OWNERSHIP OF THE ASSET IS DETERMINED BY THE TERMS O F THE CONTRACT BETWEEN THE LESSOR AND THE LESSEE. IT HAS COME TO THE NOTICE OF THE BOARD THAT THE NEW ACCOUNTING STANDARD ON 'LEASES' ISSUED BY THE INSTITUTE OF CHA RTERED ACCOUNTANTS OF INDIA REQUIRE CAPITALIZATION OF THE ASSET BY THE LESSEES IN FINANCIAL LEASE TRANSACTION. BY ITSELF THE ACCOUNTING STANDARD WILL HAVE NO IMPLICATION ON THE ALLOWANCE OF DEPRECIATION ON ASSETS UNDER THE ACT. 5.4 THUS THE CBDT'S VIEW ON THE TREATMENT OF FINAN CE LEASE IS NOT ALIGNED TO THE ACCOUNTANT'S PERSPECTIVE OF A FINANC E LEASE. FOR ACCOUNTING PURPOSES ALTHOUGH THE LESSEE SHOWS THE ASSET IN HI S BALANCE SHEET CHARGES DEPRECIATION IN ACCOUNTS AND EVEN MAKES IMPAIRMENT PROVISION YET THE ASSESSEE IS NOT ELIGIBLE TO CLAIM DEPRECIATION UNDE R THE ACT WHICH IS ALLOWED TO THE LEGAL OWNER OF THE ASSET. FURTHERMOR E NOT ONLY THE INTEREST/ FINANCE/ OTHER CHARGES COMPONENT IN THE LEASE PAYME NTS BUT THE ENTIRE LEASE PAYMENTS ARE TREATED AS A DEDUCTIBLE EXPENSE AND NO DEDUCTION IS ALLOWED FOR THE IMPAIRMENT PROVISION. IN THE HANDS OF THE LESSOR THE ENTIRE 'LEASE RENTALS' AND NOT MERELY THE FINANCE CHARGES COMPONENT THEREOF IS TAXED AS INCOME. THE LESSOR WHO IS THE LEGAL OWNER OF THE ASSET IS ENTITLED TO CLAIM DEPRECIATION UNDER THE PROVISIONS OF THE A CT. 5.5 THE AFORESAID LEGAL POSITION FINDS SUPPORT FROM THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF ICDS LTD. VS. CIT - 350 ITR 527 WHEREIN THE HONBLE COURT HELD THAT THE LESSOR IS T HE OWNER OF THE LEASED ITA NO.1962/DEL./2012 9 PROPERTY IN CASE OF FINANCE LEASE ENTITLED TO DEPR ECIATION OF THE SAME. THE PERTINENT OBSERVATION OF THE HONBLE COURT IS REPRO DUCED HEREUNDER : ' THE REVENUE'S OBJECTION TO THE CLAIM OF THE ASSES SEE IS FOUNDED ON THE LEASE AGREEMENT. IT ARGUED THAT AT T HE END OF THE LEASE PERIOD THE OWNERSHIP OF THE VEHICLE IS TRANS FERRED TO THE LESSEE AT A NOMINAL VALUE NOT EXCEEDING ONE PER CEN T OF THE ORIGINAL COST OF THE VEHICLE MAKING THE ASSESSEE I N EFFECT A FINANCIER. HOWEVER THE REVENUE'S CONTENTION CANNOT BE ACCEPTED . AS LONG AS THE ASSESSEE HAS A RIGHT TO RETAIN THE LEGA L TITLE OF THE VEHICLE AGAINST THE REST OF THE WORLD IT WOULD BE THE OWNER OF THE VEHICLE IN THE EYE OF LAW. A SCRUTINY OF THE SA LE AGREEMENT CANNOT BE THE BASIS OF RAISING QUESTION AGAINST THE OWNERSHIP OF THE VEHICLE. THE CLUES QUA OWNERSHIP LIE IN THE LEA SE AGREEMENT ITSELF WHICH CLEARLY POINT IN FAVOUR OF THE ASSESS EE' 5.6 THE HONBLE RAJASTHAN HIGH COURT IN THE CASE OF RAJSHREE ROADWAYS VS. UNION OF INDIA - [2003] 129 TAXMAN 663 UPHELD THE ASSESSEE'S CLAIM OF ALLOW ABILITY OF LEASE RENTALS PAID AS LESSEE OF THE TRUCKS AS A REVENUE EXPENDITURE UNDER SECTION 37(1) OF THE ACT EVEN THOUGH THE LEASE WAS CATEGORIZED AS FINANCE LEASE. 5.7 THE OTHER RELEVANT JUDGMENTS ARE AS FOLLOWS :- (I) THE DECISION OF THE HONBLE RAJASTHAN HIGH COURT IN THE CASE OF CIT VS. BANSWARA SYNTHETIC LTD. - 216 TAXMAN 113 WHEREIN THE HIGH COURT WHILE FOLLOWING ITS EARLIER DECISION IN THE CASE OF RAJSHREE ROADWAYS (SUPRA) OBSERVED THAT LEASE RENTALS PAID BY AN ASSESSEE IN CASE OF A FINANCE LE ASE IS ITA NO.1962/DEL./2012 10 ALLOWABLE AS AN REVENUE EXPENDITURE UNDER SECTION 3 7(1) OF THE ACT. (II) THE DECISION OF THE KARNATAKA HIGH COURT IN THE CAS E OF BANASHANKARI MEDICAL & ONCOLOGY RESEARCH CENTRE LTD - [2009] 316 ITR 407 IS ALSO TO THE SAME EFFECT. IN T HAT CASE THE ASSESSEE HAD TAKEN CERTAIN EQUIPMENTS ON LEASE FOR WHICH IT HAD PAID A CERTAIN SUM AS DEPOSIT WHICH WAS TO BE A DJUSTED AGAINST THE LEASE RENTALS AND BESIDES THAT THE ASS ESSEE WAS ALSO PAYING FINANCE/INTEREST CHARGES TO THE OWNER O F EQUIPMENT. THE ENTIRE AMOUNT OF LEASE RENTALS PAID DURING THE YEAR WAS CLAIMED BY THE ASSESSEE AS REVENUE EXPEND ITURE UNDER SECTION 37(1) OF THE ACT WHICH WAS UPHELD BY THE HIGH COURT. (III) THE DECISION OF THE JHARKHAND HIGH COURT IN THE CAS E OF CIT VS. TATA ROBINS FRASER LTD - 253 CTR 227 WHEREIN I T WAS HELD THAT A LEASE AGREEMENT PROVIDING LESSEE A RIGH T TO PURCHASE AN ASSET IS NOT HIRE PURCHASE AGREEMENT UN TIL SUCH RIGHT IS EXERCISED BY THE LESSEE. 5.8 IN VIEW OF THE AFORESAID REASONING AND THE JUDI CIAL PRECEDENTS WE HOLD THAT DISALLOWANCE OF RS.9 29 592/- IS NOT JUST IFIED ON FACTS AND CIRCUMSTANCES OF THE CASE. IT IS ORDERED ACCORDING LY. ITA NO.1962/DEL./2012 11 6. SINCE ISSUE HAS BEEN DECIDED ON MERITS IN FAVOUR OF THE ASSESSEE THE LEGAL ISSUE OF REOPENING OF ASSESSMENT BY ISSUANCE OF NOTICE U/S 148 OF THE ACT IS NOT ADJUDICATED. IT IS ORDERED ACCORDINGLY. 7. IN THE RESULT THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED AS INDICATED ABOVE. ORDER PRONOUNCED IN OPEN COURT ON THIS 31 ST DAY OF JULY 2015. SD/- SD/- (N.K. SAINI) (GEORGE GEORGE K) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 31 ST DAY OF JULY 2015 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-IX NEW DELHI. 5.CIT(ITAT) NEW DELHI. AR ITAT NEW DELHI.