ITO, Lucknow v. M/s. U.P. Cooperative Federation Ltd., Lucknow

ITA 33/LKW/2011 | 2007-2008
Pronouncement Date: 22-03-2011 | Result: Dismissed

Appeal Details

RSA Number 3323714 RSA 2011
Assessee PAN AAAAU0373P
Bench Lucknow
Appeal Number ITA 33/LKW/2011
Duration Of Justice 2 month(s)
Appellant ITO, Lucknow
Respondent M/s. U.P. Cooperative Federation Ltd., Lucknow
Appeal Type Income Tax Appeal
Pronouncement Date 22-03-2011
Appeal Filed By Department
Order Result Dismissed
Bench Allotted A
Tribunal Order Date 22-03-2011
Date Of Final Hearing 22-03-2011
Next Hearing Date 22-03-2011
Assessment Year 2007-2008
Appeal Filed On 21-01-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL A - BENCH LUCKNOW. BEFORE SHRI H.L.KARWA HON'BLE VICE PRESIDENT AND SHRI N.K.SAINI ACCOUNTANT MEMBER I.T.A.NO.33 (LKW.)/2011 A.Y. : 2007-08 THE ITO-II(3) VS. M/S. U.P.CO-OPERATIVE FEDERATI ON LTD. LUCKNOW. 32-STATION ROAD LUCKNOW. PAN AAAAU0373P (APPELLANT) (RESPONDENT) C.O.NO.5 (LKW.)/2011 (IN I.T.A.NO.33(LKW.)/2011) A.Y. : 2007-08 M/S. U.P.CO-OPERATIVE FEDERATION LTD. VS. THE ITO-I I(3) LUCKNOW. LUCKNOW. (CROSS OBJECTOR) (RESPONDENT) REVENUE BY : SHRI PRAVEEN KUMAR CIT(D.R.) ASSESSEE BY : SHRI SURENDRA KOHLI ADVOCATE. O R D E R PER H.L.KARWA VICE PRESIDENT THE APPEAL BY THE REVENUE AND THE CROSS OBJECTION BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF THE LD.CIT(A)-I LUCKNOW DATED 18.10.2010 RELATING TO THE ASSESSMENT YEAR 2007-08. 2. GROUND NO.1 OF THE APPEAL READS AS UNDER: 1. THE LD. COMMISSIONER OF INCOME TAX(A) WAS NOT J USTIFIED IN DELETING THE ADDITION OF RS.63 00 570.18 PERTAININ G TO CLAIM OF EXPENSES ON ACCOUNT OF TRANSPORT HANDLING AND PALLE DARI AND 2 ADDITION OF RS.14 52 276.32 PERTAINING TO CLAIM OF EXPENSES UNDER THE HEAD 'REPAIR TO BUILDING REPAIR TO OTHER S AND MISCELLANEOUS EXPENSES' ON THE FACTS AND CIRCUMSTAN CES OF THE CASE. 3. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT T HE ASSESSEE IS AN APEX CO- OPERATIVE SOCIETY OF THE GOVERNMENT OF U.P. IT IS ENGAGED IN A NUMBER OF ACTIVITIES INCLUDING DISTRIBUTION AND MARKETING OF AGRICULTURE PRODUCTS WAREHOUSING AND TRANSPORT ETC. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER EXAMINED DETAILS/DOCUMENTS CA LLED FOR AND FURNISHED BY THE ASSESSEE FROM TIME TO TIME. THE AO MADE THE ADDITION OF RS.63 00 570.18 OBSERVING AS UNDER : 1. THE EXPENSES ON ACCOUNT OF TRANSPORT HANDLING AND PALLEDARI HAVE BEEN CLAIMED AT RS.63 00 57 018.74 F OR WHICH DETAILS BILLS/VOUCHERS WERE CALLED FOR. IN THIS R EGARD DETAILS WERE FURNISHED VIDE LETTER DATED 9.12.2009.HOWEVER ONLY FEW BILLS/ VOUCHERS RELATING TO HEAD OFFICE ONLY WERE PRODUCED . THEREFORE TAKING A MODERATE AND REASONABLE VIEW 1% OF THE C LAIM WHICH WORKS OUT TO RS.63 00 570.18 IS DISALLOWED AND AD DED BACK TO THE TOTAL INCOME ON ACCOUNT OF NON-VERIFIABILITY O F THE EXPENSES CLAIMED. 4. AGGRIEVED BY THE ORDER OF THE AO THE ASSESSEE C ARRIED THE MATTER IN APPEAL BEFORE THE LD.CIT(A). BEFORE THE LD.CIT(A) THE ASSESSEE TOOK THE FOLLOWING LINE OF ARGUMENTS: (I) THAT THE AO MADE THE DISALLOWANCE ON THE GROUND THAT THE ASSESSEE COULD NOT PRODUCE THE BILLS AND VOUCHERS I N SUPPORT OF ITS CLAIM AND COULD PRODUCE ONLY A FEW BILLS AND VO UCHERS RELATING TO HEAD OFFICE ONLY. (II) THAT THE FULL DETAILS OF THE EXPENSES WERE FURNISHE D BEFORE THE 3 AO ON 9.12.2009 BY THE ASSESSEE. (III) THAT THE AO HAS NOT SPECIFIED TO THE EXTENT TO WH ICH THE BILLS OR VOUCHERS COULD BE PRODUCED OR COULD NOT BE PRODU CED. (IV) THAT THE AO HAS ALSO NOT SPECIFIED THE EXTENT TO WH ICH THE EXPENSES WERE NOT VERIFIABLE. (V) THAT THE AO HAS NOT ESTABLISHED THAT BILLS AND VOUC HERS TO THE EXTENT PRODUCED OR PART THEREOF WERE NOT GENUINE B EFORE SUSPECTING THE GENUINENESS OF THE ENTIRE CLAIM AND RESORTING TO AN ESTIMATED DISALLOWANCE. (VI) THAT NO BASIS FOR ESTIMATE OF DISALLOWANCE AT 1% O F THE CLAIM IS ASSIGNED OR EXPLAINED BY THE AO. (VII) THAT THE ASSESSEE MAINTAINED COMPLETE BOOKS OF ACCO UNT IN THE ORDINARY AND REGULAR COURSE OF BUSINESS WHICH ARE SUBJECT TO STATUTORY/TAX AUDIT AND AUDITED BALANCE SHEETS WERE FURNISHED WITH TAX RETURNS. (VIII) THAT THE AO HAS MENTIONED THAT SHE HAS EXAMI NED THE BOOKS OF ACCOUNT BILLS AND VOUCHERS ON TEST-CHECK BASIS AND HAS NOWHERE POINTED OUT ANY DEFICIENCIES OR DISCREPANCIES IN T HE BOOKS OF ACCOUNT AND HAS NOT REJECTED THEM. IN VIEW OF THE ABOVE THE ASSESSEE SUBMITTED BEFORE THE LD.CIT(A) THAT 4 THE ADDITION/DISALLOWANCE MADE BY THE AO MAY BE DEL ETED. 4. THE LD.CIT(A) DELETED THE ADDITION/DISALLOWANCE OBSERVING AS UNDER : THE AO.HAS MADE THE DISALLOWANCE PURELY ON ADHOC B ASIS AND THE ESTIMATE FOR DISALLOWANCE IS NOT BASED ON ANY COGE NT REASONS AND ANALYSED FACTS. IN VIEW OF THESE CIRCUMSTANCES AND ON THE FACTS BROUGHT OUT IN THE ORDER THE DISALLOWANCE MADE IS D IRECTED TO BE DELETED AND THIS GROUND OF APPEAL IS ALLOWED. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS. SHRI PRAVEE N KUMAR LD.CIT(DR) HEAVILY RELIED ON THE ORDER OF THE AO AN D ON THE OTHER HAND SHRI SURENDRA KOHLI ADVOCATE LD. COUNSEL FOR THE ASSES SEE REITERATED THE SUBMISSIONS MADE BEFORE THE LOWER AUTHORITIES. IN T HE INSTANT CASE THE AO DISALLOWED 1% OF THE CLAIM PURELY ON AD HOC BASIS. IN FACT THE AO HAS NOT ASSIGNED ANY COGENT REASON WHILE MAKING THE DISALLO WANCE. THE AO HERSELF HAS ADMITTED THAT THE ASSESSEE HAS PRODUCED DETAILS OF THE EXPENDITURE VIDE LETTER DATED 9.12.2009. HOWEVER SHE HAS NOT SPECIF IED THE EXTENT TO WHICH THE BILLS AND VOUCHERS WERE PRODUCED OR COULD NOT B E PRODUCED. THE AO HAS ALSO NOT GIVEN ANY WORKING OF THE EXPENSES WHICH W ERE NOT VERIFIABLE. IT IS SEEN THAT THE ASSESSEE HAD MAINTAINED REGULAR BOOKS OF ACCOUNT WHICH WERE SUBJECTED TO AUDIT BY STATUTORY/TAX AUDIT AND AUDIT ED BALANCE SHEETS WERE FURNISHED WITH THE INCOME-TAX RETURNS. AUDITORS HA VE NOT GIVEN ANY ADVERSE REMARKS IN THEIR RESPECTIVE REPORT. THE AO HAS ALSO NOT POINTED OUT ANY DEFECT IN THE BOOKS OF ACCOUNT OF THE ASSESSEE. THE AO HERSELF HAS ADMITTED THAT SHE HAS EXAMINED THE BOOKS OF ACCOUNT BILLS A ND VOUCHERS ON TEST-CHECK BASIS EVEN THEN THE AO HAS NOWHERE POINTED OUT A NY DEFICIENCIES/DISCREPANCIES IN THE BOOKS OF ACCOUNT. IT IS ALSO SEEN THAT THE AO HAS NOT COMMENTED UPON THE METHOD OF ACCOUNTING REG ULARLY FOLLOWED BY THE 5 ASSESSEE. IN CASE THE BOOKS OF ACCOUNT OF THE ASSES SEE WERE NOT RELIABLE THE AO SHOULD HAVE REJECTED THE BOOK RESULTS. LOOKING T O THE ENTIRE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE WE DO NOT SEE AN Y INFIRMITY IN THE ORDER OF THE LD.CIT(A) ON THIS ISSUE AND ACCORDINGLY WE UPHO LD THE ORDER OF THE LD.CIT(A) ON THIS COUNT. CONSEQUENTLY WE REJECT FI RST PART OF GROUND NO.1 OF THE APPEAL. 6. AS REGARDS THE SECOND PART OF GROUND NO.1 THE A O DISALLOWED RS.14 52 276.32 BEING 5% OF THE EXPENSES CLAIMED U NDER THE HEADS REPAIR TO BUILDING REPAIR TO OTHERS AND MISCELLANEOUS EXP ENSES AMOUNTING TO RS.2 12 41.337.62 RS.18 35 777.85 AND RS.59 68 410 .86 RESPECTIVELY. THE AO DISALLOWED 5% OF THE CLAIM STATING THAT ONLY FEW VOUCHERS PERTAINING TO HEAD OFFICE WERE PRODUCED FOR THE CLAIMS MADE UNDE R THESE HEADS. ACCORDING TO THE AO EVEN THE CLAIM WAS NOT FULLY V ERIFIABLE AND THEREFORE 5% OF THE CLAIM MADE UNDER THESE HEADS W HICH CAME TO RS.14 52 276.32 WAS DISALLOWED AND ADDED TO THE IN COME OF THE ASSESSEE. 7. ON APPEAL THE LD.CIT(A) ALLOWED THE CLAIM OF TH E ASSESSEE OBSERVING AS UNDER : THE AO IN HER ORDER IS SEEN TO HAVE ACKNOWLEDGED THE FACT THAT THE LEDGER ACCOUNTS OF THESE CLAIMS WERE FURNISHED. THE ONLY REASON ON WHICH THE DISALLOWANCE WAS RESORTED TO WAS NON PROD UCTION OF FULL VOUCHERS WHICH LED THE AO TO HOLD THAT THE CLAIMS W ERE NOT VERIFIABLE. THE AO HAS HOWEVER NOT SPECIFIED THE EXTENT OF AM OUNT TO WHICH BILLS AND VOUCHERS WERE PRODUCED AND AS TO HOW THE SE PRODUCED BILLS AND VOUCHERS WERE VERIFIED IN ORDER TO CONCLUDE THA T THE BILLS AND VOUCHERS NOT PRODUCED AMOUNTED TO NON VERIFIABILITY OF CLAIMS. THE AO WAS EXPECTED TO ANALYSE THE EXPENSES THE INEVI TABILITY OF THEIR INCURRENCE AND THE SCALE OF CLAIMS HAVING REGARD T O THE SCALE OF APPELLANTS OPERATIONS AND ACTIVITIES. THIS WOULD H AVE IMPARTED SOME REASONABLENESS TO THE DISALLOWANCE. TAKING MERE NO N PRODUCTION OF 6 PART OF THE BILLS AND VOUCHERS AS THE BASIS FOR CO NCLUDING THAT THE EXPENSES WERE NOT VERIFIABLE AND MAKING A HUGE DISA LLOWANCE RUNNING INTO LAKHS WAS THEREFORE UNJUSTIFIED AND ARBITRAR Y. IN VIEW OF THE POSITION DISCUSSED ABOVE THE DISAL LOWANCE MADE BY THE AO IS DIRECTED TO BE DELETED. 8. WE HAVE HEARD THE RIVAL SUBMISSIONS. SHRI SUREN DRA KOHLI ADVOCATE LD. COUNSEL FOR THE ASSESSEE THAT THE ASSESSEE HAD FURNISHED COPY OF ACCOUNTS EVIDENCES AND PRODUCED BOOKS OF ACCOUNT BILLS LAND VOUCHERS BEFORE THE AO AND NO DISCREPANCY WAS POINTED OUT A ND THE ADDITIONS WERE MADE FOR THE SAKE OF ADDITION AND DISALLOWANCES MA DE WERE COMPLETELY UNCALLED FOR. IN OUR CONSIDERED VIEW THE LD. CIT( A) WAS CORRECT IN DELETING THE ADDITION OF RS.14 52 276.32 BEING 5% OF THE ASS ESSEES CLAIM UNDER THE HEADS REPAIR TO BUILDING REPAIR TO OTHERS AND MIS CELLANEOUS EXPENSES. IN THE INSTANT CASE THE ASSESSEE HAD PRODUCED THE LED GER ACCOUNTS OF THESE CLAIMS BEFORE THE AO. IT SEEMS THAT THE AO HAS DISA LLOWED 5% OF THE CLAIM MAKING GENERAL OBSERVATION THAT ONLY FEW VOUCHERS P ERTAINING TO HEAD OFFICE WERE PRODUCED AND THE CLAIM WAS NOT VERIFIAB LE. IN FACT THE AO HAS NOT SPECIFIED THE EXTENT TO WHICH THE EXPENSES WERE NOT VERIFIABLE. IN OUR VIEW THERE WAS NO JUSTIFICATION IN SUSPECTING THE GENUINENESS OF THE ENTIRE CLAIM AND RESORTING TO AN ESTIMATED DISALLOWANCE. T HE AO HAS ALSO NOT GIVEN ANY REASON FOR ESTIMATING THE DISALLOWANCE AT 5% OF THE CLAIM. THE AO HAS NOT DOUBTED THE CORRECTNESS OF THE BOOKS OF ACCOUN T REGULARLY MAINTAINED BY THE ASSESSEE. THE BOOKS OF ACCOUNT MAINTAINED BY TH E ASSESSEE WERE AUDITED BY THE STATUTORY/TAX AUDIT. NONE OF THE AUDITORS HAS GIVEN ANY ADVERSE COMMENTS IN THE REPORT. IT SEEMS THAT THE DISALLOWA NCE WAS MADE FOR THE SAKE OF DISALLOWANCE WITHOUT GIVING ANY COGENT REAS ON. CONSIDERING THE 7 ENTIRE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE THE AD HOC ADDITION MADE BY THE AO HAS RIGHTLY BEEN DELETED BY THE LD.CIT(A ). IN THAT VIEW OF THE MATTER WE UPHOLD THE ORDER OF THE LD.CIT(A) AND DI SMISS THE SECOND PART OF GROUND NO.1 OF THE APPEAL ALSO. 9. GROUND NO.2 OF THE APPEAL READS AS UNDER : 2. THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITI ON OF RS.1 31 47 315/- MADE UNDER THE HEAD 'SUNDRY CREDIT ORS' ON THE FACTS AND CIRCUMSTANCES OF THE CASE. 10. THE AO HAS DISCUSSED THIS ISSUE IN PARA 3 OF TH E ORDER WHICH READS AS UNDER : 3. FURTHER THE ASSESSEE WAS REQUIRED TO FURNISH DETAILS OF SUNDRY CREDITORS CLAIMED AS UNDER: SUNDRY CREDITORS GOODS RS.7 70 70 16.85 SUNDRY CREDITORS EXPENSES RS.20 95 49.857.11 SUNDRY CREDITORS-OTHERS RS.1 02 81 11 490.81 IT WAS SEEN THAT UNDER THE HEAD SUNDRY CREDITORS- GOODS AN AMOUNT OF RS. 10639707.26 WAS SHOWN RELATING TO PROJECTS S ITUATED IN THE STATE OF UTTARAKHAND ALONGWLTH OTHER CLAIMS. DETAILS WIT H REGARD TO THE SAME WERE NOT FURNISHED BY THE ASSESSEE EVEN AFTER AVAILING NUMBER OF OPPORTUNITIES NOR ANY VOUCHERS/ETC WERE PRODUCED. FURTHER NO CONFIRMATIONS WERE FURNISHED. THE ASSESSEE ALSO DID NOT FURNISH COMPLETE DETAILS FOR CLAIM MADE UNDER SUNDRY CREDI TORS-GOODS' AMOUNTING TO RS 1 01 81 11 490.81. NO EVIDENCES WHA TSOEVER WERE FURNISHED THEREFORE UNDER THE CIRCUMSTANCES SINC E THE GENUINENESS OF THE BALANCE AT RS.1 31 4 7 31 514.77 REMAINS UNE STABLISHED HENCE 1% OF THE TOTAL WHICH WORKS OUT TO RS.1 31 47 315.1 4 IS DISALLOWED AND ADDED TO THE INCOME OF THE ASSESSEE. 11. ON APPEAL THE LD.CIT(A) DELETED THE ADDITION B Y OBSERVING AS UNDER : I HAVE CAREFULLY CONSIDERED THE POSITION STATED B Y THE AO IN HER ORDER AND THE AVERMENTS OF THE APPELLANT CONCERNING THIS ADDITION. I 8 FIND THAT THE AO HAS NOT CLEARLY INDICATED AS TO HOW THE FIGURE OF RS.1 31 47 31 514 (TO THE EXTENT SUNDRY CREDITORS A RE HELD TO BE UNSUBSTANTIATED) IS ARRIVED AT THUS THE BASIC FIGUR E ITSELF ON WHICH AN ADDITION @ 1% IS CALCULATED SUFFERS FROM AMBIGUITY THE ADDITION MADE ALSO SUFFERS FROM CONTRADICTIONS. WHILE THE GE NUINENESS OF THE SUNDRY CREDITORS WAS HELD TO BE UNESTABLISHED TO T HE EXTENT OF RS.1 31 47 31 514/- IT IS NOT UNDERSTOOD AS TO WHY AN ADDITION @ 1% OF SUCH CREDITS HAS BEEN MADE. PROVISIONS OF SECTIO N 68 UNDER WHICH THE ADDITION IS UNDERSTOOD TO HAVE BEEN MADE ENVIS AGE THE AMOUNT OF CREDIT TO BE CHARGED AS INCOME RATHER THAN AN ESTIM ATED PERCENTAGE. OF SUCH CREDIT. THE AO HAS ALSO NOT ESTABLISHED THAT T HE CREDITS HELD TO BE NON GENUINE NECESSARILY EMERGED DURING THE PREVIOUS YEAR RELEVANT TO A.Y. 2007-08 AND THAT NO COMPONENT OF ANY BROUGHT F ORWARD BALANCES EMBEDDED THEREIN. THE AO'S CONCLUSION DOE S NOT SEEM TO HAVE BEEN DRAWN OBJECTIVELY AND WITH REFERENCE TO T HE MATERIAL AVAILABLE ON RECORD. IN VIEW OF THE FACTS AND CIRCUMSTANCES DESCRIBED A ND DISCUSSED ABOVE I FIND NO MERITS IN THE ADDITION MADE BY THE AO. THE ADDITION IS THEREFORE DIRECTED TO BE DELETED. 12. WE HAVE HEARD THE RIVAL SUBMISSIONS. WE FULLY A GREE WITH THIS OBSERVATION OF THE LD.CIT(A) THAT AS TO HOW THE FI GURE OF RS.1 31 47 315.14 WAS ARRIVED AT. THERE IS NO INDICATION IN THE ORD ER OF THE AO. THUS THE BASIC FIGURE ITSELF AT WHICH AN ADDITION AT THE RA TE OF 1% IS CALCULATED SUFFERS FROM AMBIGUITY. IT SEEMS THAT THE ADDITION WAS MADE BY INVOKING THE PROVISIONS OF SECTION 68 OF THE INCOME-TAX ACT 1961 . SECTION 68 ENVISAGES THE AMOUNT OF CREDIT TO BE CHARGED AS INCOME RATHE R ESTIMATED PERCENTAGE OF SUCH CREDIT. THEREFORE THE DISALLOWANCE MADE UNDER SECTION 68 OF THE ACT ON PERCENTAGE BASIS IS NOT SUSTAINABLE IN LAW. THE AO WAS REQUIRED TO SPECIFY EACH AND EVERY CREDIT WHICH WAS NOT PROVE D BY THE ASSESSEE. ON THE CONTRARY THE ASSESSES CONTENTION WAS THAT ALL THE CREDITORS ARE GENUINE 9 PAYABLE AND HAVE RUNNING ACCOUNTS WHICH WERE FULLY VERIFIABLE AND HENCE NO PART OF IT CAN BE CONSIDERED AS ASSESSEES INCOM E. WE ALSO AGREE WITH THIS OBSERVATION OF THE LD.CIT(A) THAT THE AO HAS ALSO N OT ESTABLISHED THAT THE CREDITS HELD TO BE NON-GENUINE NECESSARILY EMERGED DURING THE PREVIOUS YEAR RELATING TO ASSESSMENT YEAR 2007-08 AND THAT NO COM PONENT OF ANY BROUGHT FORWARD BALANCES EMBEDDED THEREIN. IN OUR VIEW TH E ADDITION MADE BY THE AO IS NOT IN ACCORDANCE WITH LAW PARTICULARLY SECT ION 68 OF THE ACT AND THEREFORE WE HOLD THAT THERE WAS NO JUSTIFICATION IN MAKING THE ADDITION. IN THAT VIEW OF THE MATTER WE UPHOLD THE ORDER OF THE LD.CIT(A) AND DISMISS GROUND NO.2 OF THE REVENUES APPEAL. 13. SHRI SURENDRA KOHLI ADVOCATE LD. COUNSEL FOR THE ASSESSEE POINTED OUT THAT THE AO HAS RECTIFIED THE ASSESSMENT ORDER VIDE ORDER DATED 29.3.2010 PASSED UNDER SECTION 154 OF THE INCOME-TA X ACT 1961. ORDER UNDER SECTION 154 OF THE ACT READS AS UNDER : ORDER U/S 154 AT THE TIME OF ASSESSMENT U/S 143(3) DATED 30/12/0 9 DEDUCTION U/S 80P WAS ALLOWED TO THE EXTENT OF RS.2 68 97 692 .86 AS CLAIMED BY THE A IN THE RETURN OF INCOME. NOW A HAS MOVED AN APPLICATION U/S 154 AND REQUESTING TO ALLOW THE DEDUCTION U/S 80P T O THE TUNE OF RS.2 21 49 024 AS THEY HAVE TOTAL DEDUCTION U/S 80 P AVAILABLE TO THE TUNE OF RS.7 68 72 409.14. THE MISTAKE IS APPARENT FROM THE RECORD. HENCE THE CASE IS RECTIFIED U/S 154. SD.I.T.O. 14. ACCORDING TO SHRI SURENDRA KOHLI ADVOCATE LD. COUNSEL FOR THE ASSESSEE AS PER THE ABOVE ORDER AFTER ALLOWING DEDU CTION UNDER SECTION 80P(2) OF THE ACT THE ASSESSABLE INCOME FOR THE AS SESSMENT YEAR UNDER CONSIDERATION CAME TO RS. NIL AND HENCE IN VIEW OF THE C.B.D.T. CIRCULAR 10 NO.5 OF 2008 DATED 15.5.2008 THE APPEAL OF THE REV ENUE IS LIABLE TO BE DISMISSED BECAUSE TAX EFFECT IS LESS THAN RS.2 LACS . ACCORDING TO SHRI SURENDRA KOHLI ADVOCATE LD. COUNSEL FOR THE ASSES SEE THE APPEAL DESERVES TO BE DISMISSED ON THIS SCORE ALSO. IN OUR VIEW TH ERE IS A MERIT IN THE ABOVE SUBMISSIONS OF THE LD. COUNSEL FOR THE ASSESSEE AND THEREFORE WE HOLD THAT ON THE GROUND OF TAX EFFECT ALSO THE APPEAL IS LIA BLE TO BE DISMISSED. 15. VIEWED FROM ANY ANGLE THE APPEAL DESERVES TO B E DISMISSED. C.O.NO.5(LKW)/2011 16. THE GROUNDS RAISED IN THE CROSS OBJECTION MERE LY SUPPORT THE ORDER OF THE LD.CIT(A) AND THE ASSESSEE HAS NOT CLAIMED A NY EFFECTIVE RELIEF THEREIN. HENCE WE DISMISS THE CROSS OBJECTION AS I NFRUCTUOUS. 17. IN THE RESULT THE APPEAL OF THE REVENUE AND TH E CROSS OBJECTION BY THE ASSESSEE ARE DISMISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 22.3.11 . SD. SD. (N.K.SAINI) (H.L.KARWA) ACCOUNTANT MEMBER VICE PRESIDENT MARCH 22ND 2011. COPY TO THE : 1. APPELLANT 2. RESPONDENT 3. CIT(A) (4) CIT 5.DR. A.R. ITAT LUCKNOW. SRIVASTAVA.