Meerut Development Authority, New Delhi v. Addl. CIT, Meerut

ITA 5457/DEL/2010 | 2005-2006
Pronouncement Date: 30-09-2016 | Result: Allowed

Appeal Details

RSA Number 545720114 RSA 2010
Assessee PAN AAALM0124D
Bench Delhi
Appeal Number ITA 5457/DEL/2010
Duration Of Justice 5 year(s) 9 month(s) 27 day(s)
Appellant Meerut Development Authority, New Delhi
Respondent Addl. CIT, Meerut
Appeal Type Income Tax Appeal
Pronouncement Date 30-09-2016
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted E
Tribunal Order Date 30-09-2016
Date Of Final Hearing 08-08-2016
Next Hearing Date 08-08-2016
Assessment Year 2005-2006
Appeal Filed On 03-12-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : E : NEW DELHI BEFORE SHRI J. SUDHAKAR REDDY ACCOUNTANT MEMBER AND MS SUCHITRA KAMBLE JUDICIAL MEMBER ITA NOS.5455 TO 5457/DEL/2010 ASSESSMENT YEARS : 2003-04 TO 2005-06 MEERUT DEVELOPMENT AUTHORITY CA ANUPAM SHARMA 16 HANS PLAZA OPP. AMARPALI CINEMA GARH ROAD NEW DELHI. PAN: AAALM0124D VS. ADDL.CIT RANGE-1 MEERUT. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI KAPIL GOEL ADVOCATE DEPARTMENT BY : SHRI S.K. JAIN SR. DR DATE OF HEARING : 24.08.2016 DATE OF PRONOUNCEMENT : 29.09.2016 ORDER PER J. SUDHAKAR REDDY AM: ALL THESE APPEALS ARE FILED BY THE ASSESSEE FOR TH E ASSESSMENT YEARS 2003-04 2004-05 AND 2005-06 ARE DIRECTED AGAINST T HE ORDERS OF THE ITA NOS.5455 TO 5457/DEL/2010 2 CIT(A) DATED 31.8.2010. AS THE ISSUES ARISING IN A LL THESE APPEALS ARE COMMON FOR THE SAKE OF CONVENIENCE THEY WERE HEAR D TOGETHER AND ARE DISPOSED OF BY WAY OF THIS COMMON ORDER. 2. THE ASSESSEE IS AN URBAN DEVELOPMENT AUTHORITY F ORMED BY AN ACT PASSED BY THE UTTAR PRADESH LEGISLATURE ASSEMBLY AN D IS ENGAGED IN URBAN DEVELOPMENT OF MEERUT AND FOR PROVIDING LOW C OST HOUSING TO GENERAL PUBLIC. TWO GROUNDS FOR ALL THE ASSESSMENT YEARS ARE IDENTICAL. FOR THE ASSESSMENT YEAR 2004-05 ONE OTHER GROUND HA S BEEN TAKEN BY THE ASSESSEE WHICH RELATES TO AD HOC DISALLOWANCE OF 56% OF EXPENSES. THE TWO COMMON GROUNDS THAT ARISE IN ALL THE THREE APPE ALS ARE: (A) DISALLOWANCE OF INTEREST PERTAINING TO CLOSING STOC K; AND (B) TREATMENT OF GRANTS RECEIVED FROM THE GOVERNMENT OF UTTAR PRADES H AS REVENUE BY THE AO. 3. WE HAVE HEARD SHRI KAPIL GOEL LD. COUNSEL FOR T HE ASSESSEE AND SHRI S.K. JAIN LD.SR. DR. THE ASSESSEE HAS FILED A PAPER BOOK RUNNING INTO 29 PAGES. HE ALSO FILED COPIES OF VARIOUS DEC ISIONS AND ARGUED HIS ITA NOS.5455 TO 5457/DEL/2010 3 CASE AT LENGTH. THE LD. DR MADE SUBMISSIONS ON BEH ALF OF THE REVENUE AND MAINLY RELIED ON THE ORDER OF THE LD.CIT(A). T HE LD. DR ALSO FILED WRITTEN SUBMISSIONS. 4. WE HAVE CONSIDERED RIVAL SUBMISSIONS. THE FIRST ISSUE THAT ARISES FOR OUR CONSIDERATION IS WHETHER THE INTEREST PAID ON LOANS TAKEN SHOULD BE CAPITALIZED AND ADDED TO THE VALUE OF THE CLOSIN G STOCK OF THE ASSESSEE OR NOT. THE AO HELD THAT THE INTEREST ON LOANS TAK EN FOR DEVELOPMENT OF SCHEMES FROM HUDCO NCR STATE GOVERNMENT ETC. (A S PER COLUMN NO.6 OF SCHEDULE 1 OF ANNUAL ACCOUNTS) AMOUNTING TO RS.4 04 05 345.84 HAS TO BE INCLUDED IN THE VALUATION OF CLOSING STOC K AS ON 31.3.2003. THE ASSESSEE HAD DISCLOSED THIS INTEREST EXPENDITURE AS DEVELOPMENT EXPENDITURE. THE FIRST APPELLATE AUTHORITY HELD TH AT THE EXPENDITURE IN QUESTION WAS RELATABLE TO THE STOCK HELD BY THE ASS ESSEE. HE FURTHER HELD THAT THE ASSESSEE HAS NOT DEMONSTRATED THAT THE INT EREST CLAIMED AS REVENUE EXPENDITURE WAS ALLOWABLE AND NOT TO BE CAP ITALIZED AS COST OF STOCK. HE GAVE A FINDING THAT THE AO HAS NOT INTER FERED WITH THE METHOD ITA NOS.5455 TO 5457/DEL/2010 4 OF VALUATION OF STOCK BUT HAS ONLY ADDED THE INTE REST COST TO THE VALUE OF STOCK. 5. BEFORE US THE LD. COUNSEL FOR THE ASSESSEE SUBM ITTED THAT THE AO HAS DISTURBED THE METHOD OF VALUATION OF STOCK FOLL OWED BY THE ASSESSEE YEAR AFTER YEAR. HE SUBMITTED THAT THE AO HAS ONLY INTERFERED WITH THE VALUATION OF THE CLOSING STOCK BUT HAS NOT DISTUR BED THE VALUATION OF OPENING STOCK AND HENCE SUCH ACTION IS BAD IN LAW. HE RELIED ON THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE C ASE OF LOKHANDWALA CONSTRUCTION 131 TAXMAN 810 THE DECISION OF THE B BENCH OF THE ITAT DELHI IN ITA NO.2677/DEL/2011 FOR ASSESSMENT YEAR 2006-07 IN THE CASE OF DLF LTD. ORDER DATED 11 TH MARCH 2016 AS WELL AS THE DECISION OF THE ITAT KOLKATA B BENCH IN ITA NO.1101/KOL/2012 ORDER DATED 19 TH FEBRUARY 2014 IN THE CASE OF CELLICA DEVELOPERS PVT. LTD . AND SUBMITTED THAT IN ALL THESE CASES UNDER SIMILAR CIRCUMSTANCES THE EXPENDITURE INCURRED ON LOANS BORROWED WERE ALLOWED AS REVENUE EXPENDITURE AND WAS NOT CAPITALI ZED TO THE VALUE OF CLOSING STOCK. ITA NOS.5455 TO 5457/DEL/2010 5 6. THE LD. DR ON THE OTHER HAND OPPOSED THE CONTE NTIONS OF THE ASSESSEE AND SUBMITTED THAT THE ISSUE FOR ADJUDICAT ION IS NOT WHETHER THE AMOUNT IN QUESTION IS ALLOWABLE U/S 36(1)(III) OR N OT AND THAT THE ONLY ISSUE IS WHETHER THE INTEREST INCURRED ON LOANS TAK EN WAS TO BE CONSIDERED FOR THE PURPOSE OF VALUATION OF CLOSING STOCK OR NOT. HE SUBMITTED THAT THE EXPENDITURE IS RELATABLE TO THE CLOSING STOCK AND HENCE BOTH THE AO AS WELL AS THE CIT(A) HAS CORREC TLY DECIDED THE ISSUE. HE ARGUED THAT THE ONUS IS ON THE ASSESSEE T O PROVE THAT THE MARKET VALUE OF THE STOCK WAS LESS THAN THE COST SO ARRIVE D BY THE AO. HE DREW THE ATTENTION OF THE BENCH TO PAGE 2 OF THE AOS OR DER AND SUBMITTED THAT VALUE OF OPENING STOCK CANNOT BE INTERFERED WITH. HE DISTINGUISHED THE CASE LAW RELIED UPON BY THE ASSESSEE. 7. AFTER HEARING THE RIVAL SUBMISSIONS WE ARE OF T HE CONSIDERED OPINION THAT THE AO WAS WRONG IN CHANGING THE METHO D OF VALUATION OF CLOSING STOCK. THIS METHOD IS BEING FOLLOWED BY TH E ASSESSEE YEAR AFTER YEAR AND HAS BEEN ACCEPTED BY THE REVENUE. LOADING OF INTEREST COST TO CLOSING STOCK IS DEFINITELY CHANGING THE METHOD OF VALUATION OF STOCK. ITA NOS.5455 TO 5457/DEL/2010 6 INTEREST EXPENDITURE INCURRED ON LOANS USED FOR AC QUIRING CURRENT ASSETS WHICH INCLUDES CLOSING STOCK IS ALLOWABLE U/S 36(1 )(III). THE HONBLE BOMBAY HIGH COURT IN THE CASE OF LOKHANDWALA CONSTR UCTIONS 260 ITR 579 (BOM) HAS HELD AS FOLLOWS:- 4. FROM THE FACTS FOUND BY THE TRIBUNAL ON RECORD IT IS CLEAR THAT ASSESSEE UNDERTOOK TWO-FOLD ACTIVITIES. IT BOUGHT A ND SOLD FLATS. SECONDLY THE ASSESSEE WAS ALSO ENGAGED IN THE BUSI NESS OF CONSTRUCTION OF BUILDINGS. THE PROFITS FROM THE BOT H THE ACTIVITIES WERE ASSESSED UNDER SECTION 28OF THE INCOME-TAX ACT. IN THIS CASE WE ARE CONCERNED WITH THE SECOND ACTIVITY (HEREINAFTER REF ERRED TO FOR THE SAKE OF BREVITY AS 'KANDIVALI PROJECT'). ACCORDING TO THE COMMISSIONER LOAN WAS RAISED FOR SECURING LAND/DEV ELOPMENT RIGHTS FROM THE MANDAL. THAT THE LOAN WAS UTILISED FOR PU RCHASING THE DEVELOPMENT RIGHTS WHICH ACCORDING TO THE COMMISS IONER CONSTITUTED A CAPITAL ASSET. ACCORDING TO THE COMMI SSIONER SINCE THE LOAN WAS RAISED FOR SECURING CAPITAL ASSET THE INT EREST INCURRED THEREON CONSTITUTED PART OF CAPITAL EXPENDITURE. THIS FINDI NG OF THE COMMISSIONER WAS ERRONEOUS. IN THE CASE OF INDIA CE MENTS LTD. V. CIT MADRAS REPORTED IN 60 ITR PAGE 52 IT WAS HEL D BY THE SUPREME COURT THAT IN CASES WHERE THE ACT OF BORROWING WAS INCIDENTAL TO CARRYING ON OF BUSINESS THE LOAN OBTAINED WAS NOT AN ASSET. THAT FOR THE PURPOSES OF DECIDING THE CLAIM OF DEDUCTION UND ER SECTION 10(2)(III) OF THE INCOME-TAX ACT 1922 [SECTION 36(1 )(III) OF THE PRESENT INCOME-TAX ACT] IT WAS IRRELEVANT TO CONSI DER THE PURPOSE FOR WHICH THE LOAN WAS OBTAINED. IN THE PRESENT CASE T HE ASSESSEE WAS A BUILDER. IN THE PRESENT CASE THE ASSESSEE HAD UNDE RTAKEN THE PROJECT OF CONSTRUCTION OF FLATS UNDER THE KANDIVALI PROJECT. THEREFORE THE LOAN WAS FOR OBTAINING STOCK-IN-TRADE. THAT THE KANDIVA LI PROJECT CONSTITUTED THE STOCK-IN-TRADE OF THE ASSESSEE. THA T THE PROJECT DID NOT CONSTITUTE A FIXED ASSET OF THE ASSESSEE. IN THIS C ASE WE ARE CONCERNED WITH DEDUCTION UNDER SECTION 36(1)(III). SINCE THE ASSESSEE HAD RECEIVED LOAN FOR OBTAINING STOCK-IN-TRADE (KANDIVA LI PROJECT) THE ITA NOS.5455 TO 5457/DEL/2010 7 ASSESSEE WAS ENTITLED TO DEDUCTION UNDER SECTION 36 (1)(III) OF THE ACT. THAT WHILE ADJUDICATING THE CLAIM FOR DEDUCTION UN DER SECTION 36(1)(III) OF THE ACT THE NATURE OF THE EXPENSE - WHETHER THE EXPENSE WAS ON CAPITAL ACCOUNT OR REVENUE ACCOUNT -WAS IRRE LEVANT AS THE SECTION ITSELF SAYS THAT INTEREST PAID BY THE ASSES SEE ON THE CAPITAL BORROWED BY THE ASSESSEE WAS AN ITEM OF DEDUCTION. THAT THE UTILIZATION OF THE CAPITAL WAS IRRELEVANT FOR THE P URPOSES OF ADJUDICATING THE CLAIM FOR DEDUCTION UNDER SECTION 36(1)(III) OF THE ACT (SEE JUDGMENT OF THE BOMBAY HIGH COURT IN THE C ASE OF CALICO DYEING AND PRINTING WORKS V. CIT BOMBAY CITY-II R EPORTED IN 34 ITR 265). IN THAT JUDGMENT IT HAS BEEN LAID DOWN T HAT WHERE AN ASSESSEE CLAIMS DEDUCTION OF INTEREST PAID ON CAPIT AL BORROWED ALL THAT THE ASSESSEE HAD TO SHOW WAS THAT THE CAPITAL WHICH WAS BORROWED WAS USED FOR BUSINESS PURPOSE IN THE RELEVANT YEAR OF A CCOUNT AND IT DID NOT MATTER WHETHER THE CAPITAL WAS BORROWED IN ORDER TO ACQUIRE A REVENUE ASSET OR A CAPITAL ASSET. THE SAID JUDGMENT OF THE BOMBAY HIGH COURT APPLIES TO THE FACTS OF THIS CASE. ( EMPHASIS OURS ) 8. THIS DECISION WAS FOLLOWED BY THE DELHI BENCHES OF THE TRIBUNAL IN THE CASE OF DLF LTD . (SUPRA) AND BY THE KOLKATA BENCH OF THE TRIBUNAL IN THE CASE OF CELLICA DEVELOPERS PVT. LTD . (SUPRA). NO CONTRARY DECISION HAS BEEN BROUGHT TO OUR NOTICE BY THE LD. DR. THE AO CHOSE ONLY TO DISTURB THE VALUATION OF CLOSING STOCK BUT HAS NO T APPLIED THE SAME YARDSTICK TO THE VALUATION OF OPENING STOCK OF THE ASSESSEE. 9. FOR ALL THESE REASONS AND RESPECTFULLY FOLLOWING THE PROPOSITIONS LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN THE C ASE OF ITA NOS.5455 TO 5457/DEL/2010 8 LOKHANDWALA CONSTRUCTIONS TO THE FACTS OF THIS CASE WE DIRECT THE AO TO EXCLUDE THE INTEREST INCURRED ON LOANS FROM THE VAL UATION OF CLOSING STOCK AND ALLOW THE SAME AS DEDUCTION U/S 36(1)(III) OF T HE ACT. 10. IN THE RESULT THIS GROUND OF THE ASSESSEE FOR ALL THE THREE YEARS ARE ALLOWED. 11. THE SECOND COMMON GROUND FOR ALL THE THREE ASSE SSMENT YEARS IS WHETHER THE AMOUNT OF GRANTS RECEIVED FROM GOVERNME NT OF UTTAR PRADESH IS TO BE TREATED AS REVENUE IN NATURE. THE AMOUNTS WERE RECEIVED FROM THE HOUSING DEPARTMENT OF GOVERNMENT OF UP VIDE DO NO.152/9-A-1998 DATED 15.1.1998. THE LD.CIT(A) HEL D THAT ON GOING THROUGH THE FACTS AND NOTIFICATIONS OF UP GOVERNME NT RELIED UPON BY THE ASSESSEE HE WAS OF THE CONSIDERED VIEW THAT TH E 90% OF INCOMES WERE NOT COLLECTED ON BEHALF OF ANY OTHER BODY OR P ERSON AND THE SUMS HAVE BEEN DIRECTED TO BE INCURRED ON DEVELOPMENT OF INFRASTRUCTURE BY THE ASSESSEE. HE RECORDS THAT THE IMPUGNED SUMS HA VE BEEN DIRECTED TO ITA NOS.5455 TO 5457/DEL/2010 9 BE EARMARKED AND SPENT ON SPECIFIC ITEMS ONLY AND N OT AS PER THE FREE WILL OF THE ASSESSEE. THE CIT (A) UPHELD THE FINDI NG OF THE AO. 12. THE LD. COUNSEL FOR THE ASSESSEE RELIED ON THE DECISION OF THE JURISDICTIONAL HIGH COURT LUCKNOW BENCH IN THE CAS E OF CIT LUCKNOW VS. LUCKNOW DEVELOPMENT AUTHORITY AND OTHER CASES 219 TAXMAN 162 AND SUBMITTED THAT THIS VERY NOTIFICATION OF THE GO VERNMENT OF UP WAS CONSIDERED AND THE HONBLE HIGH COURT HELD THAT THE SUMS RECEIVED FROM THE GOVERNMENT OF UP IN PURSUANCE OF THIS NOTIFICAT ION CANNOT BE TREATED AS BELONGING TO THE AUTHORITY AND THAT THE RECEIPT IS NOT TAXABLE IN NATURE. HE ALSO RELIED ON THE DECISIONS OF THE CO- ORDINATE BENCH G OF THE TRIBUNAL IN ITA NO.131 AND 132/DEL/2009 FOR THE AY 2003-04 AND 2005-06 IN THE CASE OF SAHARANPUR DEVELOPMENT AUTHO RITY VS. ACIT ORDER DATED 8 TH APRIL 2010 WHEREIN THE FUND RECEIVED HAS BEEN HE LD AS NOT TAXABLE AS INCOME OF THE ASSESSEE. THE LD. DR RELIED UPON THE ORDER OF THE AO AS WELL AS THE CIT(A) AND SUBMITTED THAT THE AMOUNTS HAVE BEEN RECEIVED BY THE ASSESSEE FROM THE GOVERNMENT O F UP FOR INCURRING OF CERTAIN EXPENDITURE TO DEVELOP INFRASTRUCTURE A ND MERELY BECAUSE ITA NOS.5455 TO 5457/DEL/2010 10 CERTAIN RESTRICTIONS HAVE BEEN PLACED ON THE APPLIC ATION AND UTILIZATION OF THE INCOME IT CANNOT BE SAID THAT THE RECEIPT IN Q UESTION IS NOT INCOME. HE DISTINGUISHED THE CASE LAW RELIED UPON BY THE AS SESSEE. 13. AFTER HEARING RIVAL CONTENTIONS WE FIND THAT T HE JURISDICTIONAL HIGH COURT IN THE CASE OF LUCKNOW DEVELOPMENT AUTHORITY GOMTI NAGAR LUCKNOW (SUPRA) HAS OBSERVED AS FOLLOWS:- FROM THE RECORD IT ALSO APPEARS THAT THE AUTHORI TY HAD BEEN MAINTAINING INFRASTRUCTURE DEVELOPMENT AND RESERVE FUND (IDAR) AS PER THE NOTIFICATION DATED 15.1.1998. THE MONEY TR ANSFERRED TO THIS FUND IS TO BE UTILIZED FOR THE PURPOSE OF THE OBJEC T AS SPECIFIED BY THE COMMITTEE HAVING CONSTITUTED BY THE GOVERNMENT UNDE R THE SAID NOTIFICATION AND THE SAME COULD NOT BE TREATED TO B E BELONGING TO THE AUTHORITY OR THE RECEIPT IS TAXABLE IN ITS HANDS. 14. THE HONBLE HIGH COURT WAS CONSIDERING THE SAME DO NO.15/9-A- 1998 DATED 15.1.1998. THIS JUDGMENT IS BINDING ON US. 15. DELHI BENCH G OF THE TRIBUNAL IN THE CASE OF SAHARANPUR DEVELOPMENT AUTHORITY IN ITA NO.566/DEL/2010 ORDER DATED 5 TH APRIL 2010 HELD AS FOLLOWS:- 4. UPON ASSESSEES APPEAL THE LD.CIT(A) NOTED THE ASSESSEE SUBMISSIONS THAT ON IDENTICAL ISSUE IN THE AY 2004- 05 THE ITAT IN ORDER NO.ITA 02/DEL/2008 VIDE ORDER DT. 23.12.2008 HAD DELETED THE ITA NOS.5455 TO 5457/DEL/2010 11 ADDITION. THE TRIBUNAL IN THAT CASE HAS REFERRED T O THE DECISION OF HONBLE DELHI HIGH COURT IN CASE OF CIT VS. DELHI I NDUSTRIAL DEVELOPMENT FUND AND ALSO ITAT DECISION IN THE CASE OF KARNATAKA URBAN INFRASTRUCTURE DEVELOPMENT AND FINANCE CORPOR ATION. THE TRIBUNAL ALSO NOTED THAT THE SAID DECISION OF THE I TAT WAS UPHELD BY THE HONBLE HIGH COURT ALSO IN THE JUDGEMENT REPORT ED IN 284 ITR 582. THEREAFTER THE TRIBUNAL HELD THAT THE CASE L AW RELIED UPON THE ASSESSEE ARE SQUARELY APPLICABLE ON THE FACTS OF TH E PRESENT CASE. THE ASSESSEE HAD RECEIVED THE FUNDS UNDER THE ORDERS OF THE GOVT. OF UTTAR PRADESH AND IT WAS REQUIRED TO USE SUCH FUNDS AS PE R THE DIRECTION OF HIGH POWER COMMITTEE. IT HAS NO CONTROL OVER THE F UNDS. MORE SO AO HAS NOT BROUGHT TO TAX THE PRINCIPLE AMOUNT AS INCO ME OF THE ASSESSEE. IF HIS LOGIC IS ACCEPTED THEN ALL THE FEES ETC. OVE R AND ABOVE THE EXPENDITURE OUGHT TO HAVE BEEN EXAMINED AS INCOME O F THE ASSESSEE FINDING THE FACTS OF THE CASE IDENTICAL THE LD.C IT(A) DELETED THE ADDITION FOLLOWING THE RATIO FROM THE I TAT ORDER FOR AY 2004-05. 16. CONSISTENT WITH THE VIEW TAKEN THEREIN AND RESP ECTFULLY FOLLOWING THE PROPOSITION OF LAW LAID DOWN BY THE JURISDICTIO NAL HIGH COURT WE HOLD THAT THE AMOUNTS RECEIVED BY THE ASSESSEE FROM GOVERNMENT OF UP CANNOT BE TAXED AS INCOME OF THE ASSESSEE. THE AO IS DIRECTED TO EXCLUDE THE SAME FROM THE TAXABLE INCOME OF THE ASS ESSEE. 17. IN THE RESULT THIS GROUND OF THE ASSESSEE IS A LLOWED. 18. AS STATED FOR THE AY 2004-05 ONE ADDITIONAL I SSUE ARISES. THE AO IN THIS YEAR HAD DISALLOWED ON AD HOC BASIS 56% OF THE DEVELOPMENT ITA NOS.5455 TO 5457/DEL/2010 12 EXPENSES. AFTER HEARING RIVAL CONTENTIONS WE FIND THAT THE AO HAS NOT GIVEN ANY REASON WHATSOEVER IN HIS ORDER AS TO WHY HE HAS DISALLOWED 56% OF THE DEVELOPMENT EXPENDITURE. WHEN THE MATTER WAS TAKEN UP BEFORE THE FIRST APPELLATE AUTHORITY THE SAME WAS DISMISSED WITHOUT ADDRESSING THE CONTENTION OF THE ASSESSEE THAT NO R EASON WHATSOEVER WAS MENTIONED IN THE ASSESSMENT ORDER FOR MAKING THIS D ISALLOWANCE. AS THE AO HAS FAILED TO GIVE ANY REASON WHATSOEVER FOR DI SALLOWING 56% OF THE DEVELOPMENT EXPENSES AND AS THE LD.CIT(A) FAILED T O ADDRESS THIS ISSUE THE DISALLOWANCE IN QUESTION IS HEREBY DELETED AND THIS GROUND OF THE ASSESSEE IS ALLOWED. 19. IN THE RESULT THE APPEALS OF THE ASSESSEE FOR ALL THE THREE YEARS ARE ALLOWED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 29.09.20 16. SD/- SD/- [SUCHITRA KAMBLE] [J. SUDHAKAR REDDY] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED 29 TH SEPTEMBER 2016. ITA NOS.5455 TO 5457/DEL/2010 13 DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR ITAT AR ITAT NEW DELHI.