Lanco Industries Ltd., Srikalahasti v. Addl. Commissioner of Income Tax, Tirupathi

MA 136/HYD/2011 | misc
Pronouncement Date: 16-09-2011 | Result: Dismissed

Appeal Details

RSA Number 13622524 RSA 2011
Assessee PAN AAACL4108M
Bench Hyderabad
Appeal Number MA 136/HYD/2011
Duration Of Justice 6 month(s) 13 day(s)
Appellant Lanco Industries Ltd., Srikalahasti
Respondent Addl. Commissioner of Income Tax, Tirupathi
Appeal Type Miscellaneous Application
Pronouncement Date 16-09-2011
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted A
Tribunal Order Date 16-09-2011
Assessment Year misc
Appeal Filed On 04-03-2011
Judgment Text
IN THE INC OME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A' HYDERABAD BEFORE SHRI G.C. GUPTA VICE PRESIDENT AND SHRI AKBER BASHA ACCOUNTANT MEMBER M.A. NO. 134 135 & 136/HYD/2011 ARISING OUT OF I.T.A. NOS. 1194 & 1995/H/08 & 577/H YD/07 (ASSESSMENT YEARS 2004-05 AND 2005-06) M/S. LANCO INDUSTRIES LTD. SRIKALAHASTHI PAN: AAACL4108M V ADDL. CIT TIRUPATI APPELLANT RESPONDENT APPELLANT BY: SHRI S. RAMA RAO RESPONDENT BY: SHRI T. DIWAKAR PRASAD DATE OF HEARING: 26.08.2011 DATE OF PRONOUNCEMENT: 16.09.2011 O R D E R PER AKBER BASHA AM: THESE MISCELLANEOUS APPLICATIONS ARE FILED BY THE ASSESSEE AGAINST THE CONSOLIDATED ORDER OF THIS TRI BUNAL DATED 8.10.2010. SINCE COMMON ISSUES WERE INVOLVED ALL T HESE MAS ARE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THI S COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED T HAT THE ASSESSEE FILED THE APPEALS WHEREIN SIX GROUNDS WERE RAISED. THE SAID APPEALS WERE DECIDED BY THIS TRIBUNAL VIDE ITS CONSOLIDATED ORDER 8.10.2010. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT IN GROUND NO. 2 I.T.A. NO. 1195/HYD/08 THE ASSESSEE CONTENDED THAT THE PROVISION FOR GRATU ITY AMOUNTING TO RS. 11 33 372 IS ALLOWABLE AS A DEDUCT ION. THIS TRIBUNAL RESTORED THE MATTER TO THE FILE OF THE ASS ESSING OFFICER WITH A DIRECTION TO VERIFY WHETHER THE PROVISION IS MADE ON THE ACTUAL CALCULATION. NOW THE ASSESSEE SUBMITS THAT IF THE TRIBUNAL IS OF THE VIEW THAT THE AMOUNT PROVIDED AS PER ACTUARIAL VALUATION IS TO BE ALLOWED THE TRIBUNAL MAY GIVE A CLEAR M.A. NOS. 134 135 & 136/HYD/08 M/S. LANCO INDUSTRIES LTD. ========================== 2 DIRECTION TO THIS EFFECT TO THE ASSESSING OFFICER. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE VALUATI ON WAS MADE BASED ON SALARY AND IN ACCORDANCE WITH THE GENERAL ACTUAL VALUATION AND EVEN IF THERE WERE ANY DIFFERENCE TH E AMOUNT TO BE ARRIVED AT IN ACCORDANCE WITH THE ACTUARIAL VALU ATION WOULD BECOME ELIGIBLE FOR DEDUCTION. ACCORDINGLY THE LEAR NED COUNSEL FOR THE ASSESSEE CONTENDED THAT THE ITAT MAY PASS A PPROPRIATE ORDER MODIFYING DIRECTION TO THE ASSESSING OFFICER AND THE ASSESSING OFFICER MAY BE DIRECTED TO ALLOW THE AMOU NT OF THE PROVISION WORKED OUT IN ACCORDANCE WITH THE ACTUARI AL VALUATION. 3. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED T HAT DURING THE APPELLATE PROCEEDINGS THE ASSESSEE ALSO CONTESTED THE CHARGE OF INTEREST U/S. 234B AND 234C OF THE AC T. THERE ARE TWO DIFFERENT ISSUES IN THIS GROUND OF APPEAL (A) WHETHER INTEREST U/S. 234B AND 234C AT ALL ARE CHARGEABLE O R NOT WHERE THE INCOME IS DETERMINED IN ACCORDANCE WITH THE PRO VISIONS OF SECTION 115JB OF THE ACT AND (B) WHERE AN ISSUE WAS DECIDED BY THE SUPREME COURT AND AN AMENDMENT IS MADE IN THE A CT WITH RETROSPECTIVE EFFECT WHETHER INTEREST U/S. 234B AN D 234C ARISING ON ACCOUNT OF THE AMENDMENT MADE WITH RETROSPECTIVE EFFECT CAN BE CHARGED OR NOT. THE FIRST IS DECIDED BY THE ITAT. HOWEVER THE SECOND PART OF THE ISSUE WHETHER THE I NTEREST WITH REGARD TO THE ADDITION MADE BY THE ASSESSING OFFICE R ON ACCOUNT OF PROVISION FOR BAD AND DOUBTFUL DEBTS OF RS. 30 0 7 574 IN ITA NO. 1195/HYD/08 AND RS. 7 06 72 223 IN ITA NO. 577/ HYD/07 WHICH IS CONFIRMED BY THE ITAT BECAUSE OF THE AMEND MENT TO THE FINANCE ACT 2009 MADE WITH RETROSPECTIVE EFFEC T FROM 1.4.2001 CAN BE CHARGED OR NOT WAS NOT DECIDED BY T HE TRIBUNAL. ACCORDINGLY THE LEARNED COUNSEL FOR THE ASSESSEE SU BMITTED THAT THE TRIBUNAL MAY PASS APPROPRIATE ORDER WITH REGARD TO CHARGING OF INTEREST IN RESPECT OF THE TAX ARISING ON THE AD DITION OF RS. 7 06 72 223 MADE TO THE BOOK PROFIT. M.A. NOS. 134 135 & 136/HYD/08 M/S. LANCO INDUSTRIES LTD. ========================== 3 4. WE HAVE HEARD BOTH THE PARTIES AND CONSIDERED TH E MATERIAL AVAILABLE ON RECORD. GROUND NO. 2 OF THE ASSESSEE IN THE APPEAL PROCEEDINGS IS WITH REGARD TO PROVISION FOR GRATUITY AND WHETHER THE SAME HAS TO BE ADDED BACK TO THE NE T PROFIT AS SHOWN IN THE PROFIT AND LOSS ACCOUNT FOR THE PURPOS E OF BOOK PROFIT U/S. 115JB OF THE ACT. RELYING ON THE DECIS ION OF ITAT IN THE CASE OF ITO VS. JONES LANG LASALLE PROPERTY CON SULTANTS (INDIA) LTD. (2010) 39 DTR (TRIB) 230 HELD THAT THE PAYMENT OF GRATUITY BEING AN ASCERTAINED LIABILITY AND THE SAM E IS NOT TO BE ADDED TO THE NET PROFIT SHOWN IN THE PROFIT AND LOS S ACCOUNT. THE TRIBUNAL REJECTED THE VIEW TAKEN BY THE CIT(A) AND RIGHTLY DIRECTED THE ASSESSING OFFICER FOR FRESH CONSIDERAT ION WITH A DIRECTION TO THE ASSESSEE TO PROVE BEFORE THE ASSES SING OFFICER THAT THE PROVISION FOR GRATUITY IS BASED ON ACTUARI AL CALCULATIONS. WE DO NOT FIND ANY MISTAKE APPARENT FROM THE ORDER OF THIS TRIBUNAL. ACCORDINGLY THIS GROUND RAISED BY THE AS SESSEE IN THE MA IS REJECTED. 5. THE SECOND ISSUE RELATES TO CHARGING OF INTEREST U/S. 234B AND 234C OF THE ACT. WE FIND THIS BENCH OF THE TR IBUNAL HAD RIGHTLY GIVEN A FINDING THAT THE LOWER AUTHORITIES ARE RIGHT IN CHARGING INTEREST U/S. 234B AND 234C OF THE ACT BY FOLLOWING THE DECISION OF THE SPECIAL BENCH IN THE CASE OF ASHIMA SYNTEX LTD. (117 ITD 1). THIS FINDING COVERS BOTH THE ISSUES C ONTENDED BY THE LEARNED COUNSEL FOR THE ASSESSEE. HENCE WE DO NOT FIND ANY MISTAKE APPARENT FROM THE RECORD AS PER SECTION 254 (2) OF THE ACT. 6. IN THE RESULT THE MAS FILED BY THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH SEPTEMBER 2011. SD/ - (G.C. GUPTA) VICE PRESIDENT SD/ - (AKBER BASHA) ACCOUNTANT MEMBER HYDERABAD DATED 16 TH SEPTEMBER 2011 TPRAO M.A. NOS. 134 135 & 136/HYD/08 M/S. LANCO INDUSTRIES LTD. ========================== 4 COPY FORWARDED TO: 1. M/S. LANCO INDUSTRIES LTD. RACHAGUNNERI VILLAGE SRIKALAHASTHI MANDAL CHITTOOR DISTRICT AP. 2. THE ADDL. CIT RANGE-2 TIRUPATI 3. THE CIT(A) TIRUPATI 4 THE CIT TIRUPATI 5. THE DR A BENCH ITAT HYDERABAD