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2014 (10) TMI 389 - AT - Income TaxDeduction u/s 14A Held that:- The benefit of Maxopp Investment Ltd. & Others Versus Commissioner of Income Tax [2011 (11) TMI 267 - Delhi High Court] was not available to the AO it has been rightly requested that the matter is to be remitted back to the AO for fresh adjudication in the light of the decision above mentioned Decided in favour of assessee. Expenses on contribution to Cooperative Education Fund disallowed Prior period expenses disallowed - Held that:- Following the decision in Commissioner of Income-tax, New Delhi Versus Shri Ram Pistons & Rings Ltd. [2008 (5) TMI 631 - DELHI HIGH COURT] - merely because an expense relates to a transaction of an earlier year, it does not become a liability payable in the earlier year unless it can be said that the liability was determined and crystallized in the year in question. If such liability has been actually claimed and paid in the later previous years, it cannot be disallowed as deduction merely on the basis that the accounts are maintained on mercantile basis - when there was no change in the rate of tax between the two years, it is immaterial whether the deduction is allowed in one year or the other - the liability of prior period expenses for consumption of raw material has been stated to have arisen in the earlier year, but got crystallized on a later date. The expenditure and the liability have been certified by the tax auditors, and there appears to be no dispute that the appellant had 'actually incurred the expenditure - the claim of assessee has been allowed by the AO for last several years as held in Radhasoami Satsang Versus Commissioner of Income-Tax [1991 (11) TMI 2 - SUPREME Court] - principle of res judicata does not apply to income tax proceedings - each assessment year being an independent unit, what is decided in one year may not apply in the following year, but where fundamental aspect permeating through the different assessment year has been found as a fact one way or other and parties have allowed, that position to be sustained by not challenging the order, it would not be appropriate to allow the position to be changed in a subsequent year thus, Revenue is not permitted to take a different stand in the year under consideration thus, the order of the CIT(A) is upheld Decided against revenue.
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