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Income Tax - Case Laws
Showing 41 to 60 of 1783 Records
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2005 (12) TMI 258 - ITAT MADRAS-D
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... ... ..... mentioned in the order of the Subordinate Judge as well as Addl. Dist. Judge, Coimbatore, in the Sch. E and the clear description of the property is given as No. 236 after the new No. 228. Hence, there is no dispute on this issue as it is the same property viz., No. 236 which is under litigation as well as the assessee has declared the income from the same property. 18. In view of these facts and circumstances narrated above and the precedents relied upon, we are of the view that the assessee was not vested owner of the residential house property from where the income from house property was declared in the revised return of income rather bigger HUF, i.e., V. Ramakrishnan was the owner of the property. Accordingly, we hold that the assessee is entitled for exemption under s. 54F of the Act for investing the long-term capital gains in the construction of new residential house and set aside the orders of the lower authorities. 19. In the result, the appeal is allowed on merits.
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2005 (12) TMI 256 - ITAT MADRAS-D
Business Income ... ... ... ... ..... s business activity. We find that the assessee has carried on the activity of the horses with the object of earning income from those horses by letting out the horses and by sale of the horses in a systematic and regular activity, consistently over a period of years. As such, the income of the assessee from horses was business income. 14. Since it is adjudicated in the preceding paragraphs that the assessee is engaged in business activity through the employment of horses, the horses are to be treated as the stock-in-trade of the assessee. As such, the consistent policy of the assessee of valuing stock as on the close of the year and account for the increase and decrease accordingly cannot be brushed aside by holding that this is a mere garb of claiming depreciation. 15. Considering the aforesaid, we are stated to opine that order of the CIT(A) is not necessitous of any interference on our part. As such, we uphold the same. 16. In the result, the revenue s appeal is dismissed.
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2005 (12) TMI 255 - ITAT MADRAS-D
Appealable Orders ... ... ... ... ..... period of the delay so attributable to him shall be excluded from the period for which interest is payable, and where any question arises as to the period to be excluded, it shall be decided by the Chief Commissioner or Commissioner whose decision thereon shall be final. The provisions of this section will apply for the assessment year 1989-90 and to subsequent assessment years. But the remedy to claim this interest lies either with the Assessing Officer or with the Chief Commissioner of Income-tax, who has powers to waive interest under sections 234A, 234B and 234C. The assessee can move appropriate application either to the Assessing Officer or the Chief Commissioner of Income-tax and if there is any delay in that application, that can be construed liberally while dealing with that application, if any, moved by the assessee. In view of these facts and circumstances of the case, we set aside the order of the CIT (Appeals). 12. In the result, the Revenue s appeal is allowed.
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2005 (12) TMI 254 - ITAT MADRAS-D
Block Assessment in search case ... ... ... ... ..... s must be proceeded against the deceased and general rule will apply. The expression legal representative in section 159 takes in plurality of legal representatives. In the present case, there are more than one legal representative to represent the deceased and all must be impleaded to make the representation of the estate acquired. This view has been fortified by the decision of the Hon ble jurisdictional High Court in the case of Muniyammal v. Addl. ITO 1960 38 ITR 664 (Mad.). Accordingly, this assessment is irregular but curable. Respectfully following the aforesaid decision of the Hon ble jurisdictional. High Court, we set aside the entire assessment to the file of the Assessing Officer to cure the irregularity and to bring on record all legal heirs. This issue is allowed for statistical purposes. 19. In the result, the appeals in IT (SS) A Nos. 16/Mds./2001 and 23/Mds./2004 are dismissed, IT (SS) A. Nos. 79, 80, 99 and 100/ Mds./2005 are allowed for statistical purposes.
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2005 (12) TMI 251 - ITAT MADRAS-C
Form Of Appeal And Limitations ... ... ... ... ..... dy been granted. Hence no further adjournments can be granted and he proposed to decide the appeal on merits. We have seen that number of opportunities have been provided by the Commissioner of Income-tax (Appeals) to the assessee which are dated 6-10-1992 and 20-10-1992 and the order was passed on 19-11-1992 by the Commissioner of Income-tax (Appeals). We are of the considered view that the assessee has not been provided proper opportunity of being heard by the Commissioner of Income-tax (Appeals) as it is clear from the above mentioned facts. We fairly feel that the assessee should be heard reasonably before deciding the appeal ex parte. Accordingly, this appeal is set aside to the file of the Commissioner of Income-tax (Appeals) to give reasonable opportunity of being heard to the assessee and decide the issue on merits. Accordingly, this appeal is allowed for statistical purposes. 13. In the result, these three appeals of the assessee are allowed for statistical purposes.
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2005 (12) TMI 249 - ITAT MADRAS-A
Income Escaping Assessment ... ... ... ... ..... n-existent. Human knowledge, as we have mentioned, is always progressing. So relativity was always there but we became aware only after Einstein. This is the basic difference between discovery and invention. The information about the law, on the basis of which 147 proceedings were initiated, was not there until the Supreme Court says it to be so. Therefore, what the Orissa High Court has held at that time was a relevant judicial interpretation as to the law. In the circumstances, it cannot be said that income escaped assessment by reason of failure on the part of the assessee. The assessee followed the law as per the interpretation given at that point of time. His inability to predict p a future event cannot constitute as failure so as to put the case within the ken of the proviso to section 147. We, therefore, reverse the order of the Commissioner (Appeals) on this count and decide the appeal in favour of the assessee. 12. In the result, the assessee s appeal stands allowed.
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2005 (12) TMI 248 - ITAT MADRAS-A
For Concealment Of Income ... ... ... ... ..... e explanation is vague or fanciful it is open for the Assessing Officer to levy penalty. In the g present case, we find that the assessee failed to discharge the initial onus. Creditors categorically denied the factum of loan. It revealed from the bank account that the transactions were not genuine. No plausible explanation was offered by the assessee. Assessee surrendered the loan credits consequent upon the detection. As such in our opinion, the Assessing Officer was correct in levying the penalty. Accordingly, we maintain the penalty levied by the Assessing Officer and reverse the order of the CIT(A). 20. Coming now to the alternate argument of the learned counsel for the assessee that penalty should be restricted to the minimum, Assessing Officer is required to find out the net tax to be evaded by reason of the concealment. We direct him to levy the minimum penalty after making the correct calculation of tax. 21. In the result, appeal of the Revenue stands partly allowed.
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2005 (12) TMI 247 - ITAT MADRAS-A
Capital Gains, Chargeable As ... ... ... ... ..... gainst confirmation of disallowance of Rs. 33 lakhs received by the assessee towards compensation for expected orders under negotiation i.e., for not competing or indulging in the transformer business. As discussed in the earlier paragraphs, there is no existence of competitors and the assessee-firm cease to exist. Hence, impugned amount of payment of Rs. 33 lakhs towards non-competition fee in respect of future orders is unwarranted. For the same reasons advanced above for allowing Revenue s appeal, on the issue of non-competition fee for pending orders, we reject this ground of the assessee and confirm the order of the CIT (Appeals) on this issue. The case law relied on by the assessee are distinguishable on facts as in the present case, the agreement between the assessee-firm and the new company was not with the partners of the assessee-firm and the new company. 19. In the result, the appeal filed by the Revenue is allowed and the appeal filed by the assessee is dismissed.
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2005 (12) TMI 242 - ITAT MADRAS
Valuation Of Assets ... ... ... ... ..... ersonal liability. The amount of tax is payable because of the mandate of the statute. Provision of law is the cause without which the occurrence of tax payment would not have happened therefore, causa sine qua non for the payment of tax is the statutory liability payments of taxes are governed by the provisions of the relevant tax statute. Therefore, liability for such payment is in relation to the statute and not in relation to the asset. Holding of assets is a nearest cause to the incidence of taxation. It is only causa causans. Therefore, it cannot be said that the payment of taxes is directly in the context of the assets held by the assessee. Taking into consideration the entire conspectus of the case we are of the opinion that the income-tax and wealth-tax liabilities cannot be deducted as debts due in relation to taxable assets. We, therefore decide this issue in favour of the Revenue and against the assessee. 15. In the result the appeal of the Revenue stands allowed.
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2005 (12) TMI 240 - ITAT LUCKNOW-A
Income Escaping Assessment - assessment order passed u/s 147/143(3) - initiation of proceedings by issue of notice u/s 148 - Validity Of order passed u/s 263 - denial of authorship of the documents pertaining to VDIS - addition on account of unexplained money - HELD THAT:- We may point out that addition under section 69A can be made only when it is found that the assessee is owner of any money, bullion, jewellery, etc. or other valuable article, etc.; in the financial year relevant to the assessment year in which addition on account of unexplained money etc. is made.
In our considered opinion, the material on the basis of which reopening has been made for assessment year 1998-99 cannot at all justify the reopening of assessment as there was no basis for doing so. On the basis of documents on which reopening has been made, it cannot be said that any income for assessment year 1998-99 escaped assessment because on the basis of such material, prima facie, it cannot be believed nor could there be any reason to believe that income for this assessment year has escaped assessment. The department has no other material in its possession for having reason to believe that income pertaining to assessment year 1998-99 had escaped assessment.
Thus, we are of the considered opinion that action taken u/s 148/147 was wholly illegal because there was no basis for reopening of assessment as has been done in this case. The order was, therefore, without any jurisdiction and thus void.
Since the assessment order passed u/s 147/143(3) was itself illegal and void, ld. CIT(A) was having no justification to invoke jurisdiction u/s 263 against such void or now est order. We hold that as the order of the Assessing Officer passed u/s 147/143(3) was itself void, the order of CIT passed u/s 263 for quashing this order was without jurisdiction. Hence, the same is liable to be quashed. We, therefore, quash the order of the ld. CIT passed u/s 263. Thus, we quash the impugned order of ld. CIT passed u/s 263.
In our opinion, there is no material before the ld. CIT to record a prima facie finding that the assessee was owner of money, bullion, etc. in the previous year relevant to assessment year 1998-99. No such finding can be recorded on the basis of the material which came to the possession of the revenue and besides this material there was no other material collected by it to hold that the assessee was owner of any money, bullion, etc. in the previous year relevant to assessment year 1998-99 in the terms and conditions contained under section 69A of Income-tax Act. In this regard, reference can be made to the decision of Patel Cotton Co. Ltd. v. Asstt. CIT [1997 (5) TMI 430 - ITAT MUMBAI] which fully support our findings.
Thus, we are of the considered opinion that the ld. CIT was not justified in holding that the order of the Assessing Officer was erroneous or prejudicial to the interest of revenue. On this ground also, the order of ld. CIT(A) is liable to be quashed.
In the result, the appeal of the assessee is allowed and is disposed of as above.
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2005 (12) TMI 238 - ITAT LUCKNOW
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... ... ..... e that in this case the conduct of the assessee cannot be treated to be contumacious or malafide. It has also not been shown on record that assessee deliberately acted in defiance of law or dishonestly carried out its duties. 13. In view of the above and after considering the pleas of learned counsel for the assessee, raised before us, we are of the considered opinion that penalty under section 271D was not imposable on the assessee and the learned CIT(A) was fully justified in cancelling the same. We, therefore, uphold his order and reject the ground of revenue taken in this appeal. 14. In the result, the appeal of the revenue is dismissed. CO. No. 30/Alld/99 (Assessors cross-objection) 15. The cross-objection has been filed by the assessee only to support the order of learned CIT(A). As we have dismissed the revenue s appeal, by upholding the order of learned CIT(A), the cross-objection filed by the assessee has been rendered in-fructuous and stands disposed of accordingly.
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2005 (12) TMI 236 - ITAT JODHPUR
Non-maintenance of stock register - quantitative details of grey cloth and finished goods - Provisions of s. 145 - Accounts - GP rate - trading addition - HELD THAT:- In our opinion the assessee has been able to explain the fall in GP rate, by referring to steep increase in turnover, which he could achieve by reducing the selling price and paying more discount. He maintained quantitative details of grey cloth and finished goods. All the processes involved right from washing to finishing are got done from outside parties. The ld AR demonstrated the whole series of process involved by referring to marked lot number to the Thans, to demonstrate and explain that the cloth remained the same throughout. He also demonstrated the expenses involved for each process in a series. Therefore, we are convinced that the GP rate declared by the assessee cannot be disturbed. The learned CIT(A) has accepted the claim of the assessee in principle but he applied his own magic number of 11 per cent simply on ad hoc basis.
Therefore, we are of the considered opinion that no addition in this account can be made without any specific defects having been pointed out in the books of account of the assessee, which according to us gave a correct picture of his income. Hence, we accept the ground taken by the assessee and reject the ground taken by the Department in this respect. Meaning thereby Ground NO.1 of the assessee's appeal is accepted and Ground No. (iii) of the Department's appeal is dismissed.
Disallowance of 1/5th of total expenses - claimed under various heads that is travelling expenses, shop expenses, vehicle repairing and vehicle expenses, depreciation on vehicle and postages - We agree with learned Authorised Representative Shri Bhansali, that there is no evidence on record to print out any non-business user but at the same time we agree with learned Departmental Representative that the total non-user by the assessee for personal purposes other than business purposes cannot be ruled out in' the given circumstances. So, to meet the ends of justice and to strike a balance, it would be fair and reasonable if the disallowance is further reduced to 1/10th and thus the ground taken by the assessee stands partly allowed.
In the result, the appeal of the assessee is partly allowed.
Deletion out of processing charges - We are convinced with the arguments of learned Authorised Representative that the statements of Shri Mool Chand have to be read in its entirety. When the statement of Shri Mool Chand is read in its entirety, a clear inkling is given that the assessee has got processed in the name of M/s Sangam Enterprises and also paid by cheque, to said concern If the other party had manipulated and the assessee is not involved therein and there is no evidence that this money travelled back to the assessee, the claim of the assessee cannot be rejected. In our opinion, the assessee has clearly established that he paid the money to M/s Sangam Enterprises. The statement of Shri Mool Chand has to be viewed with the pinch of salt as he may have stated something adverse to the assessee for his personal gains.
Therefore, in view of the uncontroverted facts that the assessee has got the processing by dealing with M/s Sangam Enterprises, who may have got the dyeing done from any other entity be it Punith or Nitesh or Sangam, we confirm the finding of learned CIT(A) and do not allow this ground of appeal.
Addition u/s 68 - From the decision of the Tribunal in the case of Dy. CIT vs. K.C. Jhanwar [1995 (6) TMI 76 - ITAT JAIPUR] and the others relied by ld AR, it is clear that the shortage can be allowed at even 5.25 per cent as reasonable in the given facts of a case. The assessee measures lot to lot when the goods finally arrive at the assessee's premises after undergoing the entire processes. The sum total of all the above reasoning go to prove the claim of the assessee. Therefore, in our view the learned CIT(A) has correctly deleted the addition. This ground of appeal also fails.
The ground No. (iii) of Department's appeal already stands decided along with the ground of the assessee's appeal. This ground has been dismissed.
Expenditure on the "Dalali" - The fact that sales have increased manifold in this year, speaks in favour of the assessee's claims that these two persons really gave a boost to the sales. Sometimes it is neither possible nor advisable to disclose intangible benefits, which accrue to the assessee by carrying out business activities in a particular manner. It is the assessee only who knows how to manage its affairs in a better way. The ld AR has correctly placed reliance on the decision of the Hon'ble Delhi Bench of Tribunal in the case of Survir Enterprises (P) Ltd. vs. ITO [1994 (4) TMI 113 - ITAT DELHI-E] wherein it has been held that although detailed evidences in respect of services rendered were not available, nonetheless services can be rendered when payments have been made and assessed in the hands of the recipients. Therefore, in our considered opinion, when there is no personal relationship with these payees and the payment has been made by the assessee for business consideration, the same is allowable. The findings of the learned CIT(A) is thus upheld. The ground of appeal fails.
Unexplained excess credit - This issue could have been resolved by learned AO by referring this statement to assessee and by allowing the assessee to cross-examine him. It appears that nothing of that sort was done by learned AO. Therefore, the claim of the assessee has been rightly allowed by the learned CIT(A). There is no scope for our interference in this finding.
In the result, the appeal of the Department stands dismissed.
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2005 (12) TMI 235 - ITAT JODHPUR
Business Expenditure ... ... ... ... ..... o observed that ss. 31 and 37 do exist even after the introduction of block of assets concepts and have not become otiose or redundant. Therefore, we are of the considered opinion that the claim of 100 per cent depreciation on these items is allowable to the assessee-company because such expenditure is definitely an expenditure of revenue nature as the same is required for the running of machinery and plant which when put together amounted to a single unit. 10. The other reason taken by the learned CIT(A) for allowing depreciation that each and every item or part was admittedly below Rs. 5,000 in cost separately is not a valid reasoning because as held by us each and every part or units so explained cannot be taken as a complete and independent system of machinery, to be eligible for such a deduction because these are only a part of a bigger and integrated system. Therefore, on this reasoning the depreciation cannot be allowed. 11. In the result, the appeal is partly allowed.
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2005 (12) TMI 232 - ITAT JAIPUR
Business expenditure, Deduction U/s 80HHD ... ... ... ... ..... of the statute cannot be strained. If provisions of statute are unambiguous and legislative intent is clear then Court need not call into aid the other rule of construction of statutes and they call only when legislative intent is not clear Refer Innamun Gopalam vs. State of AP (1963) 14 STC 742 (SC), CIT vs. G.V. Venugopal (2005) 193 CTR (Mad) 661 (2005) 273 ITR 307 (Mad), State of Punjab vs. Jalandhar Vegetable AIR 1966 SC 1295 . 31. Therefore, in the present case the assessee is allowed to utilize the reserve to the extent of Rs. 71,23,244 and not to the extent of Rs. 1,07,82,347 under s. 80HHD(1)(b) r/w sub-s. (4) of s. 80HHD of the Act. Therefore, we reverse the decision taken by the learned CIT(A) and sustain the order of the AO who has rightly allowed the deduction under s. 80HHD(1)(b) of the Act r/w sub-s. (4) to s. 80HHD of the Act to the extent of Rs. 71,23,244. Thus, this ground of the Revenue is allowed. 32. In the result, appeal of the Revenue is partly allowed.
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2005 (12) TMI 230 - ITAT JABALPUR
Block Assessment - Search And Seizure - absence of proper service of notice u/s 158BC - barred by limitation - HELD THAT:- In our opinion this is the settled law that the affidavit of the assessee cannot be rejected without cross-examination of the person who has given the affidavit in view of the decision of the Hon'ble apex Court in the case of Mehta Parikh & Co. vs. CIT[1956 (5) TMI 4 - SUPREME COURT]. The affidavit is the best piece of evidence and CIT(A) in our opinion was not correct in law in rejecting the affidavit without bringing any evidence to the contrary. The CIT(A) was duty-bound to give opportunity to the assessee to cross-examine the Inspector and witnesses for bringing the truth as we feel it was necessary on the facts of the case to render substantial justice and to ascertain the fact whether the notice has been served on the assessee through the notice-server or by affixture.
Learned DR could not bring any evidence or proof that the notice has been sent to the assessee through registered post AD nor any evidence has been produced that the AO has given finding that sending of the notice through registered post is not necessary. Even no such finding has been recorded on the order sheet. From the first page of the order and from the impression of the ink/writing it appears as if the entry dt. 15th Feb., 1999 to 31st March, 1999 has been made at one go. Therefore, we find force in the submission of the learned AR that no notice has been served on the assessee prior to 31st March, 1999 and it was only notice issued on 30th March, 1999 the copy of which is available at p. 6 has been served on the assessee for the first time on 31st March, 1999 and since the assessment was getting time-barred, the AO has tried to bring the evidence on record that the notice has been served on the assessee prior to 31st March, 1999. Genuinenity of the photocopy of the notice available at p. 6 of the paper book has not been denied by the ld DR in the open Court.
Thus, we are of the view that the notice has not been served on the assessee in this case in accordance with s. 282 of the IT Act earlier to 31st March, 1999. In the absence of service of notice, the assessment order passed on 31st March, 1999 is a nullity and cannot be sustained in the eyes of law. We, therefore, set aside the order of the CIT(A) on this issue and annul the order passed by the AO.
We have already held that the order passed by the AO is barred by limitation. We cannot direct the AO to make a fresh assessment because that would tantamount to extending the limitation for which we are not competent. Our aforesaid view is duly supported by the decision of the Hon'ble Supreme Court in the case of Hope Textiles Ltd. vs. Union of India [1993 (10) TMI 2 - SUPREME COURT].
In the result, the appeal filed by the assessee on this issue is allowed.
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2005 (12) TMI 229 - ITAT HYDERABAD-B
Commissioner (Appeals) ... ... ... ... ..... the facts of the instant case, as the assessee herein was all along alert, and even prior to filing appeal before the correct forum, viz. CIT(A), was fighting for its cause, but before a wrong forum, viz. Tribunal, on account of wrong advice of the counsel. 5.9 In the light of the foregoing discussion, considering totality of facts and entirety of circumstances of the case, we have no hesitation to set aside the order impugned herein and restore the appeal to the file of the CIT(A) himself with a direction to condone the delay in the filing of the appeal by the assessee before him, and then give a decision on the merits of the appeal, after giving opportunity of being heard to the assessee and also duly considering any relevant stand or material that may be relied upon by the assessee in support of its contentions, and if necessary to the Assessing Officer too, before passing a speaking order in accordance with law. 6. In the result, appeal of the assessee is allowed hereby.
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2005 (12) TMI 228 - ITAT HYDERABAD-A
Profits Of The Business ... ... ... ... ..... What has to be looked into under s. 80HHC is business profits and this is not the same as in s. 80-I wherein the concept of derived from an undertaking is considered. There is no concept of derived from under s. 80HHC. All that is to be seen is whether the interest in question is assessed as business profits and if so the interest component included in such business profits should be excluded in terms of Expln. (baa) to s. 80HHC and the formula applied. There seems to be confusion on the concept of profits of business as contemplated under s. 80HHC and the concept of income derived from contemplated under s. 80-I. All that is to be seen under s. 80HHC is whether it is profit from business or not and then, if it is so, apply the formula. Looking at the matter from any angle, the order of the first appellate authority has to be upheld, by following the order of the Tribunal in the case of the assessee for earlier years. 7. In the result, the appeal of the Revenue is dismissed.
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2005 (12) TMI 227 - ITAT DELHI-H
Validity of Order passed by the learned CIT u/s 263 - erroneous and prejudicial Order - highest bidder for providing basic telephony services - Compensation for termination of project agreements with Qualcomm - receipts - Capital receipt Or Not - HELD THAT:- As is evident from the relevant clause, of the settlement agreement reproduced above, different performance and financial guarantees were given by Qualcomm on behalf of the assessee-company. In order to get itself discharged of the obligations under the said guarantees, it was agreed by Qualcomm that it would pay Rs. 33.33 crores to the assessee-company and in turn, the assessee-company shall indemnify Qualcomm from any liability that may arise under the said guarantees during the period in which they were in force. It is pertinent to note here that all these guarantees were given in connection with the setting up of a state of art broad-band network on convergence platform in Rajasthan Telecom Circle for providing basic telephony services in terms of license granted to the assessee-company by DoT. The said guarantees were, therefore, clearly related to the capital structure of the assessee-company or for that matter to its profit making apparatus and the amount received by the assessee company from Qualcomm as compensation for discharging the latter from the liabilities under the said guarantees was a receipt on capital account.
Hon'ble Supreme Court in the case of Kettlewell Bullen & Co. Ltd. [1964 (5) TMI 4 - SUPREME COURT] involving almost similar facts, is directly applicable to the present case wherein it was held that the compensation paid to the assessee for termination of managing agency was a loss of capital asset and it matters little whether the assessee did continue after the termination of the said managing agency. To the similar effect is the decision of Hon'ble Supreme Court in the case of Travancore Rubber & Tea Co. Ltd. [2000 (3) TMI 5 - SUPREME COURT] cited by the learned counsel for the assessee wherein it was held that the, quality and nature of a receipt for income tax purposes are fixed once and for all when the subject of the receipt is received and no subsequent operation can charge the nature of the receipt. We, therefore, find no merits in the contention raised by the learned CIT-DR in this regard and reject the same.
As such, we are of the considered opinion that the amount in question received as compensation by the assessee-company from Qualcomm on account of cancellation/termination of project agreements was a "capital receipt" not liable to tax. In that view of the matter, we hold that the learned CIT was not justified in holding the same to be a revenue receipt chargeable to tax. The addition made on this issue to the total income of the assessee is, therefore, directed to be deleted. Ground Nos. 8 to 13 of the assessee's appeal are, accordingly, allowed.
In the result, the appeal of the assessee is partly allowed.
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2005 (12) TMI 226 - ITAT DELHI-G
Business Expenditure ... ... ... ... ..... trading account. The assessment for 1997-98 was also made under summary scheme under s. 143(1)(a) of the Act in which there was only a limited scope of adjustment for the items as specified under s. 143(1)(a) of the Act and no opinion can be said to have been formed on any claim made in the return. If the assessee failed to bring material on record to show that the benefit of expenditure is available in the year under consideration, no right is vested in him to get the deduction of such amount which was incurred on revenue account in the earlier years. It, therefore, cannot be held that similar deduction was taken as a basis of assessment for asst. yrs. 1996-97 and 1997-98 so as to preclude the AO from taking a different view inconsistent to the view taken in the earlier year. Under such peculiar facts we do not find any material to interfere with the decision reached by the learned CIT(A). As a result grounds raised by the assessee stand rejected and the appeal is dismissed.
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2005 (12) TMI 225 - ITAT DELHI-F
Erroneous And Prejudicial Order ... ... ... ... ..... ndia Ltd. held that in such circumstances, the Tribunal was justified in setting aside the order of the CIT under s. 263 of the Act. 38. Still further, the Hon ble Supreme Court in Malabar Industrial Co. Ltd. has held that when two views are possible and the AO has taken one of the possible view, then the order cannot be held to be prejudicial to the interest of the Revenue. Since the CIT could not come to a definite finding that the expenditure in question was a capital expenditure in the proceedings under s. 263, in our opinion, the order of the AO could not be held to be erroneous. 39. We, therefore, are of the view that the CIT was not justified in passing order under s. 263 of the Act in the fact and circumstances of the case and restoring the matter back to the file of the AO to re-examine if the expenditure incurred on dies was a revenue expenditure. Hence, we cancel the order of the CIT under s. 263 of the Act. 40. In the result, the appeal of the assessee is allowed.
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