TMI Blog2010 (10) TMI 761X X X X Extracts X X X X X X X X Extracts X X X X ..... ls) has not addressed all the submissions -Further find that Ld. Commissioner of Income Tax (Appeals)'s order is a laconic order on this issue - Accordingly, remit this issue to the files of Ld. Commissioner of Income Tax (Appeals) to consider the issue afresh and pass a proper and speaking order. Disallowance u/s 43B (actual payment clause)- adjustment amounts to actual payment - Even the learned counsel for revenue has no objection to such contention provided such deduction was not allowed in the preceding year since double deduction of the same amount cannot be allowed - Considering the same, the order of Ld. Commissioner of Income Tax (Appeals) is modified and the matter is remitted to the file of Assessing Officer who shall allow the alternate claim of assessee after verification if such deduction was not allowed in the preceding year - Since it has been held that advance payment did not represent the payment of excise duty, the question of including the same in the closing stock does not arise - Therefore, finding of Ld. Commissioner of Income Tax (Appeals) to that effect is vacated. Interest u/s 234D - As per the the decision of the Delhi Tribunal in the case of M/s Glaxo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee has submitted that in the present assessment years 1994-95 and 1995-96 the ITAT vide its order dated 24.12.2006 following the ITAT order dated 11.10.2004 for the assessment year 1999-2000 remanded the issue to the Assessing Officer. The basis of addition by the Assessing Officer sustained by the Ld. Commissioner of Income Tax (Appeals) is ITAT order dated 11.10.2004. The ITAT vide its order dated 11.10.2004 remanded the issue to Assessing Officer for adjudication. Subsequently in the appeal effect order of Assessing Officer and Ld. Commissioner of Income Tax (Appeals) repeated the addition which issue is now decided in favour of the assessee by the order of the ITAT in assessee's own case for assessment year 1999-2000 in ITA no. 399/Del/2007. The relevant observation of the tribunal are as under:- "We have considered the rival contentions and found from the record that in the first round of appeal, tribunal has restored the matter back to the file of the Assessing Officer with specific direction to verify as to when the claim of the assessee was accepted, and if the Assessing Officer finds that the claim of the assessee was accepted in the year under consideration, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner of Income Tax (Appeals). But Ld. Commissioner of Income Tax (Appeals) has not addressed all the submissions. Further we find that Ld. Commissioner of Income Tax (Appeals)'s order is a laconic order on this issue. Accordingly, we remit this issue to the files of Ld. Commissioner of Income Tax (Appeals) to consider the issue afresh and pass a proper and speaking order. 7. Another issue raised for A.Yrs. 1992-93, 94-95, 95-96, 96-97 and 98-99 with regard to levy of interest u/s 220(2) of the IT Act. 7.1 Upon Assessing Officer's levy of interest u/s 220(2) the Ld. Commissioner of Income Tax (Appeals) held as under:- "I have considered the matter. The final demand has been quantified in order passed u/s 143(3)/254. I am of the considered view that the demand arising out of the original assessment to the extent it has been confirmed by the ITAT continues to exist. The Kerala High court in the case of K. Venogopalan Nambiar vs. ACIT 231 ITR 607 has stated that a notice of demand remains alive and effective to the extent that tax is finally determined to be due and payable by the assessee. Thus, it would be clear that interest u/s 220(2) of the Act charged on the u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... One common issue raised is that Ld. Commissioner of Income Tax (Appeals) was justified in deleting the disallowance made by the Assessing Officer u/s 43B (actual payment clause) of the following:- A.Y. 94-95 A.Y. 95-96 A.Y. 96-97 a) PLA balance of Excise duty on vehicles 7626026/- 16653498/- 236445673/- b) PLA balance of R and D Cess on Vehicles 284598/- 353472/- 628572/- c) PLA balance of Excise duty of spare parts 1302158/- 388005/- 2077765/- 8.1 On this issue the Assessing Officer observed that in assessment year 1994-95 as under:- "PLA Balance: a) The Hon'ble ITAT on this issue has stated in its order that: "The Tribunal in the A.Y. 1999-2000 has held that advance payment in cash of taxes or duties without incurring liability to pay such taxes or duties cannot be allowed as deduction u/s 43B of the IT Act." b) It has been further stated in the order on this issue that: "The order of the Ld. Commissioner of Income Tax (Appeals) on this count is set aside and the Assessing Officer is directed to rework the disallowance as per directions of the Tribunal." c) In view of the above directions, Rs.92,12,783/- being the credit in the personal led ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r revenue has no objection to such contention provided such deduction was not allowed in the preceding year since double deduction of the same amount cannot be allowed. Considering the same, the order of Ld. Commissioner of Income Tax (Appeals) is modified and the matter is remitted to the file of Assessing Officer who shall allow the alternate claim of assessee after verification if such deduction was not allowed in the preceding year. Since it has been held that advance payment did not represent the payment of excise duty, the question of including the same in the closing stock does not arise. Therefore, finding of Ld. Commissioner of Income Tax (Appeals) to that effect is vacated. 30. The above finding of ours would apply mutates mutatis mutandis with reference to the sum of Rs.8,41,460/- and Rs.6,76,075/- representing PLA balances of R and D cess on vehicles and excise duty on spare parts respectively." 9. We further find analogical issue was considered by this tribunal in assessee's own case for A.Y. 2000-01 dated 28.3.2005. The Tribunal held as under:- "5. Both the parties have been heard. This issue has been dealt with in great detail by the tribunal for the A.Y. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing Officer held that there is no consistent scientific basis adopted by the assessee for working out the warranty expenses claimed. Hence, Rs.2,22,16,412/- claimed on account of warranty expenses are disallowed and added back to the income. 10.1 Upon assessee appeal Ld. Commissioner of Income Tax (Appeals) noted that the said issue had come up before him in assessee's own case for A.Y. 1999-2000 in Appeal No.55/06-07. In that case in his order dated 28/12/2006, he held that the basis of computing the warranty expenditure on accrual basis adopted by the assessee was a scientific basis and would meet the demands of the Mercantile System of Accounting. Therefore, he had allowed that claim. Ld. Commissioner of Income Tax (Appeals) found in this year also, the facts are similar and the basis of calculating the warranty expenditure is the same. Therefore, following the decision for A.Y. 1999-2000 he allowed the expenditure in this year. 10.2 Against this order the revenue is in appeal before us. 10.3 We have heard both the counsel and perused the records. 10.4 Ld. Departmental Representative relied upon the Assessing Officer's order. Ld. counsel of the assessee submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d accordingly we uphold the same. 11. Another issue raised for A.Yrs.. 94-95, 96-97 98-99 is that Ld. Commissioner of Income Tax (Appeals) erred in not appreciating that section 234D is procedural law and is applicable to the computation of interest u/s 234D as to the period falling after 1.6.2003 notwithstanding the assessment year involved. 11.1 Upon Assessing Officer's action of levying interest u/s 234D, the Ld. Commissioner of Income Tax (Appeals) has referred the decision of the Delhi Tribunal in the case of M/s Glaxo Smithkline Asia (P) Ltd. vs. ACIT 97 (TTJ) (TDEL) and other similar cases. He found that tribunal held that the law dealing with the imposition of interest u/s 234D is substantive law and not procedural law and, hence, interest under this section cannot be charged in respect of assessment years prior to the coming into force of section 234D i.e. 1.6.2003. Hence, he directed that interest u/s 234D would not be chargeable. 11.2 Against this order the revenue is in appeal before us. 11.3 We have heard both the counsel and perused the records. Ld. counsel of the assessee placed reliance in this regard on the Special Bench decision of the tribunal in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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