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TMI Blog2010 (10) TMI 761X X X X Extracts X X X X X X X X Extracts X X X X ..... ainst the assessee by the Hon'ble Delhi High Court in assessee's own case for A.Y. 1985-86. Following the said order, similar issue was also decided in the case of the assessee by this Tribunal in A.Y. 1999-2000 in ITA No.993/D/2007. It is further submitted that the issue also covered against the assessee, by the decision of Hon'ble Delhi High Court in the case of C.I.T. vs. Shri Ram Honda Equipment 289 ITR 475. 3.1 Considering the above precedents, we do not find any infirmity in the order of the Ld. Commissioner of Income Tax (Appeals). Accordingly, we uphold the same. 4. Another issue raised for assessment year 1994-95, 1995-96, 96- 97, 97-98 and 98-99 pertains to addition made on account of custom duty draw back alleged to have been accrued to the assessee during the relevant assessment year. 4.1 We have heard both the counsel and perused the records. In this regard, Ld. counsel of the 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 As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8-99. 5.1 Both the counsels fairly agreed that this is consequential to the final tax liability. 6. The next issue raised FOR A.Y. 92-93 to A.Y. 95-96 is that Ld. Commissioner of Income Tax (Appeals) erred in leveling interest u/s 234B of the IT Act of Rs.15,45,67,121/- for A.Y. 1995-96. 6.1 On this issue Assessing Officer has levied interest u/s 234B. 6.2 Upon assessee's appeal Ld. Commissioner of Income Tax (Appeals) held as under:- "Ground no. 8 is with regard to levy of interest u/s 234B. This is a consequential ground and the Assessing Officer is directed to charge interest u/s 234B after giving effect to this appeal order." 6.3 Against this order the assessee is in appeal before us. 6.4 Ld. counsel of the assessee submitted detailed submissions and case laws for the proposition that interest was not leviable. Moreover, he also submitted that he has given elaborate submissions before the Ld. 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. Accordin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Representative on the other hand supported the levy. 7.4 We have carefully considered the submission. The submission includes references to various orders and their dates. Admittedly these submissions were not before the Assessing Officer, as there is no discussion in this regard in Assessing Officer's order. Ld. Commissioner of Income Tax (Appeals) has also not addressed all the submissions that has been brought out before us. Under the circumstances, when these submissions are not finding part in orders of authorities below, we consider it appropriate to remit the issue to the files of the Assessing Officer to consider the issue afresh in light of the assessees submission in this regard. He shall also factually verify the veracity of the various orders amounts and dates mentioned therein. Accordingly, the issue stand remitted to the files of Assessing Officer. Needless to add assessee should be given adequate opportunity of being heard. Revenue's appeals 8. 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:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ove discussion, it is held that advance payment in cash of taxes or duties without incurring liability to pay such taxes or duties cannot be allowed as deduction under section 43B. Therefore, the lower authorities were justified in disallowing the sum of Rs.3,19,41,668/- representing PLA balance of excise duty on vehicle in as much as there is clear finding of fact in para 9.5 of the Ld. Commissioner of Income Tax (Appeals) that PLA balances are not relatable to any goods manufactured." 29. However, we find force in the alternate of assessee's counsel that such amount should be allowed in the year in which it is adjusted against liability to pay excise duty on manufactured goods. Accordingly, it is pleaded that deduction should be allowed of the sum of Rs.1,03,79,919/- representing PLA balances on the last day of the preceding year but adjusted in this year. We have heard both the counsels and perused the records. We are in complete agreement with such contention since such 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g Officer noted that ITAT on this has given a finding in its order that warranty expenses are allowed on accrual basis if the claim of the assessee is based on scientific basis. The ITAT has based its decision on the decision taken by the tribunal in the assessee's own case for the A.y. 1999-2000. In view of the above directions of the ITAT the assessee was asked to furnish a reply establishing that the claim of warranty expenses is based on scientific method, detailed method of working out the warranty expenses alongwith justification and explanation that the method adopted is scientific. Considering the assessee reply Assessing Officer noted that assessee has stated in his reply that it is consistently following the same method for working out the warranty expenses from A.Y. 94-95 onwards. The same issue has also been dealt with in dealt with in detail in the order giving effect to the ITAT's order for A.Y. 1999-2000 in which Assessing Officer has stated that assessee has made provisions for which there is no consistent scientific basis. Following this decision, Assessing Officer held that there is no consistent scientific basis adopted by the assessee for working out the warrant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of a past event; (b) it is probable that an outflow of resources will be required to settle the obligation, and (c) a reliable estimate can be made of the amount of the obligation. If these conditions are not met, no provision can be recognized. The principle is that if the historical trend indicates that a large number of sophisticated good were being manufactured in the past and the facts show that defects existed in some of the items manufactured and sold, then provision made for warranty in respect of such sophisticated goods would be entitled to deduction from the gross receipts under section 37." 10.6 We have carefully considered the submissions and perused the records. We note that Ld. Commissioner of Income Tax (Appeals) has given a clear finding that the method for computing warranty expenditure is on scientific basis. The Assessing Officer has not brought anything on record to prove that the same is not of scientific basis. Moreover, in view of aforesaid case laws including that of Hon'ble Apex Court, we do no find any infirmity or illegality in the order of the CIT and accordingly we uphold the same. 11. Another issue raised for A.Yrs.. 94-95, 9 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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