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TMI Blog2012 (6) TMI 573X X X X Extracts X X X X X X X X Extracts X X X X ..... ignoring the submissions of the appellant. (b) The CIT(A) grossly ought to have seen that the reimbursement of the income tax is disputed by AP TRANSCO and since it is not reimbursed so for, the said amount has neither accrued not crystalised and therefore cannot be taken as the appellant's income for the AY 2002-03. (c) The CIT(A) grossly erred in holding that the Income tax receivable from AP TRANSCO is assessable under the head income from other sources but not as income from business. 3. The first limb mentioned in ground 2 vide the sub grounds 2(a) and 2(b) relates to making of an addition on account of income tax receivable from A.P. Transco as income of the assessment year 2002-03 under the correct head of income. Other limb mentioned in sub-ground 2(c) relates to the decision of the AO in changing the head of income in the respect of the above receipt and taxing the same under the head 'income from other sources'. 4. Briefly stated, relevant facts of the case are that the assessee is engaged in the business of generation of electricity and selling the same to APTRANSCO, a subsidiary of APSEB. During the assessment proceedings, AO made an addition of Rs. 2,40,45,266/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SCO in support of its contention as part of the paper book filed by it. APTRANSCO has issued more than one letter in successive years, returning the bills submitted by the assessee without payment, based on the earlier letter dated 20.11.2003 issued by it. It is submitted that these documents proposed to be filed before the Hon'ble Income Tax Appellate Tribunal as addl. evidence constitute vital evidence to show the APTRANSCO repeatedly declined to pay the amounts of Income tax reimbursable to the assessee as per Power Purchase Agreement with APSEB. The assessee submits that copies of two bills submitted by the assessee and copies of letters issued by APTRANSCO as per table given below are proposed to be introduced as additional evidence. The assessee prays that the undermentioned documents may kindly be admitted as addl. evidence and taken into account while adjudicating the appeal. S.No. Description Sheet Nos. 3. Copy of AP TRANSCO letter dated 9-4-2002 1 5 Copy of AP TRANSCO letter dated 16.8.2005 2 6 Copy of AP TRANSCO letter dated 19.8.2005 3 7 Copy of AP TRANSCO letter dated 6.7.2006 4 8 Copy of AP TRANSCO letter dated 12.9.2006 5 9 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision thereof. Without going into the merits of the issue, the preliminary matter to be decided relates to the admissibility of the impugned additional evidence and the request of the assessee's counsel for setting aside the matter to the file of the assessing officer. In this regard, we have examined the additional evidences furnished before us. These papers constitute the correspondence that took place between the assessee and the APTRANSCO. Further, there is categorical submission by the Ld Counsel that the matter is sub-judice unlike the way the CIT(A) mistakenly concluded stating that there is no dispute on the issue of reimbursebility of the MAT paid by the assessee. Considering the nature of the papers filed before us, we find that the said documents do not require any investigation into the basic facts of the issue as they are merely the correspondence between the assessee and the APTRANSCO. In fact, these documents will help in arriving at a right decision regarding the accrual or otherwise of the receivable. Considering the decision of the Hon'ble Supreme Court in the case of NTPC (299 ITR 383), we are of the opinion that the papers filed before us should be admitted. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essment year 2002-03 is allowed for statistical purposes. Revenue's Appeal ITA No.1579/Hyd/2008 13. Grounds No.1 and 5 in this appeal of the Revenue are general in nature, and therefore, they do not call for specific adjudication. 14. Ground No.2 relates to the action of CIT(A) in entertaining an additional ground, which was not raised before the assessing officer. According to the Revenue, the admission of such additional ground and adjudication thereon is not proper. In this regard, learned counsel for the assessee mentioned that the CIT(A) is free to entertain any issue which was not raised before the assessing officer,and therefore, the same is proper. 15. We heard the parties and perused the orders of the revenue and the paper book filed before us. On finding that the impugned claim is not made in the original return or by way of filing the revised return, the AO denied the claim and the CIT(A) entertained and adjudicated the issue with which the revenue is aggrieved in the present appeal. For this the CIT(A) relied on the binding judgment in the case of Goetze (India) Ltd. vs. CIT 284 ITR 323 (SC). In this regard, we have perused the relevant portions of the judgment and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Bench, about the applicability of the decision of the Apex Court in the case of Liberty India Ltd. V/s. CIT (317 ITR 218), the learned counsel mentioned that the receipt involved in the present case, being insurance premia paid, is connected with the manufacturing activity of the undertaking, and therefore, the same is operational income of the assessee, and consequently, the said judgment of the Apex Court is distinguishable on facts. 19. We perused the facts of the case and issues raised by the parties before us. On understanding the issue, we find that the orders do not speak of the basic findings relevant for adjudication of this tax refund and if it constitutes an eligible profit or "ineligible ancillary profit" in view of the Supreme Court decision in the case of Liberty India 217 ITR 218. It is also evident that the authorities at relevant point of time did not have the benefit of the said judgment of the Apex Court in the case of Liberty India (supra), which is dated August 2009. We have also perused the operational portion of the said decision given on page 219 of the reported said ITR which reads as follows:- "Incentive profits are not profits derived from eligible ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issue mentioned in grounds 2(a) 2(b) and 2(c) relates to the decision of the authorities in making addition on account of income tax receivable from A.P. Transco as income of the assessment year 2002-03. 25. Except for the amount involved, this issue is identical to the one considered by us, in the context of the assessee's appeal for the assessment year 2002-03 in the foregoing paras of this order. In the circumstances, for the detailed reasons discussed in paras above of this order, this issues for the assessment year 2006-07 also have to be set aside to the file of the assessing officer for fresh consideration, considering inter alia the additional evidence that the assessee has filed before us, in accordance with law and after giving reasonable opportunity of hearing to the assessee. 26. This appeal of the assessee is allowed for statistical purposes. Revenue's Appeal : ITA No.1580/Hyd/2008 27. In this appeal also, Grounds No.1 and 5 are general in nature, and do not call for separate adjudication. 28. Ground No.2 relates to the action of the CIT(A) in entertaining an additional ground not raised before the assessing officer. This ground is similar to the one raised by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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