9911796707
TMI Blog2012 (8) TMI 637X X X X Extracts X X X X X X X X Extracts X X X X ..... is with respect to interest on sales tax. Since the ground No 1 of Assessee's and Revenue's appeal are connected the same are taken together for disposal. Brief facts are that during Assessment Year 2005-06 the assessee availed certain benefits under the Sales tax Amnesty Scheme in order to discharge unpaid sales tax dues of financial year 1995-96, 1996-97 and 1997-98. The total amount of outstanding arrears of sales tax of the erstwhile amalgamating company was to the order of Rs. 36,43,260/-. Against this, the amnesty scheme permitted the full and final settlement by payment of Rs 20,06,132/- comprising of Rs 18,35,946/- towards sales tax, Rs 1,55,357/- towards interest and Rs.14,829/- towards penalty. Before the A.O. it was submitted by the assessee that the dues pertained to the earlier years and the same was not claimed as deduction in the respective years. The assessee claimed the payment of Rs 20,06,132 and requested that the same should be allowed as deduction to it on payment basis u/s 43B. The assessee claimed this expenditure for the first time during the assessment proceedings. The A.O. did not take cognizance of the claim and neither he admitted nor allowed the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as directly taken to Balance Sheet. He further stated that nothing is available on record to prove that in the earlier year the sales tax that was collected and not paid was added to the total income. According to him as per the provisions of section 43B, the sales tax deduction can only be allowed on payment basis in the year of payment only if in the earlier year the amount was debited to the Profit and loss account and while computing the income the same was disallowed and was added to the income. Further, the Ld. D.R. could not controvert the fact that the interest paid on sales tax was of penal in nature. 3.7 We have heard the rival contentions, perused the material on records placed before us. The issue before us is whether the interest paid on sales tax under the amnesty scheme is an allowable deduction as business expenditure. The law is well settled that the interest paid on sales tax is not of penal in nature and is therefore allowable as business expenditure. Therefore, in our opinion the interest on sales tax is an allowable business expenditure. Further, .the interest paid on sales tax under the amnesty scheme is not for infringement of any law. We accordingly hold th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tal value. 35950 sq. ft. 8.855 38,20,047/- 5. The assessee being aggrieved with the decision of the A.O. carried the matter in appeal before the CIT (A). CIT (A) confirmed the addition made by A.O. by relying on the order of CIT(A) for Assessment Year 2004-05. 6. Now the assessee is in appeal before us. Ld. A.R. of the assessee at the outset, stated that on identical facts, in the assessee's own case, Hon'ble ITAT (in ITA No.2778/AHD/2008) vide order dated 29-1-2010 has deleted the addition. He further stated that there are no change in the facts of the assessment year under consideration and the facts for which the H'ble Tribunal had decided the issue in its favour. He placed on record the copy of ITAT order. 7. Ld. Departmental Representative fairly conceded that the issue is covered by ITAT's decision in Assessee's own case and in its favour. 8. We have heard the rival contentions and perused the material on record. We find that the issue under consideration has been dealt by the co-ordinate Bench for AY 2004-05 and 2000-01 vide common order dated 29th January 2010. The Co-ordinate Bench has deleted the addition by holding as under:- "4.4 We have considered the rival sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... round before the Hon'ble Tribunal for A.Y. 2004- 05. The Hon'ble Tribunal deleted the addition made by the A.O. The Ld. A.R. placed before us the copy of the order dated 29.10.2010 (ITA No.2778/AHD/2008) of co-ordinate Bench. 14. Ld. Departmental Representative on the other hand fairly conceded that the issue is covered by ITAT's decision in assessee's own case and in its favour. 14.1. We have heard the rival contentions and perused the material on record. We find that the issue under consideration has been dealt by the co-ordinate Bench for AY 2004-05 vide order dated 29th January 2010. The Co-ordinate Bench has deleted the addition by holding as under:- "9.5. As regards the addition to book profit by an amount of deemed dividend taxed u/s. 2(22)(a), since such deemed dividend did not form the part of book profit computed as per Part-II addition III of Schedule VI to Companies Act, 1956, in view of the decision of the Supreme Court in the case of Apollo Tyres (supra) no adjustment is called for. We, therefore, delete the addition made in the book profit in respect of gratuity and deemed dividend." 15. In view of the fact that there being no change in the facts and following th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e delete the addition made in this regard." 23. In view of the fact that there being no change in the facts or any contrary decision and following the decision of the co-ordinate Bench we hold that the provision for gratuity amounting to Rs.12,03,707/- not as unascertained liability for the purpose of calculation of book profits u/s 115JB and therefore considering the same for computing the book profits is uncalled for. We therefore, delete the addition made and accordingly allow this ground of appeal of the assessee. 24. ITA No.470/AHD/2010 The Revenue in its appeal has taken following two grounds of appeal:- "1. On the facts and in the circumstances of the case and in law, the Ld. CIT (A) erred in directing to allow deduction of Rs.18,35,946/- u/s.43B of the Act on account of sales tax amnesty which was not claimed in the return of income. The Assessing Officer has power not to entertain a claim for deduction, if claimed otherwise than by filing return or revised return in view of Hon'ble Supreme Court decision in the case of Goetz (India) Ltd. v. CIT 157 Taxman 1 (SC). 2. On the facts and in the circumstances of the case and in law, the Ld. CIT (A) erred in deleting the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
