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2015 (5) TMI 182 - ITAT DELHI

2015 (5) TMI 182 - ITAT DELHI - TMI - Disallowance of deduction of expenses - Whether the CIT(A) is justified in deleting the addition of ₹ 1,14,63,360/- made by the AO on account of provision of expenses - Held that:- CIT(A) has categorically held that the expenses, which are claimed amounting to ₹ 1,14,63,360/- are accrued and ascertained liability and the same was credited to the provision account instead of vendorís account, in the absence of the final bill/invoice being received .....

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12 - Dated:- 13-3-2015 - SHRI N.K. SAINI AND SHRI GEORGE GEORGE K, JJ. For The Appellant : Smt. Parwinder Kaur, Sr. DR. For The Respondent : Sri Gaurav Jain & Bhavita Kumar, Advocates ORDER PER SHRI GEORGE GEORGE K, JM: 1. This appeal, at the instance of the Revenue and the cross objection filed by the assessee arise out of CIT(A) s order dated 05.03.2012. The relevant assessment year is AY 2004-05. 2. The solitary ground that is raised in revenue s appeal is whether the CIT(A) is justified .....

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on 30.10.2004, disclosing total income of ₹ 2,55,93,730/-. The assessment u/s 143(3) was completed on 31.08.2006, determining the total income at ₹ 2,65,66,342/-. Thereafter, notice u/s 148 was issued on 06.03.2009 and reassessment u/s 147 r.w.s. 143(3) of the Act was completed by order dated 17.09.2009, wherein a sum of ₹ 1,14,63,360/- which was claimed as deduction of expenses was disallowed by the AO, for the reason that these expenses were only provision and the liability w .....

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aggrieved by rejecting its contention on reopening of the assessment is in cross objection before us. 7. We have heard rival submissions and perused the material on record. The CIT(A) on merits has allowed the claim of the assessee by giving the following reasoning:- …………I have perused the details of provision for expenses, amounting to ₹ 1,14,63,360, made by the assessee at the end of the relevant year. The same has been made for expenses, which were incurred .....

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ty there against. Similarly, the provision has been made for statutory audit fee for the relevant financial year, which is an expense of the relevant year, for which the amount of liability is ascertained on the basis of fees agreed with the auditor and, therefore, the liability there against was provided for in the books of account. To the same effect is the provision for bonus payable to employees in relation to service rendered during the year which got accrued during the year and the liabili .....

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