TMI Blog2019 (12) TMI 203X X X X Extracts X X X X X X X X Extracts X X X X ..... ion (1) has been increased or reduced, as the case may be, the interest shall be increased or reduced. Accordingly, the AO has jurisdiction for rectifying the interest paid/payable on refund u/s. 154 of the I.T. Act and therefore, whatever the interest u/s.244A of the Act due to the assessee u/s.143(1) of the Act ought to be reduced from the interest on refund granted to the assessee company after determination of income by the appellate authorities. We find that on perusal of material available on record, the excess claim of interest to the extent of ₹ 1,15,74,341/- is required to be called back u/s.234D of the Act only, but not the withdrawal of entire interest of ₹ 3,71,78,138/- granted u/s.244A of the Act. - Decided against the Revenue. Disallowance of the expenditure incurred on reimbursement of LPG Cylinders to the employees - Held that:- as per the National Coal Wage Agreement the employees are entitled to get free issue of coal for domestic use only subject to some quantity limitation. - the assessee company has considered the reimbursement of LPG Cylinder as a perquisite in the hands of the employees and regular income tax is being deducted from such em ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... That on the facts and circumstances of the case, the action of the learned CIT / (Appeals) in confirming 50% of the disallowance has no basis whatsoever and the same has been made on an ad-hoc basis. 3(a) That on the facts and in the circumstances of the case, tire learned CIT(Appeals) erred in confirming disallowance upto 25% of the expenditure amounting to ₹ 25,40,64,757/- incurred on coal transportation paid by the company to the ex- service men transport companies. 3(b) That on the facts and in the circumstances of the case, the learned CIT(Appeals) erred in not appreciating that the said expenditure has been incurred wholly and exclusively for the purpose of business of the appellant. 3(c) That on the facts and in the circumstances of the case, the action of the learned CIT(Appeals) in confirming disallowance upto 25% of the expenditure has no basis whatsoever and the same has been made on an ad-hoc basis. 4. That on the facts and in the circumstances of the case, no interest under section 220(2) is chargeable in the present case. 5. That the appellant craves leave to add to a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, incurred expenditure on up-gradation/construction of link road by making contribution to BurdwanZillaParishad from Barabani Railway station to mines of the assessee at Sarashatali, West Bengal. Whether this is a business expenditure or not? We find that this issue has been answered by Hon ble Apex Court in the case of L. H. Sugar Factory Oils Mills (P) Ltd. Vs. CIT (1980) 125 ITR 293 (SC), wherein the Apex Court at pages 297 and 299 has held as under: The amount of ₹ 50,000 was contributed by the assessee under the Sugarcane Development Scheme towards meeting the cost of construction of roads in the area around the factory. Now, there can be no doubt that the construction of roads in the area around the factory was considerably advantageous to the business of the assessee, because it facilitated the running of its motor vehicles for transportation of sugarcane so necessary for its manufacturing activity. It is not as if the amount of ₹ 50,000 was contributed by the assessee generally for the purpose of construction of roads in the State of Uttar Pradesh, but it was for the construction of roads in the area around the factory t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... State Government equally. The expenditure of ₹ 50,000/- incurred by assessee in that case towards contribution for construction of a road around its factory is an expenditure in the revenue field as it was incurred for the purpose of facilitating the conduct of the business of the assessee and making it more efficient and profitable without the assessee getting an advantage of an enduring benefit to itself. We find that in the present case also, there is no dispute to the fact that the assessee has made the contribution of ₹ 3.57 crores during the relevant previous year to BurdwanZillaParishad for the purpose of up-gradation/construction of a link road from its mines at Sarasthali to the Barabani railway station in order to facilitate transportation of coal mined so that the business of the assessee could be conducted more efficiently and profitably. There is also no dispute to the fact that the said road is a public road and belongs to the BurdwanZillaParishad and the assessee is not owner of the road. In view of the settled position on the issue, we find that the sum of ₹ 3.57 cr. incurred during the relevant previous year by the asses `see towards contribution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es in the facts of the year under consideration and that of the earlier year. However, we are of the view that distinct features are not so glaring which would necessitate as to take a different view than the view taken by us in earlier year. That apart the CIT(A) while deciding the issue has also categorically given a finding in the order that the necessary details were not filed by assessee and this fact has not been controverted by the Ld. AR before us. We find that in order of Tribunal (supra) in paras 107 to 112 had similarly remitted this issue back to the file of Assessing Officer. The relevant findings of Tribunal are as under:- 112. We have perused the case records and heard the rival contentions. The records suggest that no documentary evidences as called for by the Assessing Officer were filed by the assessee to prove the genuineness of the transactions. The Assessing Officer is not definitely an Authority to say to the assessee how to run its business but at the same time the Assessing Officer is a responsible custodian of Revenue to examine, consider or judge the various aspects of the expenditure claimed by the assessee to come to the conclusion whe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as 246 ITR 116 has held that even if there is an audit report filed by the assessee that does not prevent the Assessing Officer to ask for relevant documentary evidences and details from the assessee to check the genuineness of the transaction and the entire conduct of the assessee. In the present case before us, when the Assessing Officer called for relevant documentary evidences regarding identity, rates and genuineness of the transactions with regard to ESM companies, the assessee has not furnished requisite details before the Assessing Officer and that for the reasons as opined by the Hon ble Delhi High Court, the power to call for details is an inherent power with the Assessing Officer within the scheme of Income Tax Act. That further the claim of TDS deduction u/s.194C of the Act by the assessee, no evidence was furnished before us to demonstrate the payment of taxes after TDS deduction. In view of the matter, we set aside the order of the Ld. CIT(Appeals) on this issue and restore the matter back to the file of Assessing Officer to verify whether necessary TDS have been deducted and other issues, regarding the genuineness of the transac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l in assessee‟s own case (supra), which is similar to the ground No.3 raised in ITA No.187/JAB/2008. Therefore, our decision rendered in ITA No.187/JAB/2008 on this issue shall apply mutatis mutandis to the ground No.2 in ITA No.189/JAB/2008. Accordingly, appeal of the assessee in ITA No.189/JAB/2008 is partly allowed for statistical purposes. ITA No.190/JAB/2008 A.Y. 2001-02 17. The ground No.1 raised in ITA No.190/JAB/2008 is similar to the ground No.1 and 4 raised in ITA No.187/JAB/2008. Since, facts and issue are similar, our decision rendered in ITA No.187/JAB/2008 shall apply mutatis mutandis to ITA No.190/JAB/2008 on this issue. Thus, ground No.1 raised by assessee is dismissed. 18. The issue raised in ground No.2 is with regard to disallowance of 25% of expenditure on coal transportation paid to ESM companies. 19. Both the parties fairly admitted that this issue is covered by the decision of Tribunal in assessee‟s own case (supra), which is similar to the ground No.3 raised in ITA No.187/JAB/2008. Therefore, our decision rendered in ITA No.187/JAB/2008 on this issue shal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... abilitation of people/villagers is revenue in nature and hence allowable. 2(a) That on the facts and circumstances of the case, the learned CIT(Appeals) erred in confirming 50% of the expenditure disallowed by the Assessing Officer amounting to ₹ 24,000/- incurred on assets not belonging to the company. 2(b) That on the facts and circumstances of the case, the action of the learned CIT(Appeals) in confirming 50% of the disallowance has no basis whatsoever and the same has been made on an ad-hoc basis. 3(a) That on the facts and circumstances of the case, the learned CIT(Appeals) erred in confirming disallowance upto 25% of the expenditure amounting to ₹ 33,05,75,547/- incurred on coal transportation paid by the company to the ex service men transport companies. 3(b) That on the facts and circumstances of the case, the learned CIT(Appeals) erred in not appreciating that the said expenditure has been incurred wholly and exclusively for the purpose of business of the appellant. 3(c) That on the facts and circumstances of the case, the learned CIT(Appeals) in confirming disallowan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y Co-ordinate Bench of Tribunal and observed as follows: 11.7. Before us, the learned counsel for the assessee has relied on the decision of Honble Supreme Court in the case of R.J. Trivedi (supra) wherein the expenditure was incurred by the assessee on fault-stone cutting operation in order to remove the obstruction in the course of mining operation and considering that it was not possible for the assessee to carry on the mining operation without removing the said obstruction, the Honble Apex Court found the said expenditure incurred by the assessee was to facilitate mining activities and, therefore, treated the same as revenue in nature. In the present, case there was no such obstruction in carrying on the mining operation of the assessee and the expenditure was incurred by the assessee to relocate and rehabilitate the villages in order to acquire a right to possession in the leasehold land to facilitate the enjoyment of surface rights in respect of the leasehold land. We are, therefore, of the opinion that the present case is distinguishable on facts from the case of R.J. Trivedi (supra) and, therefore the said decision cannot help the assessees case. Relianc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erved that if the advantage merely consists of facilitating the assessees trading operation or enabling the management and conduct of the assessees business more efficiently or more profitably while leaving fixed capital untouched, the expenditure would be of revenue nature even though the advantage may endure for a indefinite future. In the present case, the assessee has acquired an interest in the immovable property in the form of surface rights and right to possession in respect of leasehold land and the same being not merely to facilitate the assessees business operation but being in the nature of acquisition of substantive right in the immovable property for enduring advantage, the ratio laid down by the Honble Apex Court in the case of Empire Jute Co. Ltd. cannot be said to have any application in the assessees case. Similarly, the case of Plantation Corporation of Kerala v. Commr.Agrl. IT (supra) is also distinguishable on the similar line. 11.8. The learned counsel for the assessee has also contended before us that the assessee-company did not acquire any right or interest in respect of relocated villages which were built up and handed over to the village ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee therein for extracting iron coal at the beginning of the mining operation, it was considered as capital in nature whereas in the present case the assessee has made the relevant payments during the currency of the lease period. After carefully perusing the said decision of Honble Mysore High Court, it however, appears that the payment made to the Pattedars who were occupying rights over the land which had been acquired by the assessee from the government was found to be of the same character as the payments to the government for acquiring the mining lease and keeping in view this character of the payment, the Honble Mysore High Court held the same to be a capital expenditure. In the case of Chloride India Ltd. v. CIT (supra) relied upon by the revenue, the assessee had paid the money for buying out tile tenancy right and, therefore, it was held by the Honble Calcutta High Court that the amount so paid for acquiring the possession which was a benefit of enduring nature, is a capital expenditure. In the present case also, the assessee has acquired the right to possession from the villagers/occupants in respect of the leasehold land by rehabilitating and relocating the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was fully justified in upholding the action of the assessing officer in treating the same as capital expenditure and thereby disallowing the deduction claimed by the assessee in respect of the same. 11.9. In the case of Assam Bengal Cement Co. Ltd. v. CIT (supra) relied upon by the revenue, the Honble Apex Court observed that the aim and object of the expenditure would determine the character of expenditure whether it is a capital or revenue and the source or the manner of payment would then be of no consequence. In the present case, the expenditure was incurred by the assessee-company with aim and object to acquire the surface rights as well as the right to possession in respect of the leasehold land for a long period and, therefore, the nature of such expenditure was certainly of capital nature. The revenue has also relied on the decision of Honble Mysore High Court in the case of N. Peer Sahib v. CIT (supra) in respect of which the learned counsel for the assessee has contended that the lease amounts having been paid to the surface owners by the assessee therein for extracting iron coal at the beginning of the mining operation, it was considered as capital in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee for the removal of a restriction which was obstructing his business operation of mining within a particular area. We have already observed that the existence of village was not obstructing the mining operations of the assessee-company and the expenditure in question was incurred to acquire the right to possession in respect of the leasehold land to facilitate the enjoyment of surface rights. Moreover, as the said acquisition resulted into accrual of enduring benefits to the assessee-company for the balance period of lease, the same has to be treated as capital expenditure, as held by the Honble Supreme Court in the case of Assam Bengal Cement Co. Ltd. v. CIT (supra). As such, considering all the facts of the case and legal position enumerating from the judicial pronouncements discussed hereinabove, we are of the considered opinion that the impugned expenditure incurred by the assessee for acquiring surface rights as well as the right to possession in respect of leasehold land for enduring period was a capital expenditure and the learned Commissioner (Appeals) was fully justified in upholding the action of the assessing officer in treating the same as capital expenditure and ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1E.Without prejudice to our contention that the deduction is a revenue expenditure allowable fully in AY.2004-05, in view of the decision of Honble ITAT Cuttack in East India Minerals Limited Vs. JCIT (ITA No.224/CTK/2012, the assessee company should be permitted to claim the said expenditure over the limited period of the lease of land for mining. 28. With regard to this additional ground No.1E, the Ld. AR of the assessee has placed reliance on the decision of the Co-ordinate Bench of the Tribunal Cuttack in the case of East India Minerals Limited Vs. JCIT (ITA No.224/CTK/2012) wherein the Cuttack Bench of the Tribunal has held as under: 7. We have heard the rival contentions of the parties and perused the material available on record. Considering the facts and circumstances of the case, we uphold the contention of the learned Counsel for the assessee for the simple reason that the denial of claim of depreciation has been made on misinterpretation of law and the applicability thereof. Explanation to Section 32(1)(ii) leans in favour of the assessee to the extent that it is the actual action of put to use which entitles the assessee to cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and identical to the issues raised in ITA No.173/JAB/2008. Since the facts and issues are common, our decision rendered in ITA No.173/JAB/2008 shall apply mutatis mutandis to the appeal in ITA No.174/JAB/2008. 32. In the result, appeal of the assessee in ITA No.174/JAB/2008 is partly allowed for statistical purposes. ITA No.175/JAB/2008 A.Y.2006-07 33. The parties herein fairly admitted that all the issues raised in this appeal including the additional ground are similar and identical to the issues raised in ITA No.173/JAB/2008. Since the facts and issues are common, our decision rendered in ITA No.173/JAB/2008 shall apply mutatis mutandis to the appeal in ITA No.175/JAB/2008. 34. In the result, appeal of the assessee in ITA No.175/JAB/2008 is partly allowed for statistical purposes. ITA No.05/BLPR/2012 A.Y.2008-09 35. The issue raised in ground No.1 of this appeal is similar to the issue raised in ground No.1 in ITA No.173/JAB/2008. Since the facts and issues are common, our decision rendered in ITA No.173/JAB/2008 shall apply mut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n guest houses to the extent of ₹ 88.68 Lacs. Accordingly, the addition is restricted to ₹ 2.10 Lacs for Appellant Company s failure to establish the expenditure fully to the extent claimed in the P L A/c. 41. We have perused the case records and heard the rival contentions. We have also given considerable thought to the findings of the Ld. CIT(A). We find that the order of the Ld. CIT(A) is fair and reasonable in restricting the addition to the extent of ₹ 2.10 Lacs as the assessee company has failed to file the requisite details regarding their claim to that extent. Hence, we uphold the findings of the Ld.CIT(A) and the same does not require any interference. Thus, ground No.4 raised in appeal by the assessee is dismissed. 42. In the result, appeal of the assessee in ITA No.05/BLPR/2012 is partly allowed for statistical purposes. ITA No.21/BLPR/2012( By Revenue) A.Y.2006-07 43. In ITA No.21/BLPR/2012, the Revenue has raised following grounds in appeal:- 1. That on the facts and in the circumstances of the case, the learned CIT(A) erred in law and in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g an order u/s. 154 is in accordance with the legal interpretation of the Act. Since there is no ambiguity involved on violation of construction is called for. As the CIT(A) is being intermediate appellate authority and not being court of law, no violation of construction is permissible in interpretation of the statute. Implication of sub section 3 of the Section 244A cannot be imported to interpret the proviso of sub section 1. 4. That the Ld. CIT(A) s order being erroneous, perverse and contrary to the facts on record, the same may be reversed while that of the AO be restored. 5. That the appellant Assessing Officer reserves the right to amend, modify or add any of the grounds of appeal preferred. 44. The crux of the grievance of the Revenue is against the relief of ₹ 2,56,03,757/- granted out of total interest withdrawn amounting to ₹ 3,71,78,138/- which has been withdrawn by the Assessing Officer keeping in view that as per provisions of Section 244A of the Income Tax Act, 1961 ( hereinafter referred to as the Act‟), no interest shall be payable if the amount of refund is less than 10% of the tax as dete ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eased amount, as the case may be, by rectification u/s.154 of the Act. [Relied on Garden Silk Mills Vs. CIT (1996) 221 ITR 861 (Guj.)] Accordingly, the AO has jurisdiction for rectifying the interest paid/payable on refund u/s. 154 of the I.T. Act. As per provision under sub section (2) of section 234D where as a result of an order u/s.150, the amount of refund granted under sub section (1) of Section 143 is held to be allowed correctly allowed either in whole or in part as the case may be, then the interest chargeable, if any, under sub section (1) shall be reduced accordingly. The assessed income was substantially reduced at the appellate stage but it is more than the income returned. In the given fact and circumstances of the case and keeping in view of the above provisions under the Act, I find that whatever the interest u/s.244A of the Act due to the appellant, u/s.143(1) of the Act ought to be reduced from the interest on refund granted to the appellant company after determination of income by the appellate authorities. In the given facts and circumstances of the case, the additional ground of appeal filed by the Ld. AR is found to be bonafide and relevant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hall be deemed to be a notice under section 156 and provision of this Act shall apply accordingly. Thus, if there is variation of interest as per section 244A(3), such variation of interest shall be substituted for the interest originally granted by reduced or increased amount, as the case may be, by rectification u/s.154 of the Act. [Relied on Garden Silk Mills Vs. CIT (1996) 221 ITR 861 (Guj.)] Accordingly, the AO has jurisdiction for rectifying the interest paid/payable on refund u/s. 154 of the I.T. Act and therefore, whatever the interest u/s.244A of the Act due to the assessee u/s.143(1) of the Act ought to be reduced from the interest on refund granted to the assessee company after determination of income by the appellate authorities. We find that on perusal of material available on record, the excess claim of interest to the extent of ₹ 1,15,74,341/- is required to be called back u/s.234D of the Act only, but not the withdrawal of entire interest of ₹ 3,71,78,138/- granted u/s.244A of the Act. Therefore, the order of the Ld. CIT(A) is well reasoned and the same does not call for any interference. Thus, grounds raised by the Revenue are dismissed. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the case, the learned CIT(A) erred in law and in fact in deleting the addition amounting to ₹ 1135.86 Lakhs which has been made by disallowing the expenditure incurred on grant to schools and educational institutions, in spite of the facts on records that during the course of assessment proceedings the assessee company failed to furnish the break up of the above expenses. It is also pertinent to mentioned here that the assessee company also failed to explain whether the above expenses were in lieu of reimbursement of tuition fees or the expenses were outright donation or capital nature etc. 5. That on the facts and in the circumstances of the case, the learned CIT(A) erred in law and in fact in deleting the addition amounting to ₹ 2136.88 Lakhs which has been made by disallowing the expenditure incurred on reimbursement of LPG Cylinders to the employees in spite of the facts on records that during the course of assessment proceedings the assessee company could not explain the admissibility of the claim. 6. That on the facts and in the circumstances of the case, the learned CIT(A) is not justified in restricting the disallowance f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. 50. The issue raised in ground No.1 by the Revenue relates to the Community Development expenses. 51. Brief facts relating to the issue are that the assessee had debited sum of ₹ 732.98 lakhs in P L Account towards Community Development and claimed the same as allowable expenditure since it was incurred wholly and exclusively for the purpose of business. However, the Assessing Officer denied the said claim of assessee and added the said amount to the total income of the assessee. The CIT(A) has deleted the entire disallowance made by the Assessing Officer relying on the decision of Nagpur Bench of Tribunal order dated 28.02.2002 for assessment years 1995-96 and 1996-97 and orders of his predecessors. Aggrieved by the order of CIT(A), Revenue is now in appeal before us. 52. Before us, Ld. DR took us through the order of Assessing Officer and submitted that CIT(A) has erred in deleting the addition made by Assessing Officer. He thus supported the order of Assessing Officer. 53. The Ld. AR on the other hand supported the order of CIT(A). 54. We have heard the rival contentions and perused ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny of mining operation and, therefore, the expenditure incurred mainly for the welfare of the labour force has to be treated as incurred wholly and exclusively for the purpose of it's business. 55. Before us, Revenue has not pointed to any distinguishing features in the facts of the present case and the case of South Eastern Coalfields decided by Nagpur Bench of ITAT so as to persuade us to take a different view in the matter. The facts and issue are similar to the facts and issue before the Tribunal (supra). Following the same parity of reasoning, we find no reason to interfere with the order of CIT(A) and thus, the ground No.1 raised by the Revenue is dismissed. 56. The issue raised in ground No.2 is against disallowance of guest house expenses. 57. This issue has already been adjudicated by us in assessee‟s appeal in ITA No.05/BLPR/2012 in the preceding paras and the facts being identical,the same shall apply mutatis mutandis to this issue also. Thus,the ground No.2 raised by the Revenue is dismissed. 58. The issue raised in ground No.3 relates to expenditure towards social overheads ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is supposed to be chargeable. The CIT(A)‟s order does not disclose or provide any finding regarding having of any evidence or any specific enquiry while deciding this issue. He has simply relied on orders of earlier years while providing relief to the assessee. In this situation, right course would have been to remit the issue back to the file of Assessing Officer to verify the consumption, whether the excess consumption is as per agreement entered into by the assessee that the use and excess consumption is recovered from the respective employees. However, considering the fact that the matter pertains to assessment year 2008-09 and the number of employees involved and the practicality of the situation, we are of the considered view that the matter will remain undecided. In such a situation and to curtail the uncertainty, we are of the view that the ends of justice shall be met if the disallowance made by the Assessing Officer is restricted to 25% of expenses incurred by the assessee towards social overheads instead of 50% disallowed by him. We therefore direct accordingly. Thus, the ground No.3 raised by Revenue is partly allowed. 63. Groun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Co-ordinate Bench of the Tribunal, Nagpur in ITA No. 18/Nag/2001 Ors dated 18.02.2002 in favour of the assessee. He thus supported the order of CIT(A). We have perused the case records and heard the rival contentions. We find that the similar issue has been faced by the Co-ordinate Bench of the Tribunal and this issue was decided in favour of the assessee by the Tribunal in the case mentioned aforesaid (supra.) by observing as under: 13.3. The learned Departmental Representative has contended before us that only the contribution made towards the recognised provident fund, approved gratuity fund or superannuation fund is an allowable expenditure, but the expenditure incurred on payments made to various schools and clubs is not deductible under the specific provisions of Section 40A(9). In this context, we find that a useful reference may be made to the following observations of the Hyderabad Bench of Tribunal recorded in the case of Rassi Cement Ltd. v. ITO (1994) 47 TTJ (Hyd) 254 : (1993) 45 ITD 233 (Hyd) : The object and intention of the legislature introducing Section 40A(9) was only to discourage contribution to an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of coal for domestic use only subject to quantity limitation. It was further submitted that with a view to reduce the cost to the assessee as well as for a better pollution free environment, the assessee entered into an agreement with the trade unions to provide one LPG Cylinder to the entitled employees in lieu of the free issue of coal. This measure has rather resulted in the reduction of cost to the assessee which could be verified from its audited accounts vis- -vis the expenditure incurred by it in the earlier year. The Assessing Officer rejected the contentions of the assessee in the matter of double taxation relying upon the decision rendered by the Hon‟ble Supreme Court in the case of ITO Vs. S. Radhakrishnan (2002) 254 ITR 561 (SC). The Assessing Officer further observed that the assessee company has failed to prove that the expenditure claimed is equivalent to facility allowed. Hence, by treating it as far beyond business purposes, the Assessing Officer disallowed the entire expenditure of ₹ 2336.88 lacs. 70. During the First Appellate Proceedings, the Ld. CIT(A) following the order passed in Appeal No.107/CIT(A)/BSP/03-04 dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and observed that the assessee company has claimed to have treated the reimbursement of expenditure on account of the provision of LPG to the employees as perquisite and has been deducting income tax thereon, the AO‟s action is disallowing the above expenditure is not justified. Therefore, we are of the considered view that the order of the Ld. CIT(A) on this issue is fair and reasonable and the same does not call for any interference. Thus, ground No.5 raised by the Revenue is dismissed. 75. The issue raised in ground No.6 is with regard to disallowance of expenditure incurred for repairs and maintenance of assets not belonging to the assessee. 76. This issue has already been adjudicated by us and allowed the claim of assessee in assessee‟s appeal in ITA No.187/RPR/2008 in the preceding paras and the same shall apply mutatis mutandis to this issue also. Thus, the ground No.6 raised by the Revenue is dismissed. 77. The issue raised in ground No.7 is with regard to disallowance of expenses on trees plantation and others. 78. Brief facts relating to the issue are that the assessee had claimed a sum of &# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in ITA No.03/BLPR/2012. Thus, the ground No.8raised by the Revenue is allowed for statistical purposes. 84. Ground No.9 relates to the disallowance for future removal of Overburden expenses of ₹ 5,2842.67Lacs. 85. The Assessing Officer noted that assessee had made provision of ₹ 52842.67 lacs for future removal of overburden. The Assessing Officer was of the view that the provision has not crystallized into a liability and therefore cannot be allowed. He accordingly disallowed a sum of ₹ 52842.67 Lacs. When the matter carried before CIT(A), he deleted the disallowance made by the Assessing Officer. Aggrieved by the order of CIT(A), Revenue is now before us. 86. The Ld. AR on the other hand submitted that the basis of creation of reserves is on a scientific and reasonable basis and that this expenditure has been allowed in earlier years. The Ld. AR of the assessee further submitted that this issue is also covered in favour of the assessee by the decision of the ITAT, Jabalpur Bench in the case of Northern Coalfields Ltd. Vs. ACIT, Circle 2(1), Jabalpur, 59 taxmann.com 394 ( Jabalpur-Trib.). He thus supported the or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... removal expenses is admittedly revenue expenditure, but if we have to uphold the stand of the authorities below, entire overburden removal expenses is required to be treated as capital expenditure eligible only for amortization under section 35D. In any case, there is nothing on record to establish, or even suggest, that expenses incurred on removal of overburden at the surface level, which were capital expenditure in nature, have been claimed as revenue deduction on the strength of coal mining in another piece of land within that coal mine. 41. In view of these discussions, as also bearing in mind entirety of the case, we consider it fit and proper to direct the Assessing Officer to delete the disallowance of ₹ 2,05,616.72 lakhs. The assessee gets the relief accordingly. Respectfully following the same parity of reasoning as rendered in the above mentioned decision (supra), we decide this issue in favour of assessee and against the Revenue. We further find that the expenditure was allowed by Revenue to the assessee in the past. Thus, the ground No.9 raised by the Revenue is dismissed. 89. In the combined result, all the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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