TMI Blog2015 (11) TMI 1812X X X X Extracts X X X X X X X X Extracts X X X X ..... tion under section 80HHC of the Act. Disallowance of expenses which actually related to the earlier years and not this year - HELD THAT:- It is a matter of record that for the last so many years the assessee has been following the practice of claiming litigation expenses @ 20% in a duration of five years. From the perusal of various orders of lower authorities for various assessment years, this is also observed that the Department has been accepting the claim as such. Since there is no change in the facts during the year even the learned D.R. could not bring to our attention any distinguishing facts in this year, we are not inclined to interfere with the findings given by the CIT (Appeals) on the basis of principle of consistency. It is a trite law that the principle of Estoppel is not applicable to the income tax matters, this is also settled that there being no distinguishing facts emerging during the year, the Department cannot take a different view other than taken in earlier years. See NEO POLY PACK (P.) LTD. [ 2000 (4) TMI 26 - DELHI HIGH COURT] and RADHASOAMI SATSANG [ 1991 (11) TMI 2 - SUPREME COURT]. Addition of payment of bonus and leave with wages - which we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Dated:- 27-11-2015 - Shri H.L.Karwa, Vice President And Ms. Rano Jain, Accountant Member Appellant by: S/Shri S.K.Mittal And Rajeev Sharma, DRs Respondent by: Shri S.K.Mukhi ORDER Rano Jain, A.M. : These four appeals filed by the Revenue are directed against the different orders of learned Commissioner of Income Tax (Appeals)I, Ludhiana dated 17.7.2013, 31.8.2012, 13.7.2012 and 13.7.2012 for assessment years 2004-05, 2007-08, 2008-09 and 2009-10 respectively. ITA No.983/Chd/2013 : 2. The only issue in this appeal is regarding the exclusion of scrap sales in the total turnover for the purposes of deduction under section 80HHC of the Income Tax Act, 1961 (in short 'the Act'). 3. During the assessment proceedings, the Assessing Officer had confronted the assessee with the issue as to why the scrap sales should not be excluded from the total turnover and profits of business for computing deduction under section 80HHC of the Act. For this purpose, the Assessing Officer relied upon the order of the I.T.A.T., Chandigarh Bench in the case of Parker Cycles Inds. and M/s Allied Engineers in ITA No.637 and 638/Chd/2005 dated 12.5.2006. Relying on ce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot include the scrap material which is either to be deducted from the cost of raw material or is to be shown separately under the different head. 7. In view of the above, following the judgment of the Hon'ble Supreme Court, we do not find any infirmity in the action of the learned CIT (Appeals) in holding that the sale of scrap should be included in the total turnover for purposes of computation of deduction under section 80HHC of the Act. 8. The appeal of the Revenue is dismissed. ITA No.1138/Chd/2012 : 9. The ground No.1 raised by the Revenue reads as under : 1. That Ld. CIT(A) has erred both in law and on facts of the case in deleting the addition of ₹ 8,51,092/- made on account of disallowance of expenses which actually related to the earlier years and not this year. 10. Briefly, the facts of the case are that the Assessing Officer during the course of assessment proceedings observed that the assessee has debited an amount of ₹ 60,34,158/- on account of litigation expenses, whereas the actual amount incurred during the year was ₹ 51,88,061/-. On confronting by the Assessing Officer, the assessee submitted that 20% of the litigation expense ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d upon the order of the Assessing Officer and further submitted that the principle of Estoppel is not applicable so far as the method of accounting is concerned. Reliance was placed on the judgment of CIT Vs. Jamna Dass Rameshwar Dass (1952) 21 ITR 109 (P H) and that of the Hon'ble Supreme Court in the case of CIT Vs. British Paints India Ltd. (1991) 188 ITR 44 (SC). 13. The learned counsel for the assessee relied upon the order of the learned CIT (Appeals) and stressed on the fact that the same accounting policy has been followed by the assessee for the last many years and the Department has been accepting the same consistently and without there being any change in the facts during the relevant year, no such disallowance can be made. The copies of assessment orders for the assessment years 2004-05 and 2005-06 framed on the same date as in assessment year 2007-08 allowing deferred revenue expenses by the Assessing Officer himself, were also placed on record. It was further submitted that the Department has not preferred any appeal against the said order of the learned CIT (Appeals). Even in assessment year 2010-11, the Assessing Officer has allowed deferred revenue expenditu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iance and some time the signature and thumb impressions apparently appeared to be not reasonable. In this background, the Assessing Officer disallowed the amount of ₹ 1 lac out of bonus and wages. 17. Before the learned CIT (Appeals), it was submitted that the disallowance so made by the Assessing Officer is arbitrary. The learned CIT (Appeals) concurring with the submissions made by the assessee held that the action of the Assessing Officer is arbitrary especially when no bogus claim has been detected and the expenses have been presumed to be on higher side without pointing out so on the basis of any factual data. In this view, the learned CIT (Appeals) deleted the addition. 18. The learned D.R. submitted before us that the addition was made on an agreed basis, whereby the assessee himself during the course of assessment proceedings agreed to the said disallowance. 19. On perusal of the assessment order as well as that of the learned CIT (Appeals)'s order, we see nowhere this fact is emerging from this order that the addition has been made on agreed basis. However, looking to the fact that certainly there was certain discrepancy in the bonus and leave with wages ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oad for business purposes and not for leisure and trips are to be taken on year to year basis, therefore, we confirm the order of the learned CIT (Appeals) on this issue. The ground of appeal raised by the Revenue is dismissed. 25. The ground Nos.4 and 5 raised by the Revenue are general in nature, hence needs no adjudication. 26. The appeal of the Revenue is partly allowed. ITA No.1004/Chd/2012 : 27. The ground No.1 raised by the Revenue reads as under: 1. That Ld. CIT(A) has erred both in law and on facts of the case in deleting the addition of ₹ 20,05,476/- made on account of disallowance of expenses which actually related to the earlier years and not this year. 28. It is relevant to observe here that the issue in this ground is similar to the issue in ground No.1 raised by the Revenue in ITA No.1138/Chd/2012 and the findings given in ITA No.1138/Chd/2012 shall apply to this case also with equal force. 29. The ground No.2 raised by the Revenue reads as under : 2. That Ld. CIT(A) has erred both in law and on facts in deleting the addition of ₹ 50,000/- made on account of payment of bonus and leave with wages, which were not fully verifiable fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oth in law and on facts in reducing the addition of ₹ 50,000/- to ₹ 10,000/- made by the AO on account of disallowance of foreign traveling expenses being personal expenses while on tour, as the assessee had not produced all the bills of travellings well as hotel lodging and boarding or local traveling taxi bills etc., during the course of assessment proceedings. 36. It is relevant to observe here that the issue in this ground is similar to the issue in ground No.3 raised by the Revenue in ITA No.1138/Chd/2012 and the findings given in ITA No.1138/Chd/2012 shall apply to this case also with equal force. 37. The ground Nos.5 and 6 raised by the Revenue are general in nature, hence needs no adjudication. ITA No.1005/Chd/2012 : 38. The ground No.1 raised by the Revenue reads as under: 1. That Ld. CIT(A) has erred both in law and on facts of the case in deleting the addition of ₹ 24,05,022/- made on account of disallowance of expenses which actually related to the earlier years and not this year. 39. It is relevant to observe here that the issue in this ground is similar to the issue in ground No.1 raised by the Revenue in ITA No.1138/Chd/2012 and th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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