9911796707
TMI Blog2023 (7) TMI 1150X X X X Extracts X X X X X X X X Extracts X X X X ..... arefully perused and with the assistance of the ld. Counsel, we have considered the documentary evidences brought on record in the form of Paper Book in light of Rule 18(6) of ITAT Rules and have also perused the judicial decisions relied upon by both the sides. 4. The facts of the case are that the assessee is engaged in the business of manufacturing of beverages. While scrutinizing the return of income, the Assessing Officer found that the assessee has claimed deduction of Rs. 2,02,71,336/- on account of non-compete fee amortized in the computation of income. 5. The assessee was asked to justify its claim and the assessee relied upon the decision of the Hon'ble Supreme Court in the case of Empire Jute Company 124 ITR 1. It was explained that the payment of non-compete fees has been done to the shareholders/contractors of the bottling companies to facilitate the conduct of the assessee's business more efficiently and more profitably, leaving the fees untouched. 6. The Assessing Officer found that this issue has been discussed in the earlier A.Y also and claim of assessee was not found to be acceptable. Taking a leaf out of the previous assessment history on this issue, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted on the same substantial question of law by Hon'ble Delhi High Court. 5.1.2 That being the states of facts of the legacy issue, the propriety requires to follow the rules of consistency as there is nothing to differ. Thus, the issue is decided against the assessee. Consequently, the grounds in that regard raised in the respective A.Y. stand dismissed." 17. Thus, facts being identical, respectfully following the consistent view expressed by the Tribunal on identical issue arising in assessee's own case, we uphold the decision of learned first appellate authority. Grounds raised are dismissed. " 11. Respectfully, following the decision of the coordinate bench [supra[, this ground is dismissed. 12. Next ground relates to the addition on account of reversal of provision towards bad debts. 13. The Assessing Officer noticed that as per the computation of income, the assessee has reduced a sum of Rs. 8,34,21,291/-. The assessee was asked to explain and justify the reasons for making such provisions and writing it back. 14. The assessee explained that as per the accounting policy and receivables past due for more than 90 days needs to be provided. It was explained that this amou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns of Rs. 2,18,81,852/- 22. The Assessing Officer noticed that the assessee has paid traffic challans and was asked to show cause why it should not be disallowed 23. On receiving no plausible reply, the Assessing Officer made addition which was confirmed by the ld. CIT(A). 24. Before us, ld. counsel for the assessee pointed out that a similar disallowance was considered by this Tribunal in ITA No. 3448/DEL/ 2015 for A.Y 2008-09 vide ground No. 4 of that appeal and deleted the disallowance. 25. The ld. DR could not bring any distinguishing decision in favour of the revenue. 26. We have carefully perused the orders of the authorities below. We find force in the contention of the ld. counsel for the assessee. Similar disallowance was considered by this Tribunal in A.Y 2008-09. Relevant findings read as under: "23. In ground no. 4, the assessee has challenged the disallowance of Rs. 41,32,403/- representing payment made towards traffic rule violation. On perusal of record, it is observed, the assessee incurred expenses of Rs. 41,32,403/- towards traffic challans for violation of certain rules/regulation. Being of the view that the payment made was for an offence and prohibited b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Assessing Officer observed that accumulated deposits are increasing and have increased from Rs. 158 crores to Rs. 184 crores. The Assessing Officer was of the opinion that the amount outstanding at Rs. 1,58,09,01,589/- is more than eight years and concluded that there is no claimant of this huge amount and went on to make addition of the same u/s 41(1) of the Act. 33. The assessee challenged the addition before the ld. CIT(A) and vehemently contended that section 41(1) of the Act do not apply on the facts of the case. The ld. CIT(A), though convinced that section 41(1) is not applicable, but proceeded to apply provisions of section 41(2) and 43(6) of the Act and directed the AO to justify the WDV of block of assets of bottles and crates by reducing deemed sale and discarded value of Rs. 1 58.09 crores. 34. Before us, the both the assessee and the revenue are in appeal against such decision of the ld. CIT(A). 35. The ld. counsel for the assessee vehemently stated that though the ld. CIT(A) accepted that section 41(1) of the Act does not apply, but grossly erred in applying provisions of section 41(2) and 43(6) of the Act. 36. We are of the considered view that section 41(2) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... delayed payment to PF/ESI amounting to Rs. 2,48,279/-. 44. This quarrel is now settled by the decision of the Hon'ble Supreme Court in favour of the Revenue and against the assessee by the decision in the case of Checkmate Services [Pvt] Ltd 448 ITR 518. Respectfully following the same, the findings of the ld. CIT(A) are reversed. Ground No. 1 is allowed. 45. Second grievance relates to the deletion of addition of Rs. 9,29,17,122/- made on account of inventory loss and leakages. 46. Facts on record show that while scrutinizing the return, the Assessing Officer noticed that the assessee has debited Rs. 9,29,17,122/- on account of inventory loss and leakages. The Assessing Officer found that in the immediately previous year, the assessee has debited Rs. 5,90,53,380/-. The assessee was asked to furnish details and also how the figure of leakage is arrived at. 47. On receiving no plausible reply, the Assessing Officer made addition of Rs. 9,29,17,122/-. 48. The assessee carried the matter before the ld. CIT(A) and strongly contended that there is no dispute that inventory loss/leakage is based on regular method of accounting. It was explained that the inventories are valued at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eted the same. 60. The ld. DR strongly supported the findings of the Assessing Officer. 61. Per contra, the ld. counsel for the assessee relied upon the findings of the ld. CIT(A). 62. We have carefully perused the orders of the authorities below. There is no dispute that the expenses have increased by 53% if compared to the immediately preceding year. It is also a fact that sales have increased by 35% but what is not acceptable is the comparison of the increase in sales with increase in repairs and maintenance expenses etc. 63. In our considered opinion, difference of 18% between 53% and 38% has no logic without pointing out any error or defect in the books of account which are audited and no adverse inference has been pointed out by the auditors. 64. Considering the facts in totality, we do not find any reason to interfere with the findings of the ld. CIT(A). This ground is dismissed. 65. Next ground relates to the deletion of addition of Rs. 1,58,09,01,589/- made by the Assessing Officer u/s 41(1) of the Act. 66. This issue has been elaborately discussed by us in assessee's appeal [supra]. For our detailed discussed therein, this ground is dismissed. 67. In the result, t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
