9911796707
TMI Blog2025 (5) TMI 1077X X X X Extracts X X X X X X X X Extracts X X X X ..... the facts and circumstances of the case and in law, the CIT(A) erred in confirming the adjustment of 1,56,32,834 made to the arm's length price in respect of back office support services and business support services by the Transfer Pricing Officer vide his order dated October 28, 2011 passed under section 92CA(3) of the Act. 2. Re: Disallowance of Mark to market (MTM) losses on forex derivativesRs. 1302,00,00,000 [Para 4, pages 47 to 59 of the CIT(A) order] 2.1 On the facts and circumstances of the case and in law, the CIT(A) erred in confirming the disallowance of the amount of Rs.1302,00,00,000 being MTM losses on interest rate, forex and credit derivative transactions on the ground that the same were notional losses and hence cannot be considered as deductible expenditure under the Act. 2.2 Without prejudice, the Assessing Officer ought not to tax the MTM gains amounting to Rs.2504,00,00,000. 3. Re: Expenses apportioned against income exempted under section 10(15), 10(34) and 10(35)-Disallowance u/s. 14A: Rs.629,05,90,585 [Para 5, Pages 59 to 67 of the CIT(A) order] 3.1 On the facts and circumstances of the case and in law, the CIT(A) erred in confirming the appo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Reserve Bank of India, losses due to fraud etc. on retail loans amounting to 290,47,92,249 claimed by the Appellant on the ground that the Appellant's claim had not been accepted in the preceding assessment year 2006-07 and the Appellant had failed to prove the genuineness of the claim in the aforesaid assessment year. 5.2 The CIT(A) erred in not following the order of CIT(A) 7, Mumbai for A.Y. 2006-07 which after considering the facts of the case and submissions of the Appellant has held that these are expenses incurred in the normal course of banking business and accordingly allowed the Appellant's claim for business loss. 6. Re: Disallowance of Provision for expenses - 748,93,81,195 [Para 12, Pages 92 to 94 of the CIT(A) order] On the facts and circumstances of the case and in law, the CIT(A) erred in confirming the disallowance of the amount of 48,93,81,195 in respect of provision for expenses created in March 2008 on which no tax was deducted at source on the ground that the same was contingent and unascertained in nature and hence not allowable as a deduction. 7. Re: Disallowance of contribution to Pension and gratuity paid on account of Sangli Bank Limited - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ground that since the Assessing Officer had not dealt with the same in the assessment order it does not arise from the findings of the Assessing Officer and hence does not require to be adjudicated upon. 11.2 The CIT(A) failed to appreciate that the Assessing Officer had worked out the book profit and tax thereon under section 115JB in the assessment order and hence the said ground does arise from the findings of the Assessing Officer. GENERAL 12. The Appellant craves leave and reserves its right to vary, amend, alter and/ or add to the grounds of appeal and to produce such oral and documentary evidence and file such compilation of documents as may be necessary at the time of hearing of the appeal. ITA No. 4159/Mum/2014 "1. Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) erred in allowing the depreciation on leased assets without appreciating the fact that the said transaction being a financial lease transaction, the assessee did not satisfy the legal requirement of ownership of the assets for the purpose of sec 32(1) of the I.T. Act, 1961 and therefore, not entitled for claim of depreciation on the leased assets. 2. Whether on the facts a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expenses CUP 27.03 Mark-to-market gain CUP 507.84 Swap forward contract CUP 0.06 Total - receipts 683.69 Payments Remittance fees CUP 4.67 Charges paid for mortgage loan CUP 0.6 Representative and marketing services for private banking CUP 7.03 Representative and marketing services - web trade CUP 0,25 Representative and marketing services - others TNMM 2.79 Risk participation fees CUP 13.94 Interest expense CUP 5.50 Reimbursement of expenses CUP 0.62 Swap forward contract CUP 258.8 Reversal of distribution fees CUP 0.28 Total payments 367.02 Total receipts and payments i.e. total value of all International transactions 1050.71 2.3. The Ld.TPO observed that, the assessee provided back office support services, in lieu of which, it received Rs. 8,70,81,878/- included mark up of 10% from its AE in Britain UK & Canada. The assessee bench marked the transaction by treating it as ITES service provider. The assessee had selected TNMM as most appropriate method and PLI to OP/TC to computed its merger at 10%. 2.4. The assessee selected following 8 comparables with an average margin of 9.53%. Sr. No. Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly, based on the transfer pricing order passed for the previous assessment year, the Ld.TPO benchmarked the transaction by taking the margin at 11.93% and thus computed the adjustment of Rs. 17,15,159/-. 3. On receipt of the order of Ld.TPO, the Ld.AO passed draft assessment order on 18/01/2012, wherein along with transfer pricing proposed adjustment, following the disallowances were also proposed by the Ld.AO: Sl. No. Particulars Amount 1 Disallowance of deduction u/s 36(1)(vii) 32,51,44,22,114/- 2 Marked to market loss on interest rate derivative transaction 13,02,00,000/- 3 Disallowance u/s 14A r.w.r. 8D - interest portion read with exemption u/s 10(50), 10(34) and 10(35) 4,57,85,00,000/- 4 Disallowance of depreciation of leased assets 21,42,83,938/- 5 Disallowance of business loss and other expenses 12,25,33,260/- 6 Disallowance of club expenses 25,43,423/- 7 Disallowance of expenses on issue of discount of rupee and foreign currency bonds 6,54,231/- 8 Disallowance of eSOP expenses 79,28,46,381/- 3.1. On receipt of the draft assessment order, the assessee intimated the Ld.AO regarding its intention to file appeal before the Ld.CIT(A). The Ld.AO thus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... counts, bonds, inventory, etc. * Development of operational policies * Preparation of reports * Cash and fund management support √ Back office account processing and related activities * Processing of applications for various products and services * Account opening in the books * Communicating with clients to solve discrepancies in forms * Reconciliation of accounts * Processing of money transfer transactions * Preparation of I-kits and I-packs for new accounts * Account maintenance services * Handling queries √ Technology support services * Management of website * Customer information process in relation to logins, passwords, account numbers, etc. * . Secured framework of risk management √ Asset ICICI Bank Appropriately qualified and trained personnel for performance of the services √ Appropriately qualified and trained personnel for performance of the services √ Risks borne Risk Service level quality risk - risk of delivering a quality product / service √ Regulatory risk (ensuring that the AE has regulatory approvals for dealing in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e reason that the company has out sourced its activities and the business model is different. We in this regard notice that the exclusion of the company has been considered by the Delhi Bench of the Tribunal, in the case of American Express (India) (P.) Ltd., vs DCIT [2017] 83 taxmann.com 345 (Delhi - Trib.), where it is held that - The annual accounts of this company have been perused where the data entry charges and vendor payments have been specified at approximately 64.68 per cent of the total cost. This itself shows that this company is getting things done through outside vendor and is not carrying on work by employing its own human resources where as in case of the assessee, it carries on its business through its own employees for whom during the year it has incurred cost of almost 59 per cent of the total cost. The order of the co-ordinate bench in assessee's own case for the assessment year 2006-07 has also been perused wherein the co- ordinate bench has directed for exclusion of this comparable holding that the outsourcing model has its impact on the overall profitability of the company and therefore the business model of the comparable company is different than the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere is merit in the argument that the company which is rendering KPO services cannot be compared with the assessee. Accordingly, we direct the TPO to exclude Eclerx Services Ltd. from the list of comparables. Genesys International Corporation Ltd. The exclusion of this company is contended for the reason that the company is functionally different wherein the company is providing geographical information services comprising photogrammetry remote sensing data conversion and related computer based services. In this regard our attention was drawn to the annual report of the company where the business profile of the company is stated (page 1088 of PB schedule-M). Therefore, in our considered view there is merit in the contention of the assessee that the company is not functionally comparable to the assessee which is a back office service provider to its AE in various banking related activities. Accordingly, we hold that Genesys International Corporation Ltd. is not functionally comparable with the assessee and therefore to be excluded from the list of comparables. HCL Comnet Systems and Services Ltd. The exclusion of this company is contended on the ground that the company has p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore, the same cannot be compared with the assessee company. In this regard, we noticed that the turnover of the company is Rs. 649.56 crores which is significantly higher when compared to the turnover of the assessee derived from rendering back officer support services. In our considered view when the operations of the company is much larger than that of the assessee, the assets employed and the risk undertaken would also be different and therefore, there cannot be any comparison between the company having a significantly higher turnover and the company with the lower turnover. We notice from the filters applied by the TPO that the filter for lower turnover of Rs. 1 crore has been applied whereas there is no filter on upper turnover. It is settled position that while the turnover filter upper limit of the turnover filter should also be applied in order to excluded companies having very high turnover. We noticed in this regard that Hon'ble Bombay High Court in the case of Pentair Water India P. Ltd. (supra) has excluded the company on the basis of high turnover and also that on same basis the company is excluded in various decisions of the Jurisdictional High Court and also in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar and that the ITES revenue is only 8.2% of the total revenue of the company. On perusal of the annual accounts of the company, we noticed that the main revenue of the company is derived from sale of Network Integration and other traded goods and also from sale of developed software and service income from network integration and others (page 1027 of PB). On further perusal, we noticed that the income derived from BPO operations is Rs. 35 crores out of the total turnover of Rs. 426 crores which is around 8.2%. From the perusal of the filters applied by the TPO which is extracted in the earlier part of this order one of the filters applied is to exclude companies whose ITES revenue is less than 75% of the total revenue. Accordingly, the company whose income from ITES is 8.2% fails the filter applied by the TPO and should be excluded accordingly. It is also noted that even on functionality the company is not comparable to that of the assessee since the major business of the company seems to be network integration of traded goods. In view comparables of the above, we hold that the company be excluded from the comparables. Wipro Ltd. From the perusal of the financial statement of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e decision of Co-ordinate Bench of this Tribunal in case of Goldman Sachs (I Securities (P) Ltd. vs ACIT reported in (2016) 72 taxmann.com 337 for exclusion of this comparable for identical reasons. 6.5. Cross Domain Solutions Pvt.Ltd. The Ld.AR submitted that this company is functionally not similar with the assessee as it is engaged in development of software products. She further emphasized that, there is not segmental details available in its audited balance sheet. The Ld.AR placed reliance on the decision of Hon'ble Bombay High Court in the case of PCIT us BNY Mellon International Operations (India) Put. Ltd. reported in (2018) 93 taxmannc.com 363, wherein this company was upheld for exclusion by placing reliance on the decision of coordinate bench of Hon'ble High Court in case of DCIT us Bills Processing Services India Pvt. Ltd. in ITA No. 2152/M/2014 vide dated 10.10.2014. Hon'ble High Court noted that this company is a high end KPO and this cannot be compared with captive service provider. 6.6. On the contrary, the Ld.DR relied on the order passed by the authorities below. It is submitted by the Ld.DR that, the method adopted being TNMM requires broader compa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment year 2007-08. It was submitted that the authorities failed to verify allocation keys consistently applied by the assessee, based on which the cost was allocated. It is submitted that identical adjustment was considered by the co- ordinate bench of this Tribunal for AY.2007-08 (supra). 7.2. On the contrary, the Ld.DR submitted that assessee adopted TNMM as the most appropriate method and there cannot be directed co-relation between the revenue earned and the employee cost under such circumstances. It is submitted that assessee is rendering services like treasury support, back of his account processing and related activities, technology support services etc. that requires being bench marked with the mark up. He thus supported the order passed by the authorities below. 7.3. In the rejoinder, Ld.AR submitted that, functions performed by the assessee are purely BPO and is only processing the data without any critical analysis. She submitted that, assessee is only undertaking documentation and clerical work on behalf of its AE for third parties and there is no value addition to such services for which any mark up could be charged. We have perused the submission of both the si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ely makes the payment and recover the same from AEs. For assessee these are pass-through costs and therefore no mark up is added to these costs 53. The Id DR relied on the order of TPO/CIT(A). 54. With regard to the pass through cost for which the TPO has added a margin of 11.59, we notice that from the nature of expenses that these costs are incurred on behalf of the AE and the same is allocated to the AF, using allocation key. Therefore, we are of the considered view that since the costs are pass-through costs and no value addition is made by the company by paying the cost on behalf of the AE and claiming the reimbursement there is no requirement of a mark up. Accordingly, we delete the adjustment made in this regard." It is an admitted fact that, expenses has been incurred by the assessee on behalf of its AE and the same is allocated using allocation key consistently followed by the assessee. In so far as the services rendered by the assessee are concerned, they are simplicitor business process outsourcing services without any involvement of skill, knowledge. Further these are pass through costs and hence no mark up is required to be charged. 7.5. Respectfully following th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccordance with the guidelines issued by the RBI. The Bank act as counterparty for the corporate to enable them to hedge the risk. Assessee participate in the financial derivatives market part of their treasury activities. They deals in derivatives for their own balance sheet management and also for market making purposes, whereby the assessee offer their own derivative products to their customers, enabling them to hedge the risk. The assessee also manages its foreign exchange and interest rate risk to hedge its own borrowings. 9.1. It was submitted that the assessee accounts for the MTM gains/losses for such derivative contracts in accordance with the relevant Accounting Standard and the guidelines issued by RBI as the case may be. The ordinary principles of accounting are recognized under section 145 of the Act and unless there is a specific provision under the Income Tax law which lays down the taxability of a transaction in a particular manner, the accounting principles govern taxability of income. Under the basic principle governing the mercantile or accrual method of accounting, a gain or loss is accounted not when actually received or incurred, but when the legal liability/r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said loss. The Ld. DR made a without prejudice submission that if the loss is to be allowed as a deduction, then the gain which was deleted by the order under section 154 should be brought back to tax. We have perused the submissions advanced by both sides in light of records placed before us. 9.4. It is submitted that the assessee has consistently recognised gains/losses arising out of forward contracts, and has been offering gains if any to tax arising from such contracts in accordance with accounting standard 11. It was submitted that, assessee retains outstanding forward contract loss/ gains recognised as expenses/income respectively in the profit and loss account at the year end. Further, there is no dispute that, such contracts have been entered into by assessee in order to protect its interest against fluctuation in foreign currency in respect of consideration for export proceeds which are revenue in nature. Thus, in our view consequent effect of this accounting treatment is to recognized as exchange fluctuation gain or loss in the profit and loss account as on the valuation date. Hon'ble Supreme Court in case of CIT us Woodward Governor India (P) Ltd., reported in (2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m is allowable. viii) In the ultimate analysis, there is no revenue effect and it is only the timing of taxation of loss/ profit. 59. We, accordingly, hold that where a forward contract is entered into by the assessee to sell the foreign currency at an agreed price at a future date falling beyond the last date of accounting period, the loss is incurred to the assessee on account of evaluation of the contract on the last date of the accounting period i.e. before the date of maturity of the forward contract. 8. Accordingly, we hold that the loss claimed by the assessee is to be allowed as a deduction. During the course of hearing, the Ld.AR fairly conceded that the gain on MTM which has been held to be treated as income of the assessee in the order passed under section 154 can be reversed in case the MTM loss is held to be allowed as a deduction. Accordingly, we direct the Assessing Officer to reconsider the order passed under section 154 reversing the MTM gain and bring the same to tax accordingly." Respectfully following the above, we direct the Ld.AO to allow the deduction in respect of marked to market losses earned by the assessee. Accordingly Ground No.2 raised by the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8.14 The total disallowance u/s 14A amounting to Rs 594 crore plus Rs 35,05,90,585/- = 629,05,90,585/- is added to the total income. Penalty proceedings u/s.271(1)(c) will be initiated separately for furnishing inaccurate particulars of income thereby concealing the income." 10.4. On an appeal before the Ld. CIT(A), the disallowance made by the Ld.AO was upheld. 11. The Ld.AR submitted that, assessee made suo moto disallowance of 11.94 crores and no further disallowance could be made in respect of the interest expenditure as assessee has its own sufficient funds in form of reserve and surplus share capital amounting to Rs. 46820.20 crores. It is submitted that, assessee has sufficient current account deposit. 11.1. She placed reliance on the decision of Hon'ble Supreme Court in the case of Maxopp Investments Ltd. vs CIT reported in (2018) 402 ITR 640, in order to support her contention that the investment made by the assessee and held as stock in trade should be excluded for the purposes of Rule 8D(2)(iii). The Ld.AR has furnished computation of Rule 8D which is applicable for the year under consideration and is placed at page 903 and 904 of the paper book. The Ld.AR by pl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The assessee has not submitted any details whatsoever. It is not known as what was the original debt, what were principal and interest component of the debt, whether the securities were adjusted against the debt, what part of debt had already been debited to P & L account as bad debt, what is the status of such debits in assessments and appellate levels, whether write off has been made in the ledgers or not, how the income was shown in the previous year etc. No such information is coming forth from the assessee. In view of the discussion in para 10.5 and in view of the fact that in support of its claim the assessee could not substantiate the claim as per provisions of section 36(1)(vii) r.w.s 36(2) by way of giving complete details, it is held that the assessee has failed to justify the conditions requisite for allowance of a debt, as bad debt u/s 36(1) (vii) of the I.T. Act. Further the issue on same facts is sub judice in the previous years. In the result, the claim of bad debt of 26,76,70,81,747/-is disallowed, and is added to total income. Penalty proceedings u/s 271(1)(c) are separately initiated for furnishing inaccurate particulars of income and concealment of income. 12.2. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich both sides have placed reliance in support of their respective arguments. 16. At the outset it is observed that the assessee has written off bad debts to the tune of Rs. 1503,06,07,093/- u/s 36(1) (vii) of the Act. The Assessing Officer while analyzing the debts written off by the assessee has rejected the claim of assessee to the extent of Rs. 769,75,10,766/-. The remaining claim of the assessee has been accepted by the Assessing Officer. While examining the claim of bad debts written off, the Assessing Officer has segmented the debtors into large debtors, bad debt written off more than Rs. 1.00 crore, bad debts in respect of which allegedly vague explanation has been offered by the assessee, bad debts in respect of erstwhile AFL and fees written off. It is an undisputed fact that the assessee has written off bad debts in the books of account. The provisions of section 36(1)(vii) were amended w.e.f. 1 ^ (xt) April 1989. The Hon'ble Apex Court in the case of TRF Ltd. (supra) after analyzing the provisions of section 36(1)(vii) of the Act prior to amendment and post amendment held that after 1 ^ prime prime April, 1989 it is not necessary for the assessee to establish tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... off had in fact become bad. In support of this contention the Id. Departmental Representative has placed reliance on various case laws. The requirement to establish that the debts have become bad was done away vide amendment effective from 1st April, 1989. Under the old provisions of section 36(1)(vii) of the Act as were applicable prior to 1st April, 1989, it was mandatory to establish before writing off that the debts have become bad. After amendment (effective from 1st April, 1989) the requirement of section 36(1)(vii) as explained by Hon'ble Apex Court in the case of TRF Ltd. (supra) is, it is sufficient if the bad debt is written off as irrecoverable in accounts of the assessee. The Act does not require the assessee to establish that the debts have in fact become bad before writing off. The CBDT vide Circular dated 30/05/2016 (supra) in an unambiguous manner explained the mandate of section and the law as explained by Hon'ble Apex Court in the case of TRF Ltd. (supra). Though the findings of CIT(A) in the impugned order on the issue are primarily based on the order of CIT(A) for assessment years 2001-02, 2002-03 and 2004-05 without any discussion, but we find no error ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... finally resorts to the last step that is possession and disposal of the vehicle. The assessee submitted that the outstanding loan amount as on the deed of repossession along with outstanding EMI is represent the total amount due from the borrower. On sale of the asset the EMI overdue are 1st adjusted against the sale proceeds and the balance of the sale proceeds is then appropriated towards the principal portion. The assessee submitted that if there is any balance principal portion outstanding is then written off as a business laws on the sale of repossessed assets. 14.3. The submissions by the receiver considered by the Ld.AO, however was not accepted based on the disallowance that was made in the immediately preceding assessment year for a white 2006-07 and 2007-08. 14.4. On an appeal to the Ld.CIT(A) the disallowance made by the Ld.AO was upheld. 15. before this Tribunal, the Ld.AR submitted that repossessed assets due to default in repayment of EMI's by the individual customers were sold out, of which money realised was adjusted against the unpaid loan amount and the net amount was claimed as business loss. The Ld.AR drew our attention to pages 905 wherein the breakup o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowing the above view, we direct the Ld.AO to carry out fresh examination of the based on the documents furnished by the assessee in respect of the loan given to the individual customers and the nature of the assets repossessed and the sale value of the repossessed assets. Assessee is directed to furnish all relevant details in respect of the same. Ld.AO is directed to consider the claim in accordance with law. Needless to say that proper opportunity of being hurt must be granted to assessee. Accordingly ground number 5 raised by the assessee stands archaeological statistical processes. 16. Ground No.6 raised by the assessee is in respect of disallowance of provision of expenses. The Ld.AO noted that assessee made provision on which no tax was deducted. Assessee was thus called upon to explain as to why it made provision for expenses like telephone, conveyance, professional fee et cetera which is made in the month of March and reversed in the following year on 1st of April. The Ld.AO noted that in the immediately preceding year, assessee deducted tax on the provisions made as reported in the tax audit. 16.1. The assessee submitted that to the extent of Rs.48,93,81,195/- the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner of Income Tax (Supra), relied upon by the assessee, this Court has held that if no income is attributable to the payee there is no liability to deduct tax at source in the hands of the tax deductor. After quoting a passage from Kedarnath Jute Mfg. Co. Ltd. 15, this Court has held that the existence or absence of entries in the books of accounts is not decisive or conclusive factor in deciding the right of the assessee claiming deduction. 11. In Volvo India Pvt. Ltd. Vs. ITO16, this Court has observed that: "It is ex-facie apparent that the contention of the assessee Inasmuch as non-identification of the payees in the provisions and the disallowance of deduction expenditure under Section 40(a)(ia) of the Act has not been rightly appreciated by the Tribunal ... If the deduction is not claimed for the expenditures made in the provision even in the return submitted and the same is offered to tax in the subsequent year after reversing the entries pursuant to the receipt of the bills/invoices by the payees; the matter has to be analysed having regard to, whether income has accrued to the payees to deduct tax at source." 12. We may record that it was argued by Shri. Ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee can be analysed based on the documents furnished. She also plays a reliance on specific observation by Hon'ble Supreme Court in case of Goetz India Ltd (supra). 18.4. On the contrary the Ld.DR relied on orders passed by authorities below. We have perused the submissions advanced by both sides in the light of the records placed before us. 19. Admittedly the claim was raised by the assessee during the assessment proceedings and no revised return was. The authorities below under such circumstances do not have the power to examine a claim is does not form part of the return of income. However Hon'ble Supreme Court in case of Goetz India Ltd (supra) observed as under: "3. This appellant's appeal before the Commissioner (Appeals) was allowed. However, the order of the further appeal of the department before the Income Tax Appellate Tribunal was allowed. The appellant has approached this court and has submitted that the Tribunal was wrong in upholding the assessing officer's order. He has relied upon the decision of this court in National Thermal Power Company Ltd. v. CIT (1998) 229 ITR 383, to contend that it was open to the assessee to raise the points of law ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of bonus to be spread over the period of bond. The Ld.AR has also submitted that for assessment in 2014-15 the assessing officer himself allowed the claim of assessee on proportionate basis. We notice that for assessment of 2007-08 identical issue has been considered following the decision of coordinate bench of this Tribunal for assessment in 2002-03(supra) by observing as under: "27. We heard the parties and perused he materials on record. We notice that the co-ordinate bench in assessee's own case for A.Y. 2002-03 had considered the similar issue and has issued a direction to spread the expenditure over the tenure of the bond. The relevant finding of the Tribunal in this regard is extracted below :- "22. We have heard the rival contentions of the parties and perused the material available on record. As far as the nature of expenditure it of bonds / debenture and issue expenses are concerned, dispute that such expenditure is revenue in nature. In fact, in case o Madras Industrial Corp. (supra), the Hon'ble Supreme Court expenditure incurred on issue and discount of bond/ debenture are revenue in nature as the liability incurred by the assessee is wholly and exclusiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tribunal." Respectfully following the above view we direct the Ld.AR to allow the claim of the assessee on proportionate basis. Accordingly ground number 8 raised by the assessee stands allowed. 21. Ground No.9 raised by the assessee is on short grant of relief under section 90 Admittedly assessee made additional claim during assessment proceedings against which the TDS certificate was been submitted. The Ld.AO is directed to verify the same and consider the claim of assessee in accordance with law. Accordingly ground number 9 raised by the assessee stands allowed for statistical purposes. 22. Ground number 10 is in respect of interest charged under section 234 B 234D of the act. As these are consequential nature does not require separate adjudication. 23. Ground number 11 is in respect of applicability of provision of section 115 JB of the act. 23.1. It is submitted that the Ld.CIT(A) dismissed the ground of assessee by observing that the issue does not arise out of the assessment order. 23.2. The Ld.AR submitted that the issue is covered in assessee's own case assessment years 2004-05 and 2005-06 and subsequently the assessing officer himself has accepted the subm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al on record. We noticed that the Co-ordinate Bench in assessee's own case for AY 2004- 05 and 2005-06 (ITA No. 5276/Mum/2013 and ITA No. 6217/Mum/2008 dated 03.11.2017) has considered the similar issue and has held that "17. We have heard rival contentions and perused the material available on record. Learned Counsels appearing for both the parties have agreed before us that the issue is covered in favour of the assessee by the decision of the Tribunal in assessee's own case for preceding assessment year as submitted in the paper book. As could be seen from the material on record, in the impugned assessment year, there is no new lease transaction. The assessee has claimed depreciation on its own fixed assets and depreciation claimed on leased assets were continuing from past lease transactions. Notably, in assessment year 1997-98, the Tribunal while deciding the issue in ITA no.5424/Mum./2001, dated 13th July 2016, had allowed assessee's claim of depreciation. The same view was reiterated by the Tribunal while deciding the cross appeals for assessment year 2000-01 in ITA no.4657/Mum./2004 and ITA no.4826/Mum./2004 dated 31st January 2017. In view of the aforesaid, we ..... X X X X Extracts X X X X X X X X Extracts X X X X
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