ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCHES `B' NEW DELHI
BEFORE SHRI J.SUDHAKAR REDDY, ACCOUNTANT MEMBER
AND
SHRI CHANDRAMOHAN GARG, JUDICIAL MEMBER
ITA NO. 5837/DEL/2012
ASSTT.YEAR: 2009-10
Dilli Karigari Ltd., vs DCIT,
A-185, Circle-10(1),
Okhla Industrial Area, New Delhi-110001
Phase-I, New Delhi-110020
(PAN: AACCD6741L)
ITA NO. 6120/DEL/2012
ASSTT.YEAR: 2009-10
DCIT, Circle-10(1), vs Dilli Karigari Ltd.,
New Delhi. New Delhi.
(Appellant) (Respondent)
Appellant by: Shri Navin Kumar Jain, CA
Respondent by: Smt. Parwinder Kaur, Sr.DR
O R D E R
PER CHANDRAMOHAN GARG, J.M.
These appeals have been preferred by the assessee and the revenue
against the order of the CIT(A)-XIII, New Delhi dated 05.09.2012 in Appeal
No. 212/11-12 for AY 2009-10.
2. Briefly stated the facts giving rise to these appeals are that the assessee
company is engaged in the business of sale of branded readymade garments and
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
made up articles of textiles. The assessee company is also trading in personal
care, organics, jewellery and fabric. The case was selected for scrutiny under
CASS and the AO issued notice u/s 143(2) and 142(1) of the Income Tax Act,
1961 (for short the Act), along with a detailed questionnaire which were duly
served upon the assessee. After considering the details and explanation of the
assessee, the AO has held that the assessee is subsidiary of FabIndia Overseas
Pvt. Ltd. which deals in artisans based products of designer quality and the
assessee company is doing the role of coordinator between artisans and Fab
India Overseas Pvt. Ltd. (FOPL). Thus, the assessee company neither carried
out any manufacturing activity nor any trading activity during the relevant
period under consideration. The AO disallowed Rs.1,25,70,364/- out of total
rent paid by the assessee company, also disallowed Rs.22,43,080 out of
professional charges paid by the assessee company and further disallowed
interest payment of Rs.6,57,669/- paid by the assessee company. The AO
finalised the assessment at Rs.3,03,70,867 as against the returned income of the
assessee of Rs.1,48,99,754. Being aggrieved by the above assessment order, the
assesse company preferred appeal before the CIT(A) which was partly
disallowed on the issue of disallowance of interest payment to the group
companies but partly allowed on the issue of rent payment and professional
charges. Now, the aggrieved assessee as well as the revenue has preferred these
appeals before this Tribunal.
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
Assessee in ITA No. 5837/Del/2012
3. The assessee has raised sole ground in this appeal which reads as under:-
"1. a) The ld. CIT(A) has erred in upholding the
disallowance of Rs.6,57,669/- made by the AO on account of
interest paid to M/s Fab India Overseas Private Limited."
4. Apropos sole ground of the assessee, ld. AR submitted that the AO was
not justified in making disallowance of Rs.6,57,669/- by holding that when
both the companies happen to be group companies and transactions are covered
u/s 40A(2)(b) of the Act, then assessee company is not subsidiary company of
Fab India Overseas (P) Ltd.. The AR further contended that admittedly the
assessee company has received a sum of Rs. 2,52,89,149 from its holding
company as unsecured loan but at the same time, the company has shown Fab
India as its debtor for a sum of Rs.5,26,61,159. The AR reiterating its
submission before the AO submitted that the assessee company is paying
interest on unsecured loan and the same company is a debtor, as the assessee
company from day one maintained separate ledger for loan account and separate
ledger account for sales to Fab India Overseas Pvt. Ltd. on bill to bill basis and
asseesee company is receiving payments against sales from FOPL on bill to bill
basis. The AR also contended that the assessee company is getting funds from
FOPL which has invested in purchases which were made for FOPL and
accordingly, the interest pertains to purchase amount. The AR has also drawn
our attention towards Paper Book and submitted that the purchases made are
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
ultimately sold to FOPL and, accordingly, beneficiary for the purchase is also
FOPL.
5. Replying to the above, ld. DR placed reliance on the orders of the
authorities below and submitted that it was claimed by the assessee company
that both the accounts are separately maintained on bill to bill basis and
payments are received from FOPL in respect of sales made. The DR further
submitted that it is also a claim of the assessee company that unsecured loan
were raised from FOPL for smooth conducting of business; if the assessee
company had not taken from FOPL, then it would have borrowed the same from
other parties. The DR further submitted that this explanation and contention of
the assessee is not sustainable because the assessee company could have asked
FOPL to clear its dues of sales made instead of taking loans from the same
company as unsecured loan on interest. The DR has also drawn our attention
towards the fact that the amount of sundry debtors is huge and it may be
pertaining to the sales of more than one month, therefore, low unsecured loan
transaction from the assessee company FOPL cannot be isolated with the
amount of debt lying with FOPL. The DR finally submitted that the accounting
principle makes it clear that credit and debit entry should go side by side and the
only impact ultimately has to be seen for calculating interest and since amount
of debt is higher than the amount of loan, therefore, interest on such loan cannot
be allowed.
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
6. On careful consideration of above submissions, we observe that the
CIT(A) upheld the action of the AO confirming the disallowance with following
observations and conclusion:-
" Decision
I have considered the submission of the appellant and
observation of the Assessing Officer. It is seen that appellant
company has received a sum of Rs. 59,149/-from M/s Fabindia
Overseas Pvt. Ltd. It is also seen that appellant company has
shown FOPL as debtor of Rs. 5,26,61,159/-in its balance
sheet. The appellant company is paying interest on the loans
taken from FOPL but not charging interest on the amount
shown as debtor in the balance sheet. The appellant is a group
company of FOPL. It is claimed by the appellant that both the
accounts are separately maintained and bill to bill payments
are received from FOPL in respect of sales made. It is also
claimed by the appellant that loan was from FOPL for smooth
conducting of business and if appellant had not taken loan
from FOPL then. it would have borrowed the same from other
parties. It is claimed by the appellant that unsecured loan
account and debtors account cannot be co-related with each
other. It is seen from the facts of the case that at one side the
appellant is supplying goods to FOPL and showing debtor of
Rs. 5,26,61,159/- and on the other side it is receiving loans
from same company on interest. The appellant company could
have ask the FOPL to clear its dues of sales made instead of
taking loans from the same company as unsecured loans. The
amount of sundry debtor is huge and it may be pertaining to
the sales of more than one month. The transaction of the
appellant from FOPL cannot be isolated with the amount of
debt lying with FOPL. The accounting principle makes it clear
that credit and debit entry should go side by side and only the
ultimate impact has to be seen for calculating the interest.
Since the FOPL is a debtor to the extent of Rs. 5,26,61,159/-
as against the loan amount of Rs. 2,52,89,149/-. Therefore,
interest on such loan cannot be allowed. Even after adjusting
the loan amount against the sundry debtor of Rs. 5,26,61,159/-
the appellant still to receive Rs. 2,73,72,010/- from FOPL.
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
Therefore, tile accounting policy adopted by the appellant is
not in accordance with the principle of accountancy and same
cannot be allowed. The expenditure claimed by the appellant
on interest of Rs. 6,57,669/- is not laid out and expanded for
the business purposes. It is indirect benefit given by the
appellant to the FOPL and same amounts to diversion of
income by the appellant. Hence, the disallowance of interest of
Rs. 6,57,6691- made by the Assessing Officer on loan amount
of Rs. 2,52,89,149/- is upheld and this ground of appeal of the
appellant is rejected."
7. On careful consideration of rival submissions of both the parties and
conclusion of the CIT(A), we note that admittedly the assessee company
received loan of Rs.2,52,89,149 from FOPL and at the same time FOPL was a
debtor of Rs.5,26,61,151 as per balance sheet of the assessee submitted before
the AO. Although the assessee company has explained that the unsecured loan
was necessary for the smooth operation of the assessee company which was also
taken on lower rate of interest, but when the amount of sales is more than
double of unsecured loan, then the transaction of unsecured loan and transaction
of sale with the same company may be seen by the intention of the parties but
ultimate purchaser of the product of the company is a debtor to the extent of Rs.
5.26 crore as against the loan amount of Rs. 5.52 crore, then interest on such
loan cannot be allowed. We are in agreement with the conclusion of the CIT(A)
that even after adjusting the loan amount against the sundry debtor, the assessee
company is still to receive Rs.2,73,72,010 from FOPL, therefore, interest on
such loan cannot be allowed and expenditure claimed by the assessee company
on interest is not allowable. If interest so paid is allowed, then it would be
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
indirect benefit given by the assessee company to the FOPL and the same
amounts to diversion of income of the assessee company which is not
permissible. In view of above and on the basis of foregoing discussion, we
uphold the action of the AO and we are unable to see any ambiguity, perversity
or any other valid reason to interfere with the findings of the CIT(A) on the
impugned addition on this point. Accordingly, sole ground of the assessee
being devoid of merits is dismissed.
ITA No.6120/Del/2012
8. The revenue has raised following two grounds in this appeal:-
"1. Whether the CIT(A) under the facts and
circumstances of the case and in law was justified in deleting
the disallowance of Rs. 1,25,70,364/- made by the AO out of
rent paid to M/s Fabindia Overseas Pvt. Ltd. ?
2. Whether the CIT(A) under the facts and circumstances of
the case and in law was justified in deleting the disallowance
of Rs.22,43,080/- made by the AO on account of professional
charges paid to M/s Artesian Micro Finance Pvt. Ltd. ?"
Ground no. 1 of the Revenue
9. We have heard arguments of both the sides and carefully perused the
relevant material on record. Ld. DR submitted that the AO rightly noted that
the assessee has abruptly increased the expenditure under the head `rent' from
zero to Rs.1,88,55,547. The DR further contended that the assessee company
hired premises from M/s Fab India Overseas Pvt. Ltd. without consent of the
owner/landlord of the building, thus, the assessee company is not having any
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
documentary evidence to prove that the premises was hired on rent from the
owner of the building, therefore, the payment of rent was not allowable for the
assessee. The DR vehemently contended that the assessee company hardly
required any space for business activity and only small space, if ever required is
for administrative purposes. Therefore, the AO was right in allowing 1/3rd of
expenses and disallowing the balance 2/3rd expense of Rs.1,25,70,364.
10. The DR alleging the impugned order contended that the CIT(A) was not
justified in deleting the impugned addition because Fab India Overseas Pvt. Ltd.
also treated the same amount as business income and not as rental income since
this was a sub-lease transaction without the consent of owner/landlord of the
premises.
11. Ld. DR further agitated the issue by stating that the assessee company
was not requiring such huge premises of 28250 sq ft for running of its office
and for storing of inventory and, therefore, the expenditure on rent incurred by
the assessee cannot be said to be wholly and exclusively for the business
purpose of the assessee company.
12. Replying to the above, ld. AR reiterating its submissions before the
authorities below, as reproduced by the CIT(A) in para 2.6 of the impugned
order, submitted that all the grounds on the basis of which 2/3rd expenses on rent
has been disallowed by the AO are factually incorrect. The AR contended that
the entire expenditure has been incurred wholly for the purpose of business and
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
the AO arbitrarily disallowed 2/3rd of the expenses without any reason and
basis. Ld. AR further contended that the assessee company had made purchases
of Rs. 4612.01 lakh and spent Rs.1241.19 lakh towards job work and Rs.40.79
lakh towards packing material and consumables and at the same time, the
assessee company was maintaining inventory of various items which was
valued as on 31.3.2009 at Rs. 11.88 crore, therefore, for stocking of items of
inventory the assessee company needed huge facilities, therefore, amount so
paid by the assessee after deducting TDS was incurred wholly and exclusively
for the purpose of business of the company. Ld. AR strenuously contended that
the AO disallowed 2/3rd rent without any justified and cogent basis and the same
was rightly deleted by the CIT(A) by holding that the assessee company had
actually paid rent to FOPL for the area of 28,250 sq ft occupied by it for
running its office and for storing of the inventory and finished goods.
13. On careful consideration of above submissions, we observe that the
CIT(A) granted relief for the assessee with following conclusion:-
"For stocking the above items of inventory the appellant
was needed huge warehouse facilities. It is also contended by
the appellant that it has taken cash credit limits from Axis
banks of Rs. 800 lacs for which the primary security was stock
maintained by the appellant company. Without having such a
stock it was not possible for the bank to give cash credit
facility to the appellant company. The documents related to
cash credit facility are filed as Annexure-6 to the submission.
The appellant has also filed Bajaj Allianz Insurance as
Annexure-7 for the insurance taken against fire and special
perils policy, for which the appellant has paid Rs. 1.96.541/-.
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
This certificate proves that appellant was holding inventory of
stock every month, for which the insurance of more than Rs.l 0
crore was taken by the appellant.
During the course of assessment proceedings, the
appellant has filed rent agreement with the appellant and
FabIndia Overseas Pvt. Ltd. The copy of the letter through
which copy of rent agreement filed before AO on 7.9.2011 and
copy of rent agreement marked as Annexure-8 and 9 have
been filed in the submission, therefore, the observation of the
AO that copy of rent agreement was not filed before him was
not correct.
M/s FOPL has offered the rent income as business
income as the same was received by way of sub-lease from the
appellant and pay taxes thereon.
It is also seen that appellant has deducted TOS on the
rent paid to FOPL as per section 194-1 on monthly basis. The
copy of the ledger account of FOPL from the books of
appellant is filed as annexure-TO to the submission and also
the copy of the ledger account of the appellant from the books
of accounts of FOPL is also filed as annexure-l 1.
It is also seen from the agreement that the rent was paid
to FOPL on the basis of area occupied by the appellant
company as well as FOPL. The appellant company had
occupied 282S01-sq. feet out of which 39901-sq. feet was air-
conditioned area and 24260/-sq. feet was non-air conditioned
area. The rent paid by the appellant company includes security
cover charges, maintenance charges, electricity charges and
housekeeping charges.
It is also seen from annexure-12 filed with the
submission that appellant company has registered itself with
the Sales Tax Department for warehouse purposes. The
company was also registered with PF & ES1 on the said
address. These facts prove that appellant company was
operating from the said premises.
In view of the facts discussed above, it is established
that appellant company has paid rent to M/s FOPL for the
area of 28250/- sq. feet occupied by it for running its office
and for storing the inventory. Therefore, the expenditure
incurred by the appellant was incurred wholly and exclusively
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
for the business purposes of the appellant company. The
disallowance of 2/3 I'd rent by the Assessing Officer was
justified and the same is deleted."
14. On careful reading of above conclusion of the CIT(A) in the light of rival
contentions of both the parties, we note that the AO made impugned
disallowance of 2/3rd of amount of rent paid by the assessee company to FOPL.
As per submissions of the assessee before the AO, the assessee company was
incorporated on 28.10.2007 and commenced operations from 1.12.2007. It was
also contended before the AO that when the landlord/owner of the premises
denied permission and asked the assessee company to get into an agreement
with Fab India Overseas Pvt. Ltd. at their own risk, then the assessee company
which was already providing rent on provisional basis to FOPL deducted the
TDS in favour of FOPL. The DR has also pointed out that the assessee has not
properly verified that the documents submitted before CIT(A) were also placed
before the AO. From paper book of the assessee we note that verification has
been made subsequently below the signature in one paper book and in another
paper book verification seems to has been inserted after preparation and
signatures thereon. The main allegation of the AO was made that the assessee
company was not requiring such huge accommodation on huge rent, therefore,
the rent paid by the assessee company to FOPL cannot be said to be incurred
wholly and exclusively for the purpose of business. The CIT(A) went into
detail to inquire about the requirement of the assessee company and also
verified the area occupied by the assessee company out of which 3990 sq ft was
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
air-conditioned and 2460 sq ft was air-conditioned area and rent paid by the
assessee company was inclusive of security cover charges, maintenance
charges, electricity charges and housekeeping charges also. The CIT(A) also
noted that the assessee company has registered itself with the sales tax
department for warehouse purposes, with PF and ESI Department on the said
addresses which clearly shows that the assessee company was operating its
business activities from the said premises for which rent was paid to FOPL. In
this situation and in the aforementioned factual matrix of the case on the issue,
we are inclined to hold that the AO made disallowance of 2/3 amount of rent by
holding that the assessee do not have documentary evidence to prove that the
premises was even hired on rent from the owner of the buildings or from its
own group company M/s Fabindia Overseas Pvt. Ltd. The CIT(A) granted relief
by observing and noticing certain facts revealed from certain documents. At the
same time we also note that theses documents require proper examination and
verification at the end of the AO to evaluate the issue as to whether the assessee
incurred expenditure on rent wholly and exclusively for the purpose of its
business . Hence we deem it just and proper to restore the matter to the file of
the AO with this direction that the AO shall adjudicate the issue afresh by
affording due opportunity of hearing for the assessee. The assessee is at liberty
to submit explanation and documentary evidence before AO to support its stand
with these directions ground No. 1 of the Revenue is deemed to be allowed for
statistical purposes.
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
Ground no. 2 of the revenue
15. Apropos this ground, we have heard arguments of both the sides and
carefully perused the relevant material placed before us on record. The AR
submitted that the AO has disallowed amount of professional charges paid to
Artisan Micro Finance Ltd. (AMFPL) amounting to Rs.22,43,080/- by wrongly
observing that there needs to be concrete evidence in the shape of actual
requirement and the practical work done and the act does not permit transfer of
profit without any plausible reason. The DR further contended that the entry
passed by the assessee company cannot be called as income tax planning and
the claim of professional charges is not relevant to the legitimate expenditure,
therefore, the AO rightly disallowed the same. The DR further contended that
the CIT(A) granted relief for the assessee on the basis of surmises and
conjectures which is not sustainable. Drawing our attention towards para 7.3 of
the impugned order, the ld. DR alleged that the AMFPL is a supply resourcing
company and providing services to 18 companies but the professional charges
paid to this company cannot be said to be an expenditure incurred wholly and
exclusively for the purpose of the assessee company because the assessee failed
to submit any sustainable or concrete evidences in the shape of actual
requirement of the assessee company and practical work done by AMFPL
against the said payment of professional charges by the assessee company.
Replying to the above, ld. AR has drawn our attention to para 7.2 of the
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
impugned order and reiterated its submissions before the CIT(A) and submitted
that AMFPL is a company specially created by FOPL to deal with various
supply resources companies and the assessee company was one of the said 18
companies to which AMFPL was providing services. Ld. AR vehemently
contended that the AMFPL was supporting in day to day activities of 18
companies including the assessee company through eminent professionals who
specialise in their field and providing all types of technical and professional
help. Ld. AR justifying the payment of professional charges by the assessee
company further submitted that AMFPL was also charging service tax on the
bills for the services provided by it and the assessee company made payment of
professional charges after complying with all the relevant provisions of the Act.
16. On careful consideration of above submissions, we note that the CIT(A)
granted relief for the assesse with following observations and conclusions:-
"7.3 Decision
I have considered the submission of the appellant and
observation of the Assessing Officer. It is seen that during the
year appellant company has paid Rs.
36,90,967/-as legal and professional charges paid to M/s
Artisans Micro Finance Pvt. Ltd for the services rendered by
the said company. The Assessing Officer has held that there is
an abrupt increase in the legal and professional charges paid
during the year. It is clarified by the appellant that the legal
and professional charges in the previous year were Rs. 13,26,0
13/-only for four months as appellant company started its
business in December 2007 whereas the legal and professional
charge of Rs. 36,90,967/-is for twelve months during the year,
therefore, the same cannot be compared and there is no abrupt
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
increase. The appellant has filed agreement with Artisans
Micro Finance Pvt. Ltd as annexure-15 with submission and
the payment of legal and professional charges have been paid
as per this agreement. It is also claimed by the appellant that
M/s Artisans Micro Finance Pvt. Ltd. is supply resourcing
company and providing services to eighteen companies. It is
also seen from the annexure-17 filed with the submission that
M/s Artisans' Micro Finance Pvt. Ltd. derives its income from
professional fees received from various companies. During the
course of assessment proceedings the memorandum of
understanding with M/s AMFPL was filed before Assessing
Officer on 07.10.2011, as per that MOU the AMFPL would
provide various professional services to the appellant which
are as under:-
i) Assisting COCs to access funds from banks by processing
loan applications on behalf of the company with the banks.
(ii) Raising adequate equity for the COCs.
(iii) Accounting, reporting and audit support to the Finance
Department.
(iv) Support with respect to ROC and secretarial compliances
and shareholder
management.
(v) Coordinate in establishing of QC Standards.
(vi) Empowering the supply chain.
a. Strengthening supply capabilities where the goods are
produced
b. implementing common system for stocking. production
and delivery.
c. Allowing artisans to avail facilities set up with common
investment for'
processes that improve quality and add value.
d. Facilitating the training of artisans.
e. Enabling the purchase of materials in bulk so as to get the
best price.
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
The above functions assigned to AMFPL are very important
functions and the same are necessary for smooth functioning
of the business of the appellant. From the details filed it is
established that M/s AMFPL through its eminent Board is
providing full flash legal, technical and professional services
to the appellant company for smooth running of its business.
Therefore, the expenditure incurred by the appellant company
on legal and professional services of Rs. 36,90,967/-was
incurred wholly and exclusively for the business purposes of
the appellant and same is fully allowable. The disallowance of
Rs. 22,43,080/- made by the Assessing Officer was not
justified. Hence, the same is deleted."
17. On careful consideration of above submissions and contentions of both
the sides and careful perusal of the operative part of the impugned order, we
observe that the assessee was able to demonstrate that AMFPL through its
eminent board was providing full fledged legal, technical and professional
services to the assessee company for smooth running of its business. We also
observe that the AO has not disputed this fact that the assessee incurred
Rs.13,94,684/- during FY 2007-08 on the same head of professional charges
which were increased during FY 2008-09 to Rs.36,90,967. From the
assessment order, we observe that the AO simply noted the increase of
professional charges during the relevant period and asked the assessee to justify
the same but the AO rejected the explanation of the assessee at the threshold
and concluded that there needs to be concrete evidence in the shape of actual
requirement of the assessee company and the practical work done by AMFPL
for the assessee company. Ld. DR has not disputed the fact that the AMFPL
was providing legal and professional and technical services to 18 companies
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
including the assessee company and the professional services of the AMFPL
was required for the assessee company for effective operation of assessee
company's business. In this situation, when demand was also made on the same
head in the earlier year and accepted by the revenue, then in the subsequent
year, the claim of the assessee on the same head with the same set of facts and
circumstances cannot be disallowed merely on the basis that the amount has
increased without bringing out any justified reason or basis to take a different
view point or stand on the same issue. The revenue authorities are not allowed
to take an arbitrary approach to disallow the expenditure which was allowed
during the earlier financial years merely because the amount has substantially
increased during the relevant period under consideration. The AO is obviously
empowered to examine and verify the claim of the assessee but without bringing
out any adverse material, it would he held that the claim of the assessee was not
incurred or professional charges to AMFPL were not paid wholly and
exclusively for the purpose of business of the assessee. We are unable to see
any infirmity, perversity or any other valid reason to interfere with the
impugned order which granted relief for the assessee on the issue. On the basis
of foregoing discussion, we reach to a conclusion that the AO made
disallowance of professional charges without any basis which was rightly
deleted by the CIT(A) on justified and cogent reasons and we uphold the
impugned order on this issue. Accordingly, ground no. 2 of the revenue being
devoid of merits is dismissed.
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ITA NO. 5837 & 6120/Del/2012
Asstt.Year: 2009-10 & 2004-05
18. In the result, appeal of the assessee and appeal of the Revenue on ground
No. 2 are disallowed and appeal of the Revenue on ground No. 1 is deemed to
be allowed for statistical purposes.
Order pronounced in the open court on 02/02/2015
Sd/- Sd/-
(J.S. REDDY) (CHANDRAMOHAN GARG)
ACCOUNTANT MEMBER JUDICIAL MEMBER
DT. 02nd February, 2015
`GS'
Copy forwarded to:-
1. Appellant
2. Respondent
3. C.I.T.(A)
4. C.I.T. 5. DR
By Order
Asstt. Registrar
18
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