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BEFORE SHRI H.L.KARWA, HON'BLE, VICE PRESIDENT AND SHRI T.R.SOOD, ACCOUNTANT MEMBER
May, 23rd 2012
               IN THE INCOME TAX APPELLATE TRIBUNAL
               CHANDIGARH BENCHES `B' CHANDIGARH

           BEFORE SHRI H.L.KARWA, HON'BLE, VICE PRESIDENT
             AND SHRI T.R.SOOD, ACCOUNTANT MEMBER


                                M.A No. 54/Chd/2007
                               (In ITA No. 31/Chd/2002)
                              Assessment Year: 1997-98


The ACIT,                         Vs     M/s Delta International Service(P) Ltd,
Circle 4(1),                             Chandigarh
Chandigarh

                                         PAN No. AABCD2944EV

(Appellant)                                             (Respondent)

                     Appellant By                : Shri Ahkilesh Gupta
                     Respondent By               : Shri Ravinder Bindlish

                     Date of hearing       : 18.05.2012
                     Date of Pronouncement : 22.05.2012


                                       ORDER


PER H.L.KARWA, VP


      This Misc. Application by the Revenue arises out of the order of the

Tribunal dated 23.3.2005 passed in ITA No. 31/Chd/2002 relating to

assessment year 1997-98.



2.    The Asstt. CIT, Circle-4(1) Chandigarh vide his application dated

8.12.2005 has stated as under:-


      1.       The   Hon'ble ITAT have passed order dated 23.3.05 in ITA
      No.31/CHD/2002 in the case of M/s Delta Information service (P) Ltd for the
                                                                                      2


A.Y 1997-98.The revenue had taken the following grounds of appeal in
respect of fees received from students which is reproduced as under :-

       " On the facts and circumstances of the case the Ld CIT(A) vide order
        dated 10.10.2001 in appeal no. 7091/2000-01 had erred in deleting
        addition of Rs.26,00,890/- representing fees received from students"

2.     The Hon'ble ITAT have decided the issue against the revenue.
The observations of the Hon'ble ITAT in para 7 of their order are reproduced
as under :-

       " 7. Considering the facts of the case, it is clear that assessee entered
       into an agreement with M/s NIIT through which fees are received from
       the students in ESCROW A/c which is disbursed by M/s NIIT to the
       assessee on the basis of services provided by assessee to the students.
       Therefore, the receipt of the fees cannot be treated as income of the
       assessee. The disbursement of fees is subject to the services provided by
       the assessee to the students. The account is thus not controlled by
       assessee and the same accounting system was accepted in earlier years
       as is admitted by both the parties. Therefore, the CIT(A) was justified in
       deleting the entire addition as there was no accrual of income in favour
       of the assessee on the basis of mere receipt of the fees in the ESCROW
       A/c. We accordingly, do not find any infirmity in the order of the
       CIT(A). We confirm the same and dismiss the appeal of the revenue"

3.      It has been observed by the Hon'ble ITAT, vide para 7 of the order, as
reproduced above, that "same accounting system was accepted in earlier years
as is admitted by both the parties".

4.      This observation of the Hon'ble ITAT is respectfully not correct looking
to the facts of the case. The correct facts of the case are that the assessment for
the A.Y 1994-95 was framed u/s 143(3) read with section 147/148 and the
accounting systems of the assessee was not accepted/Not only for this year, but
for the assessment year 1993- 94, 1995-96 and 1996-97 the accounting system
of the assessee was not accepted by the AO and assessment was           framed us
143(3) read with section 147/148 in each of these years. Similarly, for the
assessment year 1998-9, assessment was made us 143(3) and accounting systems
was not accepted.

5.      The Hon'ble ITAT is. therefore, requested to pass necessary orders us
254(2) of the Income-tax Act 1961 to rectify the mistake apparent from records.



                                                                                                3


      6.     This petition is filed with the approval/as per directions of the Worthy CIT-II,
      Chandigarh vide his office letter No. CIT-II/CHD/Misc.Pet./761/2859 dated
      28.11.2005. The order of the Hon'ble ITAT was received in the office of the CIT-II,
      Chandigarh on 4th May 2005."



3.    We have heard the rival submissions and have also perused the

materials available on record.        Shri Ravinder Bindlish, Ld. Counsel for the

assessee   pointed out that the averments made in para 4 of the application

filed u/s 254(2) of the Income Tax Act, 1961 (in s hort 'the Act') are factually

wrong and, therefore, the application of the Revenue deserves to be

dismissed. He further submitted that the assessee entered into an agreement

with M/s NIIT through which fees received from the students in ESCROW

A/c which is disbursed by M/s NIIT to the assessee on the basis of services

provided by assessee to the students. The disbursement of fee is subject to

the services provided by the assessee to the students. The account is thus not

controlled by the assessee and the same accounting system was accepted from

assessment years 1993-94 to 1998-99.              In all the above years, the CIT(A)

after appreciating the facts and genuineness of the change of accounting

system accepted the contention of the assessee                    and deleted the entire

addition. The Tribunal vide its order dated 24.6.2005 in ITA Nos. 230, 231

& 232/Chandi/2003 relating to asses sment years 1993-94, 1995-96 and 1996-

97 confirmed the orders of CIT(A). In the year under consideration also, the

Tribunal has confirmed the order of CIT(A) in ITA No. 31/Chandi/2002 vide

its order dated 23.3.2005.



4.    Shri Ravinder Bindlish, Ld. Counsel for the assessee submitted that the

Revenue has not challenged the above orders of the Tribunal in appeal before
                                                                                        4


the Hon'ble jurisdictional High Court. He, therefore, s ubmitted that the

orders of the Tribunal referred to above have attained finality and, therefore,

the present application of the Revenue deserves to be dismissed.



5.     In our view there is a substance in the above submissions of Shri

Ravinder Bindlish, Ld. Counsel for the assessee and, therefore, we hold that

the   Misc.   Application      is   without   any   merit    and    deserves   rejection.

Accordingly, we dis miss the misc. application filed by the Revenue.



6.     In the result, Misc. Application is dismissed.


       Order Pronounced in the Open Court on this 22 n d day of May, 2012



       Sd/-                                                        Sd/-

  (T.R.SOOD)                                                  (H.L.KARWA)
ACCOUNTANT MEMBER                                           VI CE PRESIDENT

Dated : 22 n d   May, 2012
Rkk
Copy to:
  1.     The     Appellant
  2.     The     Respondent
  3.     The     CIT
  4.     The     CIT(A)
  5.     The     DR

                              True Copy
                                                        By Order

                                                    Assistant Registrar
5
 
 
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