Income Tax Appellate Tribunal - Delhi
Dlf Housing & Construction Ltd., New ... vs Department Of Income Tax on 1 March, 2011
IN THE INCOME TAX APPELLATE TRIBUNAL
(DELHI BENCH "B" DELHI)
BEFORE SHRI A.D. JAIN AND SHRI K.D. RANJAN
ITA NO. 5916(Del)2010
Assessment year: 2006-07
Asstt.Commissioner of Income Tax, M/s. DLF Housing & Construction
Circle 10(1), New Delhi. V. Ltd., DLF Centre, 9th floor,
Sansad Marg, New Delhi-01.
(Appellant) (Respondent)
Appellant by: Shri H.K. Lal, Sr. DR
Respondent by: S/Shri Pradeep Dinodia &R.K. Kapoor, CAs
ORDER
PER A.D. JAIN, J.M.
This is Department's appeal for the assessment year 2006-07, contending that the learned CIT(A) has erred in deleting the disallowance made on account of prior period expenditure.
2. The AO observed the licence fee paid at ` 72,87,513/- for the period of 12 months from August, 2005 to August, 2006. The AO computed pro- rata licence fee for the period from 1.4.2006 to 31.8.2006, i.e., for 5 months falling in assessment year 2007-08, at ` 30,36,463.75 and disallowed the same as not pertaining to the year under consideration.
2 ITA 5916(Del)2010
3. Before the ld. CIT(A), the assessee contended that the amount of ` 72,87,513/- had not been claimed by the assessee as deduction in its computation of income; that the licence fee was debited to the stock of land and was shown as part of purchases, as per Schedule 14 of the audited accounts; that similar addition made in assessment year 2003-04 had been subsequently rectified by the AO vide an order passed on 26.5.2006 u/s 154 of the I.T. Act.
4. On the assessee's above contention, the ld. CIT(A) directed the AO to verify the record and to delete the addition if the contention of the assessee that the amount had not been claimed as deduction, was found to be correct.
5. Challenging the impugned order, the ld. DR has contended that the ld. CIT(A) has erred in deleting the disallowance made on account of prior period expenses, without considering that the amount of ` 30,36,463.75 represented licence fee for the period from 1.4.2006 to 31.8.2006, i.e., for 5 months falling in assessment year 2007-08 and it did not pertain to the year under consideration, i.e., assessment year 2006-07.
6. The learned counsel for the assessee, on the other hand, has placed strong reliance on the impugned order.
7. We do not find any error in the order of the ld. CIT(A). Before the ld. CIT(A), the assessee had made an assertion that the amount of ` 3 ITA 5916(Del)2010 72,87,513/- had not been claimed as a deduction by the assessee in its computation of income. It was in view of this specific contention of the assessee that the ld. CIT(A) directed the AO to verify the record and to delete the addition, it was found to be correct that the amount had not been claimed as deduction.
8. In view of the above, finding no merit therein, the grievance sought to be raised by the Department is rejected.
9. In the result, the appeal filed by the Department is dismissed.
Order pronounced in the open court on 01.03.2011.
Sd/- sd/-
(K.D. Ranjan) (A.D. Jain)
Accountant Member Judicial Member
Dated: 01.03.2011
*RM
copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(A)
5. DR
True copy
By order
Deputy Registrar