Itxa/440/2005 Of The Commissioner Of Income-Tax, City-18, Mumbai v. M/S. H. S. Engg. Marketing Services

IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.440 OF 2005 The Commissioner of Income-TaxLalbaug, Mumbai ..Appellant M/s. H.S. Engg.Mktg.ServicesWorli, Mumbai..Respondent Mr. K.R. Choudhari for AppellantNone for Respondent 1.The revenue preferred this appeal on the following question. "(a) The substantial question of lawarises in the present appeal isregarding the correct interpretation ofthe Section 80-0 of the Income Tax Actand whether on the facts and in thecircumstances of the case and in law,the Hon’ble Tribunal is right inupholding the CIT (A) order anddirecting the A.O. to allow deductionu/s 80-0 of the Act at Rs.72,22,649/-on the basis of the reworked figuressubmitted by the assessee as againstRs.61,80,383/- as allowed by theassessing officer. 2.In the appeal preferred by the assessee beforeCIT (A), it was contended on behalf of the assesseethat A.O. was not justified in rejecting the revisedfigures of expenses and that they had revised the figures so as to work out correct amount of deductionu/s 80-0 following the ratio of ITAT in the case ofTata Unisys (47 TTJ 8 (BOM) ). Submission is that onlyappellant’s net expenditure should be excluded and notthat which was incurred on behalf of others andreimbursed by them. 3.The learned Commissioner in the appeal filedheld that from the appellant’s profit and loss accountthat by excluding reimbursement for use of appellant’soffice premises and availing of credit facility, noeffort was made to pass on any part of appellant’sactual expenditure to its sister concerns and thatappellant has independently incurred expenditure forearning income and such plea regarding exclusion ofexpenditure on service charges and interest receiptsreimbursed to the appellant has considerable force andaccordingly allowed the appeal. 4.Being aggrieved by the said finding on behalfof Commissioner, appeal is filed. The learned Tribunalafter considering the contentions in paragraph 5 heldas under: " The learned DR has not been able tocontrovert the above factual findings recordedby the learned CIT(A). The assessee incurredexpenses totally and a certain percentagethereof was allocated to the sister concern.The amount received from the sister concern andcontrovert the above factual findings recordedby the learned CIT(A). The assessee incurredexpenses totally and a certain percentagethereof was allocated to the sister concern.The amount received from the sister concern and the expenses were both reduced from thebusiness receipts as shown to the AO in therevised profit and loss account. This was overlooked by the AO and the learned CIT (A)rightly rectified that lapse by allowing theappeal of the assessee." 4.In our opinion, it is apparent from the findingthat the question of law does not arises, consequentlythe appeal is dismissed. ( R.S. MOHITE,J.) ( F.I. REBELLO,J)