The Commissioner Of Income Tax-2,Mumbai v. Raymond Ltd

srk IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTIONINCOME TAX APPEAL NO.1367 OF 2009 The Commissioner of Income Tax-2,Mumbai ...Appellant Versus Raymond Ltd. ...Respondent Mr.Vimal Gupta for appellant. Mr.Percy J. Pardiwala, Senior Advocate with Mr.Mohan Salian, Ms.Vaijayanta Shete and Mr.Jainuddin Khan i/b. Gagrats for respondents. CORAM: DR.D.Y. CHANDRACHUD & M.S.SANKLECHA, JJ. March 21, 2012. P.C. 1.This appeal by the Revenue arises in relation to Assessment Year 1993-94 from a decision of the Income Tax Appellate Tribunal dated 22 March 2007. The following substantial questions of law have been raised: (A)Whether on the facts and in the circumstances of the case and in law, the ITAT is right in deleting the increase in disallowance under Rule 6D made by the A.O.; (B)Whether on the facts and in the circumstances of the case and in law, the ITAT is right in deleting disallowance of pre-operative expenses even though the said expenditure pertains to establishment of files division and is capital in nature; (C)Whether on the facts and in the circumstances of the case and in law, the ITAT is right in allowing the actual premium paid in redemption of debentures as revenue expenditure; (D)Whether on the facts and in the circumstances of the case and in law, the ITAT is right in deleting the addition made on valuation of inventory and of goods in process made by the AO; (E)Whether on the facts and in the circumstances of the case and in law, the ITAT is right in allowing the deduction of lease rent and depreciation on leased assets while computing taxable profit for the purpose of 80HHC deduction? 2.As regards question (A), a similar issue fell for consideration in Income Tax Appeal No.189 of 2011, which appeal by the Revenue has been dismissed by the Court on 20 March 2012 pertaining to AY 1990-91. In the impugned order of the Tribunal, the Tribunal has concluded that a disallowance at the rate of 2 per cent of the total travelling expenses would meet the requirement of law since the limit under Rule 6D had been increased from Rs.150 to Rs.1500. The view of the Tribunal does not suffer from any error. Hence, no substantial question of law would arise. 3.As regards question (B), it is common ground between the counsel appearing on behalf of the Revenue and the counsel appearing on behalf of the assessee that it would stand covered against the Revenue by the decision rendered by this Court on 20 March 2012 in Income Tax Appeal No.189 of 2011. 4.As regards question (C), counsel appearing on behalf of the Revenue and the counsel appearing on behalf of the assessee are agreed that the question would stand covered against the Revenue by the judgment rendered on 20 March 2012 by this Court in Income Tax Appeal No.188 of 2011 pertaining to AY 1992-93. 5.The Appeal is admitted on question (D) and is taken up for hearing and final disposal by consent. 6. Counsel appearing on behalf of the Revenue and the counsel appearing on behalf of the assessee state that in view of the judgment of this Court dated 20 March 2012 on a similar issue in Income Tax Appeal No.189 of 2011, the present issue will have to stand disposed in terms of the order passed therein, with a further direction that the issue would stand restored to the file of the Tribunal for a fresh decision on merits. Question (D) shall stand answered accordingly. 7.As regards question (E), on the joint request of the counsel appearing on behalf of the Revenue and the counsel appearing on behalf of the assessee, the issue will stand restored to the Assessing Officer for a fresh decision on merits having regard to the provisions of Section 80HHC. All the rights and contentions of the parties are kept open, since the Revenue and the assessee have agreed to the aforesaid direction by consent. 8.The appeal is accordingly disposed of. There shall be no order as to costs. (DR.D.Y. CHANDRACHUD,J.) (M.S.SANKLECHA, J.)