Take notes as you read a judgment using our Virtual Legal Assistant and get email alerts whenever a new judgment matches your query (Query Alert Service). Try out our Premium Member services -- Free for one month.\n\nIncome Tax Appellate Tribunal - Delhi\nAddl.Cit, Special Range-8, New Delhi vs Shriram Pistons & Rings Ltd., New Delhi on 16 July, 2021\n           IN THE INCOME TAX APPELLATE TRIBUNAL,\n                 DELHI BENCH: 'G' NEW DELHI\n\n          BEFORE SHRI O.P. KANT, ACCOUNTANT MEMBER\n                             AND\n             SHRI KULDIP SINGH, JUDICIAL MEMBER\n                  [Through Video Conferencing]\n\n                       ITA No.7249/Del/2017\n                      Assessment Year: 2014-15\n\nAddl. CIT,                         Vs.   M/s. Shriram Pistons & Rings\nSpecial Range-8,                         Ltd.,\nNew Delhi                                Himalaya     House,      23,\n                                         Kasturba Gandhi Marg,\n                                         New Delhi\n                                                   PAN :AAACS0229G\n          (Appellant)                           (Respondent)\n\n\n                Appellant by         Sh. Prakash Dubey Sr.DR\n                Respondent by        Sh. R.K. Kapoor, CA\n\n\n                           Date of hearing                      08.07.2021\n                           Date of pronouncement                16.07.2021\n\n                                  ORDER\n\nPER O.P. KANT, AM:\n     This appeal by the Revenue is directed against order dated\n10/10/2017 passed by the learned Commissioner of Income-tax\n(Appeals)-28, New Delhi [in short 'the learned CIT(A)'] for\nassessment year 2014-15 raising following grounds:\n     1.     "Whether the Ld. CIT(A) was justified in deleting the disallowance\n            of Rs. 2,75,82,000/- made by the AO on account of expenditure\n            incurred for dies for new mode development by treating the same\n            as capital expenditure."\n                                          2\n                                                            ITA No.7249/Del/2017\n      2.    "Whether the Ld. CIT(A) was justified in deleting the disallowance\n            of Rs. 39,52,433/- made by the AO on account of expense under\n            "Total Productivity Maintenance (TPM)/ISO 9001" by treating such\n            expense as capital expenditure."\n      3.    "The appellant craves leave to add, alter or amend any of the\n            ground(s) of appeal before or during the course of hearing of the\n            appeal."\n\n2.    At the outset, the learned Counsel of the assessee submitted\nthat the issue-in-dispute are identical to additions made in earlier\nyears, which have been deleted by the ITAT, and thus Ld. CIT(A)\nhas   deleted    the    addition    in       dispute   in    the    year   under\nconsideration relying on the decision of the ITAT in earlier years.\n3.    The Learned DR also could not controvert this statement of\nthe Learned Counsel of the assessee.\n4.    We have heard rival submission of the parties on the issue\nin dispute and perused the relevant material on record. The\nfinding of the Learned CIT(A) on the issue in dispute are\nreproduced as under:\n      "7.   I have considered the facts of the case, basis of disallowances\n      made by AO and findings of Hon'ble ITAT vide their order dated\n      05.05.2017 in the case of appellant on identical facts for A.Y. 2010-\n      11. Hon'ble ITAT. after discussing the issue and relying on the\n      decision of jurisdictional High Court in appellant's own case, decided\n      both the issues as under:\n\n            "8.1 On perusing the above finding of the Ld. C.IT(A), with\n            regard to ground no.l relating to deletion of disallowance of\n            Rs. 80,34,087/- is concerned, we find that the assessee has\n            incurred expenditure of Rs. 1,20,49,317/- on account of dies\n            for new model development. However, the AO treated this\n            expenditure as capital expenditure in nature and therefore,\n            just allowed depreciation on the amount and disallowed the\n            remaining amount of Rs. 80,34,087/-. We further note that in\n            the assessment order, the AO has not given any reasoning for\n            treating such expenditure as capital in nature and just\n            mentioned that following earlier assessment orders,\n            maintaining the consistency and to keep the issue alive he is\n            treating the expenditure as capital in nature. On the other\n                                  3\n                                                   ITA No.7249/Del/2017\n\n\n\n\n      hand, the assessee has argued that this issue of expenditure\n      on dies and models has already been decided in assessee's\n      favour by the Jurisdictional Delhi High Court in IT A\n      No.167/2008 for A.Y. 1998-99 and in ITA No.480/2003 in AY\n      2000-01 in assessee's own case. We further find that ITAT,\n      Delhi Bench in ITA No.5438/Del/2012 for AY 2009-10 in\n      assessee's own case has again followed the decision of\n      Hon'ble High Court and allowed the expenditure as revenue\n      expenditure. Therefore, the issue is squarely covered by the\n      decisions of ITAT as well as Hon'ble Jurisdictional High Court\n      in the assessee's own case in earlier assessment years, the\n      AO's action in treating the expenditure on dies and models as\n      capital in nature was not justified. Hence, the Ld. CIT(A) has\n      rightly deleted the disallowance of Rs.80,34,087/- made by\n      the AO, which does not need any interference on our part,\n      hence, we uphold the order of the Ld. CIT(A) on the issue in\n      dispute and dismiss the ground no. 1 raised by the Revenue\n      in its Appeal.\n\n      8.2 With regard to ground no.2 relating to deletion of\n      disallowance of Rs. 12,16,796/- is concerned, we find that the\n      AO has not given any basis for making such disallowance and\n      just repeated the same logic that in preceding years such\n      disallowance was made by the AO and therefore, following\n      the principle of consistency and just to keep the issue alive, he\n      made the disallowance. In the appellate proceedings, the\n      assessee has produced the decision of ITAT, Delhi, in ITA No.\n      5438/Del/2012 in assessee's own case, wherein the issue\n      has already been decided in favour of the assessee. Since the\n      issue is squarely covered by the decision of higher judicial\n      authority, the AO's action in disallowing the expenditure\n      under the heads "TPM and 'ISO-9001', total amounting to Rs.\n      12,16,796/- was not justified. Hence, the Ld. CIT(A) has\n      rightly deleted the disallowance of Rs. 12,16,796/- made by\n      the AO, which does not need any interference on our part,\n      hence, we uphold the order of the Ld. CIT(A) on the issue in\n      dispute and dismiss the ground no.2 raised by the Revenue in\n      its Appeal."\n\n7.1 Since the Hon'ble ITAT has already taken a view on both the\nissues as ntended by appellant in both the grounds, respectfully\nfollowing the same, Iso delete the additions made by AO on account\nof capital expenditure on dies for new model development amounting\nto Rs. 3,10,82,299/- and under the head Total Productivity\nMaintenance (TPM)/ISO 9001 amounting to Rs. 39,52,433/- and\nallow the grounds taken by appellant."\n                                      4\n                                                     ITA No.7249/Del/2017\n4.1 We find that Learned CIT(A) has followed decision of the\nITAT in earlier years and, therefore, we do not find any error in\nthe order of the learned CIT(A) on the issue-in-dispute raised\nbefore us. Accordingly, all the grounds of the appeal of the\nRevenue are dismissed.\n5.    In the result, the appeal of the Revenue is dismissed.\n             Order pronounced in the open court on 16th July, 2021.\n\n            Sd/-                                       Sd/-\n      (KULDIP SINGH)                              (O.P. KANT)\n     JUDICIAL MEMBER                          ACCOUNTANT MEMBER\n\nDated: 16th July, 2021.\nRK/-(DTDC)\nCopy forwarded to:\n1.     Appellant\n2.     Respondent\n3.     CIT\n4.     CIT(A)\n5.     DR\n                                                Asst. Registrar, ITAT, New Delhi