I.T.O.,WARD-2(2), ASANSOL vs. M/S MAA LILORI ISPAT PVT. LTD., ASANSOL

3. We have heard rival contentions. On careful consideration of the facts and circumstances of the case, perusal of the papers on record, orders of the authorities below as well as case law cited, we hold as follows:- “1. Whether on the facts and circumstances of the case and in law, the Ld. CIT(A), Asansol is justified in deleting the disallowance of Rs. 5,95,541/-.

Whether on the facts and circumstance 4. Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) is s of the case and in law, the Ld. CIT(A) is justified in deleting the addition/disallowances made on the above issues in relying justified in deleting the addition/disallowances made on the above issues in relying justified in deleting the addition/disallowances made on the above issues in relying entirely on the submission of the assessee and in deleting the additions, without entirely on the submission of the assessee and in deleting the additions, without entirely on the submission of the assessee and in deleting the additions, without referring these above issues to the AO for su referring these above issues to the AO for submission of remand report and thus bmission of remand report and thus violating of the provisio violating of the provisions of rule 46A of the I.T. Rules 1962.

The appellant craves leave to supplement, substitute, add alter, amend, cancel or 5. The appellant craves leave to supplement, substitute, add alter, amend, cancel or 5. The appellant craves leave to supplement, substitute, add alter, amend, cancel or otherwise modify all or any of the grounds herein otherwise modify all or any of the grounds herein-before or at the time of hearing, if e of hearing, if necessary so arises.” 4. Ground No. 1 is against the deletion of disallowance of Rs.5,95,541/ Ground No. 1 is against the deletion of disallowance of Rs.5,95,541/ Ground No. 1 is against the deletion of disallowance of Rs.5,95,541/-. The ld. CIT(A) in his order has dealt with this issue as follows: CIT(A) in his order has dealt with this issue as follows:- “The appellant had paid Rs.5,95,541/ “The appellant had paid Rs.5,95,541/- as penalty for making late payment of as penalty for making late payment of surcharge of electricity charges to DVC. The A.O. held these payments were surcharge of electricity charges to DVC. The A.O. held these payments were surcharge of electricity charges to DVC. The A.O. held these payments were penal in nature and hence n penal in nature and hence not allowable as expenditure. During the course of ot allowable as expenditure. During the course of the assessment proceedings, the appellant stated that the penalty paid to DVC the assessment proceedings, the appellant stated that the penalty paid to DVC the assessment proceedings, the appellant stated that the penalty paid to DVC on account of late paymen on account of late payment was not in the nature of any infringement of any t was not in the nature of any infringement of any law or Act. It is a penal cause arising out of bilateral agreement between two law or Act. It is a penal cause arising out of bilateral agreement between two law or Act. It is a penal cause arising out of bilateral agreement between two parties and cannot be termed as an offence under any law. It is compensatory parties and cannot be termed as an offence under any law. It is compensatory parties and cannot be termed as an offence under any law. It is compensatory in nature. The Hon’ble Supreme Court in the case in nature. The Hon’ble Supreme Court in the case of Prakash Cotton Mills Pvt. of Prakash Cotton Mills Pvt. Ltd. vs. CIT Central Bombay had held that notwithstanding the nomenclature, Ltd. vs. CIT Central Bombay had held that notwithstanding the nomenclature, Ltd. vs. CIT Central Bombay had held that notwithstanding the nomenclature, it is necessary to find whether the penalty paid is compensatory or penal in it is necessary to find whether the penalty paid is compensatory or penal in it is necessary to find whether the penalty paid is compensatory or penal in nature. As the expenses incurred are compensatory in nature, the addition nature. As the expenses incurred are compensatory in nature, the addition nature. As the expenses incurred are compensatory in nature, the addition of Rs.5,95,541/- is deleted and is deleted and appeal is allowed.”

Ground No. 3 is against the deletion o Ground No. 3 is against the deletion of an addition of Rs.83,40,692/ f an addition of Rs.83,40,692/-. This is part of the reconciliation difference disputed in Ground No. 2. Here also, the factual findings of the reconciliation difference disputed in Ground No. 2. Here also, the factual findings of the reconciliation difference disputed in Ground No. 2. Here also, the factual findings of the ld. CIT(A) could not be disputed by the revenue. Thus, we uphold the same and f the ld. CIT(A) could not be disputed by the revenue. Thus, we uphold the same and f the ld. CIT(A) could not be disputed by the revenue. Thus, we uphold the same and dismiss Ground No. 3 of the revenue. dismiss Ground No. 3 of the revenue.

Ground No. 4 is on the issue of admission of additional evidence by the ld. CIT(A). Ground No. 4 is on the issue of admission of additional evidence by the ld. CIT(A). Ground No. 4 is on the issue of admission of additional evidence by the ld. CIT(A). We find that there is no admission of additional We find that there is no admission of additional evidence by the ld. CIT(A) and that all evidence by the ld. CIT(A) and that all the papers, of reconciliation statements of reconciliation statements etc., considered by the ld. CIT(A), were also considered by the ld. CIT(A), were also before the Assessing Officer, copy of which was placed at page 34 of the paper book. before the Assessing Officer, copy of which was placed at page 34 of the paper book. before the Assessing Officer, copy of which was placed at page 34 of the paper book. Hence, we dismiss Ground No. 4 of the reven Hence, we dismiss Ground No. 4 of the revenue. 8. Ground No. 5 is general in nature. Ground No. 5 is general in nature. 9. In the result, appeal of the revenue, is dismissed. In the result, appeal of the revenue, is dismissed.