HERBERTSONS LTD. Vs. DY. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE assessee - company and the revenue have filed cross -appeals against the order of Commissioner (Appeals), Central -II, Mumbai. Since both these matters arise out of a single order, therefore, these appeals are being disposed of by a common order.

(2.) THE assessee had filed an application for admission of 2 additional grounds as under : Before we proceed to consider each of the issues involved, it is essential to consider the admission of additional grounds.

(3.) THE authorised representative in support of the additional grounds submitted that admission of these grounds does not involve any fresh investigation into the facts as all the facts relating to this claim are already on record. Further, the necessity for filing additional grounds was to correctly quantify the liability on account of the guarantee obligation. Originally, a claim of Rs. 238.08 lakh was made on payment basis, whereas actual liability on accrual basis was Rs. 479.97 lakh. Hence, the additional claim of Rs. 241.89 lacs. Similarly, on the second issue, though the appellant incurred a sum of Rs. 185 lacs for obtaining the use of the technical information, the appellant had erroneously claimed only 1/6th of this expenditure, i.e., Rs. 30.83 lakh under the belief that the said expenditure would attract the provisions of section 35AB. The additional ground on this issue was to rationalise the claim as per the law. In support, the authorised representative relied on the decision of the Supreme Court in the case of National Thermal Power Corporation v. : [1998]229ITR383(SC) and the decision of the jurisdictional High Court in the case of CIT v. : [1978]112ITR734(Bom) . The CIT (Departmental Representative) had no specific objection for admission of these grounds.