IN INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH,CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA Nos.434 TO 439/CHD/2016 A.Y. 1996-97,1998-99,1999-2000 2001-02,2002-03 & 2006-07 State Bank of Patiala, Vs ACIT, H.O. Mall, Circle, Patiala. Patiala. PAN: AACCS0143D (Appellant) (Respondent) Appellant by : Shri C.Naresh Respondent by : Shri Sushil Kumar Date of Hearing : 28.09.2016 Date of Pronouncement : 05.10.2016 O R D E R PER BHAVNESH SAINI, JM All appeals by same assessee are directed against common order of ld. Ld. CIT(Appeals) Meerut Camp at Patiala dated 11.02.2016 for above assessment years, challenging additions on account of Prior Period Expenses disallowed in sum of Rs. 8 lacs, Rs. 10 lacs, Rs. 4,81,174/-, Rs. 10,44,226/-, Rs. 38,82,672/- and Rs. 41,58,174/- for all above assessment years respectively. 2. We have heard ld. Representatives of both parties and perused findings of authorities below. 2 3. appeals in ITA 434/2016 to 437/2016 are taken up for disposal for relevant assessment years being its third round appellate proceedings before Tribunal. 4. assessee in second round of appellate proceedings before ITAT Chandigarh Bench in ITA 451 to 455/2011 for assessment years 1996-97, 1998-99, 1999-2000, 2001-02 and 2002-03, has raised issue of disallowance of Prior Period Expenses in all appeals which have been decided by Tribunal vide order dated 25.01.2012, copy of order is placed on record. Tribunal in this order referred to its first order and operative part of first round appellate order reads, H o we v e r , s s e s s i n g O f f i c e r i s e n t i t l e d t o v e r if y t h e c l i m o f s s e s s e e n d d e m n d i n g d e t i l s o f such expenses. We restore issue to f ile of s s e s s i n g O f f i c e r f o r f r e s h d e c i s i o n i n c c o r d n c e wi t h law af ter giving reasonable opportunity of being heard to assessee. 5. ITAT Chandigarh Bench in second round of appellate proceedings while passing order dated 25.01.2012 (supra) has considered observation of Assessing Officer which indicated that assessee had not cooperated with Assessing Officer in matter of furnishing required details for proper appreciation and adjudication of issue of Prior 3 Period Expenses. operative portion of findings of Tribunal reads as under : assessee is directed to render necessary cooperation in th e matter of f iling evidences and any other detail, as required by Assessing Off icer f or purpose of f r am i n g s s e s s me n t . Assessing O f f i c e r i s l s o d i r e c t e d t o c o m p l y wi t h t h e n e c e s s r y directions contained in decision of IT T in s s e s s e e ' s o wn c s e , r e p r o d u c e d b o v e n d p r o v i d e proper and reasonable opportunity to assessee . appeals of assessee for these years on issue of disallowance of Prior Period Expenses were allowed for statistical purposes. 6. Assessing Officer in background of these two appellate orders, mainly last order dated 25.01.2012 (supra) had taken up matter for assessment for considering issue of Prior Period Expenses and passed order under section 143(3)/254 of Act. Assessing Officer noted in assessment orders that show cause notices under section 142(1) of Act were served upon assessee seeking explanation as to why these Prior Period Expenses may not be disallowed in absence of any corroborative evidence. Assessing Officer also noted that assessee has not availed opportunity and also did not seek any adjournment. Assessing Officer also noted that ITAT Chandigarh Bench restored matter to file of Assessing Officer for purpose of examining claim 4 of Prior Period Expenses through adducing evidence which assessee was required to bring on record. However, assessee in its reply has merely stated position of law in context of Prior Period Expenses but order of Tribunal is not complied with in which Assessing Officer was required to verify claim of assessee. Since no evidences have been furnished by assessee except few sample vouchers/bills, Assessing Officer had taken adverse inference against assessee. Thus in absence of complete evidence supporting claim of assessee, Assessing Officer disallowed Prior Period Expenses in all years and made additions. 7. assessee challenged these additions before ld. CIT(Appeals) and his submissions have been reproduced in impugned order. ld. CIT(Appeals) also noted that there were specific directions of ITAT to Assessing Officer to verify claim of expenses, therefore, it was incumbent upon assessee to produce all relevant documents and evidences before Assessing Officer so claim of assessee could be verified. In appeal also, assessee did not produce any additional evidence despite opportunity given, therefore, no interference was called for in matter and ld. CIT(Appeals) dismissed all appeals of assessee. 8. ld. counsel for assessee contended that assessee does not know which of evidences were to 5 be furnished before Assessing Officer. He has submitted that assessee has filed chart of expenditure disallowed by Assessing Officer and audit report and it was also explained in reply before Assessing Officer that there are no Prior Period Expenses in view of regular system of accounting followed by assessee bank. On other hand, ld. DR submitted that assessee failed to comply with directions of Tribunal and no evidence have been furnished before authorities below as well as before Tribunal, therefore, addition has been rightly confirmed by ld. CIT(Appeals). 9. On consideration of rival submissions, we are not inclined to interfere with orders of authorities below. It is admitted fact that present appellate proceedings are third round appellate proceedings before Tribunal on same matter in issue of Prior Period Expenses . ld. counsel for assessee was directed to explain whether chart submitted by assessee with audit report are evidence to claim deduction on account of Prior Period Expenses, however, ld. counsel for assessee was not able to point out as to how filing of chart and audit report are evidence to satisfy requirements of law as have been directed by Tribunal in first two founds of appellate proceedings. contention of ld. counsel for assessee is, therefore, rejected. ld. counsel 6 for assessee also submitted in reply before Assessing Officer that there are no Prior Period Expenses in view of regular system of accounting followed by bank. However, Tribunal in first two appellate proceedings while restoring matter to file of Assessing Officer have directed Assessing Officer to verify claim of assessee and demand details of such expenses. Tribunal also held that assessee is directed to render necessary cooperation in matter of filing evidences and other details as required by Assessing Officer for purpose of framing assessment. Since Assessing Officer had been considering matter in issue of Prior Period Expenses in set aside proceedings as directed by Tribunal, therefore, Assessing Officer was bound to follow order of Tribunal and should have restricted his findings to directions issued by Tribunal with regard to disallowance of Prior Period Expenses. We rely upon decision of Hon'ble Punjab & Haryana High Court in case of Kartar Singh Vs CIT 111 ITR 184 and decision of Allahabad High Court in case of S.P.Kochhar Vs ITO 145 ITR 255. 10. Since directions have been earlier issued by Tribunal to assessee to produce evidences before Assessing Officer as demanded by Assessing Officer and to cooperate with Assessing Officer, therefore, assessee was required to furnish complete details and 7 evidences before Assessing Officer for claiming deduction on account of expenses incurred for prior period. However, assessee has failed to produce any evidence before authorities below and no evidence or details have been furnished. It is well settled law that when assessee claimed deduction of expenditure, burden would be upon assessee to prove that expenses have been incurred wholly and exclusively for purpose of business to satisfaction of Assessing Officer, however, assessee failed to do so. claim of assessee before Assessing Officer was that no Prior Period Expenses were incurred in view of regular system of accounting followed by assessee bank, would have no relevance in view of specific directions issued earlier by Tribunal for producing details and evidences of Prior Period Expenses before Assessing Officer. In absence of any evidence or material produced before authorities below as well as before Tribunal, we do not find any justification to interfere with orders of authorities below. These appeals of assessee have no merit, same are accordingly, dismissed. 11. In ITA 439/2016 for assessment year 2006-07, issue and findings of authorities below are same. In this case, it is stated that it second round appellate proceedings before Tribunal, however, fact remained same. assessee did not produce any 8 evidence before Assessing Officer, therefore, assessee failed to comply with directions of Tribunal, therefore, following reasons for decision in ITA 434 to438/2016 (supra), we dismiss this appeal of assessee as well. 12. In result, all appeal of assessee are dismissed. Order Pronounced in Open Court. Sd/- Sd/- (ANNAPURNA GUPTA) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 5th October, 2016. Poonam Copy to: 1. Appellant 2. Respondent 3. CIT(A) 4. CIT,DR Assistant Registrar, ITAT/CHD State Bank of Patiala v. ACIT, Circle, Patiala