Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2017 (6) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2017 (6) TMI 1173 - ITAT MUMBAIDisallowance of deduction u/s. 80IB - proof of manufacturing activity - Held that:- The assessee stood eligible towards claim of deduction u/s. 80IB as the activity of bottling of LPG gas carried out by the assessee corporation is a manufacturing activity. See Bharat Petroleum Corporation Ltd. Vs. CIT-Mumbai City (2013 (5) TMI 956 - BOMBAY HIGH COURT) Disallowance u/s. 14A - Held that:- Adhoc disallowance made by the A.O u/s 14A cannot be approved. We thus set aside the orders of the lower authorities and delete the disallowance made in the hands of the assessee u/s 14A. The Ground of appeal No. 2 and 3 raised by the assessee before us are thus allowed Disallowance of deposits with Government Agencies/Local Authorities - Held that:- The issue as regards allowability of the deposits placed by the assessee with Government agencies/local authorities as a revenue expenditure, is squarely covered by the aforesaid order of the Tribunal passed in the assessee's own case for A.Y. 2002-03 as the Tribunal referring to the CBDT circular No. 420 (F. No. 204110183 IT (A-ii), [dated 04.06.1985]hold that deposits which are perennial in nature are allowed as revenue expenditure and tax as income in the year in which they are refundable. We thus finding no reason to take a different view, thus set aside the disallowance Disallowance of amortization of premium on leasehold land - Held that:- The revenue in the assessment framed in the hands of the assessee corporation for A.Y. 2014-15 had allowed the registration and stamp duty charges of ₹ 2,47,98,757/- as a revenue expenditure, as claimed by the assessee corporation in its revised return of income for A.Y. 2014-15, by relying on the judgment of the Hon’ble High Court of Bombay in the case of CIT-3 Vs. Reliance Industrial Infrastructure Ltd.(2015 (8) TMI 1215 - BOMBAY HIGH COURT) as observed that the period of lease for which the property has been taken, cannot be regarded as a decisive test to determine the nature of the expenditure. In any case, it is not disputed before us that the stamp duty amount has been paid on the lease deed for the purposes of carrying on assessee's business. Once the aforesaid position is accepted then the amount of stamp duty paid for has to be allowed as revenue nature. Thus addition to be deleted. Assessment of interest received from the bonds issued by the Oil Coordination Committee (OCC) - “Profits and gains of business” or “Income from other sources” - Held that:- The adjudication of the issue raised before us, though for the very first time, is necessary in order to correctly assess the tax liability of the assessee, therefore, in the backdrop the fact that no objection had been raised by the Ld. D.R as regards the same, thus admit the same. As legal issue had not been considered by the CIT(A) while disposing of the appeal of the assessee before us, therefore in all fairness restore the matter to the file of the CIT(A) with a direction to adjudicate the same as relying on Mangalore Refineries and Petro Chemicals Ltd. [ 2016 (10) TMI 94 - BOMBAY HIGH COURT] Additional depreciation u/s. 32(1)(iia) disallowed - assessee had claimed Additional Depreciation u/s. 32(iia) based on the fact that the assessee is engaged in the business of manufacturing and the subject assets are being used for the bottling of LPG so as to market the product manufactured - Held that:- whether the activity of bottling LPG gas amounts to production or manufacturing, or not, is no more res integra in light of the judgment of the Hon’ble Jurisdictional High Court in the case Bharat Petroleum Corporation Ltd. Vs. CIT-Mumbai City (2013 (5) TMI 956 - BOMBAY HIGH COURT), wherein the Hon’ble High Court had in unequivocal terms held that bottling LPG gas is a manufacturing activity. We thus are of the considered view that now when the very perception of the department that the activity of bottling LPG gas does not amount to manufacturing or production activity, does no more survive, therefore the disallowance of the assesses claim towards additional depreciation by holding to the contrary, thus cannot be sustained. We thus set aside the order of the CIT(A) and restore the matter to the file of the A.O, with a direction to allow the claim of the assessee towards additional directions u/s. 32(1)(iia).
|