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2019 (4) TMI 294 - HC - Income TaxDiversion of income - disallowance of expenses for transportation of the employees, paid to the Employees' Welfare Trust - Tribunal held that there was force in the version of the assessee that it was only towards the transportation cost of the employees as arranged by the Welfare Trust - HELD THAT:- Section 40A(9) permits deduction only in respect of contributions like provident fund, approved superannuation fund and approved gratuity fund [as envisaged under the relevant clauses of Section 36]. The 'Employees Welfare Trust' is contended as not an approved one and it does not come within the purview of the statutory prescriptions. In fact, in respect of the transportation of the employees, the Tribunal verified the facts and figures and held that the contribution effected was to an 'approved fund' and further that, the Transportation of the employees would otherwise have had to be undertaken by the assessee company, in terms of the service conditions. This finding also is a question of fact and no substantial question of law is involved. Disallowance of interest and other expenses under section 14A to 0.5% of the total interest and expenditure - HELD THAT:- Dis-allowance of the interest worked out by the Commissioner of Income Tax [Appeals] on the basis of the loan taken and for the period in which it was held. It was after referring to the facts and figures, that a definite finding was rendered by the Tribunal, interdicting disallowance of interest on other expenses to an extent of 0.5% of the total interest and the expenditure. The said aspect is more a question of fact, than any question of law and as such, even if the additional ground and the question of law mooted by the Department are permitted to be raised by allowing the I.A., it will not tilt the balance in any manner projecting any substantial question of law. Loss sustained on IRFC bonds - capital loss OR business loss - version of the Department, with reference to the loss sustained on IRFC bonds is that it is a 'capital loss' and not a business loss - HELD THAT:- The verdict passed by the Tribunal, in favour of the assessee under this head is perfectly within the four walls of law and does not warrant any interference, as no substantial question of law is involved. See APOLLO TYRES LTD. VERSUS COMMISSIONER OF INCOME TAX [2002 (5) TMI 5 - SUPREME COURT]. Addition u/s 43A - Adjustment of actual cost of capital asset only on settlement of the liability, that is, on actual payment - entitled to claim the deduction due to foreign exchange fluctuation - HELD THAT:- he said question is in relation to Section 43A of the I.T. Act. The Court has rendered a finding placing reliance on the verdict passed in APOLLO TYRES LIMITED VERSUS THE ASSISTANT COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 11, NEW DELHI AND THE ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 1 (1) , ERNAKULAM. [2019 (4) TMI 82 - KERALA HIGH COURT] and connected cases, which stands answered against the Department and in favour of the assessee. Scope of remand proceedings - omission of first proviso to clause (ii) of Sub section (1) to Section 32 with effect from 1/4/1996 by finance Act which provided for 100 % depreciation - HELD THAT:- The first proviso to Clause (ii) of sub section (1) of Section 32 [which provided for 100% depreciation] was omitted w.e.f. 01.04.1996 and as such, the remand is bad. This Court is of the view that this is a matter which can be considered by the assessing officer even on remand and there is no estoppal against law. As such it is not a matter for interference of this Court.
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