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2015 (6) TMI 974 - HC - Income TaxDisallowance under section 14A - Tribunal held that interest earned on the Nostro account is taxable and if the High Court decides that the interest earned on the Nostro account is not taxable, then consequential disallowance under section 14A may be directed - Held that:- The Tribunal by the impugned order allowed the Revenue's appeal holding that the interest received by the respondent-assessee on the Nos tro account amounting to ₹ 13.66 crores is chargeable to tax. In the above circumstances, we are unable to understand how the Revenue is aggrieved by the impugned order accepting the Revenue's contention before it that the interest on the Nostro account is chargeable to tax. - Decided against revenue Exemption under section 10(15)(iv)(h) - to be allowed on gross basis OR on net basis - Held that:- The Tribunal records in the impugned order that the Revenue has before it accepted the position that the exemption under section 10(15)(iv)(h) of the Act is to be allowed on gross basis and not on net basis. In spite of having accepted that exemption under section 10(15)(iv)(h) of the Act is to be allowed on gross interest before the Tribunal, the Revenue has proposed to above question for consideration without pointing out in any manner the basis for withdrawing the concession made before the Tri bunal. In any case in terms of section 10(15)(iv)(h) of the Act it is a self-evi dent position that interest payable by any public sector company is not to form part of the total income. Further, the Tribunal in the impugned order has relied upon its own decision in other cases to hold in favour of the respondent-assessee and the decisions in those cases have not been shown to be inapplicable to the present facts and/or disturbed in appeal - Decided against revenue Expenses incurred at the head office on behalf of the Indian branch of the assessee - deductible under section 37(1) of the Act without any restrictions contained in section 44C as per ITAT - Held that:- The Tribunal by the impugned order allowed a deduction under section 37 of the Act without in any manner being restricted by section 44C of the Act. This was on the basis of an agreed position before it that this issue stands covered by the decision of the Tri bunal in Joint CIT v. American Express Bank Ltd. [2012 (8) TMI 371 - ITAT MUMBAI ]. It is further pointed out by the respondent that the Revenue being aggrieved by the decision of the Tribunal in American Express (supra) carried the issue in appeal to this court (2015 (4) TMI 1041 - BOMBAY HIGH COURT ), dismissed the Revenue's appeal on the above issue by following its decision in CIT v. Emirates Commercial Bank Ltd. [2003 (4) TMI 2 - BOMBAY HIGH COURT ] - Decided against revenue Tax the interest received under section 244A at the rate prescribed in article 12 of the DTAA between India and France as per ITAT - Held that:- The Tribunal by the impugned order restored the issue of the rate at which interest is to be charged to tax on Income-tax refund received under section 244A of the Act to the Assessing Officer to be decided in the light of the Indo-France DTAA and the decision of the Special Bench of the Tribunal in the matter of Asst. CIT v. Clough Engineering Ltd [2011 (5) TMI 562 - ITAT, DELHI ]. In the circumstances no fault can be found with the impugned order of the Tribunal in restoring the issue to the Assessing Officer to determine/adopt the rate of tax on refund in the light of the relevant clauses of the Indo-France DTAA and the decision of the Special Bench in Clough Engineering (supra).- Decided against revenue Interest received by the Indian permanent establishment of the foreign bank from its head office and other overseas branches - not chargeable to tax in computing the total income as per ITAT - Held that:- Tribunal in the impugned order has recorded the fact that the respondent-assessee has admitted before it that to bring about parity, it is not claiming any deduction of interest paid by it to its head office while computing the taxable income.Accordingly, in view of the above settled position that no person can make profit out of itself, the proposed question of law not being substantial, is not entertained.- Decided against revenue
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