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2013 (10) TMI 1403 - AT - Income TaxDeduction u/s. 80IA(4) claim allowed Disallowance u/s 14A - Held that:- Admittedly Rule 8D of the I.T. Rules is not applicable for the A.Y. 2008-09 and this legal position has been clarified by the Hon'ble High Court of Bombay in the case of Godrej and Boyce Mfg. Co. Ltd. Vs. DCIT (2010 (8) TMI 77 - BOMBAY HIGH COURT). Now the next question is whether there, any justification to apply Sec. 14A on the facts on this particular case. As per the record, the assessee’s interest free funds are more than the investment made in the shares of the subsidies. We, therefore, concur with the finding of the Ld. CIT(A) that there is no justification for making the disallowance at least in this year by invoking Sec. 14A of the Act. Deduction u/s. 80IA(4) - exemption u/s. 10A - Held that:- In the case of Gem Plus Jewellery India Ltd. (2010 (6) TMI 65 - BOMBAY HIGH COURT) the issue was in respect of computation of the profits and gains derived from export for the purpose determined the exemption u/s. 10A. In the said case, disallowance of the PF/ESIC payments had been made because of the statutory provisions i.e. Sec. 43B which was in respect of employer’s contribution and Sec.36(1)(v) r.w.s. 2(24) (x) in the case of employee’s contribution which have been deemed to be the assessee’s income. The Hon'ble High Court held that the disallowance was added back by the Assessing Officer which has increased in the business profits of the assessee and exemption u/s. 10A is allowable with reference to such enhanced income. We, therefore, following the principles laid down by the jurisdictional High Court in the case of Gem Plus Jewellery India Ltd. (supra) allow the plea of the assessee and direct the Assessing Officer to consider the said addition for the purpose of computing the deduction u/s. 80IA(4) of the Act.
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