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2016 (4) TMI 1143 - AT - Income TaxAddition made on account of gain arising out of repurchase of debentures - CIT(A) deleted the addition - Held that:- We find that the order passed by the Commissioner of Income Tax (Appeals) is well reasoned and thus no interference is called for placing reliance on the decision of Hon'ble Karnataka High Court in the case of CIT Vs. Industrial Credit & Development Syndicate Ltd.(2006 (3) TMI 90 - KARNATAKA High Court ) wherein held to the reality of the situation, as the assessee has not derived any income, he is entitled not to treat it as an income. Therefore, the Tribunal was fully justified in its conclusion that the said surplus amount reflected in the balance-sheet cannot be treated as an income of the assessee. - Decided in favour of assessee Addition made on account of Bad debts - the assessee company could not prove the Bonafide of the said bad debts and the accounting entries thereof - CIT(A) deleted the addition - Held that:- The issue in present appeal is identical to the issue adjudicated by the Co-ordinate Bench of the Tribunal in assessee’s own case in earlier assessment years wherein held that the impugned disallowance has been made by the Assessing Officer on mere conjectures and surmises. It is quite clear that the claim of the assessee for the bad debts written-off is in terms of section 36(1)(vii) r.w.s. 36(2) of the Act. It is also quite clear that the debts in question have been actually written-off as irrecoverable in the account books of the assessee. It is also not disputed by the Revenue that the impugned debts have arisen in the course of carrying on assessee’s business of financing. Therefore, having regard to the factual position and the parity of reasoning laid down by the Hon’ble Supreme Court in the case of TRF Ltd. (2010 (2) TMI 211 - SUPREME COURT ), we find no error on the part of the CIT(A) in deleting the impugned addition - Decided in favour of assessee Non inclusion of interest on Non- performing assets - overriding of provisions of RBI Act over the provisions of Sec. 145 of the Income Tax Act - Held that:- As decided in assessee's own case as per the CIT(A), unrecognized income on NPAs classified in terms of RBI guidelines cannot be assessed on actual basis. The aforesaid stand of the CIT(A) is directly supported by the judgement of the Hon’ble Delhi High Court in the case of Brahamputra Capital Financial Services Ltd. (2011 (5) TMI 321 - Delhi High Court ), which is also a case of a NBFC. The CIT(A) has also relied upon the decision of the Pune Bench of the Tribunal in the case of Alfa Laval Financial Services Ltd. (2011 (9) TMI 1083 - ITAT PUNE), which is also a copy of a NBFC. The Revenue has not brought to our notice any decision to the contrary. - Decided in favour of assessee Disallowance made u/s. 14A of the Act read with Rule 8D - Held that:- In assessment year 2009-10 disallowance has been made for the similar reasons and the Commissioner of Income Tax (Appeals) has made observations with regard to the satisfaction recorded by the Assessing Officer for invoking the provisions of Rule 8D in identical words, as was recorded in assessment year 2008-09. We respectfully follow the order of Co-ordinate Bench of the Tribunal and delete the addition made u/s. 14A r.w. Rule 8D. In assessment year 2008-09 the assessee had made disallowance of ₹ 57,600/-, which includes ₹ 7,600/- towards demat charges and ₹ 50,000/- based on past assessments. Similarly, in the assessment year under appeal we direct the Assessing Officer to make disallowance of ₹ 26,951/- towards demat charges and ₹ 50,000/- to cover other expenditure. Thus, total disallowance u/s. 14A would be ₹ 76,951/-. Accordingly, the first issue raised in the appeal by the assessee is partly allowed. Non grant of TDS credit - Held that:- The issue relating to grant of TDS credit was considered by the Co-ordinate Bench of the Tribunal in assessee’s own case in assessment year 2008-09. After perusal of the order of Co-ordinate Bench of the Tribunal in appeal by the assessee for assessment year 2008-09 (supra), we find that this issue was remitted back to the file of Assessing Officer to allow the credit for the TDS on behalf of the assessee in the light of judgment of Hon'ble Allahabad High Court in the case of Rakesh Kumar Gupta Vs. Union of India & Others (2014 (5) TMI 520 - ALLAHABAD HIGH COURT ). Since, the issue in the present appeal is identical we deem it appropriate to remit this issue back to the file of Assessing Officer to decide the issue in similar terms. Claim for deduction in respect of amortization of premium paid for securities forming part of business assets - Held that:- We remit this issue back to the file of Assessing Officer to decide the issue in accordance with the judgment of Hon'ble Bombay High Court in the case of Commissioner of Income Tax Vs. M/s. Lord Krishna Bank Ltd. (2014 (7) TMI 997 - BOMBAY HIGH COURT ) holding that the assessee is entitled for deduction with respect to the diminution in value of the investment and amortization of premium on investment held to maturity on the ground of mandate by RBI guidelines – Decided against revenue. Claim of deduction in respect of Employee Stock Options (ESOP) expenditure - Held that:- It is an admitted fact that the assessee has claimed ESOP expenditure for the first time before the Tribunal. The Hon'ble Supreme Court of India in the case of Goetze (India) Ltd. Vs. CIT [2006 (3) TMI 75 - SUPREME Court ] has held that the powers of the Appellate Tribunal are not impinged to accept the claim of assessee which has not been made before the Assessing Officer. We deem it appropriate to remit this issue back to the file of Assessing Officer to consider the claim of the assessee in the light of decision of Special Bench of the Bangalore Tribunal in the case of Biocon Limited (2013 (8) TMI 629 - ITAT BANGALORE ). The assessee shall file fresh computation of income before the Assessing Officer. The Assessing Officer shall consider the same and decide the claim of assessee in accordance with law. Accordingly, this ground of appeal of the assessee is allowed for the statistical purpose.
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