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 1193 - AT - Income TaxTreatment to business loss from commodity trading as speculative loss - notional addition of ₹ 10,000/- as alleged administrative and finance cost incurred on commodity trading - Held that:- The actual delivery means real as opposed to notional delivery. Whether a transaction is a speculative in general sense or under the Contract Act, is not relevant for Income Tax purposes. Before the ld. CIT (Appeals) the assessee admitted that part of the transactions were not settled by actual delivery of goods and at least part of the loss was speculative. The assessee, however, could not produce any evidence to substantiate its claim that part of the loss that has been incurred was settled by actual delivery of goods and the loss is not speculative. Even before the Tribunal, the assessee could not improve its case on the issue. We thus do not find any reason to interfere with the first appellate order. The same is upheld. The expenses on administrative and finance estimated at ₹ 1,00,000/- in assessment year 2008-09 and ₹ 10,000/- each in assessment year 2009-10 being a nominal one, is justified and upheld. The ground Nos. 2 and 3 are accordingly rejected. Validity of addition made u/s 80IC - apportionment of common expenditure between the unit eligible for deduction under section 80IC and non-eligible units on the basis of turnover - Held that:- CIT (Appeals) correctly allowed partial relief to the assessee on the claimed deduction under section 80IC of the Act by upholding the criteria of apportionment of indirect expenditure of Baddi Unit on the basis of sales turnover of Baddi Unit to the total turnover of other units etc. for the allocation of expenditure of interest on the basis of actual usages of funds for which a working was furnished by the assessee. This action of the CIT (Appeals) has resulted in relief of ₹ 1,96,95,332/- towards the claimed deduction under section 80IC of the Act. He has given relief of ₹ 38,26,826/- on the basis that it was amount of notional ad-hoc 1% cost inputted to Baddi Unit for sales affected by other units while computing deduction under section 80IC of the Act CIT (Appeals) has perused the debits and credits to the account of Head Office and taking them into consideration on a daily basis to find out the product, the product on which interest cost attributable to net use by funds by Baddi Unit has been computed by resident company at ₹ 34,61,811/- has been held attributable to Baddi Unit by him. CIT (Appeals) has noted further that the assessee had opening credit balance in its books of accounts to the account of Head Office of ₹ 17,57,43,596.23 from which the assessee company had deducted the investment in fixed assets out of share capital and share premium, which was derived by taking into fixed assets as appearing in the balance sheet of Baddi Unit to the total fixed assets held by the assessee company. While computing the figure of actual usages of funds by the Baddi Unit the assessee has also reduced the profit declared by Baddi Unit of ₹ 10,62,29,705/- in the preceding two assessment years to arrive at the opening figure of funds in use by the Baddi Unit. In absence of rebuttal of these material facts by the Revenue, we do not find reason to interfere with the first appellate order - Decided against revenue
|