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2017 (5) TMI 1760 - AT - Income TaxDeduction u/s 10B - HELD THAT:- As relying on own case for assessment year 2006-07 to allow the claim of the assessee under section 10B of the Act with respect to the interest income. Deduction with respect to cheque bouncing charges - What is required to be excluded is only the net income on this count, if any. We find that the assessee has been consistently asserting before the lower authorities that the cheque bouncing charges recovered have to be offset against bank charges paid by the assessee and once it is so done, it results in nil income. Thus, the same would not effect the computation of deduction under section 10B of the Act. On this aspect, we direct the Assessing Officer accordingly. Computation of deduction under section 10B is in relation to the determination of total turnover for the purposes of computing the profits eligible for the benefits of section 10B - As assessee pointed out that the total turnover adopted by the Assessing Officer is inclusive of excise duty, which is inappropriate and that the total turnover should be adopted after excluding the element of excise duty. On this aspect also we find enough merit in the plea of the assessee because in the figure of export total turnover(i.e the numerator) the element of excise duty is not present, therefore, in the denominator also i.e. in the figure of total turnover, the element of excise duty should also be excluded for reasons of parity. Disallowance u/s 14A - suo moto disallowance made by assessee - HELD THAT:- It is noticeable that neither before the Assessing Officer nor before the CIT(A) assessee has taken the issue of suo-motu disallowance made out of legal and professional expenses which has been canvassed before us. In this context, we deem it fit and proper to set-aside the matter back to the file of Assessing Officer, who shall re-examine the disallwoance under section 14A of the Act in the context of the fresh plea of the assessee that there is already a suo-motu disallowance made in the computation of income. In any case, we may clarify here that the disallowance, if any, made by the Assessing Officer in the ensuing remand shall not exceed the sum of ₹ 3,08,871/-, disallowed by the CIT(A). Disallowance out of employees contribution to P.F and ESIC on the ground that the payments have been made belatedly - HELD THAT:- In the context, of the present controversy the judgment of the Hon’ble Jurisdictional High Court in the case of CIT v. Hindustan Organics Chemicals Ltd [2014 (7) TMI 477 - BOMBAY HIGH COURT] is fully applicable and the impugned disallowance is unsustainable. The judgment of the Hon'ble Bombay High Court in the case of CIT v. Ghatge Patil Transport Ltd [2014 (10) TMI 402 - BOMBAY HIGH COURT] is also directly on the point and impugned disallowance is unsustainable. For the said reasons the plea of the assessee is allowed. Addition u/s 145A - AO noted from the audit report under section 44AB of the Act and the computation of income that there was deviation in the method of valuation of closing stock from that prescribed under section 145A - HELD THAT:- As assessee has not made any specific arguments but submitted that the Assessing Officer be directed to allow adjustments in the value of opening stock, etc. as per the methodology accepted in the earlier years. On this limited plea, there was no opposition from the Ld. Departmental Representative. Accordingly, it is directed that the Assessing Officer shall give full effect to the provisions of section 154A of the Act as a consequence of his making adjustment to the valuation of the closing stock, based on the methodology accepted in past years. Needless to say, the Assessing Officer shall allow the assessee a reasonable opportunity of being heard before passing an order afresh. Thus, on this aspect assessee succeeds for statistical purposes.
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