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2022 (6) TMI 1024 - AT - Income TaxDeduction u/s 80IA - whether the income earned by the assessee in the form of refund of VAT, interest income on the FDs with the bank shall qualify for deduction u/s 80IA or not? - HELD THAT:- A perusal of the above provisions of the Act, it would show that the Parliament had employed the language that “any profits and gains derived by an undertaking or an enterprise from any business referred to in sub-section (4), such business being hereinafter referred to as the eligible business”. The expression “derive” had come for interpretation before the Hon’ble Supreme Court in the case of Pandian Chemicals Ltd [2003 (4) TMI 3 - SUPREME COURT] in the context of the provisions of section 80HH. Following this interpretation cited supra, it cannot be said that the income earned by the assessee in the form of all those items cannot be said to flow directly from undertaking itself. Therefore, the income so earned does not qualify for deduction u/s 80IA of the Act. Thus, we do not find any illegality in the order of the ld. CIT(A). Thus, this ground of appeal no.1 stands dismissed. Disallowance u/s 14A - HELD THAT:- We find from the order of the CIT(A) that only contention raised before the ld. CIT(A) was that the provisions of section 14A have no application in the case of strategic investments. We further find from the order of the Assessing Officer, it was asserted vide para 15(c) that during the year under consideration the appellant had not received any exempt income and therefore, no disallowance can be made. AO without dealing with this contention applied the provisions of section 14A of the Act. In the circumstances, we are of the considered opinion that to meet the ends of justice matter requires remission to the AO with direction that if it is found on verification that no exempt income was earned from the investments made no resort to provisions of section 14A can be made keeping in view of the decision cited supra. Accordingly, this ground of appeal remitted to the file of AO for de novo consideration on merits in accordance with law after affording reasonable opportunity of being heard to the assessee. Thus, this ground of appeal no.2 stands partly allowed for statistical purposes. Reduction from the book profits the amount of eligible profits u/s 80IB - HELD THAT:- This issue raised by way of additional ground of appeal is covered against the appellant by decision of the Coordinate Bench of the Tribunal in the case of M/s. Chheda Electricals and Electronics Pvt. Ltd. [2022 (5) TMI 510 - ITAT PUNE] - additional ground raised by the assessee stands dismissed.
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