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2023 (4) TMI 325 - AT - Income TaxRefund of DDT in respect of payments made to non-resident shareholders - levy of Dividend Distribution Tax ('DOT') liability by considering the benefit of applicable DTM between India - Netherlands and India - Germany respectively qua the rate of tax (i.e. 10%) towards payment of dividend to the non-resident shareholders - HELD THAT:- We find that the issue relating to claim of refund of DDT in respect of payments made to non-resident shareholders has been dealt in the case of Reckit Benkiser India Pvt. Ltd. [2020 (6) TMI 474 - ITAT KOLKATA] wherein it was set aside to the file of Ld. AO for factual verification in the light of an agreement and other relevant documents and the provisions of DTAA. Thus we are unable to lay our hands on this submission - remit the matter back to the file of AO for verification of the amount of dividend paid relating to DDT deposited by the assessee, relevant agreement and documents in respect of non-resident shareholding and the DTAAs of the respective countries of the non resident shareholders and thereafter consider granting of refund of the DDT so claimed by deciding the issue in accordance with law. Deduction towards education cess paid on income-tax and DDT as allowable expenditure u/s. 37(1) - HELD THAT:- The issue is no longer res integra as the coordinate bench in the case of Kanoria Chemicals & Industries Ltd. [2021 (10) TMI 1153 - ITAT KOLKATA] has held that it is not an allowable expenditure u/s. 37(1) of the Act which has been adequately affirmed by the subsequent amendment vide Finance Act, 2021 with retrospective effect. Accordingly, additional ground raised by the assessee for claim of deduction of education cess as allowable expenditure are admitted and dismissed in terms of observations hereinabove. Disallowance of royalty u/s 40(a)(ia) - payment to Kolkata Port Trust ('KOPT') due to non-deduction of tax at source - HELD THAT:- We find it proper to remit the matter back to the file of Ld. AO for the limited purpose of verification of discharging of tax liability by KOPT on the impugned amount of royalty payable by the assessee to KOPT - In this respect, we also direct the Ld. AO to exercise his powers available under the Act to call for the relevant information from KOPT for the factual verification and confronting the same to the assessee for its reply, if so desired - ground taken in this respect is allowed for statistical purposes. Disallowance u/s. 14A r.w.r. 8D(2)(iii) - investment made by assessee in shares which yielded dividend - HELD THAT:- By placing reliance on the decision in the case of REI Agro Ltd. [2013 (9) TMI 156 - ITAT KOLKATA] and in view of the above findings of the coordinate bench of ITAT, Kolkata in assessee's own case [2021 (4) TMI 239 - ITAT KOLKATA] CIT(A) correctly directed the Ld. AO to verify and re-compute the disallowance @ 0.5% of the average value of those investment which resulted in exempted income.
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