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2023 (4) TMI 995 - AT - Income TaxDisallowance u/s. 14A - Assessee submitted that the assessee company has not earned any exempt income during the year - HELD THAT:- As in view of the recent judgment in the case of PCIT vs Era Infrastructure (India) Pvt Ltd [2022 (7) TMI 1093 - DELHI HIGH COURT] are inclined to hold that for the year under appeal, in absence of any exempt income disallowance u/s. 14A of the Act is uncalled for. Therefore, no interference is called for in the findings of the ld. CIT(A) and ground no. 2.1 to 2.4 raised by the revenue are dismissed. Addition made on account of closing stock - Difference in closing stock - in the audit report u/s. 44AB quantity of closing stock of LAB stated at 6973 MT, whereas the figure of 6978 MT has been stated in the schedule related to quantitative details appearing in the income tax returns - HELD THAT:- As the opening quantity of 6973 MT has been taken, in our view this prima facie, seems to be a typographical error which do not call for any addition/disallowance. Thus, no interference is called for in the findings of the ld. CIT(A). Therefore, revenue ground is dismissed. Addition for notional loss arising on account of foreign exchange loss - alleged claim of foreign currency loss is notional in nature and the same has been calculated for the outstanding foreign currency payable/receivable by the assessee for the contract which have not expired at the close of the year - HELD THAT:- In the instant case, such contract which did not expire on 31.03.2013, the foreign currency loss has been calculated, considering the currency value on the last date of the financial year. In the subsequent period, when these contracts expire or the liability to be payable or the claim on receiving from debtors is crystallized actual gain/loss is calculated and routed through the profit and loss account. Since, the said claim is notional and has been claimed in order to make the true and fair presentation of the financial statement, therefore, respectfully following the ratio laid down in the case of Woodward Governor India Pvt Ltd [2009 (4) TMI 4 - SUPREME COURT] no infirmity in the findings of the ld. CIT(A) deleting the disallowance - ground raised by the revenue is dismissed. Addition made on account of long term capital gains - shortfall of receiving sale consideration from sale of equity shares - HELD THAT:- Before us, assessee failed to file any documentary evidence to explain the reason of alleged short fall. On the other hand ld. CIT(A) has placed complete burden of proof on the shoulders of the AO alleging him to have failed to establish with necessary detailed documentary evidence which in our view is not justified. Sale consideration has been received by the assessee, therefore, the reason for the shortfall has to be explained by the assessee only by placing necessary documentary evidence. Thus, this issue of addition regarding shortfall of receiving sale consideration from sale of equity shares is restored to the ld. AO for examining it afresh for which necessary details shall be filed by the assessee so as to unable the Assessing Officer to decide in accordance with law. Disallowance for a cost incurred for effecting the said transaction of sale of equity shares which is paid to MAPE Advisory Group, Mumbai- 30 - main reason for the said disallowance by the Assessing Officer was that the major portion of the professional fees to MAPE Advisory Group was paid in the preceding year and the invoice was raised on 09.10.2011 - Expenditure towards professional fees paid for the said sale transaction has been rightly claimed during the year under appeal, because the genuineness of the expenditure is not in doubt and the facts as narrated by the assessee are found to be correct. We therefore, confirm the findings of the ld. CIT(A) allowing the claim of cost incurred for effecting transaction of sale of equity shares. Thus, ground no. 5 raised by the revenue is partly allowed for statistical purposes.
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