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Income Tax - Case Laws
Showing 141 to 160 of 802 Records
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2018 (6) TMI 1641 - ITAT DELHI
Extension of the stay originally granted - stay beyond the aggregate period of 365 days - section 254(2A) validity - HELD THAT:- The Hon’ble Delhi High Court in Pepsi Foods Pvt. Ltd vs. ACIT [2015 (5) TMI 655 - DELHI HIGH COURT] has held that the third proviso to section 254(2A) is constitutionally invalid. The net effect of this judgment is that if the appeal could not be disposed of by the Tribunal for no fault of the assessee, then the power vests with the Tribunal to extend the stay beyond the aggregate period of 365 days.
On merits, it is indisputably found that the terms of stay originally granted have been duly complied with. The appeal could not be finally heard for one reason or the other, but, for no fault of the assessee. Considering the entirety of the facts and circumstances of the instant case, we are inclined to grant extension of stay for a further period of six months from today or till the disposal of the appeal, whichever is earlier. The appeal is stated to be fixed for hearing on 19.7.2018.
Stay application is allowed.
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2018 (6) TMI 1639 - ITAT DELHI
TP Adjustment - comparable selection - functional dissimilarity - HELD THAT:- Infosys BPO Limited company was functionally dissimilar to the assessee company as this company was engaged in providing high-end integrated services. It has been submitted and demonstrated from the annual report of BPO Infosys Ltd that this company is rendering a wide array of BPO services in the nature of business platforms, customer service outsourcing, finance and accounting, human resources outsourcing, legal process outsourcing, sales and fulfilment sourcing and procurement outsourcing etc. On the other hand, it is seen that the assessee provides only back office support services in the nature of IT enabled services and it is essentially a captive service provider. We direct the AO/TPO to exclude BPO Infosys Ltd. from the final set of comparables.
BNR Udyog Ltd. is carrying out medical transcription, medical billing and coding whereas the assessee is a captive service provider. ITAT Delhi Bench had the occasion to consider the comparability of another company providing medical transcription service i.e. Accentia Technologies Ltd. with the assessee company in assessee's own case BT e-Serv (India) (P.) Ltd. v. ITO [2017 (11) TMI 64 - ITAT DELHI] by holding that the functions of medical transcription are not at all comparable to the functional profile of the assessee company.
Eclerx Services Limited was functionally different from the assessee company as this company was engaged in Knowledge Process Outsourcing (KPO) services and was engaged in providing financial services like trade processing, reference data services like web content management and merchandising execution, web analytics, social media etc
Excel Infoways Limited ompany was also functionally dissimilar as it was engaged in IT enabled BPO services and development of infrastructure facility. It has also been submitted that this company fails the employee cost filter as well as the diminishing revenue filter.
TCS e- Serv Ltd. functionally dissimilar to the assessee company as this company provides KPO services to banking and financial services industry in the form of core business processing services, analytics and insights as well as support services for both data and voice processes. Also service wise segmental details were not available in the case of this company
R Systems Ltd - we direct the assessee to produce the relevant information before the TPO and also direct the TPO to verify the same and if found appropriate, include R Systems Ltd in the final list of comparables.
Denial of working capital adjustment - HELD THAT:- In the proceedings before us for this year, it has been demonstrated by the Ld. AR that the working of the working capital adjustment claim was submitted before the TPO/AO. We also note that the claim of the assessee was rejected without assigning any reason. In such a circumstance, it is our considered opinion that the TPO/AO should consider the claim of the assessee with regard to working capital adjustment afresh after duly examining the computation as submitted by the assessee and after giving due opportunity to the assessee.
Transfer pricing adjustment on account of interest on receivables - HELD THAT:- AR had been placing extensive reliance on the order of the co-ordinate Bench of the ITAT in assessee's own case BT e-Serv (India) (P.) Ltd.[2017 (11) TMI 64 - ITAT DELHI] while pleading for similar relief with respect to the comparables, the issue of interest on receivables was not argued at all and a plea was made to restore the issue to the TPO/AO with appropriate directions conveniently side-stepping the fact that this issue had been decided against the assessee in AY 10-11 in the very same order on which the Ld. AR had placed extensive reliance. However, we also note that the Ld. CIT DR also had not pointed out that this issue was covered against the assessee - thus in the interest of justice, the issue of adjustment in respect of interest on receivables should be re-examined by the TPO/AO after giving adequate opportunity to the assessee to present its case and also after giving due consideration to the order of the ITAT in assessee's own case
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2018 (6) TMI 1637 - ITAT MUMBAI
TPA - comparable selection - exclusion of TCS- E-serve Ltd - HELD THAT:- From the order of the Tribunal in assessee's own case for the A.Y.2011-12 [2016 (9) TMI 1425 - ITAT MUMBAI] , wherein facts and circumstances were similar and Tribunal have directed for exclusion of TCS- E-serve Ltd., from the final set of comparables on account of functional dissimilarity, ownership of significant intangibles and impact of 'TATA' brand on its profitability. . Respectfully following the order of the Tribunal, we direct the AO to exclude TCS- E-serve Ltd., from the final set of comparables.
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2018 (6) TMI 1634 - ITAT KOLKATA
Dismissal of appeal for non appearance - HELD THAT:- At the time of hearing, neither anybody appeared on behalf of the assessee nor filed any application seeking adjournment. Several adjournments were made in this case either at the request of the assessee or at the request of the Ld. DR. Last such adjournment was made on 19.04.2018 at the application of the assessee fixing the case for hearing on 26.06.2018. On 26.06.2018, when the matter was taken up for hearing no one represented on behalf of assessee. So, it gives an impression that assessee is not seriously interested in pursuing the appeal before the Tribunal.
As in the case of CIT Vs. B. N. Bhattacharjee & Anr. [1979 (5) TMI 4 - SUPREME COURT] observed that preferring an appeal means effectively pursuing it and the law does not help a sleeping litigant. Hence, the assessee’s appeal is liable to be dismissed as un-admitted. We, therefore, relying upon the decision of ITAT Delhi Bench in the case of CIT Vs. Multiplan India (Pvt.) Ltd., [1991 (5) TMI 120 - ITAT DELHI-D] dismiss the appeal of the assessee for non-appearance. - Decided against assessee.
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2018 (6) TMI 1631 - CALCUTTA HIGH COURT
Additional or fresh ground before Tribunal - permissibility of a claim for deduction made for the first time before the Appellate Tribunal without such claim having been made earlier - entitled to depreciation of the goodwill that had been acquired pursuant to the acquisition of a company or a unit or the like - HELD THAT:- The assessee refers to a previous judgment NATIONAL THERMAL POWER COMPANY LIMITED VERSUS CIT [1996 (12) TMI 7 - SUPREME COURT] for the proposition that if, as a result of any judicial decision given while the appeal is pending, it is found that a non-taxable item is taxed or a permissible deduction is denied, it would be open for such ground to be raised in course of the appeal and the matter to be adjudicated upon.
Supreme Court found that in view of the wide authority conferred by Section 254 to the Appellate Tribunal, a point in such regard could be taken for the first time before the Appellate Tribunal if such point arose as a result of a judicial decision that affected the rights of the assessee during the pendency of the appeal.
There does not appear to be any substantial question of law warranting reconsideration of the Appellate Tribunal’s opinion.
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2018 (6) TMI 1630 - ITAT AHMEDABAD
Penalty u/s 271(1)(c) - Addition on account of other income and Addition on account of interest expenses - HELD THAT:- So far as the first two additions we have noted that the assessee has, on it’s own, accepted these inadvertent mistakes.
The explanation of the assessee about these mistakes, in our considered view, deserves to be accepted. The PMS receipt break up is known only upon receipt of the statement, and, more often than not, PMS receipts are dividend receipts which are tax exempt in nature. Similarly, interest on delayed TDS is an interest payment nevertheless and it cannot be treated as a fake, malafide or patently incorrect claim. In a case in which returned income is ₹ 35.37 Crores, errors of this magnitude cannot be said to deliberate errors with ulterior motives. The amounts are indeed small and explanations of the assessee are quite reasonable.
Exchange fluctuation - Assessing Officer himself has accepted the fact that even income was booked on capital account by mistake as a result of wrong posting of capital field vouchers in the revenue account. Certainly, this kind of a casual approach is not desirable but then right now we are only concerned whether the explanation of the assessee is reasonable, and whether meets the test of preponderance of probabilities, or not. Viewed in this perspective, in our considered view, the explanation offered by the assessee is reasonable and worth being accepted. We, therefore, deem it fit and proper to delete the penalty in respect of the addition for exchange fluctuation as well.
Claim of depreciation - assessee had purchased the building and land for ₹ 5,93,47,914/- and the stamp duty valuation of land was ₹ 1,10,99,970/-. While there is no building valuation on record, based on the above facts, the building being treated at the value of ₹ 5 crores is not an outright absurd claim as, even after reducing the stamp duty valuation of land, the building value at ₹ 4.83 Crores does seem reasonable from that perspective – even though that is not legally correct, as held by the co-ordinate bench. The fact that building was demolished is a subsequent event, and adopting the stamp duty valuation figures in broad terms may result in disallowance of depreciation but the claim has some basis. Keeping in view of these discussions, in our considered view, the penalty in respect of disallowance of depreciation must also stand deleted. - Decided in favour of assessee.
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2018 (6) TMI 1628 - ITAT DELHI
TP adjustment - comparable selection - Provision of Software Development Services - HELD THAT:- PERSISTENT SYSTEMS AND SOLUTIONS LTD. (PERSISTENT) being a product development company and into diversified services having no segmental information is not a valid comparable vis-à-vis the taxpayer which is a routine software development service provider, so we order to exclude the same from the final set of comparables.
SANKHYA INFOTECH LTD. (SANKHYA) - being into diversified services providing customized services to end users and has developed customized products for imparting training and having its own research and development centre cannot be a valid comparable visà-vis the taxpayer which is a routine software development service provider.
E-ZEST SOLUTIONS (E-ZEST) - Coordinate Bench of the Tribunal in M/s. Symantec Software and Services India Pvt. Ltd. Vs. DCIT [2017 (1) TMI 1388 - ITAT CHENNAI] examined comparability of the taxpayer with routine software service provider and ordered to exclude the same on the ground that it is providing high end technical services and as such, is a KPO and not a software development company. So, in view of the matter, we order to exclude E-Zest from final set of comparables.
Working capital adjustment denied - HELD THAT:- The taxpayer has filed detailed working capital computation and has also filed submissions on working capital adjustment as per OECD Guidelines. It is also an uncontroverted fact that the working capital adjustment has been allowed to the taxpayer by the TPO in AY 2012-13 and business model of the taxpayer has not undergone any change.
In these circumstances, we are of the considered view that the issue is required to be sent back to AO/TPO to decide allowability of working capital adjustment in view of the settled principle of law applied by the Revenue itself in taxpayer’s own case for AY 2012-13 after providing an opportunity of being heard to the taxpayer.
Computing correct margins of the comparables - HELD THAT:- We are of the considered view that when the taxpayer has argued its case on the basis of facts and figures brought on record by way of evidence as well as submissions, AO/TPO is required to compute the correct margin. So, this issue is remanded back to the AO/TPO to compute the correct margin to be consistent with directions issued by the ld. DRP in taxpayer’s own case for AY 2012-13 as there is no change in the business model of the taxpayer.
INFOSYS LTD. (INFOSYS) - keeping in view the functional dissimilarity, scale of operation, high brand value impacting profit, having own research and development centre with capital expenditure of ₹ 5 to ₹ 7 crores and revenue expenditure of ₹ 570 crores, creating huge intangibles for the company and the fact that Infosys is a full-fledged risk bearing company, hence cannot be a valid comparable vis-à-vis the taxpayer which is a routine captive software service provider working on minimal risk having no brand value nor having any research and development centre to produce its own intangibles. So, ld. CIT (A) has rightly excluded Infosys from the final set of comparables.
WIPRO TECHNOLOGIES LTD. (WIPRO) has generated its entire revenue pursuant to the master service agreement having its huge scale of operation as compared to taxpayer and the fact that the taxpayer is a routine captive service provider, the ld. CIT (A) has rightly excluded Wipro as a comparable from final set of comparables for benchmarking the international transactions.
Companies with diversified business activities with no segmental financials and is also into research and development activities, product engineering and end to end product life scale management solutions, etc. and as such, cannot be a valid comparable vis-à-vis the taxpayer which is a routine captive software development service provider.
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2018 (6) TMI 1627 - ITAT BANGALORE
Disallowance u/s 14A - claim restricted to the exempt income earned by the assessee - HELD THAT:- Hon'ble Delhi High Court in the case of Joint Investments (P) Ltd. v. CIT [2015 (3) TMI 155 - DELHI HIGH COURT] has taken the view that disallowance u/s. 14A cannot exceed the exempt income. Similar view was expressed by the Hon'ble Delhi High Court in the case of CIT v. Holcim India Pvt. Ltd., [2014 (9) TMI 434 - DELHI HIGH COURT] .
These decisions were considered by the Mumbai Bench of the Tribunal in the case of Future Corporate Resources Ltd v. ACIT [2017 (9) TMI 805 - ITAT MUMBAI] relating to AY 2011-12 and it was held by the Tribunal Mumbai Bench that disallowance u/s. 14A of the Act cannot exceed the exempt income. Following the aforesaid decisions, we hold that disallowance u/s. 14A in the present case should be restricted to the exempt income earned by the assessee. - Appeal of the assessee is partly allowed
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2018 (6) TMI 1624 - PATNA HIGH COURT
Addition u/s 40(a)(ai) - Books of Account were rejected and the profit was estimated @ 8% of turnover - ITAT deleted addition - whether the addition made as per the statutory provision could be interfered with in a manner done? - HELD THAT:- Having heard learned counsel for the parties and on analyzing the reasons that weighed with the Tribunal for rejecting the justification given by the learned Commissioner (Appeals), we find that the Tribunal has not committed any error. Once the Books of Account were rejected and the profit was estimated @ 8% of turnover, then, the same Books of Account cannot be relied upon for the purpose of making addition under the provision of Section 40 of the Act. In doing so, the Tribunal has not committed any error. We do not find any substantial question of law warranting reconsideration. - Decided against revenue.
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2018 (6) TMI 1623 - ITAT AHMEDABAD
Addition u/s 36(1)(va) r.w.s. 2(24)(x) - late payment of Employees Contribution to PF/ESI - HELD THAT:- The issue in question is squarely covered against the assessee by in the case of CIT vs. Gujarat State Road Transport Corporation [2014 (1) TMI 502 - GUJARAT HIGH COURT] wherein it is categorically held that in the case of delayed deposit of employees contribution to PF, the same will not be deductable in computing income under section 28 of the Act. The law so laid down by the Hon’ble jurisdictional High Court is binding on us. The mere fact that an appeal against the said decision is pending before the Hon’ble Supreme Court does not dilute binding nature of this judicial precedent.
In effect thus while any delayed deposit of PF/ESI is to be disallowed, in terms of Hon’ble Gujarat High Court’s judgment in the case of Gujarat State Road Transport Corporation (supra), the question as to whether there is a delay or not may be decided by the Assessing Officer in the light of above observations by the coordinate bench. The assessee will get relief, if found admissible, on that basis. Appeal of the assessee is allowed for statistical purposes.
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2018 (6) TMI 1621 - KERALA HIGH COURT
Applicability of the monitory limit in filing appeals - subject matter of the questions of law raised have a cascading effect in the general application of the Income Tax Act and the question also is one which arises periodically in the case of other assessee too - Claim the benefit u/s 35AB - whether 1/6th amount paid by the assessee for know-how for the purpose of setting up of modern plant is allowable under Section 35AB when the assessee had not commenced business in the relevant assessment year? - HELD THAT:- FAA had found that the expenses, being incurred for the purpose of know-how, definitely, the same is allowable. The Tribunal refused to entertain the appeal relying on the circular of the CBDT restraining the Department from filing appeals where the tax effect is less than ₹ 2 lakhs. It was found that the circular applies equally to old cases and new cases. The learned Counsel appearing for the assessee also submits that the tax effect, in the subject year and the succeeding years was NIL for reason of the assessee having continuosly suffered loss in all the years. There can be no cascading effect atleast in the case of the assessee. In such circumstances, we are of the opinion that the question of law arising from the First Appellate Authority's order can be left open for consideration in an appropriate case.
The Income Tax Appeals would stand rejected answering the questions raised against the Revenue and in favour of the assessee finding that the appeal before the Tribunal was not maintainable.
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2018 (6) TMI 1619 - ITAT MUMBAI
TP Adjustment - addition on corporate guarantee given by the assessee for availing loan by the associated enterprises - TPO after reducing the guarantee fee received by the assessee @1% from its AEs treated the balance amount as adjustment under section 92CA as transfer pricing adjustment which is also confirmed by the DRP - HELD THAT:- As decided in assessee's own case [2018 (5) TMI 1886 - ITAT MUMBAI] held that guarantee commission should be worked out at 0.50% of the average amount of the loan outstanding. We, therefore, following the decision of the co-ordinate Bench and maintaining the consistency with the earlier year, direct the AO to delete the addition.
Addition u/s 14A read with rule 8D - HELD THAT:- No disallowance is attracted in respect of those investments which yielded no exempt income under the provision of section 14A read with rule 8D as has been held in the case of ACIT vs. Vireet Investment (P.) Ltd. [2017 (6) TMI 1124 - ITAT DELHI] . We, therefore, restore the issue back to the file of the AO with the direction to decide the same in the light of the ratio laid down by the special bench in the above case.
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2018 (6) TMI 1614 - KARNATAKA HIGH COURT
Penalty u/s 271(1)(c) - excessive deduction claimed u/s 10B - additions made in the income on account of alleged excess stock - HELD THAT:- The first reason for which penalty in question was imposed by the Assessing Authority in the present case was on account of the excessive deduction claimed u/s 10B which was set aside by the learned Tribunal, following the decision of this Court in the case of ‘CIT v. Tata Elxsi Ltd. [2011 (8) TMI 782 - KARNATAKA HIGH COURT].
Another ground on which the penalty was imposed by the Assessing Authority was the additions made in the income on account of alleged excess stock, holding which too was set aside by the learned Tribunal vide Paragraph-17 of the impugned order quoted above holding that the said alleged excess stock was not as a result of purchases made outside the books of accounts, but was only on account of wrong entries in the books of accounts and in any case the higher stock in trade declared as closing stock in a particular year would be taken as opening stock at the beginning of the next year and therefore the tax effect of such alleged excess stock is ‘Nil’ and thus it being a tax neutral entry, the learned Tribunal found that there was no concealment on the part of the Assessee, attracting penalty u/s 271(1)(c).
We are satisfied that in the facts of the present case before us, since the Tribunal has reiterated the findings of facts that both the additions made to the income of the Assessee having been set aside following the decision of the High Court in the case of Tata Elxsi Ltd., [supra] as far as issue of Section 10B is concerned and on the issue of excess stock being tax neutral, such cogent and reasonable findings of facts returned by the learned Tribunal and consequentially setting aside the penalty u/s 271(1)(c) , does not give rise to any substantial question of law requiring the consideration by this Court u/s 260A.
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2018 (6) TMI 1613 - ITAT CHENNAI
Addition u/s 14A r.w.r 8D - whether assessee had not directly or indirectly incurred any expenditure to earn exempt income? - HELD THAT:- In support of its claim, the assessee submitted a cash flow statement for FY 2006-07 which was not filed before the CIT(A). Further, some of the plea taken by the assessee before us, like the investment made was for controlling interest etc., was not taken before the lower authorities.
In the facts and circumstances, we deem it fit to remit this issues back to the AO for a fresh examination. The assessee shall place all the materials in its support before the AO and comply to the AO’s requirements as per law. The A O is free to conduct appropriate enquiry as deemed fit, but he shall furnish adequate opportunity to the assesssee on the material etc to be used against it and decide the matter in accordance with law. In the result, the corresponding grounds of the assessee are treated as allowed for statistical purposes.
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2018 (6) TMI 1612 - ITAT BANGALORE
TP adjustment - cross objections seeking exclusion of (i) Sankya Infotech Ltd., (ii) Extensys Software Solutions Ltd., and (iii) Thirdware Solutions Ltd. - whether CIT(A) has erred by accepting certain comparable companies using unreasonable comparability criteria? - HELD THAT:- The assessee-company raised a general ground and no specific ground of cross objection was raised seeking exclusion of the above three companies. Thus, the question of returning a finding by the Tribunal on the comparability of three comparable companies does not arise. Therefore, the MP on this ground is dismissed.
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2018 (6) TMI 1611 - ITAT BANGALORE
Addition u/s. 41(1) - remission of liability or cessation of liability - material evidence to show that liability of the assessee in respect of the aforesaid creditors was either remitted or ceased to exist - HELD THAT:- AO after noting several liabilities in the form of sundry creditors existing in the balance sheet for a long time, took the view that wherever some payments have been made to the creditors during the previous year by the assessee, those liabilities can be said to be existing; and wherever no payment was made towards outstanding liability during the previous year, the liability in respect of such creditors can be taken as either having been remitted or no longer in existence. This approach was not correct in law and the CIT(Appeals) has rightly deleted the addition on the basis that there should be evidence to show either remission of liability or cessation of liability and in the absence of such evidence, no addition can be made u/s. 41(1).
It is no doubt true that the assessee filed evidence before the CIT(Appeals) to show some payments were made even in respect of some of the outstanding creditors during the previous year whose liability was considered as income u/s. 41(1) by the AO. CIT(Appeals) has, however, not deleted the addition on the basis of any additional evidence. The grievance projected by the revenue in the grounds of appeal is therefore devoid of any merit - Decided against revenue.
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2018 (6) TMI 1609 - ITAT JAIPUR
Higher depreciation @ 30% on dumpers, trucks, excavator/JCB - AO disallowed the claim of the assessee on the ground that the assessee has not given these vehicles on hire - higher depreciation is not applicable when the assessee is not in the business of running the vehicles on hire - HELD THAT:- In the present case, admittedly, the assessee is in the business of civil construction. The assessee had engaged his own Trucks for transporting earth to facilitate laying of roads. Assessee cannot be said to be in the business of hiring out his Trucks for removal of earth to make him entitled for higher rate of depreciation, as removal and transportation of earth are only sub-processes of his main business of laying of roads. The order of CIT (A) entitling the assessee for higher rate of depreciation on the premise that his motor vehicles were used for removal of earth and since the earth did not belong to the assessee, therefore, the use of his motor vehicles was on hire, in the opinion of this Court, is not correct, either on facts or in law as decided in Anamay Construction [2015 (10) TMI 2740 - MADHYA PRADESH HIGH COURT].
The argument of the appellant that the shifting of soil from sites etc. would make him eligible for the definition of hiring on behalf of others is therefore not relevant in this case and in my opinion he will not be entitled for a higher rate of depreciation @ 30% as has been rightly held by the AO. The disallowance is accordingly upheld - Decided in favour of revenue
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2018 (6) TMI 1608 - ITAT AHMEDABAD
Addition u/s 14A - investment out of interest free fund - HELD THAT:- CIT(A) directed the AO to modify the disallowance required to be made u/s. 14A because she found that out of the total investment of ₹ 19,49,122/- a sum of ₹ 4,48,622/- was made out of interest free fund. This amount cannot be considered for making the disallowance thus, CIT(A) has restricted the disallowance required to be made on an investment of ₹ 15,00,500/. The assessee has not challenged this finding of the CIT(A) and after going through the CIT(A)’s order, we do not find any error in the order of the CIT(A) in A.Y. 2010-11 which is confirmed. Similar finding has been recorded in A.Y. 2011-12 and therefore, the ground of appeal raised by the revenue in A.Y. 2011-12 is also rejected.
Deduction u/s 80IA - dispute between the assessee and AO is that AO has notionally brought forward business losses and depreciation of earlier years and notionally set off against the income of the windmill - HELD THAT:- As relying on VELAYUDHASWAMY SPINNING MILLS P. LTD. & SUDAN SPINNING MILLS (P.) LTD. & MOHAN BREWERIES [2010 (3) TMI 860 - MADRAS HIGH COURT] it indicated that depreciation already claimed by the assessee and set off against the regular source of income cannot be notionally brought forward and set off against the income of windmill for the current year after selection of initial year for claiming deduction u/s. 80IA(iv).
The assessee has been given choice of 10 consecutive years out of 15 years for claiming deduction u/s.80IA(iv). Once assessee has selected initial year then unabsorbed depreciation and losses of that year and subsequent years could be carried forward for set off against the income of those years before computing the deduction admissible u/s.80IA(iv).
In the present cases, AO has brought forward the depreciation of A.Y. 2007-08, 2008-09 etc, which has already been set off against the regular income. He brought forward such depreciation on notional basis, which is contrary to the proposition laid down by the Hon’ble Madras High Court. FAA has rightly appreciated the controversy and rightly granted the deduction to the assessee. We do not find any error in the order of the CIT(A) hence, this ground of appeal is rejected in both the years.
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2018 (6) TMI 1606 - ITAT AHMEDABAD
Unexplained investment u/s.69B - addition is made solely on the basis of market value of land, as adopted by the sub-registrar, as true value of purchase of land - HELD THAT:- As decided in VIRJIBHAI KALYANBHAI KUKADIA [2012 (10) TMI 791 - ITAT AHMEDABAD] provisions of Sec.50C cannot be applied for making addition u/s. 69B.
In the present case, since the A.O. has relied on the jantry rates without bringing any material on record to prove that assessee has in fact made investments over and above than that recorded in the books, no addition can be made in the present case and therefore no interference is called for to the order of CIT(A). - Decided against revenue.
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2018 (6) TMI 1605 - CALCUTTA HIGH COURT
Interest income relatable to the tea business - assessment as income from other sources - Whether the interest income derived from temporary investment of surplus borrowed funds for the business of growing and manufacturing of tea, would fall within the scope of Rule 8 of the Income Tax Rules, 1962? - HELD THAT:- Appellate Tribunal noticed the previous view of this Court in favour of the assessee in the judgment reported in Eveready Industries India Ltd. vs. CIT [2009 (12) TMI 226 - CALCUTTA HIGH COURT] but was of the opinion that in view of the Supreme Court dictum in the judgment reported in Pandian Chemicals Ltd. vs. CIT [2003 (4) TMI 3 - SUPREME COURT] the judgment in Eveready Industries India Ltd. was no longer good law.
However, in a more recent judgment in CIT vs. Meghalaya Steels Ltd. [2016 (3) TMI 375 - SUPREME COURT] the Supreme Court restricted the operation of the Rule in Pandian Chemicals Ltd. and expressly approved, inter alia, the judgment of this Court in Merinoply and Chemicals Ltd. [1993 (8) TMI 29 - CALCUTTA HIGH COURT] on the construction of Section 80-IB and Section 80-IC of the Income Tax Act, 1961.
The Revenue is represented and accepts the legal position as evident from the judgment in Meghalaya Steels Ltd.
Accordingly, the judgment and order impugned is set aside on the basis of the Supreme Court judgment in Meghalaya Steels Ltd. and the order of the Commissioner (Appeals) passed on April 24, 2010 is restored on such ground
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