Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2015 (6) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (6) TMI 1096 - AT - Income TaxDisallowance on account of losses due to earthquake - Held that:- In the instant case, no material has been brought before us to show that any receipt, which was received by the assessee in relation to the expenditure in question, was treated by the department as revenue receipt. Further, in the absence of any material or details brought before us to show that the expenditure was incurred only for repairing of building or asset, and not for construction of new building, we do not find any good reason to interfere with the order of the CIT(A), which is confirmed. The ground of appeal of the assessee is dismissed. Disallowance of the expenditure being the provision made for employees cost of arrears payable upto 31st March, 2008 - Held that:- As the Gujarat Government accepted the 6th Pay Commission in December, 2008, and therefore, following the ratio laid down in the judgement in the case of CIT Vs. Kerala State Financial Enterprises, (2008 (2) TMI 383 - HIGH COURT OF KERALA) and CIT Vs. Bharat Heavy Electrical Ltd. (2012 (9) TMI 515 - DELHI HIGH COURT ), disallowance made by the AO was deleted.- Decided in favour of assessee. Excess depreciation claimed on account of capital grant - Held that:- The submissions of the assessee before us is that the uniform rate of 15% adopted by the CIT(A) is not justified. As per provisions of section 43(1) of the Act, the capital grant should be reduced from the cost/WDV of the relevant asset, and thereafter the depreciation is to be calculated. Thus, the capital grant receipt in respect of asset, on which depreciation is allowable at the rate different from 15% should be worked out as per the applicable rate. The DR could not point out any mistake in the above submission of the assessee, which we find is in accordance with law. We, therefore, set aside the orders of the lower authorities on this issue, and restore the matter back to the file of the AO for adjudication afresh MAT - Enhancement of book profit computed under section 115JB - liability towards arrear payable to the employees pending decision of the 6th Pay Commission - Held that:- We find that the Tribunal in the case of assessee itself in the Asstt.Year 2006-07 and 2007-08, while deciding similar issue held that enhancement and reduction u/s 115J is limited only to the specific items provided under clauses (a) to (i) and (i) to (viii). The AO has only to satisfy himself that the provisions of the Companies Act have been complied with while preparing the accounts.he assessee has complied with the provisions contained in Schedule-VI to the Companies Act read with Schedule-XIY and Circular dt. 7.3.2009 of the Department of Company Affairs. Hence the AO's action in reducing the amount is held to be unjustified. - Decided in favour of assessee. Disallowance of claim of guarantee fees paid to Government of Gujarat - Held that:- CIT(A) correctly observed that guarantee fee was an annual recurring expenditure incurred by the assessee. Guarantee fee was payable to Govt. of Gujarat every year in respect of loans taken by the assessee and guaranteed by the Govt. of Gujarat. As held by Hon’ble Supreme Court in the case of India Cements Ltd. (1965 (12) TMI 22 - SUPREME Court ), loan cannot be treated as asset or advantage resulting in enduring benefits. Guarantee fees paid to Govt. of Gujarat was in connection with raising of loans and enduring benefit or advantage could not be said to have resulted by taking such loans. Only if the assets acquired out of such loans were not put-to-use till the end of previous year i.e. 31.3.2008, the guarantee fees to such extent i.e. in respect of such loans only could be capitalized as cost of such asset. The assessee has certified that no new project was started or commissioned during the year for which above guarantee was paid, and the guarantee fees was in respect of loans for acquisition of capital assets, which were already put-to-use prior to 1.4.2007. The guarantee fees of ₹ 5,69,35,000/- is directed to be allowed as revenue expenditure, subject to verification by the AO of the certificate filed during the appellate proceedings i.e. there was no capital work-in-progress in respect of loans on which guarantee fees was paid. Disallowance of loss of material through pilferage, shortage of material-in-transit, shortage arising on physical verification etc. - CIT(A) deleted the addition and held that similar issue was decided by the CIT(A) in favour of the assessee in assessee’s own case for the Asst.Year 2006-07 and 2007-08 - Held that:- The DR relied on the order of the AO. He could not bring any material on record to how that the relief allowed by the CIT(A) in the Asstt.Year 2006-07 and 2007-08 was appealed against before higher forums, and the order of the CIT(A) was varied by any higher authority. In the absence of any such material, we do not find any good reason to interfere with the order of the CIT(A) on this issue, which is hereby confirmed and the ground of appeal of the Revenue is dismissed.
|