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2017 (2) TMI 744 - ITAT MUMBAIDeduction u/s 10A vis-a-vis Disallowance u/s 14A - Held that:- As submitted by the Ld. A.R that now when any part of the expenditure claimed by the assessee was disallowed u/s 14A, then as a consequence thereto the profits of the assessee eligible for deduction u/s 10A would witness a corresponding increase, leading to a consequent increase in the claim of deduction of the assessee u/s 10A of the ‘Act’, pursuant whereto the net effect would remain at Rs. Nil. We find substantial force in the contention of the Ld. A.R and are persuaded to be in agreement with him that pursuant to disallowance u/s 14A, the business profits eligible for deduction u/s 10A, to the said extent would stand enhanced. - Decided in favour of assessee. ‘Income from House Property’ - computation of ALV - Held that:- The benefit of computing the ‘ALV’ u/s 23(1)(c) could not be extended to a case where the property was not let out at all, would however duly encompass and take within its sweep cases where the property had remained let out for two or more years, but had remained vacant for the whole of the previous year. Thus we are of the view that now when in the case of the present assessee the property under consideration had remained let out upto 04.12.2008, and thereafter though could not be let out and had remained vacant during whole of the year under consideration, but also had never remained under the self occupation of the assessee, the computation of the ‘ALV’ u/s 23(1)(c) of the ‘Act’, had rightly been carried out.- Decided in favour of assessee. Recasting of the ‘Book profit’ u/s 115JB - Held that:- We find that the A.O while computing the ‘Book profit’ u/s 115JB of the ‘Act’, being guided by the clear provision so contemplated in Sec. 115JB(2) – Explanation 1(f), had rightly made an addition of ₹ 3,10,868/- (supra), being the amount of expenditure relatable to the dividend income of ₹ 11,36,128/- (supra), which being exempt u/s 10(34) of the ‘Act’, had duly been excluded by the assessee while computing the ‘Book profit’, and accepted as such by the A.O. We thus finding no infirmity in the making of the addition of ₹ 3,10,868/- (supra) by the A.O, which thereafter had rightly been sustained by the CIT(A), therein uphold the order of the CIT(A) to the said extent. In the case of Bearing of ‘Dividend paid or proposed’ on computation of ‘Book profit’ though the working of ‘Book profit’ as per MAT provisions by the assessee company itself, as is found reproduced by the A.O in the body of the assessment order, therein prima facie reveals that the assessee company had adopted the same amount of ₹ 2,95,37,024/- as the starting point for computing the ‘Book profit’, followed by a separate addition of ₹ 41,69,100/- towards ‘dividend paid or proposed’, which if that be so, is in self contradiction of the claim raised by the assessee in appeal, however, as the said working is neither found to be in conformity with the settled position of law, nor free from doubts and mistakes, the same thus does not inspire much confidence. Thus in all fairness we herein restore the issue to the file of the A.O, who is directed to look into the mistake which appears to had crept in as regards the making of a separate addition of ₹ 41,69,100/- after adoption of the ‘Net profit’ of ₹ 2,95,37,024/- (supra) as the starting point for computing the ‘Book profit’, and therein rework out the ‘Book profit’ u/s 115JB of the ‘Act’, as per law. Claim of ‘Long term Capital Loss’ - Held that:- In view that as per the material placed on our record by the assessee vide Page 1-5 of the ‘APB’, which is stated to have also been filed with the A.O, the latter is entitled towards the claim of ‘Long term Capital Loss’, though subject to verification of the facts and figures furnished by the assessee. We thus in all fairness restore this matter to the file of the A.O, who after making necessary verifications shall determine the entitlement of the assessee towards C/forward of the ‘LTCL’ so claimed by it, as per law. Levy of interest for alleged late payment of ‘Dividend distribution tax’ - Held that:- e find that as per Sec.115-O(3) a statutory obligation is cast upon the principal officer of the domestic company to pay the tax on distributed profits to the credit of the Central Government within 14 days from the date of : (a) declaration of any dividend; or (b) distribution of any dividend; or (c) payment of any dividend, whichever is earliest. That failing such compliance within the stipulated time period, the assessee as per Sec. 115P is liable to be saddled with interest @ 1% for every month or part thereof, on the amount of such tax, for the period beginning on the date immediately after the last date on which tax was payable and ending with the date on which the tax is actually paid. We find that to the extent the facts had been brought to our notice by the Ld. A.R, and it remains as a matter of fact as claimed by the assessee, that the dividend was declared as on 25.09.2009, and the dividend distribution tax on the same was paid within the stipulated time period of 14 days, i.e. as on 06.10.2009, then if that be so, though subject to the verification of the said averments of the Ld. A.R before us, the assessee cannot be held to have defaulted as regards making of the payment within the stipulated time period of 14 days as required u/s 115-O(3) of the ‘Act’, as a result whereof no interest u/s 115P is liable to be imposed. We thus in light of and subject to our aforesaid observations, delete the interest of ₹ 99,190/- levied on the assessee.
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