TMI Blog2013 (10) TMI 549X X X X Extracts X X X X X X X X Extracts X X X X ..... Held that:- The issue be set aside to the file of the AO following the preceding year 2000-01 orders for re-examination of the issue in the light decision in the case of Mukund Ltd.(2007 (2) TMI 358 - ITAT MUMBAI) for finding the nature of the premium part - Decided in favour of assessee for statistical purposes. Disallowance of provision for doubtful debts and advances while computing the book profits under Section 115JB - Held that:- This issue now stands covered against the assessee by insertion of clause 1 in Explanation 1 to Section 115JB, which has been inserted by Finance (No.2) Act, 2009 w.r.e.f. 1-4-2001. Thus, in view of the amendment in the said provision the ground taken by the assessee cannot be allowed. Disallowance of deduction u/s 80HHC - the income as per normal computation is Nil and accordingly no deduction is allowed u/s 80HHC while computing book profit u/s 115JB - Held that:- This issue now stands covered in the case of DCIT Vs. Syncome Formulations (I) Ltd., [2007 (3) TMI 288 - ITAT BOMBAY-H] wherein it has been held that deduction under Section 80HHC in the case of MAT assessment, is to be worked out on the basis of adjusted book profit and not on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hase of imported spares 1,64,886 - iii. Staff agreement deposit forfeited 30,831 26,794 iv. Amount recovered from employees against 1 month notice period salary 11,705 4,825 v. Bonus on spares purchased from W. Schlafhorst AG Co. - 51,510 Total 2,18,547 83,129 4.1 With reference to the i. surplus sale of assets, this issue is decided against assessee by the orders of the ITAT in AY 2000-01 in ITA No.3925/Mum/2005 wherein vide Para 14.1 it was held that "compensation for the amount received on surplus of assets can also be not related to the business of export and therefore, the same is decided against assessee". Respectfully following the same, we hold that surplus received on sale of assets cannot be treated as income derived from the EOU unit. Therefore, ground is rejected. 4.2 With reference to item No. ii v ie. bonus received against purchase of spares, the learned CIT (A) relied on the orders in earlier years in holding that this item cannot be considered as income derived from the Industrial Undertaking. However, as seen from the orders of the ITAT in AY 2002-03 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ground No.3 pertains to the confirmation of the amounts paid as penalty which are as under: Penalty paid in respect of compliance of Central Excise Rule, 1944 in Century Cement Division Rs.3000 Penalty paid under CST Act in Maihar Cement Division Rs.2,49,250 Penalty paid under Central Excise Duty in Maihar Cement Division Rs.7,000 Penalty on CENVAT claim on Explosives and Ammonium Nitrate under section 35F of Central Excise Act in Manikhgarh Cement Division Rs.10,000 6.1 The learned CIT (A) in his order distinguished the entire amount disallowed by AO and allowed the some amounts partly stating that it is compensatory in nature, whereas he has confirmed the above amounts as penalty. It was fairly admitted that this issue was restored to AO in immediately preceding year for fresh examination in the light of the principles laid down by the Hon'ble Supreme Court to decide whether the amounts are compensatory in nature or penal in nature. The findings of the ITAT in AY 2001-02 on the issue are as under: "41. This issue has been dealt with by the Tribunal in I.T.A. Nos. 3925 4170/Mum/2005 in assessment year 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this issue has been set aside to the file of the Assessing Officer following the earlier years‟ order after observing and holding as under :- "24. The issue had been set aside to the file of the AO in the preceding year in I.T.A. Nos. 3925 4170/Mum/2005 in assessment year 2000-01, for re- examination of the issue in the light of the Special Bench decision of the Tribunal in the case of Mukund Ltd. reported in 106 ITD 231 (Mum SB) for finding the nature of the premium part. Respectfully following the order, we set aside the order of CIT(A) and restore the issue to the file of the AO for passing fresh order on the impugned issue after allowing proper opportunity to the assessee. Ground no. 6 is allowed for statistical purposes." 7.2 Accordingly, in this year also, this issue is set aside to the file of the Assessing Officer to be decided in view of the direction given above. Accordingly, this ground is treated as allowed for statistical purposes. 8. Ground No.5 pertains to the issue of confirming the action of AO in disallowing the claim for mining lease expenses for Century Cement Division to 1/20th of Rs.16,23,610 as against 1/10th claimed by assessee on the ground t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... going through the orders passed by the ITAT in 2001-02 and 2002-03, we find that the Tribunal has recorded a finding that this issue stands covered against assessee in assessee's own case from AYs 1990-01 onwards. In view of the admitted position, this issue is decided against assessee and the ground is rejected. 12. Ground No.9 pertains to the action of AO in disallowing provisions in respect of difference of electricity duty on colony consumption payable to MPEB/CSEB etc., for Rs.86,74,603 on the ground that it will be allowed on payment basis in subsequent years. The learned Counsel pointed out that this issue has been restored to the Assessing Officer with a direction in the appeal for the assessment year 2001-02, wherein the Tribunal has directed the Assessing Officer to allow the expenditure on payment basis. The relevant observation and finding of the Tribunal in the assessment year2001-02, reads as under :- "28. This issue has been decided in favour of the assessee by the Tribunal in preceding years wherein the AO was directed to allow the expenditure on payment basis consistently, whatever system of accounting is adopted by the assessee, is to be followed year to year. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Chairman of the company without appreciating the fact that it was not an expenditure incurred wholly and exclusively for the purpose of business of assessee. Even though this issue is covered in favour of assessee by the decision of the Hon'ble Bombay High Court in earlier years, as seen from the orders of the previous year in AYs 2001-02 and 2002-03, the issue is restored to the file of AO to examine in detail the nature of expenses along with the Board resolution if any, as it was brought to notice that assessee has not furnished details before AO. Accordingly in the interest of justice, consistent with the view taken in earlier two years, we restore the issue to the file of AO to examine the details and decide accordingly. Ground is considered allowed for statistical purposes. 18. Ground No.2 pertains to the issue of directing AO to allow depreciation on account of addition to Plant Machinery being provision for custom duty on Airjet looms and Auto Coner without appreciating that the same are covered by the provisions of section 43B. The amount involved is Rs.32,387. It was fairly admitted that this issue is covered in favour of assessee and against the Revenue by the orders ..... X X X X Extracts X X X X X X X X Extracts X X X X
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