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2015 (10) TMI 19 - ITAT MUMBAI

2015 (10) TMI 19 - ITAT MUMBAI - TMI - Interest due to the assessee u/s. 244A denied - time taken for curing the defects in TDS certificate - Held that:- The undisputed facts are that the TDS certificates were submitted with the return of income. It is also a fact that the TDS certificate has been issued by Reserve Bank of India and various other Government agencies therefore any defect in the TDS certificate cannot be attributed to the assessee. Further, the tax deducted at source by the deduct .....

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Decided in favour of assessee.

Disallowance of payment of MICR charges - non deduction of tds u/s. 194J - whether the bank was not required to deduct tax from the payments made to SBI and therefore provisions of Sec. 40(a)(ia) are not attracted? - CIT(A) allowed the claim - Held that:- We have carefully perused the orders of the authorities below. We have also the benefit of the order made u/s. 201 (1) & 201(1A) of the Act dated 23.3.2011. We have also the benefit of the copy of notif .....

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- SUPREME COURT OF INDIA) squarely apply. Considering the facts in totality as mentioned above, we decline to interfere with the findings of the Ld. CIT(A). - Decided in favour of assessee.

Disallowance u/s 14A - CIT(A) confirming the expenditure u/s. 14A being the amount of interest allocated on a proportionate basis - Held that:- Undoubtedly, in the first round of litigation, the Tribunal has clearly held that Rule 8D is not applicable for the year under consideration, therefore, d .....

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lities and Power Ltd [2009 (1) TMI 4 - HIGH COURT BOMBAY] squarely apply which has been followed by in the case of HDFC Bank (2014 (8) TMI 119 - BOMBAY HIGH COURT) which has been followed by the Tribunal in assessee's own case in A.Y. 2002-03 to 2004- 05. Thus we direct the AO to delete the impugned disallowance made u/s. 14A of the Act.- Decided in favour of assessee.

Deduction u/s. 36(1)(viia) - CIT(A) allowed claim - Held that:- The assessee had not made any provision in the books .....

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ded against assessee.

Provisions of Sec. 115JB are not applicable in the case of the assessee and accordingly ground taken by the assessee is allowed. - ITA No. 6981/Mum/2013, ITA No. 6977/Mum/2013, ITA No. 6919/Mum/2013, ITA No. 6978/Mum/2013, ITA No. 6920/Mum/2013, ITA No. 6979/Mum/2013 - Dated:- 31-7-2015 - Sushma Chowla, JM And N K Billaiya, AM For the Petitioner : Shri G M Doss For the Respondent : Shri C Naresh ORDER Per Bench The captioned appeals were heard together and are di .....

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,19,73,313 was given to the assessee for the year under consideration. However, credit of ₹ 88,07,960/- was given on 29.4.1998. It is the claim of the assessee that interest on TDS of ₹ 88,07,960/- should be granted from April, 1991 instead of April, 1998. 4. The Ld. CIT(A) declined the allow the grievance of the assessee holding that provisions of Sec. 244(2) clearly apply on the facts of the case because there was delay in curing the defects in TDS certificate. Therefore, the asses .....

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there in the TDS certificate is not attributable to the assessee because the TDS certificate was issued by the Reserve Bank of India and various other Government agencies, therefore provisions of Sec. 244(2) do not apply on the facts of the case. 7. Per contra, the Ld. Departmental Representative strongly supported the findings of the Revenue authorities. 8. We have given a thoughtful consideration to the rival submissions and have carefully perused the orders of the authorities below. The undis .....

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in the exchequer in time, section 244A(2) is not attracted. We draw support from the decision of the Hon'ble High Court of Bombay in the case of Larsen & Toubro (supra). We, accordingly set aside the findings of the Ld. CIT(A) and direct the AO to allow the interest for the period 1.4.1991 to 31.3.1998. 9. In the result, the appeal filed by the assessee is allowed. 10. ITA Nos. 6977/M/2013 & 6919/M/2013 are cross appeals by the assessee and the Revenue against the very same order of .....

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of such details, it was found that the assessee has made payment of ₹ 16,96,032/- towards MICR charges to MICR centre managed by the SBI. The AO further noticed that tax on payment of such charges has not been deducted at source as was required u/s. 194J of the Act. It was explained that the bank was not required to deduct tax from the payments made to SBI and therefore provisions of Sec. 40(a)(ia) are not attracted. The explanation of the assessee was not accepted by the AO and according .....

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isallowance. 14. Aggrieved by this, the Revenue is before us. 15. The Ld. DR strongly supported the assessment order. 16. Per contra, the Ld. Counsel for the assessee reiterated what has been stated before the First Appellate Authority. The Ld. Counsel also drew our attention to the order made u/s. 201(1) and 201(1A) of the Act wherein the AO has admitted that the State Bank of India has confirmed that MICR charges were duly accounted while making tax payment by SBI. However, for non deposit of .....

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arges). In our considered opinion, since it has been admittedly proved that the recipient of the MICR charges i.e. State Bank of India has included the sum while making tax payment by it. The ratio laid down by the Hon'ble Supreme Court in the case of Hindustan Coco Cola (supra) squarely apply. Considering the facts in totality as mentioned above, we decline to interfere with the findings of the Ld. CIT(A). 18. In the result, the appeal filed by the Revenue is dismissed. ITA No. 6977/M/13 - .....

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's appeal 21. The sole grievance of the assessee is that the Ld. CIT(A) is not justified in confirming the expenditure of ₹ 26.13 crores u/s. 14A being the amount of interest allocated on a proportionate basis. 22. In the first round of litigation, the disallowance made by the AO u/s. 14A read with Rule 8D travelled upto the Tribunal and the Tribunal in ITA Nos. 4702 to 4706/M/2010 for A.Yrs 2002-03 to 2006-07 at para-5 of its order has restored the matter to the file of the AO for dec .....

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rest free funds of the assessee are considered qua the average investments in assets earning tax free income, it would be clear that the assessee is having sufficient own funds for making the investments therefore the ratio laid down by the Hon'ble Bombay High Court in the case ofHDFC Bank in 366 ITR 505 squarely apply. Therefore, there cannot be any allocation of interest in so far as the computation of disallowance is concerned. The Ld. Counsel also placed reliance upon the decision of the .....

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e formula given in Rule 8D. We also find that the interest free funds available with the assessee is ₹ 1357.84 crores whereas average investments in assets earning tax free income is at ₹ 815.76 crores. This clearly shows that the assessee is having sufficient interest free funds for making the investments. The ratio laid down by the Hon'ble High Court of Bombay in the case ofReliance Utilities and Power Ltd 313 ITR 340 squarely apply which has been followed by the Hon'ble Hi .....

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t grievance of the Revenue is that the Ld. CIT(A) erred in allowing deduction u/s. 36(1)(viia) of the I.T. Act. 29. Briefly stated the facts of the case are that while giving effect to the order of the Tribunal, the AO by his order dated 5.1.2012 did not allow deduction u/s. 36(1)(viia) of the Act based on the amount eligible at 7.5% of gross total income and 10% of rural advances and restricted the deduction to the quantum of provision made in the books towards bad and doubtful debts. 29.1. Bef .....

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e Ld. CIT(A) followed the decision of the Tribunal in assessee's own case for A.Y. 2007-08 and allowed the claim of the assessee. 30. Before us, the Revenue strongly relied upon the finding of the Ld. AO and the Ld. Counsel for the assessee reiterated what has been stated before the First Appellate Authority. Once again reliance was placed on the decision of the Tribunal in ITA Nos. 6631/M/2010 and 6349/M/10 for A.Y. 2007-08. 31. We have carefully perused the orders of the authorities below .....

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, we have to say that the decision of the Hon'ble Punjab & Haryana High Court in the case of State Bank of Patiala 272 ITR 54 was neither brought to the notice of the Tribunal nor it was considered by the Tribunal. On identical set of facts, the Hon'ble Punjab & Haryana High Court after considering the following facts has held accordingly:- "The deduction allowable under section 36(1)(viia) of the Income-tax Act, 1961, is in respect of the provision made. Therefore, making o .....

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alisation and in view of the amendment made in that section with retrospective effect from April 1, 1985, it enhanced the claim for deduction from ₹ 1,19,36,000 to ₹ 1,94,21,000 in its return of income but accordingly made up the shortfall in the provision in the balance-sheet of the subsequent year. The assessee contended before the Assessing Officer that this was substantial compliance with the requirement of law but the Assessing Officer restricted the claim for deduction for bad .....

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books of the subsequent year. Therefore, the Tribunal was right in holding that since the assessee had made a provision of ₹ 1,19,36,000 for bad and doubtful debts, its claim for deduction under section 36(1)(viia) had to be restricted to that amount. No substantial question of law arose for consideration of the court in the appeal ". Respectfully following the decision of the Hon'ble Punjab & Haryana High Court (supra), we set aside the findings of the Ld. CIT(A) and confirm .....

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