TMI Blog2012 (4) TMI 602X X X X Extracts X X X X X X X X Extracts X X X X ..... d income earned - Held that:- CIT(A) after examining the facts of the case and submissions of the parties has rightly held that 5% of the dividend income would be reasonable expenditure to earn the dividend income of ` 2,13,19,656/- thereby restricting disallowance to ₹ 10,65,980/-. In view of our above findings, we uphold the order of the CIT(A) and dismiss this ground of appeal as well. - ITA Nos.1318 & 1319/Mds/2011 - - - Dated:- 30-4-2012 - DR. O.K. NARAYANAN, VICE-PRESIDENT AND SHRI VIKAS AWASTHY, JUDICIAL MEMBER Appellant by : Shri A.Rai, CIT DR Shri K.E.B.Rangarajan, Jr. Standing Counsel Respondent by : Shri Anil Nair, C.A., ORDER PER VIKAS AWASTHY, JUDICIAL MEMBER: The present two set of appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hrough the facts of the case, submissions of the parties and documents on record partly allowed the appeal of the assessee. Aggrieved against the orders of the CIT(A) dated 28th April, 2011, the department preferred appeal (ITA No.1318 of 2011) before the Tribunal impugning the order of the learned CIT(A) on the following grounds:- i) Deleting the disallowance on foreign exchange loss credited to the profit and loss account to the tune of ` 44,76,485/-; ii) Deleting the disallowance under section 40a(ia) amounting to ` 4,47,485/-; iii) Restricting the disallowance made under section 14A read with Rule 8D to 5% of dividend income earned i.e. ` 10,65,980/-. 4. Similarly for the assessment year 2007-08 the assessee filed return o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment year 2006-07 are general in nature and thus needs no adjudication. 7. The learned D.R. submitted that the CIT(A) while deleting disallowance on foreign exchange loss has wrongly relied on the decision of the Hon ble Supreme Court of India in the case of CIT Vs. Woodward Governor India P.Ltd., reported as 312 ITR 254(SC). He submitted that the ratio laid down by the Hon ble Supreme Court in Woodward s case is not applicable in the facts and circumstances of the present case. The learned D.R. assailing the third ground of appeal submitted that the CIT(A) has erred in deleting the disallowance under section 40(a)(ia) amounting to ` 4,47,485/-. He contended that the provision of section 40(a)(ia) is very specific about the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Supreme Court of India passed in the case of CIT Vs. Woodward Governor India P. Ltd. reported as 312 ITR 254. He submitted that the Assessing Officer in his order has observed that the assessee has incurred loss on realization of export proceeds due to exchange fluctuations. The Assessing Officer has disallowed loss on the ground that the loss is nothing but a notional loss. The learned A.R. defending the order of the CIT(A) submitted that the assessee had deposited the TDS before the due date of filing the return of income. To support his arguments, he relied on the decisions of the Tribunal in the case of Bapushaeb Nanasaheb Dhumal in ITA No.6628/Mum/2009, M/s. Golden Stable Lifestyle Centre Pvt.Ltd. Vs. ACIT in ITA No.5145/Mum/2009 and K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gree with this. The profit and loss account of the assessee prepared for the year ending on 31.03.2006 on which day valuation of the current assets and receivables are made. Even though the profit or loss is computed for relevant previous year as a whole, the valuation of stock, current assets and receivables is usually made on the balance sheet day. On the balance sheet day, as there is fluctuation in the foreign exchange rate, the value of receivable reflected in the balance sheet has come down and thereby assessee has incurred loss for that day. When the balance sheet is prepared on that day, the loss is real even though the realisation may be at a future date and even the assessee gain more at that point of time by another rate fluctuat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Assessing Officer following the decisions of the Mumbai Bench of the Tribunal on similar issue in the case of Bapushaeb Nanasaheb Dhumal in ITA No.6628/Mum/2009 decided on 25.6.2010, in the case of M/s. Golden Stable Lifestyle Centre Pvt.Ltd. Vs. ACIT, in ITA No. 5145/Mum/2009 and in the case of Kanubhai R.Makwana Vs. ITO in ITA No.2983/Ahd/2010 decided by Ahmedabad Bench of the Tribunal. It is not in dispute that tax has been deducted at the applicable rates and the same has been remitted before due date of filing of the return. Sufficient compliance has been made after tax is remitted before the due date of filing of return. Therefore respectfully following the decisions of the co-ordinate Benches of the Tribunal, we uphold the find ..... X X X X Extracts X X X X X X X X Extracts X X X X
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