TMI Blog2016 (4) TMI 915X X X X Extracts X X X X X X X X Extracts X X X X ..... e income or receipt of the assessee, this Tribunal is of the considered opinion that second limb of Rule 8D would come into operation. Even in case no expenditure was incurred, third limb of Rule 8D provides for computation of expenditure. In the case before us, the Assessing Officer has applied the provisions of Rule 8D and computed the disallowance at ₹ 24,61,662/-. There is no dispute about the computation of expenditure as made by the Assessing Officer. Therefore, this Tribunal do not find any reason to interfere with the order of the CIT(A). Accordingly, the same is confirmed. - Decided against assessee Reopening of assessment - no adjustment of bad and doubtful debts to the book profit u/s 115 JB - Held that:- The Assessing O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5JB(2) of the Act. This Tribunal is of the considered opinion that since Explanation 1 to sec. 115JB(2) of the Act is applicable retrospectively with effect from 1.4.2001, the provision for bad and doubtful debt has to be increased as provided therein. Therefore, this Tribunal do not find any reason to interfere with the order of the lower authority. - Decided against assessee Rectification proceedings u/s 154 - excess loss was set off against the book profit - Held that:- It is not in dispute that the total book loss available to the assessee-company for carry forward and set off for assessment year 2004-05 is only ₹ 3,57,07,000/- and not ₹ 4,31,68,928/-. The Assessing Officer has rectified only this apparent mistake on reco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rding to the ld. Counsel, when the assessee has not incurred any expenditure, there is no reason for making the disallowance. 4. On the contrary, Shri A.B Koli, ld. Departmental Representative submitted that though the assessee claims that no expenditure was incurred and the surplus funds were used for making investments, Rule 8D provides for computation of expenditure for earning the exempted income. When the assessee has incurred expenditure indirectly which is not attributable to any particular income or receipt and no such expenditure was also attributable to earning of the exempted income, the rule provides for computation of expenditure for disallowance by applying Rule 8D(2). The Assessing Officer computed the disallowance by appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der of the CIT(A). Accordingly, the same is confirmed. 6. Now, coming to I.T.A.No.1389/Mds/2014 for assessment year 2004-05, the first ground of appeal is with regard to reopening of assessment u/s 147 of the Act. 7. Shri R.Vijayaraghavan, ld. Counsel for the assessee submitted that the assessee filed the return of income on 24.10.2004. The Assessing Officer reopened the assessment by issuing notice u/s 148 of the Act on 25.2.2011 after the expiry of four years from the end of assessment year in which the return of income was filed. Therefore, according to the ld. Counsel, reopening of assessment is not justified. 8. On the contrary, Shri A.B Koli, ld. Departmental Representative submitted that the return was originally filed on 24 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion a provision was made to the extent of ₹ 3,50,72,000/- for bad and doubtful debts and the same was added in the computation of total income under the normal provisions of the Income-tax Act, 1961. However, while computing profit u/s 115JB of the Act, no adjustment was made. Referring to clause(i) of sec. 115JB(2) of the Act, the ld. Counsel submitted that Explanation 1 to sec. 115JB of the Act was inserted by Finance Act, 2008, therefore, the same is not applicable for the assessment year under consideration. 11. We have considered the rival submissions on either side and also perused the material available on record. Explanation 1 to sec. 115JB of the Act was introduced by Finance Act 2008 with retrospective effect from 1.4.200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Assessing Officer in the proceedings u/s 154 of the Act. 13. Shri R.Vijayaraghavan, ld. Counsel for the assessee submitted that in the assessment made after reopening of assessment on 19.12.2011, an amount of ₹ 4,31,68,928/- was shown as brought forward book loss and the same was reduced from the profit as per the Profit Loss Account to arrive at the taxable profit of ₹ 1,04,79,974/- u/s 115JB of the Act. Subsequently, the Assessing Officer found that the unabsorbed depreciation of SPIC Organics Ltd u/s 32(2) of the Act for the assessment year 2000-01 was only ₹ 3,57,07,000/-. Therefore, the Assessing Officer came to know that the excess loss was set off against the book profit which is a mistake apparent from the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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