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Joint Commissioner of Income Tax (OSD) Circle-4, Kolkata, Versus M/s. Jay Shree Tea & Industries Ltd. and vice-versa

2013 (11) TMI 1717 - ITAT KOLKATA

I.T.A. No. : 590/Kol /2012, C.O. No. 49/Kol ./2012 (arising out of I .T.A. No.: 590/Kol ./ 2012) - Dated:- 29-11-2013 - Shri Mahavir Singh (Judicial Member) and Shri Abraham P. George (Accountant Member) Shri Rajendra Prasad, Sr. D.R. , for the Department Shri B.K. Chaturvedi , A.R. , for the assessee O R D E R Per Shri Abraham P. George : 1. These are appeal and Cross Objection filed by the Revenue and assessee respectively directed against an order dated 23rd December, 2011 of Commissioner of .....

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duously applied section 14A alongwith Rule 8D of the Income Tax Rules, 1962 for making the disallowance. Per contra, ld. A.R. submitted that section 14A could not have been applied at all in view of the decision of Hon ble Mumbai High Court in the case of Godrej & Boyce Manufacturing Co. Ltd. -vs.- DCIT [328 ITR 81]. 4. We have heard the rival submissions and seen the impugned order. In the case of Godrej & Boyce Mfg. Co. Ltd., Hon ble Mumbai High Court had held that Rule 8D could be app .....

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disallowance to the extent of 1% of the exempt income, which is a reasonable estimate generally followed by this Tribunal, while considering disallowances under section 14A of the Act, for years prior to assessment year 2008-09. We cannot appreciate the argument of the assessee that no disallowance at all was called for under section 14A of the Act. We, therefore, dismiss the Ground No. 1 of the Revenue as well as Cross Objection filed by the assessee. 5. Vide its Ground No. 2, Revenue is aggri .....

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.684/Kol/2012, following its own order for assessment year 2006-07 in ITA No. 2248/Kol/2010 had held that while computing book profit under Chapter XIV-B of the Act, section 14A had no application whatsoever. Respectfully following this decision, we dismiss Ground No.2 raised by the Revenue. 8. Vide it s Ground No. 3, Revenue is aggrieved that notional interest of ₹ 12,87,900/-on sticky loans added by the Assessing Officer was deleted by the ld. CIT(Appeals). 9. Ld. Counsels for the assess .....

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ght of the rival submissions made by both the sides, it is found that undisputedly the assessee has not account for interest on deposit of ₹ 3,99,40,000/- as the assessee has initiated legal proceedings for recovery of the said amount and the proceedings are still pending before the appropriate authorities. Therefore, the assessee has not got the interest thereby but the AO worked out the notional interest @15% of the said loan on the ground that the assessee is following the mercantile sy .....

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he recovery of the said amount. Hence, the addition is not sustainable for legal scrutiny and accordingly deleted". For the impugned assessment year also Revenue has no case that assessee had accounted as income any interest on sticky loans. Assesese having not accounted for any interest on sticky loans, we are of the view that ld. CIT(Appeals) was justified in relying on the earlier orders of this Tribunal, and deleting the addition made. Ground No. 3 of Revenue s appeal stands dismissed. .....

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R. submitted that ld. CIT(Appeals) was well supported by the decision of Hon ble jurisdictional High Court in the case of CIT - vs.- AFT Industries Ltd. [270 ITR 167]. 14. We have heard the rival submissions and perused the orders of authorities below. The ground itself is misconceived since there was no addition of the like amount for any interest income on foreign funds, made by the Assessing Officer in the assessment order. If we consider it as a disallowance for cess on green leaves, in view .....

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