TMI Blog2019 (6) TMI 740X X X X Extracts X X X X X X X X Extracts X X X X ..... above facts and circumstances, we restore this disputed issue to the file of the AO to recompute the disallowance where only dividend yielding investment has to be considered for the purpose of calculation of average value of investments under rule 8D(2)(iii). Accordingly, the ground of appeal of the assessee are allowed for statistical purposes. Disallowance of long-term retention bonus - AR contention that bonus paid to employees has to be allowed - HELD THAT:- AO has considered the provision of long-term retention bonus as an ascertained liability and it was not paid before due date of filing of Return of income u/s 139(1) and disallowed apparently u/s 43B which the learned AR concedes. The claim shall not be allowable for the assessm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng/2017 - - - Dated:- 14-6-2019 - Shri B.R. Baskaran, Accountant Member And Shri Pavan Kumar Gadale, Judicial Member For the Appellant : Shri V.K.Gurunathan, Advocate. For the Respondent : Shri Vimal Anand, Addl.CIT(DR) ORDER PER PAVAN KUMAR GADALE, JM : The assessee has filed the appeal against the order of the CIT(A), Mysore, passed u/s 143(3) read with section 144C and 250 of the Income-tax Act,1961 ['the Act' for short]. 2. The assessee has raised the following grounds of appeal: 1. The learned CIT (Appeals) erred in passing the order in the manner he did. 2. The learned CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld CIT(A) failed to consider that the expenditure incurred in foreign currency towards telecommunication, insurance 86 freight charges had to be reduced from the total turnover as it was already reduced from the export turnover. The abovementioned reduction needs to be made in the light of the decision of the Hon'ble jurisdictional High Court of Karnataka. 8. The learned CIT (Appeals) erred in confirming the levy of Interest under Section 234B of the Act. 9. For these and such other grounds that may be urged at the time of hearing, the Appellant prays that the appeal may be allowed. 3. Brief facts of the case are that the assessee is in the business of property development and filed t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the SLP filed by the Revenue is pending before the Hon ble Supreme Court against the order of the Hon ble High Court and the expenses incurred in foreign currency towards providing technical services outside India has to be reduced only from export turnover and not from total turnover and restricted the claim of deduction u/s 10A of the Act and determined the total income and passed the order u/s 143(3) r.w.s. 144C dated 18/3/2013. 4. Aggrieved by the order, the assessee has filed an appeal with the CIT(A). Whereas the CIT(A) has not granted the relief on the disputed issues but granted relief on other additions and partly allowed the appeal of the assessee. 5. Aggrieved by the order of the CIT(A), the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee has not incurred any expenditure for earning dividend income and hence, no disallowance is called for. On perusal of the assessment order, we found that the AO has calculated disallowance under rule 8D(2)(iii) considering % of average value of investment. As rightly pointed out by the learned AR that the AO has considered the value of all investments as on 1/4/2008 and as on 31/3/2009 and calculated. In the Special Bench decision of Tribunal rendered in the case of Vireet Investments (165 ITD 27)(Del.), it has been held that where for the purpose of calculation of disallowance under rule 8D, only those investments which yielded exempt income have to be considered. Considering the above facts and circumstances, we restore this di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed issue to the file of the AO to verify the material and evidence in respect of claim made in the earlier years and allow the deduction and this ground of appeal is allowed for statistical purposes. 9. The last ground of appeal being that the AO has restricted the claim of expenses towards telecommunication expenditure, insurance incurred in foreign currency for providing technical services outside India, by allowing the deduction only from export turnover. The learned AR relied on the decision of the jurisdictional High Court in the case of Tata Elxsi (supra) where the Hon ble High Court held that for the purpose of computing exemption u/s 10A, when the export turnover in the numerator is to be arrived at after excludin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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