TMI Blog2013 (6) TMI 884X X X X Extracts X X X X X X X X Extracts X X X X ..... the Income-tax Act, 1961. The appeals for the assessment years 2006-07 and 2007-08 are directed against the common order of the Commissioner of Income-tax(Appeals)-I at Chennai, dated 4-9-2012 and again arise out of the regular assessments completed under section 143(3) of the Act. 2. First we will consider the appeal filed by the Revenue for the assessment year 2005-06. 2.1. The first issue raised in this appeal is that the Commissioner of Income-tax(Appeals) has erred in granting a relief of ₹ 6,86,413/- towards charges paid to M/s.Fumigation Services. We find that the disallowance of ₹ 6,86,413/- made by the Assessing Officer under section 40(a)(ia) is deleted by the Commissioner of Income-tax(Appeals) in the light of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to apply for the impugned assessment year 2005-06. It is to be seen that tax was deducted at source by the assessee on payment of ship charter hire charges of ₹ 11,83,36,685/-. The tax deducted at source was paid by the assessee on 27-5-2005, which is after the close of the relevant previous year but before the due date for filing of the return of income under section 139(1). The Tribunal have consistently held that the amendment brought in section 40(a)(ia) regarding payment of TDS deducted on or before the due date for filing of the return and escaping from the rigors of section 40(a)(ia) is retrospective. The Chennai Bench of the Tribunal has held so in the case of SRS Import Export vs. DCIT (ITA No.956(Mds)/2012) and in the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the details available on record and as explained by the learned chartered accountant appearing for the assessee, we find that banks have given loans to different entities for specific purposes and there is no diversion of funds from one loan account to another company. In the case of the assessee the loans are mainly of Packing Credit Advances given by the banks against confirmed export orders. Such Packing Credit Advances cannot be diverted for any other purpose as the said loan portfolio is under the close scrutiny of the banks. The banks themselves are directly making payments under loan account to suppliers of goods, etc.. Therefore it is not possible to hold that the assessee-company had diverted any funds from its Packing Credit Adva ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f indirect expenditure would have gone into managing the investment and earning dividend income. Therefore, taking an overall view of the situation we find that a sum of ₹ 3 lakhs may be disallowed as expenditure relating to earning of dividend income. The order of the Commissioner of Income-tax(Appeals) on this point is modified and accordingly the disallowance of ₹ 37,05,741/- is reduced to ₹ 3 lakhs. This ground is partly allowed. 3.3. The third issue raised by the Revenue is that the Commissioner of Income-tax(Appeals) has erred in granting a relief of ₹ 2,65,360/- towards charges paid to M/s.Fumigation Services, from which the assessee has not deducted tax at source. This disallowance is confirmed and the ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o ₹ 3 lakhs and the order of the Commissioner of Income-tax(Appeals) on this point is modified to the above extent. This issue is decided partly in favour of the Revenue. 4.2. The third issue raised by the Revenue is that the Commissioner of Income-tax(Appeals) has erred in granting a relief of ₹ 3,77,708/- towards charges paid to M/s.Fumigation Services, from which the assessee had not deducted tax at source. The order of the Commissioner of Income-tax(Appeals) on this issue is set aside and the disallowance of ₹ 3,77,708/- is confirmed, as discussed above by us in our order passed for the assessment year 2006-07. This issue is decided in favour of the Revenue. 4.3. The fourth issue raised by the Revenue is that the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
