9911796707
TMI Blog2020 (8) TMI 560X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the business of commercial printing and photo typesetting. Assessee filed its return of income for A.Y. 2007-08 on 31.10.2007 declaring total income of Rs. 17,65,29,535/-. The case was selected for scrutiny and thereafter initially the assessment was framed u/s 143(3) vide order dated 30.12.2009 and the total income was determined at Rs. 18,91,41,620/-. Subsequently, the case was reopened by issuing notice u/s 148, which was issued and served to the assessee on 20.03.2012. Consequently, the case was taken for scrutiny and thereafter assessment was framed u/s 143(3) r.w.s 148 vide order dated 22.03.2013 and the total income was determined at Rs. 20,11,00,353/-. Aggrieved by the order of AO, assessee carried the matter before the CIT(A) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... resorted to the reopening of case by issuing notice u/s 148 of the Act. The AO as per the recorded reasons, had resorted of the reopening of the assessment for two reasons. Firstly, assessee had claimed and has been allowed deduction of expenditure on account of cess on income tax of Rs. 14,21,208/-, which according to AO was not allowable u/s 40(a)(ii) of the Act. The second reason for reopening was that assessee had made a provision for doubtful debt amounting to Rs. 2,02,10,084/- in the Profit and Loss Account but while computing the total income, it had added back only Rs. 96,72,559/- resulting into underassessment of income by Rs. 1,05,37,525/- on that count. In reassessment order framed u/s 143(3) rws 147 of the Act, AO made the addit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upholding the addition made by AO. He submitted that assessee had debited the aforesaid amount to the Profit and loss account and had claimed it as deduction. The AO was of the view that cess was an integral part of income tax and covered under the provisions of s. 40(a)(ii) and therefore cannot be allowed as deduction. He accordingly disallowed the amount of cess on income tax u/s 40(a)(ii) of the Act. When the matter was carried by the Assessee before the CIT(A), the order of AO was upheld by CIT(A). 8. Before us, Learned AR submitted that the issue that the cess on income tax is not covered u/s 40(a)(ii) is covered in assessee's favour by the decision of Hon'ble Bombay High Court in the case of Sesa Goa Ltd. vs. JCIT reported in [2020] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... F. No. 91/58/66-ITJ(19), dated 18.05.1967. 10. Before us, Revenue has not placed any contrary binding decision in its support. In such situation, we, relying on the decision of Hon'ble Bombay High Court in the case of Sesa Goa (supra) hold that the AO was not justified in disallowing the amount of cess paid on income tax. We therefore, direct its deletion. Thus, ground of appeal of the assessee is allowed. 11. Before us, Ld AR had submitted that if the ground on merit is decided in Assessee's favour, the grounds raised by him challenging the reassessment proceedings would be rendered academic. Since we have herein above have decided the issue on merit in assessee's favour, the grounds raised by the assessee challenging the reassessment pr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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