TMI Blog2021 (7) TMI 275X X X X Extracts X X X X X X X X Extracts X X X X ..... ies (P) Ltd. vs. CIT[ 1989 (7) TMI 342 - CALCUTTA HIGH COURT] - The ground raised by the Revenue on this issue is accordingly allowed. Addition on account of bonus unpaid by invoking the provisions of section 43B - CIT(A) deleted the addition on the ground that identical issue was decided by his predecessors in the preceding so many assessment years - HELD THAT:- As per provisions of section 43B(c) any sum referred to in clause (ii) of sub-section (1) of section 36, payment of bonus shall be allowed as an expenditure on actual payment. Since the assessee admittedly had not paid such bonus before the specified date for which the auditors even have qualified the same, the ld. CIT(A) in our opinion was not justified in deleting the addition. The ground raised by the Revenue is accordingly allowed. Addition on account of leave encashment unpaid u/s. 43B - CIT(A), following the orders of his predecessor for preceding so many assessment years, deleted the addition - HELD THAT:- The order of CIT(A) in our opinion, is not in accordance with law. With effect from 01.04.2002, clause (f) has been inserted in provisions of section 43B according to which any sum payable by the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3-14 deleted the above additions. 4. Aggrieved with such order of the CIT(A), the Revenue is in appeal before the Tribunal by raising the following grounds:- 1. The order of Ld. CIT(A) is not correct in law and on facts. 2. That on the facts and circumstances of the case, the Ld. CIT(A) has erred in deleting the addition of ₹ 1,43,46,219/- made by AO on account of Amortization of investment'. 3. That on the facts and circumstances of the case, the Ld. CIT(A) has erred in deleting addition of ₹ 960/- made by AO on account of 'Interest on TDS'. 4. That on the facts and circumstances of the case, the Ld. CIT(A) has erred in deleting addition of ₹ 6,62,612/- made by AO on account of 'Bonus Unpaid'. 5. That on the facts and circumstances of the case, the Ld. CIT(A) has erred in deleting addition of 31,63,861/- made by AO on account of 'Leave Encashment Unpaid'. 6. The appellant craves leave to add, amend any/all the ground of appeal before or during the course of hearing of the appeal. 5. Grounds No. 1 and 6 being general in nature are dismissed. 6. In ground of appeal No. 2, the Revenue has challenge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provisions of Section 44 of the Act and to this extent, the IRDA guidelines cannot have any overriding effect on the same. From the perusal of books of accounts and the details filed by the assessee, he noted that the assessee has shown ₹ 1,43,46,219.44 as amortization (charge)/credit against the interest earned on such securities. 9. According to the AO, the contention of the assessee is not maintainable so far as the claim of amortization is concerned. He observed that in some cases such investments have been made from the local market where cost has been incurred more than the face value of the securities. However, the market rate of such securities is not significantly less than purchase cost because in a majority of such investments in securities, further investments have been made in secured funds where the chances of any significant fall does not exist. He noted that as per the practices adopted by the assessee over the years, the difference in purchase value of the securities and the face value is amortized and written off over the period of remaining life-span of the security against the interest received/receivable. The claim of such amortization is not permissib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his predecessor for AYs 2012-13 and 2013-14 and 2006-07 to 2011-12. Nothing contrary was brought to our notice to take a contrary view than the view taken by the CIT(A) on this issue. We, therefore, do not find any infirmity in the order of the CIT(A) deleting the addition. Accordingly, the ground raised by the Revenue on this issue is dismissed. 12. So far as the deletion of ₹ 960 made by the AO on account of interest on TDS as per grounds of appeal No. 3 is concerned, we find, the AO made the addition on the ground that ₹ 960/- has been debited under the head 'Miscellaneous expenses' being interest on TDS which, according to him, is inadmissible u/s. 40(a) of the IT Act. Here also, the Ld. CIT(A) deleted the same by following the orders of his predecessors for preceding assessment years. However, in our opinion, interest on TDS is not an allowable expenditure in the light of the decisions of Hon'ble Supreme Court in the case of Bharat Commerce Industries reported in 230 ITR 733 and the decision of Hon'ble Calcutta High Court in the case of Martin Harries (P) Ltd. vs. CIT, reported in 73 Taxmann 555. The ground raised by the Revenue on this issue ..... X X X X Extracts X X X X X X X X Extracts X X X X
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