TMI Blog2019 (6) TMI 1644X X X X Extracts X X X X X X X X Extracts X X X X ..... uction Co.[ 2018 (4) TMI 1627 - ITAT PUNE] held that the assessee is eligible to claim deduction u/s. 80IA(4) of the Act. Respectfully following the decision of Co-ordinate Bench, the findings of Commissioner of Income Tax (Appeals) on this issue are reversed and ground No. 2 of the appeal is allowed. Disallowance of expenditure claimed by the assessee as repairs and maintenance - HELD THAT:- A perusal of documents on record show that the expenditure incurred by the assessee is purely on account of repairs. The expenditure clearly falls within the domain of current repairs‟ within the meaning of section 30 of the Act. Expenditure on repairs of compound wall - The addition has been made merely for the reason that in R.A. bill it has been mentioned Construction of compound wall . The contention of the assessee is that it is repair of existing compound wall. The lower authorities have observed that the assessee has failed to bring on record any documentary evidence to substantiate prior existence of compound wall. Before us also the assessee has not placed on record any documentary evidence to show existence of compound wall. In the absence of complete relevant info ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... debts as irrecoverable - HELD THAT:- As decided in case of TRF Ltd. [ 2010 (2) TMI 211 - SUPREME COURT] it is a well settled law that the assessee need not established that the debt has in fact become irrecoverable. It is enough if the bad debt is written off as irrecoverable in the accounts of assessee. It is not disputed by the Department that the amounts written off as bad debts were duly reflected in the books of assessee in the past and they were written off during the assessment year under appeal. Thus, in view of law laid down by the Hon‟ble Apex Court, we find merit in the contentions of assessee. - Decided in favour of assessee. - ITA No. 1364/PUN/2011, ITA No. 555/PUN/2012 And ITA Nos. 349 & 350/PUN/2015 - - - Dated:- 25-6-2019 - Shri R.S. Syal, Vice President And Shri Vikas Awasthy, Judicial Member For the Assessee : Shri Ashok Kothary. For the Revenue : Shri Pankaj Garg. ORDER PER VIKAS AWASTHY, JM : These four appeals by the assessee are directed against the order of Commissioner of Income Tax (Appeals)-III, Pune for the respective assessment years. Since, the facts in all these appeals are similar, the appeals a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... placed reliance on CBDT‟s Circular F. No. 225/12/2016-ITA-II. 3.1 In respect of ground No. 2 of the appeal, the ld. AR submitted that the assessee had claimed deduction of ₹ 61,15,826/- u/s. 80IA of the Act in respect of profits from windmill. The assessee had claimed similar deduction in assessment year 2006-07. The same was denied to the assessee by the Assessing Officer and Commissioner of Income Tax (Appeals). The assessee carried the issue in appeal before the Tribunal in ITA No. 1450/PUN/2009 for the assessment year 2006-07. The Tribunal vide order dated 20-12-2018 allowed the benefit of deduction u/s. 80IA to the assessee. 3.2 In respect of ground No. 3 of the appeal, the ld. AR submitted that the assessee had incurred expenditure on repairs and maintenance of building. The assessee had paid ₹ 14,65,000/- for re-roofing of Jalgaon Office and ₹ 1,87,174/- for repairing of compound wall at Jalgaon. Further, the assessee had incurred expenditure of ₹ 6,53,811/- for installation of DG set which includes civil work for foundation of DG set, fabrication and carpentry work. The ld. AR submitted that re-roofing was done with polycarbonate s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eteness the relevant extract of the findings of Co-ordinate Bench in assessee‟s own case for assessment year 2006-07 are reproduced here-in-below : 9. We have perused the case record and heard the rival contentions. We also analyzed the facts and circumstances in this case. We find that in the case of ACIT-1(3) Vs. M/s. Superior Financial Consultancy Services Pvt. Ltd. (supra.), facts and circumstances were exactly similar to the instant case on hand. In that case before the Mumbai Bench of the Tribunal, the assessee, a private limited company, engaged in the business of borrowing and lending funds reflected stock-in-trade of ₹ 8,30,95,223.15 in its P L account as on 31.03.2002 and converted its stock-in-trade of shares to investment with effect from 1.04.2002. Accordingly, the assessee reflected its stock of shares in its balance sheet as investment‟ as on 31.03.2003. During the year under consideration (A.Y.2004-05) the assessee sold shares out of the shares converted into investment and has claimed long term capital gain on sale of such shares amounting to ₹ 7,13,29,191/-. In the assessment framed u/s.143(3) of the Act, the Assessing Officer as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ible business without adjusting prior year losses from such eligible business against the current years income on the ground that prior years losses from the eligible business had already being set off against Income from Other business or against other Income. This is patently erroneous in as much as Section 80-IA(5), the eligible business is required to be taken as the only source of the Income of the assessee. It means that for the purpose of computing profit derived from the eligible business, the losses from such eligible business incurred in the prior years will have to be considered as still remaining intact; and consequently, will have to be brought forward and set off against the Income from the eligible business. The other businesses if any of the assessee and set off of the loss from the eligible business already made against income from such other businesses will be out of the reckoning. The Commissioner of Income Tax (Appeals) upheld the findings of Assessing Officer. Disallowance of deduction u/s. 80IA in the assessment year under appeal is on similar lines as was made in assessment year 2006-07. The Co-ordinate Bench of Tribunal in assessee‟s own ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n existence, prior to the date of repairs, the expenditure has to be allowed as revenue in nature. Another addition that has been made after disallowing expenditure is on account of installation of DG set, civil work, fabrication and carpentry. The contention of the assessee is that the assessee had purchased new DG set for which civil work was required to be carried out for the installation. The expenditure incurred on foundation of DG set is purely revenue in nature as no enduring benefit would accrue to the assessee and no new asset has come into existence. Therefore, the addition of ₹ 6,53,811/- on account of foundation of DG set is held to be on revenue account. In view of our above findings the ground No. 3 of the appeal is partly allowed in the aforesaid terms. 9. In the result, the appeal of assessee for assessment year 2007-08 is partly allowed. ITA No. 555/PUN/2012, (A.Y. 2008-09) 10. This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals)-III, Pune dated 30-11-2011 for the assessment year 2008-09. The grounds raised by the assessee in appeal are as under : On the facts and the circumstanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... impugned order and prayed for dismissing the appeal of assessee. 13. Both sides heard. Orders of the authorities below perused. The ground No. 1 of the appeal is with respect to the treatment to be given to income from sale of shares. The assessee has claimed gain on sale of shares as Long Term Capital Gain, whereas, the Department has held the income on sale of shares as Business Income. We find that the issue raised in ground No. 1 of the present appeal is identical to the issue adjudicated by us in ground No. 1 of the appeal for assessment year 2007-08. Therefore, the findings given by us in assessment year 2007-08 on this issue would mutatis mutandis apply to the ground No. 1 of the present appeal. Consequently, ground No. 1 is allowed. 14. In respect of ground No. 2 of the appeal, the ld. AR stated at the Bar that he is not pressing ground No. 2. Thus, in view of the statement made by the ld. AR of assessee ground No. 2 is dismissed as not pressed. 15. In ground No. 3 of the appeal, the ld. AR has assailed the disallowance of ₹ 1,71,353/- u/s. 14A r.w. Rule 8D. We find that the disallowance has been made under the provisions of Rule 8D(2)(iii). Undisput ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. In invoking the provisions of Sec.14A of the I.T. Act, 1961 and adding ₹ 1,31,412/- as disallowance of expenditure U/s 14A of the Income Tax Act, 1961. It is prayed that the said disallowance be deleted. 4. In not appreciating the fact that the assessee has not incurred any expenditure attracting provisions of Sec. 14A and thereby disallowing of ₹ 1,31,412/-. This action being bad in law it is prayed that the disallowance of ₹ 1,31,412/- be deleted. 5. In disallowing bad debts of ₹ 91,91,033/- written off, during the year by the assessee as bad debts in its books of accounts. It is prayed that the same be allowed and the income be reduced to that extent. 6. In disallowing bad debts comprising of various amounts totalling to ₹ 91,91,033/- on the one or other ground and stating that they are not debts or bad debts. This action of the Assessing Officer and the CIT(A) being not in accordance of law and the accounting principles it is prayed that the entire amount of bad debts be allowed to be written of during the year and the income be reduced to that extent. The appellant named above craves leave to add, to alter and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndis apply to the assessment year under appeal. Accordingly, ground Nos. 1 and 2 of the appeal are allowed. 22. In ground Nos. 3 and 4 of the appeal the assessee has assailed disallowance u/s. 14A of the Act. Undisputedly, the assessee has earned dividend income of ₹ 5,92,935/-. No suo-moto disallowance has been made by the assessee u/s. 14A of the Act. The contention of the assessee is that the Assessing Officer has not recorded proper satisfaction u/s. 14A. There is no set proforma/format for recording satisfaction before making disallowance u/s. 14A. However, the requirement is that the Assessing Officer before making disallowance under Rule 8D should record reasons as to why he does not concur with the contentions of assessee for making insufficient/no disallowance under the provisions of section 14A. Analysis of satisfaction recorded by Assessing Officer is subjective examination. In the present case, in our considered opinion the Assessing Officer has recorded satisfaction as envisaged under sub-section (3) of section 14A before making disallowance under Rule 8D(2)(iii). The Assessing Officer has not made any disallowance with respect to interest expenditure under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions of Sec.14A of the I.T. Act, 1961 and adding ₹ 1,31,730/- as disallowance of expenditure U/s 14A of the Income Tax Act, 1961. It is prayed that the said disallowance be deleted. 4. In not appreciating the fact that the assessee has not incurred any expenditure attracting provisions of Sec. 14A and thereby disallowing of ₹ 1,31,730/-. This action being bad in law it is prayed that the disallowance of ₹ 1,31,730/- be deleted. The appellant named above craves leave to add, to alter and to amend the grounds of appeal if and when required. 26. The ld. AR submitted that the issue raised in ground Nos. 1 and 2 of the appeal are with respect to claim of deduction u/s. 80IA, which has already been argued in assessment year 2007-08. The submissions made for the assessment year 2007-08 would equally apply to the assessment year 2011-12. 26.1 The ld. AR submitted that ground Nos. 3 and 4 of the appeal are with respect to disallowance of ₹ 1,31,730/- u/s. 14A r.w. Rule 8D. The ld. AR further submitted that the issue raised in ground Nos. 3 and 4 of the appeal is identical to the one raised in assessment year 2010-11. The submissions ma ..... X X X X Extracts X X X X X X X X Extracts X X X X
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