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TMI Blog2016 (4) TMI 1427X X X X Extracts X X X X X X X X Extracts X X X X ..... pectively u/s. 143(3) of the Income-tax Act, 1961 (hereinafter referred to as "the Act") vide his orders dated 29.12.2006 and 31.12.2008. 2. The first common issue in both the years, i.e., A.Ys. 2004-05 and 2005-06 is as regards to disallowance of provision for expenses amounting to Rs. 51,78,904/- and Rs. 36,69,434/-. This issue is raised by the assessee in AY 2004-05 vide Grounds 1 to 3, which reads as under: "1. The Ld. CIT(A) erred in disallowing the provisions made in DMT division of Rs. 8,42,477/- on the ground that the assessee has not given details and these expenses pertains to earlier years or subsequent years. He has not appreciated the facts that the assessee is following mercantile system of accounting and has made the provis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee by the tribunal's order in assessee's own case for A.Y. 2003-04 in ITA Nos. 2250 and 3193/Mum/2010 dated 11.6.2015, wherein the tribunal vide paras 6 and 7 has dismissed the grounds of assessee as under: '6. Ground no.3 relates to a disallowance in the sum of Rs. 31,26,703/-, being the provision for various expenses, effected by the AO for the reason that they were not supported by any evidences. In appeal, the ld. CIT(A) called for a remand report from the AO in view of the additional evidences/materials sought to be relied upon by the assessee, granting deletion where found evidenced and/or supported. The balance disallowance, being confirmed, the assessee is in second appeal. 7. We have heard the parties, and perused the ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re not making any observation with regard to the deduction of the said expenditure for those years/s. We decide accordingly, dismissing the assessee's third ground.' 4. The ld. Counsel for the assessee conceded that this issue now stands covered against the assessee. Accordingly, we dismiss this issue of the assessee's appeals in both the years. 5. The next common issue in these two appeals of the assessee, is as regards to the order of CIT(A) in restricting the disallowance u/s. 14A of the Act. 6. At the outset, the ld. Counsel for the assessee stated that these two assessment year are A.Ys. 2004-05 and 2005-06 and Rule 8D is not applicable in these two assessment years in view of the decision of the Hon'ble Bombay High Court in the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mputation of the deduction u/s. 80HHC, and which was, at the very outset, again, admitted by the ld. AR to be squarely covered against the assessee by the decision of the Apex Court in the case of Ipca Laboratories Ltd. v. Dy. CIT [2004] 266 ITR 521 (SC). We, accordingly, direct for computation of deduction u/s. 80HHC in terms of the said decision by the said hon'ble apex court. We decide accordingly.' In view of the above concession given by the assessee, we dismiss this issue of the assessee's appeal. However, we want to clarify in respect to A.Y. 2004-05, the ld. Counsel for the assessee has further conceded that the CIT(A) has restricted the disallowance to Rs. 7 lacs, which should be restricted at the same amount. In view of the abov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. In view of the above, we are of the view that the disallowance should be restricted to the extent amount already disallowed u/s. 14A of the Act and not exceeding the same. We order accordingly. 11. The next issue in ITA No. 7329/Mum/2010 for the A.Y. 2004-05 is as regards to the order of CIT(A) confirming the disallowance of deduction of eligible profits u/s. 80-HHC of the Act while computing income u/s. 115JB of the Act. For this, the assessee has raised following ground no. 8: "8. The CIT(A) erred in holding that the appellant is not entitled to deduction u/s. 80HHC. As a result, the deduction u/s. 80HHC should not be reduced while computing book profit u/s. 115JB of the Income Tax Act, 1961." 12. At the outset, the ld. Counsel for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 8,42,477/-, provision for water bill amounting to Rs. 15,13,564/- and provision for various expenses amounting to Rs. 28,22,863/- in A.Y. 2005-06. The ld. Counsel for the assessee stated that these expenses are already taxed as provision for expenses and now these are reversed it should not be taxed. On query from the Bench, the ld. Sr. DR stated that the issue can be remitted back to the file of the A.O. for verification of the fact, whether the provision for expenses have been taxed in earlier year or not. Let the assessee produce these evidences, whether these provisions for expenses have been taxed in earlier year or not. On this, the ld. Counsel for the assessee fairly conceded that he has no objection if the issue is remitted bac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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