TMI Blog2017 (5) TMI 1794X X X X Extracts X X X X X X X X Extracts X X X X ..... profit of the assessee-company under section 115JB - HELD THAT:- As observed that this issue is consequential to the issue involved in Ground No. 1 of the assessee s appeal for AY 2011-12, which has been decided by us in the foregoing portion of this order. Following our conclusion drawn in AY 2011-12 on the said issue, we direct the Assessing Officer to restrict the disallowance under section 14A read with Rule 8D to the extent of exempt dividend income. Ground No. 3 of the assessee s appeal thus is partly allowed. Addition interest subsidy and excise duty refund in computing the income of the assessee under the normal provisions of the Act - HELD THAT:- As decided in own case [ 2017 (3) TMI 1051 - ITAT KOLKATA] incentives, designed to achieve a public purpose, cannot be construed as production or operational incentives for the benefit of assessees alone. It was further held that making of additional provision in the scheme that the incentives would be available to the eligible industrial units from the date of commencement of commercial production and that these are not to be allowed for creation of new assets cannot be viewed in isolation to treat the incentives as produ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing Officer while computing its book profit under section 115JB of the Act as well as its business income under the normal provisions of the Act. After considering the submissions made by the assessee as well as the material available on record, the ld. CIT(Appeals) deleted the additions made by the Assessing Officer on account of excise duty refund and interest subsidy in computing the income of the assessee under the normal provisions of the Act. He, however, confirmed the said two additions made by the Assessing Officer while computing the book profit of the assessee-company under section 115JB of the Act. He also confirmed the disallowance made by the Assessing Officer under section 14A read with Rule 8D while computing the income of the assessee under the normal provisions of the Act and book profit under section 115JB of the Act. 5. Aggrieved by the order of the ld. CIT(Appeals), the assessee and Revenue are both in appeal before the Tribunal on the following grounds:- ITA No. 1953/KOL/2014 (Assessee s appeal) (1) That the Ld. CIT(A)-XII, Kolkata was not justified in upholding the action of the ld. Additional Commissioner of Income Tax, Range-12, in adding a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alcutta High Court in G.A.No.3581 of 2013 in the appeal against the order of the Tribunal in the case of REI Agro Ltd. (supra). In the light of the admitted factual position that the assessee had earned dividend income of only Rs.8,440/- during the previous year, we are of the view that there can be no disallowance u/s 14A of the Act of any sum beyond Rs.8,440/-. Accordingly the addition made u/s 14A of the Act is directed to be restricted to the extent of dividend income of Rs.8,440/-. Gr.No.3 is partly allowed . 7. As the issue involved in the year under consideration as well as all the material facts relevant thereto are similar to AY 2010-11, we respectfully follow the decision of the Coordinate Bench of this Tribunal for A.Y. 2010-11 and direct the Assessing Officer to restrict the disallowance under section 14A read with Rule 8D to the extent of exempt dividend income. Ground No. 1 of the assessee s appeal thus is partly allowed. 8. As regards the issue involved in Ground No. 2 of the assessee s appeal relating to the addition made on account of excise duty refund and interest subsidy while computing book profit under section 115JB of the Act, it is observed that this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the income of the assessee under the normal provisions of the Act is squarely covered in favour of the assessee by the order dated 08.03.2017 (supra) of the Coordinate Bench of this Tribunal passed in assessee s own case for AY 2010-11, wherein a similar issue was decided in favour of the assessee vide Paragraphs No. 11 12 of its order, which read as under:- 11. The conclusion of the Hon'ble High Court is that the Excise refund and interest subsidy received in pursuance of New Industrial Policy of the Government have to be considered in the light of the Office Memorandum dt. 14th June, 2002, and the said Office Memorandum makes it explicit that the concessions were given to achieve twin objects viz., acceleration of industrial development in the State of Jammu Kashmir and generation of employment in that State. The Hon'ble High Court further held that a close reading of the Office Memorandum and the amendments introduced thereto with para 3 of Central Excise Notification Nos. 56 and 57, dt. 11th Nov., 2002, makes it amply clear that the generation of employment so contemplated was not casual or temporary but of permanent nature and the paramount consideration o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee s appeal for AY 2012-13 relating to the disallowance made under section 14A read with Rule 8D in computing the income of the assessee under the normal provisions of the Act is similar to the one involved in Ground No. 1 of the assessee s appeal for AY 201112, which has already been decided by us in the foregoing portion of this order. Following our conclusion drawn in AY 2011-12 on the similar issue, we direct the Assessing officer to restrict the disallowance under section 14A read with Rule 8D to the extent of exempt dividend income earned by the assessee. 15. As regards the issue involved in Ground No. 2 of the assessee s appeal for AY 2012-13 relating to the addition made on account of excise duty refund and interest subsidy while computing book profit under section 115JB of the Act, it is observed that this issue is also similar to the issue involved in Ground No. 2 of the assessee s appeal for AY 201112, which has already been decided by us in the foregoing portion of this order. Following our conclusion drawn in AY 2011-12 on the similar issue, we delete the addition made by the Assessing officer on account of excise duty refund and interest subsidy while co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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