TMI Blog2023 (5) TMI 1049X X X X Extracts X X X X X X X X Extracts X X X X ..... ived from business, and forty per cent of such income shall be deemed to be income liable to tax . Having considered the above Rule, we find merit in the contention of the assessee that the income of the assessee should be computed first after making the disallowance and whatever is the resultant income only 40% of that income has to be treated as taxable income in terms of Rule 8(1) of the Income Tax Rules, 1962. Since the issue requires no examination and verification of records, we are, therefore, restoring the issue to the file of ld. Assessing Officer to examine the same to compute the income in terms of our observations as stated above by following the Rule 8(1) of the Income Tax Rules. Assessing Officer is directed to compute the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the case, and in law, the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (hereinafter referred to as the ld. CIT(A)) erred in confirming the entire disallowance of Rs.2,51,10,171/- being the deposit of employees share towards Provident Fund contribution after the due date within the meaning of Explanation 1 of section 36(1)(va) of the Income Tax Act, 1961 (the Act) to the business loss as per return without considering application of rule of 8(1) of the Income Tax Rules, 1962 (the Rules) made for computing income from business of tea growing and manufacturing companies and followed by the appellant as the effective disallowance would be forty percent of Rs.2,51,10,171/- i.e. Rs.100,44,068/- . 4. The fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le Apex Court in the case of Jute Corporation of India Limited vs.- CIT reported in (1991) 187 ITR 668 (SC) and National Thermal Power Company Limited vs.- CIT reported in (1998) 229 ITR 383 (SC). We have perused the Rule 8(1) of the Income Tax Rules, 1962, which deals with the manner of computing the income from cultivation and manufacturing of tea. Sub-Rule (1) provides that where the income derived from the sale of tea grown and manufactured by the seller in India shall be computed as if it were income derived from business, and forty per cent of such income shall be deemed to be income liable to tax . Having considered the above Rule, we find merit in the contention of the assessee that the income of the assessee should be computed f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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