2016 (1) TMI 1205 - AT - Income Tax

ITAT Mumbai grants relief on interest expenses & book profit calculation under section 115JB

M/s. Orion Travels Pvt. Ltd. Versus Dy. Commissioner of Income Tax Cen. Cir. 31 Mumbai and Asst. Commissioner of Income Tax Cen. Cir. 31 Mumbai

The Appellate Tribunal ITAT Mumbai allowed both appeals filed by the assessee regarding the denial of relief on interest expenses and the calculation of ... Denial of relief of the liability on account of interest expenses - confirming the calculation of book profit u/s. 115JB - Held that:- As in the assessee’s own case for the A.Y.2001-02 & 2003-04 the coordinate bench of Mumbai restored the above said the issues to the file of CIT(A) for fresh adjudication in the light of order passed by ITAT, Mumbai in the case of Hitesh S. Mehta Vs. DCIT [2013 (10) TMI 1065 - ITAT MUMBAI ] to readjudicate the matter in view of the observations made therein. Issues:Assessment of interest expenses denial by CIT(A) and calculation of book profit u/s. 115JB.Analysis:The judgment by the Appellate Tribunal ITAT Mumbai pertains to two appeals filed by the assessee against orders dated 10.09.2010 & 24.12.2012 by the Commissioner of Income Tax (Appeals) relevant to the assessment years 2007-08 & 2008-09. The appeals were taken up together for convenience as the parties and the nature of controversy were the same. The assessee raised several issues but primarily contested the denial of relief on interest expenses amounting to Rs. 15,78,212/- & Rs. 26,77,555/- and the calculation of book profit u/s. 115JB amounting to Rs. 7,74,534/- & Rs. 10,28,561/- respectively. The assessee argued that the case was similar to previous orders in their favor. The Departmental Representative did not contest the factual position. Upon review, it was found that a coordinate bench had directed a fresh adjudication based on a previous order, leading to the direction for the CIT(A) to decide the matter in light of the specified order. Consequently, the appeals of the assessee were allowed, and both appeals were granted in favor of the assessee.In conclusion, the Appellate Tribunal ITAT Mumbai allowed both appeals filed by the assessee concerning the denial of relief on interest expenses and the calculation of book profit u/s. 115JB. The decision was based on the similarity of the case to previous orders and the direction for fresh adjudication in accordance with a specified order. The judgment highlighted the importance of consistent application of legal principles and the need for fair and thorough adjudication in tax matters.