Tribunal partially allows assessee's appeal for 2006-07, directs reassessment on disallowance and interest.

The Revenue's appeal for the assessment year 2006-07 was dismissed, and the assessee's appeal was partly allowed. The Tribunal directed the Assessing Officer to re-examine the computation of disallowance u/s 14A and interest u/s 244A in accordance with relevant rulings. The disallowance of contribution to the Retired Employees Medical Benefit Scheme u/s 40A(9) was deleted based on precedent. The Tribunal's decision was issued on 11-10-2013, with instructions for further proceedings.

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Issues:
1. Disallowance made u/s 14A of the Act for assessment year 2006-07.
2. Method of computation of disallowance u/s 14A of the Act.
3. Disallowance of contribution made to Retired Employees Medical Benefit Scheme u/s. 40A(9) of the Act.
4. Computation of interest u/s. 244A of the Act.

Analysis:

1. Disallowance made u/s 14A of the Act for assessment year 2006-07:
The assessee challenged the disallowance made u/s 14A of the Act. The Ld. Counsel did not press the ground challenging the disallowance. The remaining ground was about the method of computation of disallowance u/s 14A. The Assessing Officer included "profit on sale of investments" as exempted income, which the assessee contested as incorrect. The Tribunal set aside the order of the Ld. CIT(A) and directed the Assessing Officer to re-examine the claim of the assessee and re-compute the disallowance u/s 14A accordingly.

2. Disallowance of contribution made to Retired Employees Medical Benefit Scheme u/s. 40A(9) of the Act:
The only issue in the appeal filed by the revenue was the deletion of disallowance of contribution made to the Retired Employees Medical Benefit Scheme. The Tribunal noted that a previous decision favored the assessee on this issue. The Ld. CIT(A) followed the decision of the Tribunal and deleted the disallowance, justifying it by citing the Tribunal's earlier ruling. The Tribunal upheld the decision of the Ld. CIT(A) based on the precedent set by the jurisdictional Tribunal.

3. Computation of interest u/s. 244A of the Act:
The appeals filed by the assessee raised the issue of computation of interest u/s. 244A of the Act. The Ld. Counsel relied on a Supreme Court judgment but a subsequent Supreme Court decision clarified the issue. The Tribunal found that the issue required fresh examination in light of the latest Supreme Court ruling. Consequently, the Tribunal set aside the order of the Ld. CIT(A) and directed the Assessing Officer to re-examine the issue in accordance with the recent Supreme Court decision.

Conclusion:
The appeal filed by the Revenue for the assessment year 2006-07 was dismissed, while the appeal filed by the assessee for the same year was partly allowed. The remaining three appeals filed by the assessee were treated as allowed. The Tribunal pronounced the judgment on 11-10-2013, providing directions for further action on the issues discussed in the judgment.

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