High Court of Bombay upholds Tribunal decisions, dismissing revenue appeals on tax issues. Legal precedents applied.

The High Court of Bombay dismissed the appeals filed by the revenue, upholding the Tribunal's decisions on various issues raised by the appellant. The Court found that the questions raised did not present substantial legal questions and were not entertained due to previous rulings and lack of merit in the appellant's arguments. The Court's analysis focused on legal arguments, precedents, and the application of relevant sections of the Income Tax Act, resulting in the rejection of the appellant's contentions.

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Issues:
- Appeal challenging common order dated 21 November 2012 passed by the Income Tax Appellate Tribunal for Assessment Year 2006-07 and 2007-08.
- Questions of law raised by the appellant regarding disallowance of expenses, exclusion of income exempt under Section 10(35), depreciation claim, and carry forward of excess application of income.
- Analysis of each question based on legal arguments and precedents cited.

Question No. (i):
The issue revolves around the Tribunal setting aside the order confirming disallowance made by the AO under Section 14A read with Rule 8D of the I.T. Rules 1962. The appellant argued that the Tribunal failed to appreciate the relevance of a previous Bombay High Court decision contested before the Supreme Court. However, the Court noted that the issue was already decided in favor of the respondent-assessee by a previous Court decision, and the SLP filed by the revenue was also dismissed. Consequently, Question No. (i) was not entertained due to lack of substantial legal question.

Question No. (ii):
This question concerns the exclusion of income exempt under Section 10(35) from the total income of the assessee for calculating the application of income under Section 11 of the I.T. Act. The Tribunal set aside the CIT (Appeals) order as it did not consider the relevant decisions cited by the respondent-assessee. The Court found fault with the CIT (Appeals) for disregarding the cited decisions without proper reasoning, leading to the Tribunal's decision being upheld. Therefore, Question No. (ii) did not raise a substantial question of law and was not entertained.

Question No. (iii):
The issue here pertains to the claim of depreciation on fixed assets already shown as application of income under Section 11. The Assessing Officer disallowed the claim, citing double deduction concerns. The Tribunal, following precedent, allowed the depreciation claim, emphasizing that it does not lead to double deduction. The Court supported the Tribunal's decision based on previous rulings and dismissed the revenue's grievance. Question No. (iii) did not give rise to a substantial legal question and was not entertained.

Question No. (iv):
This question involves the carry forward of excess application of income from earlier years against the income of the subject assessment years. The Assessing Officer disallowed the set off, but the Tribunal restored the issue for examination of exemption claim under Section 11 for earlier years. The Court upheld the Tribunal's decision, stating that the issue for the subject assessment year depended on the Assessing Officer's decision for earlier years. Consequently, Question No. (iv) did not raise a substantial question of law and was not entertained.

In conclusion, the High Court of Bombay dismissed the appeals filed by the revenue, upholding the Tribunal's decisions on various issues raised by the appellant. The Court's analysis focused on legal arguments, precedents, and the application of relevant sections of the Income Tax Act, resulting in the rejection of the appellant's contentions.

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