2014 (11) TMI 1236 - AT - Income Tax

Tribunal dismisses Revenue's appeal on various issues incl. expense disallowance & deduction computation

The Tribunal dismissed the Revenue's appeal on various issues including disallowance of monitoring and community development expenses, meter replacement ... Disallowance made by the AO on monitoring and community development expenses - Disallowance made by the AO on meter replacement expenses - revenue or capital expenditure - Profits eligible for deduction u/s. 80IA - apportioning the head office expenses - MAT applicability as per section 115JB - HELD THAT:- As decided in own case [2013 (8) TMI 836 - ITAT MUMBAI] wherein following the decisions of the Tribunal in earlier years has deleted the addition. Respectfully following the decision of the Tribunal in earlier years grounds raised by the Revenue is dismissed. Issues:1. Disallowance of monitoring and community development expenses2. Disallowance of meter replacement expenses3. Allocation of head office expenses for deduction u/s. 80IA4. Computation of deduction u/s. 80IA for Dahanu Unit5. Restriction of deduction u/s. 80IA to business income6. Applicability of Sec. 115JB in the caseIssue 1: Disallowance of monitoring and community development expensesThe Revenue challenged the deletion of disallowance made by the AO on monitoring and community development expenses. The Tribunal and High Court had previously decided on similar grounds for earlier years. The Ld. Counsel for the assessee presented a detailed chart showing how the grounds were covered by previous decisions. The Tribunal, following its earlier decisions, dismissed the Revenue's appeal regarding this issue.Issue 2: Disallowance of meter replacement expensesThe Revenue disputed the deletion of disallowance on meter replacement expenses, arguing it should be treated as capital in nature. Similar issues had been decided by the Tribunal and High Court for prior years. Following previous decisions, the Tribunal dismissed the Revenue's appeal on this ground.Issue 3: Allocation of head office expenses for deduction u/s. 80IAThe Revenue contested the deletion of disallowance by not apportioning head office expenses for units, affecting the deduction u/s. 80IA. Previous decisions by the Tribunal and High Court were considered. The Tribunal, in line with earlier rulings, dismissed the Revenue's grievance on this matter.Issue 4: Computation of deduction u/s. 80IA for Dahanu UnitThe Revenue disagreed with the computation of deduction u/s. 80IA for Dahanu Unit. Previous decisions by the Tribunal and High Court were referred to. Following the Tribunal's earlier decisions, the current appeal by the Revenue was dismissed on this ground.Issue 5: Restriction of deduction u/s. 80IA to business incomeThe Revenue challenged the restriction of deduction u/s. 80IA to the extent of business income. Previous Tribunal and High Court decisions were taken into account. The Tribunal, in line with past rulings, dismissed the Revenue's grievance on this issue.Issue 6: Applicability of Sec. 115JBThe Revenue contended that Sec. 115JB should apply in the case, which the Ld. CIT(A) had not upheld. The Tribunal considered previous decisions and dismissed the Revenue's appeal, stating that the provision of Sec. 115JB was not applicable in the case of the assessee.In conclusion, the Tribunal dismissed the appeal filed by the Revenue, following previous decisions and rulings on each of the issues raised, and pronounced the order on 26th November 2014.