TaxTMI 
TaxTMI 
2013 (8) TMI 821
X X X X Extracts X X X X
X X X X Extracts X X X X
....ance under section 14A, the assessee has taken into consideration the compensation cost of the employee handling the mutual fund activity, the relevant infrastructure cost and the time spent for carrying on the said activity. The computation and working of disallowance was given before the Assessing Officer. As per the calculation, disallowance was worked out at Rs. 53,305, which was around 3.60% of the dividend income. On this basis, the assessee offered lumpsum disallowance of Rs 74,046, being 5% of the dividend income which worked out at Rs 74,046. The Assessing Officer, however, applied Rule 8D and worked out the disallowance under section 14A of Rs 10,07,850, as per the calculation made at Page-17 of the assessment order. The learned Commissioner (Appeals) though agreed that Rule 8D is not applicable in the assessment year 2007-08 in view of the judgment of the Hon'ble Jurisdictional High Court in Godrej & Boyce Mfg. Co. Ltd. v/s DCIT, [2010] 328 ITR 081 (Bom.), however, held that the disallowance of Rs 10,07,850, was quite reasonable and, therefore, no relief was given. 4. Before us, the learned Counsel submitted that the disallowance sustained by the learned Commissioner ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ndard 19, the assessee has capitalised the value of vehicle in the books of account and the same were shown under the head "Fixed Assets". No depreciation was claimed by the assessee on these vehicles for the income tax purpose. In the computation of income, the assessee has added back an amount of Rs 3,76,000 to the profits of the business as finance charges on leased assets which was debited to the Profit & Loss account and reduced the lease rentals amounting to Rs 17,68,972 from the income. The Assessing Officer, following the judgment of Hon'ble Supreme Court in Asea Brown Boveri Ltd. v/s IFCI, [2005] 56 SCL 21, held that these rentals paid by the assessee is nothing but purchase of an asset and the payment made as lease rental in reality are payments in installments towards re-payment of loans obtained for the purchase of the assets shown as finance leased assets. Accordingly, deduction of Rs 17,68,972, claimed as lease rental of vehicle were disallowed and added back to the total income. 9. Before the Assessing Officer, alternative plea was also taken that depreciation and finance charges with respect to the leased vehicle should be allowed. The Assessing Officer rejected ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e assessee was also entitled for depreciation as the same was shown as fixed assets in the books of the assessee. He further submitted that if the assessee had recovered these lease rentals from the employees, the question of any debit on account of finance charges in the Profit & Loss account would not arise and the question of paying any fringe benefit tax on lease rental would also not arise. Therefore, the findings of the learned Commissioner (Appeals) cannot be sustained. Finally, he submitted that in view of the latest judgment of Hon'ble Supreme Court in ICDS Ltd. v/s CIT, [2013] 350 ITR 527 (SC), the assessee's alternative claim of revenue expenditure and depreciation should be allowed as the decision of Goetze India Ltd. (supra) is not applicable to the appellate authorities. 12. On the other hand, the learned Departmental Representative strongly relied upon the findings of the learned Commissioner (Appeals). Alterna- tively, he submitted that the matter can be restored to the file of the Assessing Officer for deciding the issue afresh in view of the judgment of the Hon'ble Supreme Court in IDCS Ltd. (supra). 13. We have carefully considered the rival contentions, pe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....igh Court in Techno Shares and Stocks Ltd., vide judgment dated 19th September 2010 and, accordingly, reversed the order of the Assessing Officer. 19. Before us, the learned Counsel submitted that this issue has been decided in favour of the assessee in assessee's own case for assessment year 2003-04 wherein it has been directed to the Assessing Officer to follow the judgment of the Hon'ble Supreme Court. 20. On the other hand, the learned Departmental Representative relied upon the findings of the Assessing Officer. 21. After carefully considering the rival contentions and on perusal of the relevant findings of the Assessing Officer and the learned Commissioner (Appeals), we find that the issue of allowability of depreciation on BSE and NSE cards stands concluded by the Hon'ble Supreme Court in Techno Shares and Stocks Ltd. v/s CIT, [2010] 327 ITR 323 (SC). Thus, we do not find any reason to deviate from the conclusion drawn by the learned Commissioner (Appeals). Consequently, the ground raised by the Revenue is treated as dismissed. 22. Ground no.2, relates to disallowance under section 40a(ia) on account of V-SAT and lease line charges. 23. The assessee has incurr....