TaxTMI 
TaxTMI 
2013 (9) TMI 119
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....de order dated December 29, 2009 passed under section 143(3) of the Act. On appeal, the learned Commissioner of Income-tax (Appeals) partly allowed the appeal. Being aggrieved by the order of the learned Commissioner of Income- tax (Appeals) the Revenue and the assessee both are in appeal before us. I. T. A. No. 4567/Mum/2011 (By Revenue) Ground No. 1 is against the part relief allowed by the learned Commissioner of Income-tax (Appeals) in respect of disallowance under section 14A of the Act. The brief facts of the above issue are that the Assessing Officer observed that the assessee had made investment in shares and also carried out trading in shares on which dividend income of Rs. 12,02,765 has been earned which was claimed exempt under section 10(34) of the Act. The Assessing Officer further observed that an expenditure of Rs. 1,13,676 has been allocated against such exempt income. The Assessing Officer further observed that the company cannot earn dividend without its existence and management. He further observed that investment decisions are very complex in nature and require substantial market research, day-to-day analysis or market trends and decisions with regar....
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....51,81,00,000 Total 1,03,04,97,001 Average investment 51,52,48,501 The learned Commissioner of Income-tax (Appeals) while relying on the decision of the hon'ble jurisdictional High Court in Godrej and Boyce Mfg. Co. Ltd. [2010] 328 ITR 81 (Bom) rejected the plea of the assessee that no expenditure had been incurred for earning exempt income and that only direct expenditure can be considered for disallowance observed that the assessee has not established that borrowed funds have not been utilised for making such investments income from which was exempt from tax, however, accepted the calculation given by the assessee and held that the disallowance under section 14A should be restricted to Rs. 31,69,778. At the time of hearing the learned Departmental representative while relying on the order of the Assessing Officer submits that he has no objection if the issue is set aside to the file of the Assessing Officer in the light of the decision of the hon'ble jurisdictional High Court in the case of Godrej and Boyce Mfg. Co. Ltd. [2010] 328 ITR 81 (Bom). On the other hand learned counsel for the assessee, at t....
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....fficer observed that the assessee has shown other liability of Rs. 1,17,36,988. By letter dated December 25, 2009 the assessee filed details of other liabilities along with proof of payment. On perusal of the details, the Assessing Officer observed that it included service tax payable of Rs. 48,10,998 and service tax payable on management consultancy of Rs. 41,97,663 for which no documentary evidence for payment was filed. The Assessing Officer presumed that such service tax had not been paid and accordingly disallowed the service tax payable of Rs. 90,08,661 (Rs. 48,10,998 plus Rs. 41,97,663) under section 43B of the Act. On appeal it was submitted by the assessee that the sum of Rs. 41,97,663 had been paid before the due date of filing of return and in support copies of challans were also filed. Regarding service tax payable of Rs. 48,10,998 it was contended that there was no liability to pay service tax as on March 31, 2007 as the amounts were not received from the parties to whom services were provided, therefore, provisions of section 43B are not applicable. The learned Commissioner of Income-tax (Appeals) while deleting the part of the disallowance on the ground that the said....
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....ot also be invoked." In the absence of any distinguishing feature brought on record by the Revenue, we respectfully following the consistent view of the Tribunal decline to interfere with the order of the learned Commissioner of Income-tax (Appeals) and accordingly the ground taken by the Revenue is rejected. Ground No. 3 is against the deletion of disallowance of payment of software charges Rs. 10,68,161. The brief facts of the above issue are that the Assessing Officer observed that the assessee has made payment of software charges to its group companies which are (a) IL and FS Infotech Ltd.-Rs. 9,80,825 and (b) IL and FS Infotech Finvest Ltd.-Rs. 16,89,500. He further observed that as the assessee has not submitted any documentary evidence which could substantiate that the above expenditure were revenue in nature, the Assessing Officer treated the entire software expenditure claimed of Rs. 26,70,405 as capital expenditure after allowing depreciation at 60 per cent. which was worked out to Rs. 16,02,243, and accordingly he disallowed a sum of Rs.10,68,162. On appeal it was submitted by the assessee that the expenditure was not incurred for purchase of software but for ma....
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.... and in law, the learned Commissioner of Income-tax (Appeals) erred in restricting the disallowance of Rs. 99,56,933 made under section 14A of the Act to Rs. 31,69,778 for the purpose of computation of book profit under section 115JB of the Income-tax Act." Ground Nos. 1 to 3 in the assessee's appeal in I. T. A. No. 4594/Mum/ 2011 read as under : "1. On the facts and circumstances of the case the learned Commissioner of Income-tax (Appeals) has erred in confirming that while computing the book profit under section 115JB the disallowance made under section 14A amounting to Rs. 31,69,788 be added to the book profit. The appellant prays that the conclusion reached by the learned Commissioner of Income-tax (Appeals) is erroneous and contrary to the provisions of law. 2. The appellant prays that while computing book profit under section 115JB no addition of the disallowance computed under section 14A should be made to the book profit. 3. The appellant prays that the book profit may be computed under section 115JB without making any additions on account of the disallowance computed under section 14A." Since common issue is involved, the above grounds are disposed of as und....