TaxTMI 
TaxTMI 
2014 (11) TMI 550
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....7 are as under :- "25. The issue raised in Ground no. 9 relates to the asessee-company's claim for deduction u/s 801B in respect of the following items of other income. 1. Other income related to Silvassa 9,06,872 2. Interest received 107,25,448 3. Miscellaneous income 2,38,388 4. Reversal of doubtful debts 21,15,36 5. Insurance claim 5,39,412 Total 1,45,25,483 26. At the time of hearing, the id. Representatives of both the sides have agreed that this issue is squarely covered by the order of the Tribunal dated 14th September(supra) passed in assessee's own case for A.Y. 2002-03 wherein the disallowance made on account of assessee's claim for the deduction u/s 801B in respect of first four items i.e. other income related to Silvasa unit interest received, miscellaneous income and reversal of excess provision of doubtful debts was confirmed by Tribunal, whereas the claim of the assessee u/s 801B in respect of insurance claim was allowed by the Tribunal by observing as under:- The issue raised in ground No. 5 of the assessee 's appeal relates to the disallowance made by the AO and confirmed by the learned CIT(Appeals) on ac....
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....ed. Respectfully following the order of the Tribunal, we direct the AO to allow deduction u/s.80IB in respect of income from insurance claim. 4. The next grievance of the assessee relates to claim of depreciation which has been dealt by the AO at para 14 and by CIT(A) at para 16. 4.1 Learned AR placed on record order of Tribunal in assessee's own case for the A.Y.2003-04, wherein the issue has been decided by the Tribunal partly against the assessee. The precise observations of the Tribunal at page 20 para 35 are as under :- "35. As regard the issue raised in ground no. 13 of the assessee's appeal relating to disallowance of depreciation on the assets of Silvasa Unit, the ld. Representatives of both the sides have agreed that this issue is squarely covered against the assessee and in favour of the Revenue by the order of the Tribunal dated 13th April 2009 (Supra) passed in assessee's own case for A.Y. 2001-02, wherein the similar issue was decided against the assessee by following the decision of the Hon'ble Bombay High Court in the case of Scope Industries Pvt. Ltd. 289 ITR 195 as well as that the Tribunal in assessee's own case for A.Y. 2000-01. Respectfu....
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....cost. 6.1 The CIT(A) deleted the disallowance partly after having the following observation :- "3.10 I have perused the TPO's order and the written submission. The total amount relating to cost sharing was Rs. 2,24,25,081 out of which the Appellant was able to submit details of basis of allocation amounting to Rs. 2,21,34,295. On the basis of the said details the cost allocations ere considered to be at arm's length. With regards to the disallowance of Rs. 290,786, the Appellant had requested to determine the arms length price in accordance with the provisions of section 92C(1) and 92C(2) of the Act. Since, the genuineness of the payments is not in doubt and the receipt of services and benefits derived by Castrol India has itself not been challenged by the TPO/AO, the ALP relating to the same cannot be determined to be Nil and some value needs to be attributed. It would be unjust to the Appellant to disallow the entire amount of expenditure and determine the arm's length price as Nil. Since most of the details were submitted except the basis of allocation, the ALP is held to be 50% of the transaction value of Rs. 290,786 i.e Rs. 145,393. The Appellant gets partial....
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.... 2006-07. It is noted that no convincing or sound basis has been given by the learned CIT(Appeals) therein in support of the 50% cost allocation accepted by him and such estimate has been made purely on adhoc basis. In our opinion, the exercise of ascertaining ALPs has to he done by the TPO keeping in view the well laid down scheme in the relevant provisions of the Act and addition, if any, on account of TP adjustment, has to be made only after doing such exercise. We, therefore, restore this issue to the file of the AO/TPO with a direction to do such exercise and make addition, if an on this issue after completing such exercise in accordance with law. Ground N6.2 of the assessee 's appeal is accordingly treated as allowed for statistical purposes." 16. As the issue involved in the year under consideration i.e. 2003-04 as well as all the material facts relevant thereto are similar to A.Y. 2002-03, we respectfully follow the order of the Co-ordinate bench of this Tribunal for A.Y. 2002-03 and restore this issue to the file of the AO/TPO for deciding the same afresh as per the same directions as given by the Tribunal in A.Y. 2002-03. Ground no. 5 of the assessee's appeal i....
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....pped to 10% of Castrol India's profit in any relevant financial year. The Appellant had also submitted to SIA details of total foreign exchange inflow and outflow during the period of collaboration. In the said working, the appellant had evidently bought out foreign exchange outflow on account of Royalty @ 10% of profits before taxes. Accordingly, the TPO's allegation that there is no question of any "implicit" approval seems to be erroneous. The payments made by the appellant through the authorized dealers (bankers) are made in accordance with the prevelant exchange control regulations. Had the company made any excess payments, it would have been objected to by the authorized dealers, who have the delegated authority under the Foreign Exchange Management Act, 1999 to administer compliance with exchange control laws in India. Viewed in the above background, the TPO's interpretation of the SIA approval was erroneous. The TPO has erred in disallowing royalty of Rs. 40,25,954. Accordingly, the Appellant's appeal is allowed and the adjustment made by the TPO is directed to be deleted." 7.1 We found that the issue regarding disallowance of royalty has been decid....
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.... no case of any excess payment made of royalty by assessee than approved by SIA to justify its disallowance by way of TP adjustment. In our opinion, the Id. CIT (A) could not appreciate these infirmities in the order of the TPO despite the same were specifically brought to his notice on behalf of the assessee and confirmed the TP adjustment made by the TPO in respect of royalty payment which was totally unjustified. We therefore, delete the addition made by the AO/TPO and confirmed by the Id. CIT on account of TP adjustment in respect of royalty payment and allow ground no. 3 of the assessee's appeal. x x x x x x x x x x x x 43 The first issue raised by the Revenue in its appeal for A.Y. 2004-05 relating to deletion by the id. CIT(A) of the addition made by the AO/TPO on account of TP adjustment in respect of royalty payment is similar to the one involved in ground no. 3 of the assessee's appeal for A.Y.2003-04 which has already been decided by us in foregoing portion of this order. Following our conclusion drawn in A.Y. 2003-04 on the similar issue, we uphold the impugned order of the Id. CIT(A) for A.Y. 2004-05 deleting the addition made by the AO/TPO on account ....
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....8.2 As the facts and circumstances of the case during the year under consideration are same, respectfully following the decision of Tribunal for A.Y.2003-04, we do not find any infirmity in the order of CIT(A) for deleting the disallowance of expenditure on advertisement films. 9. Now, we shall take up the appeal filed by the assessee (i.e. ITA No.8371/Mum/2010) for A.Y.2006-07. 10. The first grievance of the assessee relates to disallowance of payment of royalty, which has been dealt by the AO at para 2. 10.1 We found that this issue is square covered in favour of the assessee by the order of Tribunal for A.Y.2003-04 & 2004-05. Relevant observation of the Tribunal has been reproduced above. Respectfully following the order of the Tribunal, we direct the AO for allowing assessee's claim in the light of decision of Tribunal. We direct accordingly. 11. The next grievance of the assessee relates to disallowance of expenditure in the nature of costs allocations. 11.1 This issue has been dealt by the AO at para 2. We found that similar issue has been dealt by the Tribunal in assessee's own case for A.Ys. 2002-03, 2003-04 & 2004-05, wherein the matter was remanded back to ....
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.... terms of direction given by the Tribunal in aforementioned order. We direct accordingly. 14. The next grievance of the assessee relates to disallowance of assessee's claim u/s.80IB in respect of its income from insurance claims/reversal of doubtful debts. 14.1 The issue has been dealt by the AO at para 8. We found that similar issue has been dealt by the Tribunal in the assessment year 2003-04 in favour of assessee in respect of insurance claim. The relevant observation of the Tribunal at page 18 para 27 is as under :- "27. Respectfully following the order of the Tribunal dated 141h September 2012(supra) passed in assessee's own case for A.Y. 2002-03, we uphold the impugned order of the id. CIT(A) confirming the disallowance made by the AO on account of assessee's claim for deduction u/s 801B in respect of first four items of other income and delete the said disallowance to the extent it was in respect of income from insurance claim. Ground no. 9 is of the assessee's appeal is partly allowed." 14.1 this issue has been dealt by us in assessment year 2006-07 vide para 3, wherein assessee's claim for deduction u/s.80IB was allowed with respect of insurance cla....
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....jected the ground taken by the revenue in regard to long service award, resulting in favour of assessee. Respectfully following the order of the Tribunal, we delete the addition made by the AO and confirmed by the CIT(A). 17. The next issue relates to disallowance of expenditure on advertisement films. 17.1 This issue has been dealt by the AO at para 12 of the assessment order. The Tribunal in A.Y.2003-04, has dealt this issue in favour of the assessee at para 41. The relevant observation of the Tribunal is as under:- "41. As regards the issue raised in ground no. 2 relating to the disallowance made on account of advertisement expenses, it is observed that this issue is squarely covered in favour of the assessee by the order of the Tribunal dated 30t July 2009 (supra) for A.Y. 2001-02 wherein order of the Id. CIT(A) deleting the similar disallowance made by the AO on account of advertisement expenses treating the same as capital expenditure was upheld by the Tribunal following its order in assessee's own for A.Y. 1998-99. Respectfully following the said decision of the coordinate bench of this Tribunal in assessee's own case for A.Y. 2000-01, we uphold the impugned....