TaxTMI 
TaxTMI 
2015 (3) TMI 928
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....00 vi) 40(a)(ia) for non deduction of tax Rs. 42,88,15,332 vii) Expenditure relating to earlier years Rs. 4,21,87,375 viii) Disallowance of interest u/s 115P Rs. 7,62,78,605 3. On appeal by the assessee before the CIT(A), the CIT(A) allowed the grounds raised by the assessee in respect of the aforesaid issues. Aggrieved by the order of CIT(A), the revenue is in appeal before us. 4. Ground Nos. 1 & 6 are general in nature. Ground No.2 is as follows: "The CIT(A) erred in granting relief to the assessee in respect of Mine Closure Obligation in view of the fact that it is not an ascertained liability and if at all any expenditure is to be allowed, it should be spread over evenly for all the years since the date of commencement of mining operations till the date of closure of mining activities." 5. In the profit & loss account, assessee debited Rs. 10.55 crores towards mine closure obligation. This was a provision made towards expected future liability to closure of mines which are exploited by the company. Assessee explained that this is a statutory liability for which a separate fund had been created by the company with LIC. AO did not agree with the contentions of the assessee....
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....gainst the Revenue by ITAT in earlier years and in the later year in A.Y. 2008-09 in ITA.No.714 & 885/Hyd/2012 dated 28.02.2014 decision is as under : "9. We have heard the arguments of both the parties, perused the record and have gone through the orders of the authorities below as well as the decisions cited. In AY 2006-07, the coordinate bench in assessee's own case (supra), held as follows: "11. We have heard both the parties, perused the record and gone through the orders of the authorities below. It is observed that the basis of calculation for the relevant AY 2006-07 for Rs. 71.18 crores was submitted during the original assessment and accepted by the AO. The detailed calculation of Rs. 21.31 crores charged to P&L A/c (on the basis of Rs. 71.18 crores) was also enclosed and produced before the CIT. Hence, the CIT is wrong in his observation that the estimate of Rs. 21.31 crore is excessively on a higher side and absolutely no realistic or rational basis for such calculation. 12. The CIT is not correct in invoking the provisions of section 263 as we find that the issue is debatable and when two views are possible the AO has taken one view. The Apex Court in the case of Mala....
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....ssee has made the claim on the mines which are in working condition which are being operated or not. If the assessee has made the claim on mines which have not started operations, the same cannot be allowed. As rightly held by the CIT(A) in A.Y. 2008- 09, ascertainability of liability is to be ascertained year-wise. Therefore, to that extent, following the Coordinate Bench decision, we direct the assessee to furnish the relevant data to the A.O. towards the mines closure obligation and A.O. is directed to verify and allow the amount accordingly. Subject to the above observations, the ground No.2 is considered as allowed for statistical purposes. 9. As the issue under consideration is materially identical to that of AY 2010-11, respectfully following the decision of the coordinate bench in that year, we remit the issue to the file of the AO with a direction to verify and allow the assessee's claim following the decision of coordinate bench in AY 2010-11. This ground of revenue is allowed for statistical purposes. 10. Ground Nos. 3 & 4 are as follows: "3. The CIT(A) erred in law and in facts in holding that the leasehold land is an intangible asset and depreciation on such asset i....
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....y other business or commercial rights of similar nature. The accounting policy/method is consistently followed by number of years and was allowed as deduction. He submitted that the issue is covered by the decisions of coordinate benches of ITAT, Hyderabad for AY 2008-09, 2009-10 and 2010-11 in assessee's own case. 14. We have considered the submissions of the parties and perused the material on record. On perusal of record, we find that the issue is squarely covered by the decisions of the coordinate benches of ITAT, Hyderabad in assessee's own case. In AY 2010-11 in ITA No. 1795/Hyd/2012, the coordinate bench while dealing similar issue, held as follows: "36. Ground No.3 pertains to depreciation on intangible assets. Assessee claimed an amount of Rs. 16,77,48,219/- towards depreciation on intangible assets. In the course of scrutiny proceedings, assessee was asked to explain the nature of the assets acquired and the liability of such depreciation. It was explained that intangible assets are mainly lease hold lands acquired from various State Governments which can be used for certain period. A.O. noted that from the above explanation that the lands are not owned by the assessee ....
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....nd are incidental to the holding of rights were claimed u/s.32(1)(ii) being the license to carry out the mining therefore could not be denied insofar as the Government and the lessee are in control of the asset. The definition of depreciation therefore has been misconstrued for the purpose of allowing deduction by the Assessing Officer and the learned CIT(A) in holding a view on the promulgation of Section 32(1)(ii) with effect from the year 1998-99 which has been further amended w.e.f. Assessment Year 2003- 04. In this view of the mater, we are inclined to hold that the assessee is entitled to depreciation as charged to the P & L account in accordance with its business exigencies. We direct accordingly. On the claim of deduction/s.80G, the A.O., is directed to verify the receipts and allow the deduction in accordance with the provisions of Income-tax Act,1961." 22.1 Since the issue under consideration is materially identical to that of the case decide by the Tribunal in the case of East India Minerals Ltd., respectfully following the same, we set aside the order of the CIT(A) and direct the AO to delete the addition made in this regard". 37. Respectfully following, we allow the ....
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....eld as follows: "40. Ground No.5 pertain to claim of Rs. 71,20,08,354/- on corporate social responsibility stated to have been incurred wholly and exclusively for the purpose of business. Assessee has incurred the above amount only to operate mines in remote places. It was submitted that the expenditure was necessary for the smooth conduct of the business such as installing traffic signals at circle near the vicinity of the Office, flood relief etc., and following the Union Government's CSR policy, NMDC has to create budget mandatorily at Rs. 104 crores (2% of PBT) whereas, company has spent only Rs. 71.20 crores. The A.O. however, held that the amount is not related to the business of the assessee and they are in the nature of donations which cannot be allowed under section 37(1). Ld. CIT(A) confirmed the same. 41. At the outset, it was submitted that similar issue was allowed by the ITAT in earlier years and the latest being ITA.No.714 & 885/Hyd/2012 dated 28.02.2014 wherein this issue was examined and allowed vide para 35 as under : 35. We have considered rival submissions and perused the record. We find that the issue in dispute is squarely covered by the decision of coordin....