TaxTMI 
TaxTMI 
2015 (3) TMI 931
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.... circumstances of the case and in law, the learned Commissioner of Income-tax (Appeals) erred in granting interest under section 244A on interest and also holding that while issuing refund interest amount will take priority before principal amount." 3. We have heard rival submissions and gone through the facts and circumstances of the case. We find that the Commissioner of Income-tax (Appeals) has factually noted errors committed by the Assessing Officer while computing interest under section 244A of the Act and he brought out the factual details under the following eight aspects : "(a) In treating Rs. 2,29,85,384 refunded on September 30, 2005, as refund out of tax paid even though it included Rs. 31,63,564 towards interest under section 244A of the Income-tax Act, 1961 ; (b) In granting interest on Rs. 1,49,79,822 for the period October 1, 2005 to July 31, 2006 instead of granting interest on Rs. 1,81,43,386 and consequently granting short interest ; (c) In not granting in....
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...., Circle-8, Kolkata under section 143(3) of the Income-tax Act, 1961 (hereinafter referred to as the "Act") for the assessment year 2006-07 vide his order dated July 15, 2008. 5. The only issue in this appeal of the Revenue (I. T. A. No. 1092/K/2009) is as regards to the order of the Commissioner of Income-tax (Appeals) deleting the disallowance made by the Assessing Officer for non-deduction of TDS by invoking the provisions of section 40(a)(ia) of the Act on reimbursement of cost for providing access to system and management audit methodology updates, etc. to EYGS LLP and Ernst and Young LLP, U. K. For this, the Revenue has raised following sole ground : "1. That the learned Commissioner of Income-tax (Appeals) erred on facts and in law in deleting the disallowance under section 40(a)(ia) of the Income-tax Act, 1961, of a total sum of Rs. 7,11,91,335 which was made by the Assessing Officer for non-deduction of tax at source as per provision of the Income-tax Act, 1961." 6. Briefly stated facts are that the assessee claimed deduction for Rs. 6,88,12,554 and Rs. 23,78,781 being amounts pay....
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....Ltd. the facts appear to be identical to that of the present case in hand. Therefore, both factually as well as legally the assessee has a case and on this issue the assessee, therefore, should succeed in our considered opinion as the amount is towards the reim bursement and with the passage of time, now globalisation has been adopted by different countries for facilitating data and technical skill of different countries. Simply because the supply of data pertains to technical services, the Department should not be rigid for application of section 195 without examining the actual factual aspect of the matter that it is a result of an agreement in between the parties for sharing the data amongst the members firms in the globalisation process. This aspect, in particular, has not been controverted by the Department at any stage of the proceeding. Hence, we decide this issue in favour of the assessee and against the Revenue." Aggrieved, the Revenue came in appeal before us. 7. We have heard rival submissions and gone through facts and circumstances of the case. Before us, learned counsel for the assessee stated that the issue is squarely covered in favour of the assessee and against ....
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.... same as exempt. The assessee claimed that it had not incurred any expenditure to earn this dividend income. During the course of the assessment proceedings the assessee explained before the Assessing Officer that it has invested short-term surplus fund available with it in Grindlays Cash Fund. The assessee also filed complete details, i.e., the date of investment, dividend reinvested, refund receipts and closing balance as on March 31, 2003. Completed copy of statement including bank statement was submitted. The assessee explained that these funds were not invested out of borrowed fund but were invested out of surplus funds available with the company for short period. The Assessing Officer estimated the proportionate management expenses qua the exempted income at 10 per cent. and, therefore, computed the proportionate management expenses at Rs. 35,23,840. Aggrieved, the assessee preferred appeal before the Commissioner of Income-tax (Appeals), who invoked rule 8D of the Rules by noting that the Special Bench in the case of ITO v. Daga Capital Management Pvt. Ltd. [2009] 312 ITR (AT) 1 (Mum) [SB] has held that rule 8D read with section 14A of the Act is retrospectively applicable a....
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....for leave encashment. For this, the assessee has raised following ground No. 2 : "2. The learned Commissioner of Income-tax (Appeals) has also erred in not deleting the disallowance of a sum of Rs. 1,54,71,071 being the provision made for leave encashment in the current assessment year on the basis of actuarial valuation." 12. At the outset, learned counsel for the assessee Shri R. N. Bajoria, senior advocate stated that the assessee-company has added a sum of Rs. 1,54,71,071 on account of provision for leave encashment. According to him, this amount was added back in the computation of income filed with original return of income in pursuance to section 43B(f) of the Act. He further stated that the hon'ble Calcutta High Court in the case of Exide Industries Ltd. v. Union of India [2007] 292 ITR 470 (Calcutta) stuck down the provisions of section 43B(f) of the Act as being arbitrary and ultra vires. Learned counsel for the assessee stated that the hon'ble Supreme Court has stayed the judgment of the hon'ble Calcutta High Court in the case of Exide Industries Ltd. and, there....
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....eals). Hence, it cannot be raised before the Tribunal as it is not arising from the order of the Commissioner of Income-tax (Appeals). On query from the Bench, the learned Commissioner of Income-tax-Departmental representative fairly conceded that there is no such issue arisen from the order of the Commissioner of Income-tax (Appeals). Hence, the same is dismissed. This ground of appeal of the Revenue is dismissed. 16. These cross-appeals being I. T. A. No.1257/K/2011 by the Revenue and I. T. A. No. 1215/K/2011 by the assessee are arising out of order of the Commissioner of Income-tax (Appeals)-VIII, Kolkata, in Appeal No. 27/ CIT(A)-VIII/Kol/10-11, dated July 13, 2011. Assessment was framed by the Deputy Commissioner of Income-tax, Circle-8, Kolkata, under section 143(3) of the Income-tax Act, 1961 (hereinafter referred to as the "Act") for the assessment year 2008-09 vide his order dated May 24, 2010. 17. The first issue in this appeal of the Revenue is as regards to the order of the Commissioner of Income-tax (Appeals) deleting the disallowance made by the Assessing Officer for non-deduction of TDS by invoking the provisions of section 40(a)(ia) of the Act on reimbursement of ....
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....4A of the Act read with rule 8D, a sum of Rs. 2,94,941 is disallowed. It includes sum of Rs. 2,61,235 which is 0.5 per cent. of the average investment and an amount of Rs. 33,706, being proportionate interest." Aggrieved, the assessee preferred appeal before the Commissioner of Income-tax (Appeals), who restricted the disallowance at one per cent. of dividend income. Aggrieved, now the Revenue is in appeal before us. 20. At the outset, learned counsel for the assessee stated that rule 8D of the Rules will apply with effect from the assessment year 2008-09 and the Assessing Officer has rightly computed the disallowance. He conceded this issue. Accordingly, this issue of the Revenue's appeal is allowed. 21. Coming to I. T. A. No. 1215/K/2011. The first issue in this appeal of the assessee is against the order of the Commissioner of Income-tax (Appeals) confirming the disallowance of provision for leave encashment. For this, the assessee has raised following ground No. 1 : "1. The learned Commissioner of Income-tax (Appeals) has erred on facts and in law in not deleting the disallowance of a s....