2015 (12) TMI 566

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....s. Megha Sharma ORDER P. C. 1. This appeal filed by the Revenue challenges order dated 31st October, 2012 passed by the Income Tax Appellate Tribunal (the Tribunal) whereby the Revenue's appeal in respect of Assessment year 2007-2008 was dismissed. 2. The Revenue has urged the following substantial question of law for our consideration : (i) Whether on the facts and in the....

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....ax was payable on the expenditure disallowed. However, the Assessing Officer by an order dated 23rd December, 2009 did not accept that the Assessee's contention resulting in an amount of Rs. 46.11 lakhs being excluded from the benefit of Section 10A of the Act and subjected to tax. 4. In appeal, the Commissioner of Income Tax (Appeals) by an order dated 12th October 2012, allowed the Respon....

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....ting tax at source and, therefore, where the expenditure has been disallowed, the disallowed expenditure must suffer tax. Therefore, the benefit of deduction under Section 10A of the Act cannot be extended to such income, which is a result of disallowance. It is further submitted that the decision of this Court in Gem Plus Jewellery India Ltd. (Supra), would have no application as it dealt with th....

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....lery India Ltd. (Supra) by making following observations : "12. .... The disallowance of the provident fund / ESIC payments has been made because of the statutory provisions - Section 43B in the case of the employer's contribution and section 36(v) read with section 2(24) (x) in the case of the employee's contribution which has been deemed to be the income of the assessee. The pla....