TaxTMI 
TaxTMI 
2012 (5) TMI 674
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....receding year which reached the Tribunal and Mumbai Bench in I.T.A. No. 3890 & 3507 /Mum/2005 for the assessment year 1999- 2000 and I.T.A. No. 3925 & 4170/Mum/2005 for the assessment year 2000-01 have dealt with most of the issues and, therefore, most of the issues are already dealt with and covered in the year under consideration. He also filed a chart which referred to each ground of appeal taken by the assessee and also by the department and how the issues were dealt with by the AO, CIT(A) and finally by the co-ordinate Bench for the two assessment years 1999-2000 and 2000-01. DR also placed a copy of judgment in Liberty India and Circular No. 551 dated 23/01/1990. I.T.A. No. 3926/Mum/2005 : 3. In this appeal the first ground raised by the assessee is that the C.l.T.(A) has erred in confirming the action of the A.O. in disallowing the loss due to Exchange rate fluctuation of Rs. 1,22,97,318/- to the extent of loan which was not paid during the year. 4. At the time of hearing the Senior AR appearing on behalf of the assessee submitted that the issue is covered in favour of the assessee by the decision of the Hon'ble Supreme Court in the case of CIT vs. Woodward Governer....
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....bunal following the order of Tribunal for earlier year, particularly in assessment year 1998-99 in I.T.A. No. 9329/Mum/2004 vide paras 9 to 11. We, accordingly, decide this issue against the assessee. The ground taken by the assessee is dismissed. 10. Ground No. 2(ii) relates to the C.S.T. reimbursement claim received at Rs. 22,27,850/- in Century Yarn and Rs. 34,80,311/- received in Century Denim. We find that this issue has been decided in favour of the assessee in the preceding year by the ITAT in I.T.As. No. 3925/Mum/2005 & I.T.A. No. 4170/Mum/2005 in assessment year 2000-01 in paras 14.2, 15 16 & 17 which are as under: 14.2 As far as the issue regarding CST reimbursement is concerned, the ld. counsel of the assessee pointed out that similar issue has been decided in favour of the assessee vide para 11.1 in ITA No.9329/Mum/2004. 15. On the other hand, the ld. D.R. submitted that this issue has been decided by the Hon'ble Bombay High Court in the case of CIT vs. Dresser Rand India Pvt. Ltd. (2010) 323 ITR 429 (Bom). 16. In the rejoinder, the ld. counsel of the assessee submitted that the issue involved in the present appeal is little different. It is not a case of sa....
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....for the exemption under section 10B. We, therefore, set aside the order of the CIT(A) and direct the AO to treat the refund as business receipt for the purposes of claim of exemption under section 10B. Ground no. 2(v) is allowed. 14. Ground No. 2(vi) relates to staff agreement deposit forfeited. We find that this issue has been decided against the assessee in I.T.A. Nos. 3890 & 3507/Mum/2005 in assessment year 1999-2000 in para 20. We do not intend to disturb the accepted position, hence we hold that these amounts do not qualify for the exemption u/s 10B as these are not held to be receipts derived from the industrial undertakings. Ground no. 2(vi) is dismissed. 15. Ground No. 2(vii) relates to refund of Rs. 21,83,894/- from MPCT for assessment years 1993-94 and 1994-95 received from the Sales Tax Department in Century Yarn. In ground no. 2(ii), we have dealt with the refund of CST, going by the same reasons as decided in ground No. 2(ii), we hold that refund is purely business receipt and related to business of the assessee. Being business receipt, we hold that the receipt is eligible for qualifying for the exemption under section 10B. We, therefore, set aside the o....
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....counsel of the assessee submitted that the issue is covered in favour of the assessee by the order of Tribunal in earlier year and in this regard he specifically referred to para 19 of the order of Tribunal in ITA No.9329/Mum/2004. 27. On the other hand, the Id. D.R. submitted that the Hon'ble Bombay High Court in the of CIT vs. J.K. Chemicals Ltd. (supra) and other decisions relied on by the CIT(A) has clearly held that such project expenses are not allowable. 28. In the rejoinder, the Id. counsel of the assessee pointed out that In the case of J.K. Chemicals Ltd. the issue was regarding expenditure incurred for project report for setting up a new unit, whereas in the case before us the expenditure is in the form of salary, travelling and misc. expenditure, which is of revenue nature. He also furnished a copy of the order of Bombay High Court In ITA No.4218 of 2009 wherein the Revenue had taken this issue before the Hon'ble Bombay High Court and which was ultimately decided in favour of the assessee. 29. We have considered the rival submissions carefully and find that the Tribunal decided this issue in ITA No.9329/Mum/2004 vide para 19. Further,....
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....0,2911- being the amounts pertaining to leasehold land w/off in various Divisions. 24. The issue had been set aside to the file of the AO in the preceding year in I.T.A. Nos. 3925 & 4170/Mum/2005 in assessment year 2000-01, for re-examination of the issue in the light of the Special Bench decision of the Tribunal in the case of Mukund Ltd. reported in 106 ITD 231 (Mum SB) for finding the nature of the premium part. Respectfully following the order, we set aside the order of CIT(A) and restore the issue to the file of the AO for passing fresh order on the impugned issue after allowing proper opportunity to the assessee. Ground no. 6 is allowed for statistical purposes. 25. Ground No. 7 is that the C.I.T.(A) has erred in confirming the action of the A.O. in treating Compensation from exploitation of commercial premises, as income from house property instead of business income. 26. This issue is decided against the assessee in preceding years. We, therefore, do not find any reason to disturb the findings. Accordingly, we uphold the disallowance. Ground no. 7 is dismissed. 27. Ground No. 8 is that the C.I.T.(A) has erred in confirming the action of the A.O. in disallo....
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....balance amount of Rs. 114.23crore only utilized in this respect The amount of deduction works out to Rs. 28,55,750 (i.e. 1/10th of Rs. 2,85,57,500 being 2.5% of Rs. 114.23 crore). Appellant's claim of deduction of Rs. 76,02,500 for A.Y. 2000-2001 is therefore, not correct. The Assessing Officer is directed to allow deduction u/s.35D as done in the earlier years but. only to the extent of Rs. 28,55,750 as calculated above. Appellant gets part relief of Rs. 28,55,750 and disallowance of Rs. 4 7,4 6,750 is confirmed. This ground is thus partly allowed." 59. Before us, it was mainly submitted that some additional expenditure has been incurred and therefore the same was also eligible and therefore the project cost has to be considered at a higher figure and the same is to be allowed accordingly. It was also submitted that similar expenditure was allowed vide paras '27 to '29 of the order of Tribunal in ITA No.9329/Mum/2004. However, on a query by the Bench, the ld. counsel could not explain how the additional expenditure has arisen because; normally, after the completion of Euro Issue, the net proceeds would be remitted to assessee and later on nothing would remain payable. The....
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..... 3,43,188/- while computing book profits u/s 115JB of the Income-tax Act. The provision for doubtful debts and advances of Rs. 3,43,188/- are debited to Profit & Loss Account. No adjustment in this respect is admissible u/s 115JB of the Income Tax Act and the same should not be added to book profits. 35. The issue is covered by the decision of the Hon'ble Supreme Court in the case of Apollo Tyres Ltd. vs. CIT, reported in 255 ITR 273, wherein the Hon'ble Supreme Court held (Head note) as under: "The Assessing Officer, while computing the book profits of a company under section 115J of the Income-tax Act, 1961, has only the power of examining whether the books of account are certified by the authorities under the Companies Act as having been properly maintained in accordance with the Companies Act. The Assessing Officer, thereafter, has the limited power of making increases and reductions as provided for in the Explanation to section 115J. The Assessing Officer does not have the jurisdiction to go behind the net profits shown in the profit and loss account except to the extent provided in the Explanation. The use of the words "in accordance with the provisions o....
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....rder, we dismiss this ground. Ground no. 14 is dismissed. 38. Ground No. 15 was not pressed before us, therefore, the same is being dismissed as not pressed. 39. Ground No. 16 is general in nature. In the result, assessee's appeal is partly allowed. I.T.A. No. 4171/Mum/2005: 40. Ground No. 1 of appeal raised by the revenue is that the CIT(A) has erred in directing the assessing officer to restrict the disallowance to Rs. 1,06,837/- without appreciating that in view of the explanation to section 37(1) any expenditure incurred by an assessee for any purpose which is an offence or which is prohibited by law shall not be deemed to have been incurred for the purpose of business or profession and no deduction will be allowable in respect of such an expenditure. 41. This issue has been dealt with by the Tribunal in I.T.A. Nos. 3925 & 4170/Mum/2005 in assessment year 2000-01, in paras 69, 70 and 71 which read as under: "69. Before us, it was submitted that the amounts dL1lowed by the CIT(A) are basically of compensatory nature and therefore the same should have hen allowed. In this regard , reliance was placed on the decisions of Hon'ble Supreme Court in the c....
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....vel expenses of Mrs. S.D. Gina, wife of Shri. B.K. Birla, Chairman of the company without appreciating the fact that it was not an expenditure incurred wholly and exclusively for the business of the assessee. 45. In the preceding year, the ITAT had restored the issue to the file of the AO directing, the AO to examine in detail the nature of expenses along with the Board's resolution, if at all, therefore, following the findings of the ITAT in the preceding year and in the interests of justice, we restore the issue to the file of the AO to take a decision thereon. This ground is allowed to that extent. Ground no. 3 is partly allowed. 46. Ground No. 4 is that the CIT(A) erred in directing the assessing Officer to allow depreciation of Rs. 57,756/- on account of addition to plant & machinery being provision for custom duty on Airjet looms and Auto corner without appreciating that the same are covered by the provisions of section 43B. 47. In assessment year 2000-01, in ITA No. 4170/Mum/2005 in paras 77 and 78 and in the earlier years, the ITAT has been deciding the issue against the revenue and in favor of the assessee, respectfully following the decisions taken by the ITAT....