TaxTMI 
TaxTMI 
2016 (12) TMI 880
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....(hereinafter called the Act) was not within the time as provided in section 154(7) of the Act and the CIT(A) ought to have held that the period of limitation should be reckoned from the date of order giving appeal effect to the order of the tribunal. The issue raised in the second ground of appeal is against the upholding the action of AO of not reducing the reversal of provisions for custom duty of Rs. 3.50 Cr from the book profits. 3. The facts in brief are that during the financial year 1987-88 the assessee created provisions for custom duty payable by the assessee to the tune of Rs. 3.50 Cr which as per the Government of India policy was not to be paid if the assessee fulfilled certain conditions as prescribed. The assessee fulfilled....
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....;s books profit by a sum of Rs. 3.5 crores on account of provision for custom duty of Rs. 3.50 crores pertaining to A.Y. 1988-89 and written back by the appellant A.Y. 1989-90. 5.2. It is not disputed that the appellant had made provision of custom duty of Rs. 3.50 crores payable in its books of accounts for the previous year relevant to A.Y. 1988-89. The AO had disallowed such provision of custom duty of Rs. 3.50 crores while computing total income of the appellant under the normal provisions of the Act as well as while computing book profit u/s. 115J of the Act in the scrutiny assessment order passed u/s. 143(3) of the Act dated 27.03.1991. Hon'ble ITAT, 'J' Bench, Mumbai vide ITA No. 119/Bom/1992 and ITA No.1006/Bom/....
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....llant company did not even make this issue as additional ground of appeal before the Hon'ble ITAT, Mumbai Bench. 5.5 It is further brought to my notice that the appellant had written back provision of custom duty of Rs. 3.72 crores pertaining to A.Y. 1989-90 in A.Y. 1990-91. The LAO allowed such write back of provision of custom duty of Rs. 3.72 crores pertaining to A.Y. 1989-90 in AY 1990-91 under the normal provisions of the Act. However, he did not allow such relief while computing book profit u/s. 115J of the Act. On this limited issue of disallowance of Rs. 3.72 crores pertaining to A.Y. 1989-90 in A.Y. 1990-91, the appellant has accepted such disallowance while computing book profit u./s. 115J of the Act in A.Y. 1990-91. ....
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....t. Ultimately the matter travelled up to the tribunal and tribunal decided the issue against the assessee vide order dated 9th March, 2007 upholding the action of AO that provisions created for custom duty were not to be allowed. The assessee reversed the provisions so created in AY 1988- 89 in the AY 1989-90 of Rs. 3.50 Cr as not being payable after meeting the conditions as per GOI policy. The ld AR argued that the said provisions could not be taxed again at the time of reversal as these were not allowed deduction earlier at the time of creation thereof. The Ld AR submitted that while giving the appeal effect to ITAT order dated 9th March, 2007 the AO did not reduce the written back provisions of Rs. 3.50 Cr relating to AY 1988-89 while c....
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....efore us when they ceased to be payable as per the Govt of India Policy. At the time of creation of these provisions the deduction was not allowed while calculating the income under MAT by the AO in the assessment proceedings whereas the assessee suo motto disallowed the said provisions u/s 43 B of the Act under normal provisions of the Act in the return of income filed meaning thereby that the deduction was not allowed under the normal provisions as well as under the MAT provisions. The issue of allowance the said provisions under MAT travelled up tribunal and tribunal decided the issue against the assessee vide order dated 9th March 2007. The AO while passing the order dated 23rd July, 2007 giving appeal effect to tribunal order dated 9th....