TaxTMI 
TaxTMI 
2017 (2) TMI 1005
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....t Year 2008-09. 2. The Revenue urges the following reframed questions of law for our consideration : (i) Whether on the facts and in the circumstances of the case and in law, the Tribunal was justified in holding that the sales tax exemption benefit for the A.Y. 2008-09 is a capital receipt not liable to income tax? (ii) Whether the respondent assessee is eligible for deduction under Section 80IA of the Income Tax Act by urging that the Rail system is not a profit center but a cost saving exercise undertaken in terms of subsection (4) of Section 80IA? (iii) Whether on the facts and circumstances of the case, the Tribunal was correct in law, in setting aside the issue of 'interest expenses' to the file of the Assessing Offic....
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....der Section 14A of the Act i.e. expenditure incurred to earn exempt income. However, the Assessing Officer after holding that he is not satisfied with the correctness of the disallowance of expenditure made by the respondent assessee applied Rule 8D of the Rules and determined a further the disallowance of Rs. 4.03 crores. Therefore, the disallowance in the aggregate was Rs. 4.53 crores under Section 14A of the Act in the assessment order dated 28th February, 2011. (c) Being aggrieved, the respondent assessee carried the issue in appeal to the Commissioner of Income Tax (Appeals) [CIT(A)]. By an order dated 21st December, 2011, the CIT(A) upheld the order of the Assessing Officer holding that the Assessing Officer had recorded his nonsatis....
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....own funds, to the Assessing Officer in the subject assessment year. So far as disallowance of other expenses by the respondent assessee is concerned, the Tribunal records its satisfaction with it and holds no further disallowance is called for. 4. Mr. Suresh Kumar, learned Counsel appearing for the Revenue submits that the impugned order of the Tribunal in correctly proceeds on the basis that the Assessing Officer has not recorded his nonsatisfaction with the claim of disallowance made by the respondent assessee. In support, he invites our attention to paragraph 6.4 of the order dated 28th February, 2011 of the Assessing Officer wherein the Assessing Officer records as under : "6.4 ....... Under these circumstances, and having regards to....
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....lace on record all the relevant facts including his accounts and recording of reasons by the Assessing Officer in the event that he comes to the conclusion that he is not satisfied with the claim of the assessee;" 6. Thus, no fault can be found with the impugned order of the Tribunal holding that the Assessing Officer should show fallacies in the computation of disallowance done by the respondent assessee. Thus, there is no reason to discard the disallowance done by the respondent assessee. Nevertheless, the impugned order of the Tribunal has restored the issue of disallowance of interest to the Assessing Officer to determine the extent of its tax free investments out of own funds and out of borrowed funds. So far as the claim with regard....