TaxTMI 
TaxTMI 
TaxTMI 
2018 (2) TMI 171
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....proceed to adjudicate all the grounds in this composite order. ITA No.2263/PUN/2014 (By Assessee - A.Y. 2010-11) 3. We shall first take up the assessee's appeal first. Grounds raised by the assessee in this appeal read as under : "1. The lower authorities erred in law and on facts in disallowing assessee's claim for deduction u/s.80IA(4) of the I.T. Act amounting to Rs. 77,62,555/-. 2. The lower authorities erred in law and on facts by disagreeing with assessee companies claim that no interest bearing funds were utilized for making investments in shares and securities and further more in disallowing interest expenditure amounting to Rs. 8,43,096/- by applying provisions u/s.14A of the I.T. Act, 1961. Without prejudice to above : 3. The lower authorities erred in law and on facts in taking depreciated value of Fixed assets instead of Gross Block of assets as appearing in audited financial results while arriving at the interest disallowance under rule 8D." 4. Briefly stated relevant facts are that the assessee is a company engaged in the manufacturing of Engineering goods and Generation of electricity through windmill. Assessee made a claim of deduction u/s.80IA(4) of....
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....e filed after claiming 80-IA(4) deduction of Rs. 77,62,555 on profits from Windmill project (last date of revised return time limit was 31/3/2012) 2. Decision of learned AO- Learned AO, vide Para-5 of the 143(3) order dated 18/3/2013, disallowed the said deduction and made addition. Reason cited was position absence of claim in the original return and absence of filing of form no. 10CCB. 3. Decision of learned CIT(A)-Learned AO's order was challenged before the learned CIT(A). Learned CIT(A), vide appellate order dated 12/9/2014, dismissed the key objection of the Appellant. Form no. 10CCB was filed by the Appellant during appellate proceedings and the same was accepted by the learned CIT(A). But as regards claim of deduction u/s 80-IA(4), learned CIT(A) construed provisions of section 80-AC read with section 139(1) and held that, if the same is not claimed in the original return of income, the said deduction is not permissible though claimed in a revised return thereafter. While so deciding, learned CIT(A) kept reliance on the decision of Bal Kishan Dhawan HUF V. ITO - 18 taxman.com 234 (Amrtisar). Appellant's reliance on the decision of Yash Developers V. ITO - ITA ....
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.... 139(1). In particular, decision of Yash Developers (supra) was referred considering similar factual matrix. Various contrary decisions were also considered by the Honorable Bench in this regard. Finally, considering possible two views, placing reliance on the apex court decision in the case of CIT V. Vegetable Products - 88 ITR 192, the matter was decided in favour of the Appellant therein. d. Present case of Appellant on a better footing - Compared to the decision in the case of Anand Shelters (supra), Appellant submits that, his case stands on an elevated footing. As per facts, Appellant did file a return in due time u/s 139(1). As such, even on a literal construction of section 80-AC, Appellant does not suffer from any rigors per se. e. Further reliance on decision in ACIT Vs. Precot Meridian Limited ITA 1214/Mds/2012 (Chennai Tribunal)- In a similar factual matrix, the Honorable Chennai ITAT has observed as under- Para 9. " A plain reading of section 80AC makes it clear that from the assessment year 2006-07, deduction claimed under section 80IA / 80-IB / 80-IC / 80-ID / 80-IE shall not beallowed unless the assessee furnishes a return on or before due date specified ....
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....iteral interpretation of relevant provisions of section 80AC of the Act. 8. We heard both the sides and perused the orders of the revenue authorities. Core issue relates to the allowability of deduction under section 80IA(4) of the Act through filing of revised return of income u/s 132(5) of the Act. The present litigation arose in view of the stipulation for validly claiming of said deduction if any only through filing of return u/s 139(1) of the Act. The said condition was provided in section 80AC of the Act. On perusal of the above submissions of Ld. AR, we find the Chennai Bench of the Tribunal decided the issue in favour of the assessee on the facts similar to that of the assessee, i.e. involving the provisions of section 139(1) of the Act. This decision relied on the logic developed by the Pune Tribunal in the case of Anand Shelters (supra). Similar liberal interpretation of section 80AC of the Act is affirmed by the Tribunal of Allahabad Bench in the case of Parmeshwar Cold Storage Pvt. Ltd. Vs. ASCIT (supra). All these decisions are pronounced on the factual matrix of filing return of income u/s 139(4) of the Act and in the absence of return filed u/s 139(1) of the Act. On....
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....urisdictional High Court's decision in the case of CIT v. HDFC Bank (2014) 49 taxmann.com 335 (Bombay). It was submitted before the learned CIT(A) that, considering the presence of about Rs. 8.22 CR of own funds as against Investments of Rs. 2.91 CR, presumption ought to have been drawn that, the investments are made from own funds. However, the said contention was rejected by the learned CIT(A) by observing that no any fund-flow is submitted on record, etc. Appellant has prepared a fund-flow showing movement of funds in AY 2010-11. The same is marked as Annexure-a and enclosed herewith. Kindly consider the same and oblige." 13. Considering the same, we are of the opinion that the assessee's claim should be allowed in view of the binding judgments of the Hon'ble Bombay High Court in the case of HDFC (supra) and Reliance Utilities and Power Ltd., cited (supra). Accordingly, the assessee should be given relief on the amount of Rs. 8,43,096/-. Thus, Ground No.2 raised by the assessee is allowed. 14. Considering the relief given by us in Ground No.2, we are of the opinion that adjudicating of Grounds Nos. 3 and 4 raised by the assessee without prejudice to Ground Nos. 1 and 2, b....
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....er business and is not engaged in dealing with any other party except the assessee company. Hence, various expenses shown by it in its P&L A/c. Are not commensurate with its activities. 3. It is declaring only a meagre amount of income and is claiming a major portion of the Tax Deducted by the assessee company as refund, 4. The expenses debited by the said firm are excessive as seen above. Hence, an amount of Rs. 40 lacs u/s.40A(2)(b) is disallowed and added back to the total income of the assessee.. " 19. During the First Appellate proceedings, the CIT(A) considered the submissions of the assessee and disapproved the AO's manner of making disallowance. Contents of Para 21 of his order are relevant and the same are extracted as under : "21.It is seen from the facts of the case that the Assessing Officer has not tested the payments on the above yardstick and has based his conclusion on the technical competency and low profitability of the firm which is my view is not relevant consideration for applying the provisions of Sec. 40A(2)(b) of Income-tax Act. The Assessing Officer has not obtained any comparative rate to justify the disallowance. The appellant in it's rep....
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.... basis as per the provisions of section 80IA(5) of the Act. Relying on the Special Bench decision of the Tribunal in the case of Goldmine Shares and Finance Pvt. Ltd., the AO disallowed the claim of the assessee amounting to Rs. 1,15,63,288/-. 23. During the First Appellate Proceedings, the CIT(A) allowed the claim of the assessee u/s.80IA(5) of the Act. While doing so, he relied on the decisions of Pune Bench of the Tribunal in the case of Serum International Ltd. in ITA Nos. 290 to 292/PN/2010 order dated 28-09-2011 and M/s. Advik High Tech Ltd. of his predecessor for A.Y. 2008-09. Thus, the CIT(A) deleted the disallowance made by the AO applying the provisions of section 80IA(5) of the Act. 24. On hearing both the sides on this issue and on perusing the orders of the revenue, we find the CIT(A) relied on the decisions of Pune Bench of the Tribunal in the case of Poonawalla Stud and Agro Farm Pvt. Ltd. Vs. ACIT and Serum International Ltd. - ITA Nos. 290 to 292/PN/2010 order dated 28-09-2011 and granted relief to the assessee as per the discussion given in Para Nos. 7 and 8 of his order. For the sake of completeness of this order, we proceed to extract the said paragraphs as un....
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....he Tribunal in the case of Goldman Shares & Finance (P) Ltd. (Supra). There is no dispute that even a decision of non-jurisdictional High Court is a binding precedent for the Tribunal until a contrary decision is given by any other competent High Court. In this regard, we find strength from the recent decision of Hon'ble jurisdictional Bombay High Court in the case of Commissioner of Central Excise Vs. Valson Dyeing, Bleaching and Printing Works (Supra) wherein the Hon'ble Bombay High Court has been pleased to hold in a case of excise matter that Tribunal is bound by the decision of High Court, even of a different State, so long as there is no contrary decision of any other High Court. The Hon'ble Bombay High Court has been pleased to hold further that the Tribunal had no option but to follow the judgment of the Madras High Court. An authority like an Income Tax Tribunal acting anywhere in the country has to respect the law laid down by the High Court, though of a different State, so long as there is no contrary decision of any other High Court on that question. We thus respectfully following the ratio laid down by the Hon'ble jurisdictional High Court in the case of Commissioner o....