TaxTMI 
TaxTMI 
2018 (5) TMI 957
X X X X Extracts X X X X
X X X X Extracts X X X X
....unal and High Courts and SLP before Supreme Court have been increased as measure for reducing Litigation. The revised monetary limits laid down in para-3 of this Circular and the manner of computing tax effect as laid down in para-4 of this Circular are as follows: "3. Henceforth, Appeals/ SLPs shall not be filed in cases where the tax effect does not exceed the monetary limits given hereunder: - Sl. No. Appeals in Income-tax matters Monetary Limit (in Rs) 1. Before Appellate Tribunal 10,00,000/- 2. Before High Court 20,00,000/- 3. Before Supreme Court 25,00,000/- It is clarified that an appeal should not be filed merely because the tax effect in a case exceeds the monetary limits prescribed above. Filing of appeal in such cases is to be decided on merits of the case. 4. For this purpose, "tax effect" means the difference between the tax on the total income assessed and the tax that would have been chargeable had such total income been reduced by the amount of income in respect of the issues against which appeal is intended to be filed (hereinafter referred to as "disputed issues"). However the tax will not include any ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....0 lakhs or despite low tax effect the appeal of the revenue is maintainable, the revenue is at liberty to move this Tribunal for recall of this order. 7. In view of the above, we hold that the appeals filed by the Department, against the impugned orders of the Ld. CIT(A), is contrary to the policy decision of the Department and as such the appeals filed by the Department are dismissed in limine. 8. In the result, the appeals of the Revenue are dismissed. Let us take up assessee's appeal for A.Y.2008-09 in ITA No.1090/Kol/2014 Disallowance u/s 14A of the Act r.w.r.8D of the Rules Grounds 1 to 3 of A.Y.2008-09 9. Brief facts of this issue is that the assessee is a company engaged in the business of running business centre, tours and travels, house keeping, leasing, consultancy etc. The return of income for A.Y.2008-09 was filed by the assessee on 27.09.2008 declaring total income of Rs. 7,57,16,616/-. The ld. AO observed that the assessee has made substantial investments to the tune of Rs. 9,92,20,896/- in shares and securities. He observed that the assessee had also earned tax free dividend income of Rs. 49,48,462/- from its investment in shares and securities. The....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ment of income. 3. For that on the facts and in the circumstances of the case and in law, the authorities below erred in making the disallowance under Section 14A read with Rule 8D and therefore the disallowance be appropriately reduced." 11. We have heard the rival submissions. We find that the assessee before the ld. CIT(A) had only identified six specific items towards administrative expenses and had given the computation of disallowance u/s 14A of the Act. The ld. AR stated that this working was also furnished before the ld. AO by the assessee. The lower authorities having ignored the computation of disallowance u/s 14A of the Act given by the assessee, and having proceeded to invoke that provision of Rule 8D(2) for arriving at the disallowance figure u/s 14A of the Act, cannot again make further addition of Rs. 65,537/- (i.e. working given by the assessee). At any stretch of imagination the said specified items cannot be construed as direct expenses incurred for earning dividend income as stated by the ld. CIT(A). Hence we direct the ld. AO to delete the disallowance u/s 14A of the Act to the tune of Rs. 65,537/- made in the first limb of Rule 8D(2) of the rules. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rnover Total turnover The ld. AO adopted the profit of the business (excluding other income of schedule-13 of profit and loss account and income from house property) at Rs. 7,40,46,584/-. The export turnover of the unit was arrived at Rs. 1,18,55,867/-. The total turnover (excluding other income of schedule-13 of profit and loss account and income from house property) was arrived at Rs. 18,73,43,882/-. Accordingly the deduction u/s 10 A of the Act was computed as under :- 74046584 X 11855867 = 46,22,679/ 187343882 13. The ld. CIT(A) ignored the computation mechanism followed by the ld. AO and proceeded to identify certain specific expenses which in his opinion were common expenses and observed that the same requires apportionment between taxable unit and 10A unit as under : A)Up keep and service cost (schedule 16 of profit and loss account) Rs. 1,53,57,583/- B) Administrative selling and other expenses Subscription 9,75,915 Rates & Taxes 8,91,912 Office Expenses 8,82,325 Gardening Expenses 2,78,732 Security Service Charges 36,20,494 Flower Expenses 1,86,558 Pantry Purchases 55,87,03....
X X X X Extracts X X X X
X X X X Extracts X X X X
....een recognized by the software technology part of India (STPI) and STPI had allowed the assessee to set up the undertaking in the assessee's already existing business premises. Hence, the assessee is entitled to have deduction u/s 10A of the Act being registered and recognized by STPI. It is not in dispute that the assessee is entitled to get deduction u/s 10A of the Act in respect of its software unit. The only dispute is with regard to apportionment of common expenses between taxable unit and 10A unit which has a bearing on the quantum of deduction eligible u/s 10A of the Act. We find that the assessee had maintained separate balance sheet and separate profit and loss account for its software unit and online recruitment service in the name and style of PBC Software. We find from profit and loss account for the year ending on 31.03.2008 of PBC Software, the total income was Rs. 1,19,73,467/- comprising of recruitment service (Rs.25,58,417) software development charges (Rs.92,97,450/-) , foreign exchange fluctuation income (Rs.1,17,100/-) and miscellaneous income Rs. 500/-. The assessee has debited the following expenses in the books of PBC Software : i) Electricity expenses ....