TaxTMI 
TaxTMI 
2018 (6) TMI 889
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....he Id.CIT(A) has erred in misinterpreting Assessing Officer's allowance of business expenses for A.Y. 2012- 13 as the authoritative proof of existence of business in a year previous to that. 3. That on the facts and in the circumstances of the case and in law, the Id.CIT(A) has erred in allowing the assessee's claim of deduction of the following expenditure : a) Employees remuneration and benefits Rs. 373.55 lacs b) Administrative and other expenditure Rs. 213.81 lacs c) Finance Cost Rs. 1201.41 lacs d) Depreciation Rs. 18.98 lacs 4. On the facts and circumstances and in law, the Ld.CIT(A) has further erred with respect to the commencement of business as mere commencement of business in one year does not lead to an automatic allowance of expenses in successive years irrespective of the existence or its continuance of business activities. 5. On the facts and circumstances and in law, the Ld.CIT(A) has further erred in. ignoring his own decision for A.Yrs.2006-07, 2009-10 and 2010-11 wherein the order of the AO was upheld, 3. The Assessing Officer in this case observed that the assessee had not shown any income....
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.... where working was in pipe line and working could not be started then also the expenses claimed on these activities are to be allowed in accordance with the business activities. Hence, I therefore, restore this issue to the file of the Assessing Officer to examine aftesh after affording opportunity of being heard to the assessee.' 5. The ld. Commissioner of Income Tax (Appeals) further noted that pursuant to the above direction of the ITAT, the Assessing Officer has accepted the assessee's claim of commencement of business and allowed the expenditure in relation thereto. Accordingly, the ld. Commissioner of Income Tax (Appeals) after somehow discussion has concluded as under: Therefore, in view of the specific finding of fact by the Hon'ble Tribunal in appellant's own case for A.Y.2007-08 and which was accepted by Ld. AO in order u/s 143(3) r.w.s 254 as also the decisions of Hon'ble Mumbai Bench of ITAT in the cases cited supra, I have no hesitation in holding that the appellant's business had commenced and, therefore, expenditure claimed by it on revenue account had to be allowed. 6. Against the above order, the Revenue has filed the appeal before th....
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....of Rs. 1254.84 lakhs on account of funds lent as 'Inter Corporate Deposits. The interest income has been earned from the funds lying with the company. The interest incomes of Rs. 1254.84 lakhs which are interest on ICD are taxable as income from other sources. * Similarly, the assesses has earned interest income from Banks of Rs. 41.94 lakhs on account of funds kept with banks as FD. The interest Income from banks has been earned from the funds lying with the company parked with the Banks. The interest inconfes from bank; of Rs. 41.94 lakhs which are bank interest on FD are taxable as income from other sources. * Similarly, the assessee has earned interest income from debentures of Rs. 908,63 lakhs on account of funds lent investment In debentures,. The interest income has been earned from the funds lying with the company & invested as debentures with the other companies. The debenture interest incomes of Rs. 908.63 lakhs which are debenture interest on are taxable as income from other sources. * Similarly, the assessee has earned interest income from Income tax refunds of Rs. 0.28 lakhs. The interest incomes on Income tax Refunds of Rs. 0.28 lakhs wh....
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....2AB. However, I do not find that any specific submission has been made in respect of the taxability of interest income from ICD debentures etc. under the head 'Income from Other Sources'. On the contrary, I also find that my Ld. Predecessor in appellant's own case for A.Y.2006-07 and 2009-10 had confirmed the action of Ld. AO in taxing the interest income under the head 'Income from other sources' (ITA No. CIT(A)- 22/ACIT-10(3)/IT-296/2011-12 and CIT(A)-22/ACIT-10(3)/IT-497/2011-12 vide orders dated 30th January, 2014). As the facts obtaining in the present year are in pan materia with the facts of earlier years, respectfully following the decision of Hon'ble CIT(A)-22, Mumbai in the above two years, interest income earned from ICD etc. is held to be taxable under the head 'Income from other sources' However, as far as deduction of finance cost is concerned, the same has to be verified by the Ld. AO as to whether it pertains to the earning of interest income or to the business of the appellant company and in case there is no direct corelation with the earning of interest income, the finance cost shall be allowable to the appellant company, if it is s....
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....Officer has proceeded to make the disallowance u/s. 14A amounting to Rs. 783.15 lacs. 16. Before the ld. Commissioner of Income Tax (Appeals), the assessee made elaborate submissions and also furnished a chart according to which the disallowance came to Rs. 188.00 lacs. The ld. Commissioner of Income Tax (Appeals) considering the same held as under: 2.4.11 Having considered the entire gamut of case brought before me, i am of the considered opinion that in view of binding decision of Hon'ble Bombay High Court in the case of Court in the case of Godrej & Boyce Mfg. Ltd. (supra), the action of the Ld. AO in making disallowance u/s 14A r.w. Rule 8D is sacrosanct. It is seen that the appellant has made a claim of direct expenditure by way of interest towards certain loans of Rs. 81.5 crores and Rs. 65 crores respectively. Obviously, if these are verifiable, they would go out of the purview of disallowance made by the Ld. AO. In this regard, it would therefore, meet the ends of justice if the Ld. AO is directed to verify the claim made by the appellant towards inadmissible interest expenditure as also the claim of total average investments being Rs. 23,408.47 lacs in plac....