TaxTMI 
TaxTMI 
2018 (1) TMI 1369
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....e Act". Heard both sides. Case files perused. 2. We come to assessee's appeal ITA No.3158/Ahd/2015. It raises two substantive grounds therein. The first one seeks to reverse both the lower authorities' action invoking Section 14A r.w. Rule 8D disallowance of Rs. 3,18,172/-. We notice at the outset that both the lower authorities follow their respective findings right from assessment year 2008-09 to 2011-12 in order to compute the impugned disallowance under the newly introduced computation provision i.e. Rule 8D of the Income Tax Rules. Case records reveal that the assessee's appeals against the said corresponding disallowance stand accepted on 08.04.2016 and 14.09.2017. It has come on record that the said co-ordinate benches have del....
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....ntial increase in the turnover of the company during the year under consideration either. It is seen that the A.O has disallowed directors' remuneration as per the provisions of sec.40A(2) of the I.T. Act. The provisions of sec.40A start with non obstante clause and have overriding effect over the provisions of any other section of Income-tax Act, 1961. The Hon'ble Gujarat High court in CIT vs Bharat Vijay Mills Ltd. (1988) 128 ITR 633 (Guj.) has held that provisions of sec.40A have been declared to be of an overriding nature. The non obstante clause at the beginning of sec.40A(l) clearly indicates that if any other provisions exist somewhere on the statute book, they have to give way to clear the express provisions of Sect....
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....#39; services to the appellant company, I am inclined to agree with the contentions of the appellant that the remuneration to the directors be allowed keeping in view the increase in turnover and profitability of company. However, a perusal of the submissions made by the appellant shows that the appellant has not made out any case or submitted any evidence to show that there was any improvement or alteration in the services rendered by the directors towards the company. There has not been any substantial increase in the turnover of the company during the year under consideration either. However, the remuneration paid to the directors appears to be excessive and in my considered view, the same needs to be restricted as per the provisions of ....
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....he fact that the CIT(A) has followed his predecessors' orders for assessment years 2008-09 to 2011-12. We notice in this factual backdrop that the above co-ordinate bench's order (supra) has reversed the CIT(A)'s findings under challenge therein in partly affirming Assessing Officer's identical action; although involving different amounts paid as remuneration to assessee's Directors and other specified parties. Learned Departmental Representative is fair enough in not drawing any distinction on facts as well as law. We thus accept assessee's latter substantive ground as well as its main appeal ITA No. 3158/Ahd/2015. 5. The Revenue's substantive ground on the other hand seeking to revive the entire disallowance is rejected accordingly. ....
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....ccounting regularly followed by the assessee without valid reasons. The Hon'ble Supreme Court in the case of Chainrup Sampatram (1953) 24 ITR 481 has also clearly held that profits do not arise out of valuation of closing stock and situs of its arising or accruing where the valuation is made and valuation of unsold stock is necessary part of the process of determining trading results but it can in no sense be regarded as source of such profit. The case of Chainrup Sampatram was also followed by the Hon'ble S.C. in the case of CIT vs Dynavision (2012) 76 DTR 351 (S.C). In this case it is held by Hon'ble S.C. that closing stock cannot be valued by including the element of excise duty when no such adjustment is made in opening stoc....