TaxTMI 
TaxTMI 
2018 (3) TMI 1865
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 1961. The headings of effective grounds raised before us reads as under:- I. Disallowance of Corporate Social Responsibility expenses ('CSR') : Rs. 27,00,000/- II. Addition of provision of slow moving / obsolete stock to the book profit of the Appellant while computing the tax liability under Section 115JB of the Act : Rs. 89,54,389/- III. Amortization / Depreciation claimed on Terminal Rights: Rs. 2,41,58,004/- 2. Facts leading to the same are that the assessee being resident corporate assessee engaged in operating terminal has been assessed for impugned AY at Rs. 'Nil' under normal provisions and at Rs. 31.35 crores u/s 115JB as against returned income of Rs. 'Nil' under normal provisions and Rs. 29.72 crores u/s 115JB. The three ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... extracted below:- Similar view has been taken by Hon'ble Bombay High Court in the case of Voltas Limited v. CIT (1994) 207 ITR 47 (Bom.). The onus lie on the assessee to prove with cogent material to have substantiated its claim that the said expenses is incurred wholly and exclusively for the purposes of business of the assessee as required u/s 37(1) of 1961 as some remote connection with business is not sufficient to claim the expenses as business expenses, which in the instant case the assessee failed to prove the same. Hence, these expenses of Rs. 15,87,014/- incurred for CSR by providing ambulance services, paramedical services and medical supplies to villagers in the vicinity of its container terminal cannot be allowed as business ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ming difference and was revenue neutral in nature and therefore, the same was allowable to the assessee. Upon due consideration, we find that exactly on similar facts in AY 2009-10, the matter has been remanded back by the Tribunal to the lower authorities with following directions:- 11. We have considered rival contentions and also perused the material available on record including the case laws. We have observed that the assessee company is engaged in the business of developing bulk terminal of Jawaharlal Nehru Port into a new container terminal, operating and maintaining the same. The activities carried out by the Company broadly include the loading and unloading of containers from shore to ship and from ship to shore; reefer services;....
X X X X Extracts X X X X
X X X X Extracts X X X X
....instead of merely being a provision or unascertained liability as contended by Revenue. Keeping in view specific provision in the Statute vide explanation 1(c) and (i) to Section 115JB of 1961 Act, the additions to book profit are required if the nature of said cost of obsolescence and loss on account of obsolete and slow moving inventory as debited in Profit and Loss Account is merely a provision or an unascertained liability for which onus is on the assessee to rebut the same and prove that it is a business loss sustained by the assessee and is not hit by explanation 1(c) and (i) to Section 115JB of 1961 Act. The case laws relied upon by the assessee are not relevant at this stage as the assessee has not discharged its prima onus cast und....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rate of depreciation on certain intangible assets acquired by the assessee. During assessment proceedings, it was noted that the assessee entered into 30 years license agreement with Jawaharlal Nehru Port Trust (JNPT) and paid certain upfront payment including stamp duty. These rights were categorized as Terminal Rights and amortized in the books of accounts over a period of 10 years effective from AY 2007-08. However, the assessee claimed depreciation thereupon @25%, being the rate applicable to 'intangible assets' while computing its income as per Income Tax. Since the agreement was for 30 years, the same, in the opinion of Ld. AO, was to be amortized over a period of 30 years. The amount of disallowance thus computed, worked out to Rs. 2....