TaxTMI 
TaxTMI 
2020 (2) TMI 1310
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....on the facts and circumstances of the case and in law, the Commissioner of Income Tax (Appeals) ('"CIT(A)") erred in upholding the action of the assessing officer in excluding interest income of Rs. 1,35,27,971 from the profits of the business for computing deduction under section 80HHC of the Income Tax Act, 1961 ("the Act"). 2. That the CIT(A) erred on facts and in law in sustaining the ad-hoc disallowance of Rs. 55,76,844 made by the assessing officer under section 14A of the Act, being 25% of the tax free dividend income earned by the appellant, on the alleged basis that some expenditure was incurred by the appellant for earning dividend income. 2.1 That the CIT(A) erred on facts and in law in not apprecia....
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....s and manufacture and processing of pressure diecasting parts. It files its return of income on 29.10.2004 at Rs. 8,55,38,347/-. The assessment u/s 143(3) of the Act was made on 26.12.2006 determining total income of the assessee at Rs. 16,41,94,835/-. The assessee preferred an appeal before the ld CIT(A) who passed order on 06.10.2015 where the appeal of the assessee is partly allowed. Therefore, both the parties are in appeal before us. 5. We first take up the appeal of the revenue. 6. The first ground of appeal is against the order of the ld CIT(A) in directing the ld AO to exclude sales and excise duty as part of the total turnover for computing the deduction u/s 80HHC of the Act. 7. The assessee has sales tax of Rs. 124470737/....
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....rt in CIT Vs. Laxmi Machine Works 209 ITR 667. In the result ground No. 1 of the appeal is dismissed. 9. Ground no. 2 relates to the additions of Rs. 76,04,979 /- on account of disallowance of royalty. The above issue is squarely covered in favour of the assessee by the decision of the Hon'ble Delhi High Court in ITA No. 312/2015 and 538/2015 dated 04.01.2016, wherein, the appeal filed by the revenue against the order of the coordinate bench for Assessment Year 2007-08 to 2009-10 has not been admitted. The coordinate bench in that order has held that the expenditure of royalty and technical guidance fees is revenue in nature. In view of this ground No. 2 of the appeal of the revenue is dismissed. 10. In the result, ITA No. 1056/De....
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.... Bank deposit cannot be netted off by the interest income related to the business. It was further stated that assessee does not challenge that above income us not "income from other sources" but a "business income". It was further countered that the decision of the Hon'ble Delhi High Court is in fact in favour of the revenue wherein, it has been held that surplus funds are parked with the bank and interest earned thereon, it has to be categorized as "income from other sources". It goes out of income derived for the "business" u/s 80HHC of the Act. 15. We have carefully considered the rival contentions. It is undisputed that the assessee has eared interest income on fixed deposit has not been challenged as being taxed under the head "....
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.... record a satisfaction having regard to the books of account and then prove that the explanation of the assessee is false/ incorrect. In the present case, no such satisfaction has been recorded. The ld AR relied upon the decision of the Hon'ble Supreme Court in 402 ITR 640. 18. The ld DR vehemently submitted that the ld AO after examination has disallowed all the expenditure. The orders of the lower authorities were relied upon. It was further claimed that there is proper satisfaction recorded by the ld AO. 19. We have carefully considered the rival contentions and also perused the orders of the lower authorities. When the assessee contends before the AO, that it did not incur any expenditure for the earning of exempt income, the ....