2017 (4) TMI 1509

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....f the Income Tax Act, 1961 as imposed by the AO qua the addition on account of write back of bad debts, writing back of investments, deduction u/s 10(23) of the Act, disallowance of depreciation on lease transactions treated as finance transactions, expenses for earning dividend u/s 80M, expenses apportioned for earning dividend income, share issue expenses and disallowance of deduction u/s 36(1)(viii) of the Act. 2. Brief facts of the case are that the assessment was completed u/s 143(3) of the Act on 15.2.2000 at an income of Rs. 4,46,96,07,540/- as against the returned income of Rs. 2,26,84,77,725/- by making following disallowances: S.No. Nature of disallowance Amount in Rs. 1 Under Rule 6D 87,337 2 Guest Hous....

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....ted in the similar circumstances. 3.2 As regards the write back of bad debts of Rs. 54,57,02,401/-, the ld.CIT(A) deleted the addition on the ground that the assessee offered the entire write back of bad debts of Rs. 54,57,02,401/- in the return of income and the same could not be said to be concealment of income. 3.3 On the writing off of investments Rs. 47,83,79,789/-, the ld.CIT(A) deleted the penalty on the ground that the assessee has not claimed any writing off of investments and therefore there was no concealment of income on the part of the assessee. 3.4 On the deduction u/s 10(23G) of Rs. 23,22,56,327/-, the ld. CIT(A) deleted the penalty by holding that section 14A of the Act was introduced by the Finance Act, 2001 subseq....

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.... of deduction of Rs. 68,25,97,615/-, the ld.CIT(A) held that when there was no specific method prescribed under the Act for the calculation of special reserve given in the Act and it could not be presumed that the one followed by the assessee was erroneous. Further, the ld.CIT(A) held that since the deduction is linked to the business profits, the same would be subject to revision on account of changes to the business profits and accordingly held that no penalty was attracted. 4. On the other hand, the ld.DR reiterated the same contentions as made before the ld.CIT(A) and relied upon the order of AO and prayed that the FAA has wrongly deleted the penalty imposed for various disallowances made by the AO which attracted penalty under the p....

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.... decision of Jurisdictional High Court which was not available at the time of filing of the return. The rest of the expenses were claimed by following the decisions in assessee's own cases for the assessment year 1987-88 which ultimately has been followed by the ld.CIT(A).The issue regarding disallowance of deduction u/s 36(1)(viii) of the Act of 68,25,97,615/- and the issue with regard to deduction u/s 10(23G) of the Act, we find that section 14A was introduced by the Finance Act, 2001whereas the return of income was filed before 29.11.1997. On the issue of depreciation on lease asset, the same was deleted by the Co-ordinate Bench of the Tribunal in the earlier year in assessee's own case and hence no order of ld.CIT(A) on this issue is co....