TaxTMI 
TaxTMI 
2021 (1) TMI 641
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.... there is no provision in the depreciation schedule for 100% depreciation on Bolero van is misplaced and is an incorrect interpretation of the provisions of the Income Tax Act. 2.1 The Commissioner of Income Tax (Appeals) erred in confirming the disallowance of Rs. 14,46,000 being the loss on Silver futures. 2.2 The Commissioner of Income Tax (Appeals) erred in disposing of the related grounds in a summary manner without adverting to the detailed submissions made before him. 2.3 The Commissioner of Income Tax (Appeals) went wrong in relying on the decision of the Supreme Court in the case of Woodword Governor Private Ltd. which is not applicable to the facts of the present case. 3.1 The Commissioner of Income Tax (Appeals) went wrong in remanding the issue relating to the disallowance u/s.14A r.w. Rule 8D when all the facts are there on record. 3.2 The Commissioner of Income Tax (Appeals) ought to have totally deleted the disallowance u/s.14A of the Income Tax Act." 2. Brief facts of the case are that the assessee filed its return of income for the assessment year 2012-13 on 21.09.2012 admitting NIL income. The return filed by the assessee was processed under section 143(1) o....
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....a plant & machinery, the Assessing Officer allowed only 15% depreciation and the balance claim of depreciation was brought to tax, which was confirmed by the ld. CIT(A) on further appeal. The ld. Counsel for the assessee relied on the decision in the case of CIT v. Smith Kline & French (India) Ltd. (supra) and submitted that the Hon'ble Karnataka High Court has observed in the above case law that the buses in question purchased were the facilities for the prosecution of scientific research and therefore, the assessee was entitled to the benefit of section 35(1)(iv) of the Act. It was further submission that in the present case the assessee purchased the "Bolero Van" and used for the R & D unit transporting R & D materials as well as personnel connected to the research & development and therefore, the claim of the assessee is liable to be allowed. We find force in the arguments of the ld. Counsel. We have perused decision in the case of CIT v. Smith Kline & French (India) Ltd. (supra), wherein, the Hon'ble Karnataka High Court has observed as under: The facts which are necessary for the purpose of answering the question, are as follows: During the assessment year, the assessee c....
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....or the prosecution, of scientific research, but do not include any expenditure incurred in the acquisition of rights in or arising out of, scientific research;" The Tribunal rejecting the contention held that they did not see any force in the contention of the department, in view of the clear provisions contained in section 43(4)(i) and 43(4)(ii) extracted above. Thereafter, at the instance of the revenue, the reference has been made. 2. Shri Srinivasan, the learned counsel for the revenue, contended that the type of expenditures which could be allowed must be those strictly intended for the prosecution of scientific research or facilities for the prosecution bf scientific research, and the buses meant for providing conveyance to the scientific personnel to travel from their respective residences to the factory, cannot be regarded as a facility for the prosecution of scientific research. Sri Sarangan, the learned counsel for the assessee, however, submitted that the language used in the explanation was very wide and every capital expenditure incurred which facilitates the prosecution of scientific research, falls within the definition of the explanation and, consequently, the b....
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....nge as on the date of the balance-sheet is an item of expenditure under section 37(1) of the Act and prayed for reversing the orders of authorities below. On the other hand, the ld. DR dutifully supported the orders of authorities below. 5.2 We have considered the rival submissions and gone through orders of authorities below including the paper books filed by the assessee. On the claim of loss on commodities trading in silver futures, after considering the submissions of the assessee as well as by holding that the facts and circumstances in the case of CIT v. Woodward Governor India Pvt. Ltd. (supra) are different from the facts and circumstances of the assessee's case and in view of the CBDT Instruction No. 03/2010, which provides that MTM losses on foreign derivatives being the difference between the purchase price and the values as on the valuation date, is a notional loss and is contingent in nature, the ld. CIT(A) confirmed the disallowance on marked to market losses on silver futures claimed by the assessee. 5.3 First of all, it is relevant to state that in the case of CIT v. Woodward Governor India (P.) Ltd. (supra), the Hon'ble Supreme Court has observed and held that th....
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....enue account, on capital account and for general purposes outstanding as on 31.03.1991, and claimed the differences between their respective amounts in Indian currency as on 31.03.1990 and 31.03.1991 as revenue loss under section 37(1) in respect of loans used in revenue account. The assessee also treated the similar difference in foreign exchange as an increased liability u/s 43A. The Assessing Officer allowed the deduction claimed u/s 37(1), taking into consideration the increased foreign exchange liability and repaid in the accounting year for the purpose of depreciation. He did not however, allow the claim for foreign exchange loss on loans both in relation to capital as well as revenue account which were outstanding on the last day of accounting year. On appeal, the CIT(A) affirmed the view of AO in relation to deduction u/s 37 of the interest on loans outstanding on the last day of the accounting year but allowed the benefit of increased liability for computation u/s 43A in relation to loss outstanding on the last day of the accounting year. Hence, the assessee as well as department took the matter in appeal to the Appellate Tribunal. The Tribunal held that the loss claimed b....