2021 (1) TMI 1037

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....me tax Rules, 1962 amounting to Rs. 20,06,321/-. 3. Vide letter dated 21.03.2016, the assessee has also raised the following additional grounds of appeal: 1.1 We beg to refer to the above appeal which is yet to be disposed of by your goodself. In this regard, we would humbly request for inclusion of the enclosed additional ground in the above appeal which does not require any further investigation of facts. 2.0 Claim of Excise Duty Subsidy & Interest Subsidy as Capital receipt 2.1 The assessee has set up one unit in Jammu and Kashmir and by virtue of New Industrial Policy received Interest subsidy and Excise duty subsidy amounting to Rs. 18,21,922/- & Rs. 8,57,05,868/-. In computing the total tax liability, the same was claimed as ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ncome in view of CBDT Circular No. 91/58/66 - ITJ(19) dated 18-05-1967, wherein it has been clarified that the effect of the omission of the word 'cess' from Sec. 40(a) (ii) of the Act is that only taxes paid are to be disallowed. 3.2 The recent decision of Hon'ble Rajasthan High Court in the case of Chambal Fertilisers and Chemicals Ltd -vs.-JCIT (ITA No. 52/2018, dated 31-07-2018) also confirms the above claim made by the appellant and thus concludes that education cess is an allowable expenditure in computing total tax liability. Prayer 4.0 In view of the above, the appellant most respectfully prays for admission of the enclosed additional grounds in the appeal pending before your goodself. Your appellant also most r....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... explained that the investment in mutual funds were temporary in nature just to use the funds, by the time the same can be absorbed in the business of the assessee company. 8. After considering the submissions made by the assessee, the Assessing Officer was of the firm belief that provisions of section 14A r.w.r 8D squarely apply on the facts of the case and accordingly, computed the disallowance at Rs. 20,06,321/- 9. The assessee agitated the matter before the ld. CIT(A) but without any success. 10. Before us, the ld. counsel for the assessee reiterated what has been stated before the lower authorities. 11. Per contra, the ld. DR strongly supported the findings of the Assessing Officer/ld. CIT(A). 12. Having considered the rival conte....