2021 (9) TMI 743

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....ing grounds has been raised:- 1. "Whether on facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition of Rs. 15,99,87,681/- made on account of Premium payable on redemption of debentures." Whereas, in the assessee's appeal following ground of appeal has raised:- The Hon'ble CIT(A) erred on facts and circumstance of the case in confirming the disallowance u/s 14A read with Rule 8D made by the AO amounting to Rs. 601,453/-. 3. The facts, in brief, are that the Ld. AO on examination of audited accounts and financial statements noted that during the relevant financial year 2013-14, the assessee company had issued nonconvertible debentures worth Rs. 86 crores ' redeemable after 7 years ....

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....epted the assessee's contention after referring to the judgment of the Hon'ble Delhi High Court in the case of CIT vs. Jagatjit Industries Ltd. 204 CTR 428 accepted the assessee's contention. The relevant observation and finding of the Ld. CIT (A) reads as under:- "7.6 I have considered the observations of the Assessing Officer and submission made by the appellant. On careful perusal of the facts of the case of the appellant and judgment relied upon by the Assessing Officer in deciding the issue under consideration it is noticed that in the case of Raymond Ltd. (supra), the Hon'ble High Court of Bombay has not touched the instant issue under appeal. The Hon'ble High court has only decided the issue as to whether the premium payable on red....

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....s. Jagatjit Industries Ltd. (supra) wherein the Hon'ble High Court relied upon the ratio and principle laid down by the Hon'ble Supreme Court in the case of Madras Industrial Investment Corporation Ltd. wherein it was observed as under:- "Having heard learned Counsel for the parties, we are of the view that the question sought to be agitated before us is no longer examinable in the face of authoritative pronouncement of the Supreme Court in Madras Industrial Investment Corporation Ltd. v. Commissioner of Income Tax (supra). That being so, the moment the debentures were issued, the liability had arisen against the assessee which would constitute on expenditure allowable under section 37 of the Act. What is argued by the revenue all the ....

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....ses a) CIT vs. First Leasing Company of India Ltd. (Madras High Court) - Tax case b) National Engg. Industries Ltd. vs. CIT (cal.) 236 ITR 577 c) CIT vs. Tube Investments (India) Ltd. 261 ITR 753 (Mad.) 8. Thus, we do not find any infirmity in the order of the Ld. CIT(A) that assessee's claim in respect of proportionate premium on redemption of debentures and in the profit and loss account on the proportionate basis is allowed. Therefore, the addition has rightly been deleted. 9. Now we come to the assessee's appeal wherein the assessee has challenged the disallowance of Rs. 6,01,453/- u/s 14A read with Rule 8D. 10. Brief facts are that the AO noted that the assesee company has made an investment of Rs. 97,00,000/- as on 31.03.2014....