TaxTMI 
TaxTMI 
2022 (8) TMI 88
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....cture" or "production" as intended u/s.32(1)(iia) of the Act. 2). The Ld. Commissioner of Income-Tax (Appeals)-XIV, Ahmedabad has erred in law and on facts in deleting the addition of Rs.14,62,000/- made u/s.14A of the Act for the purpose of computing book profits as per Section 115JB of the Act. 3). On the facts and in the circumstances of the case, the Ld. Commissioner of Income-Tax (Appeals)-XIV, Ahmedabad ought to have upheld the order of the Assessing Officer. 4). It is therefore, prayed that the order of the Ld. Commissioner of Income-Tax (Appeals)-XIV, Ahmedabad may be set-a-side and that of the order of the Assessing Officer be restored." 3. The assessee has also made an application under Rule 27 of ITAT Rules vide letter dated 23.03.2022. However, learned AR at the time of hearing submitted that he has been instructed by the assessee not to press the application filed under Rule 27 of ITAT Rules. Therefore, the application filed under Rule 27 of ITAT Rules has been dismissed as withdrawn. 4. The first ground of appeal raised by the Revenue is that the learned CIT(A) erred in deleting the disallowance made by the AO on account additional depreciation of Rs. 9,17,06,....
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....inclined with appellant that it fulfilled all the eligible conditions for claim of additional depreciation (discussed by appellant at para 3 of written submission dated 17.2.2014). Hon'ble Gujarat High Court in the case of Diamonds & Chemicals Ltd, (supra) upheld the ratio of Hon'ble ITAT, Ahmedabad in the. same case for such additional depreciation for windmill as relied on by appellant. I am inclined the ratio of Hon'ble High Court is squarely applicable in the facts of the appellant's case. It is therefore disallowances made by A.O. are neither justified nor substantial in law. The A.O: is directed to allow such additional depreciation of Rs.9,17,06,000 . The appellant gets relief accordingly. This ground is allowed." 7. Being aggrieved by the order of learned CIT(A), the Revenue is in appeal before us. 7.1 The Learned DR before us contended that there was an amendment by the Finance Act, 2012 wherein activity of generating electricity was classified as manufacturing activity and therefore the same is eligible for additional depreciation under S. 32(1)(iia) of the Act. However, such amendment is applicable w.e.f. 01.04.2013 whereas the year involved in the im....
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....l to the facts of the case as discussed in the case cited above. Before us, learned DR has not brought anything on record suggesting that the ruling given by the Hon'ble Madras High Court has been stayed or overruled. Likewise, learned DR has not brought any distinguishing features in the facts of the case on hand vis-àvis the facts of the case cited above. Similarly, learned DR has not brought any contrary binding decision at the time of hearing. Thus, in view of the above, we do not find any infirmity in the order of the learned CIT(A). Hence, the ground of appeal of Revenue is hereby dismissed. 9. Second issue raised by the Revenue is that the learned CIT(A) erred in deleting the addition made by the AO for Rs. 14,62,000/- while calculating the book profit under S.115JB of the Act. 10. During the assessment proceedings under S. 143(3) of the Act, the AO has made disallowance of Rs. 15,000/- under the provisions of Section 14A of the Act which was enhanced to Rs. 14,62,000/- by the learned CIT(A). However, the AO while giving effect to the order of the learned CIT(A) omitted to make the addition for Rs. 14,62,000/- while calculating the book profit under the provisions o....
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....is book profit is irrespective of the fact whether appeal effect is properly given or not or whether rectification is done or not. This legal proposition is based on 'Doctrine of Merger' i.e. the A.O's original asstt. order in which he had computed book profit u/s.115JB of the Act if enhanced by ld.CIT(A) then A.O.'s such original order merges with ld.CIT(A) order and for all subsequent order of A.O. such book profit is required to be taken at enhanced profit. (vi) In reference to merit aspect, the ld.CIT(A) had already enhanced such disallowances u/s.14A of the Act in regular provisions and not in the provisions of section 115 JB of the Act. It is verified from the order giving effect to CIT(A)'s order dated 09.08.2010 that A.O. computed both total income at Rs.9,35,29,370 as well as book profit u/s.115JB of the Act at Rs.50,19,45,000 (as computed u/s. 143(3) order dated 24.12.2.008) and held that MAT provisions are applicable in the case of appellant. Therefore, A.O. is not justified in disturbing such book profit u/s.115JB of the Act in the impugned asstt. order without reasons or grounds. (vii) I am inclined with appellant's contention that as per legal ....
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....o.47 of 2014) dated 19.11.14 wherein it was held that the disallowance regarding the exempted income needs to be made as per the clause (f) to Explanation-1 of Sec. 115JB of the Act independently. The relevant extract of the judgment is reproduced below:- "We find computation of the amount of expenditure relatable to exempted income of the assessee must be made since the assessee has not claimed such expenditure to be Nil. Such computation must be made by applying clause (f) of Explanation 1 under section 115JB of the Act. We remand the matter for such computation to be made by the learned Tribunal. We accept the submission of Mr. Khaitan, learned Senior Advocate that the provision of section 115JB in the matter of computation is a complete code in itself and resort need not and cannot be made to section 14A of the Act." Given above, we hold that the disallowances made under the provisions of Sec. 14A r.w.r. 8D of the IT Rules, cannot be applied to the provision of Sec. 115JB of the Act as per the direction of the Hon'ble Calcutta High Court in the case of CIT Vs. Jayshree Tea Industries Ltd. (Supra). Now the question arises to determine the disallowance as per the clause....