AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2022 (10) TMI 831
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....1554,49,38,130/- and income under section 115JB of the I.T. Act, 1961 at Rs.2744,13,64,687/-. The case of the assessee company was selected for scrutiny and thereafter, assessment was framed under section 143(3) of the I.T. Act, 1961 vide order dated 28.03.2017 and the total taxable income was determined by the A.O. at Rs.2840,74,56,640/-. 2.1. Aggrieved by the order of the A.O, the assessee carried the matter in appeal before the Ld. CIT(A) who vide order dated 13.02.2018 granted partial relief to the assessee company. 3. Aggrieved by the order of the Ld. CIT(A), the assessee is now in appeal before the Tribunal and has raised the following grounds : 1. "On the facts and circumstances of the case, the order passed by the learned Commissioner of Income Tax (Appeals) [CIT(A)] is bad both in the eyes of law and on facts. 2. (i) On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in confirming the action of the AO in not allowing deduction amounting to Rs.2,41,37,671/- claimed by the assessee under Section 80-IA of the Act. (ii) That the above said disallowance of deduction has been confirmed despite the fa....
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....ng the issue against the assessee at para- 11 of the order noted that on identical facts in assessee's own case while deciding the appeal for the A.Ys. 2010-11 to 2014-15 and for the reasons given in those orders, he had upheld the order of A.O. He noted that since the facts of the case in the year under consideration are identical to that of earlier years, he following his decision of earlier years, upheld the order of A.O. 6. Aggrieved by the order of Ld. CIT(A), the assessee is now in appeal before us. 7. Before us, the Learned Counsel for the Assessee at the outset, submitted that an identical issue arose in assessee's own case in A.Y. 2014-15 before the Coordinate Bench of Delhi Tribunal and the Tribunal vide order dated 15.02.2022 in ITA.No.1803/Del./2018 has decided the issue in favour of the assessee. He submitted that the Tribunal while deciding the issue in favour of the assessee had followed the order of Coordinate Bench of the Tribunal for the earlier A.Y. 2010-11. He pointed to the relevant findings of the Tribunal. He submitted that since it is an admitted fact that the issue in the present grounds are identical to that of earlier years, therefore, following the....
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....is fully covered. 12. On the other hand, ld. DR for the Revenue in order to repel the arguments addressed by the ld. AR for the assessee contended that income directly derived from industrial undertaking is liable u/s 80IA and relied upon the decision of Hon'ble Supreme Court in Conventional Fastners vs. CIT, Dehradun (2018) 256 taxman 61 (SC), Hon'ble Uttaranchal High Court in Conventional Fastners vs. CIT, Dehradun 88 taxmann.com 163 and coordinate Bench of the Tribunal in the case of Conventional Fastners vs. ITO in ITA No.6016/Del/2017 order dated 18.05.2018. 13. Undisputedly, assessee has claimed deduction u/s 80IA qua URI-I, Chambera-II, Dhauliganga and Rangit projects and given the project-wise income detail of such other income as under :- S.No. Particulars URI-I Chamera-II Dhauli-Ganga Rangit Total 1 Rent / Hire Charges from contractors - - 3,545 16,500 20,045 2 Rent / Hire Charges Employees - - - 340 340 3 Rent / Hire Charges - Others 1,477,599 64,212 - 149,378 1,691,189 4 Other Income (Balances, Expenses, Liabilities No longer required written back 13,689,631 ....
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.... interest income and interest expenditure are liable to be excluded for the purpose of deduction under section 80-I of the Act." 48. Further, the Hon'ble Delhi High Court in the case of Pr. CIT vs. Bharat Sanchar Nigam Limited reported in 388 ITR 371 explaining the meaning derived from while computing the deduction u/s 80-IA of the Act, has held as under: "8. The question arose in the context of the Assessee being asked to explain why certain specific items categorized as 'other income' and 'extraordinary item' in the Profit and Loss Account in assessment year 2004-05 should not be excluded from the profit and gains of the Assessee. According to the Revenue, these items could not be considered as profits and gains 'derived from' the eligible business for the purpose of deduction under Section 80 IA. The said six items were : (i) Extra Ordinary Items (ii) Refund from Universal Service Fund (iii) Interest from others (iv) Liquidated Damages (v) Excess provision written back (vi) Others including sale of directories, publications, form, waster paper, etc. 9. The AO held that the si....
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....ts operation. The legislature having ousted applicability of sub-section (1) and (2) in the opening sentence brought in for the purposes of time line sub-section (2) into play but made no efforts whatsoever to put the assessee under sub-section (2A) to meet the stringent requirements that the profits so contemplated were to be "derived from". The requirements of the first degree nexus of the profits from the eligible business has not been brought into play." 11. As a result, the orders of both the AO and the CIT (A) to the extent they deny the Assessee, which in this case is in the business of providing telecommunication services, deduction in respect of the above items in terms of Section 80IA(2A) are unsustainable in law and have rightly been reversed by the IT AT." 49. Further, the Hon'ble Gujarat High Court in the case of Nirma Industries Ltd. Vs DCIT (2006) 283 ITR 402 has held as under: "27. Insofar as question No. 2 is concerned, according to the Tribunal s. 80-I of the Act uses the phrase 'derived from' and hence the interest received by the assessee from its trade debtors cannot be taken into consideration for the purpose of computing profits....
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....rd included the principal sum as well as the interest for delay in payment of the principal sum. The assessee claimed that the interest was of the same nature as other trading receipts, but it was held by the Tribunal that the same was 'Income from other sources'. The apex Court laid down: "The assessee is a contractor. His business is to enter into contracts. In the course of the execution of these contracts, he has also to face disputes with the State Government and he has also to reckon with delays in payment of amounts that are due to him. If the amounts are not paid at the proper time and interest is awarded or paid for such delay, such interest is only an accretion to the assessee's receipts from the contracts. It is obviously attributable and incidental to the business carried on by him. It would not be correct, as the Tribunal has held, to say that this interest is totally de hors the contract business carried on by the assessee. It is well settled that interest can be assessed under the head 'Income from other sources' only if it cannot be brought within one or the other of the specific heads of charge. We find it difficult to comprehend how the interest r....