AI Drafter 
TaxTMI 
TaxTMI 
2017 (7) TMI 1444
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....ny on the ground that the assessee had sought to postpone its liability and the filing of revised return was not bona fide without appreciating that the revised return filed by the assessee was valid and the same should have been considered while determining the income of the assessee. 2] The learned CIT(A) erred in holding that - a. That by filing a revised return, the assessee was adopting a colourable devise to postpone its tax liability. b. The reversal of sale consideration and the write off of the amount receivable from Milestone Developers was not a bona fide transaction and the sole intention was to postpone the tax liability of the assessee. c. There was no omission or wrong statement in the original return filed by the assessee and therefore, the revised return filed was invalid in law. 3] The learned CIT(A) erred in not appreciating that the assessee had filed the revised return within the time prescribed u/s 139(5) and therefore, there was no reason to reject the valid revised return filed by the assessee. 4] The learned CIT(A) failed to appreciate that - a. The agreement for sale of office premises to Cereb....
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....ction u/s 36(1)(iii) of the Act. 6.1] The learned CIT(A) erred in holding that the assessee had utilized borrowed funds for the purposes of making interest free advances to various parties including sister concerns totaling to Rs.164,94,97,755/- and hence, the interest attributable to such advances was not allowable as a business deduction in this year. 6.2] The learned CIT(A) failed to appreciate that the said interest free amounts were advanced by the assessee to various parties including sister concerns for the purposes of business and hence, the learned CIT(A) was not justified in disallowing the interest. 6.3] The learned CIT(A) further erred in not appreciating that the assessee had sufficient interest free funds available with it which were more than the amount of interest free advances made by the assessee and accordingly, there was no reason to make any disallowance of interest. 4. The Revenue in ITA No.1291/PUN/2013 has raised the following grounds of appeal:- 1. The order of the Commissioner of Income-tax(Appeals) is contrary to law and to the facts and circumstances of the case. 2. The Commissioner of Income-tax (Appeals) ....
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....n under section 80IB(10) of the Act was rejected. The last addition made in the hands of assessee was on account of diversion of interest bearing funds to the sister concern. The Assessing Officer noted that total secured funds as on the year ending were at Rs.256.83 crores and the total interest outgo of the assessee at Rs.36.22 crores. The advances made to the group concern amounted to Rs.11,89,32,883/- Further, amount was advanced to Kumar Urban Development Limited at Rs.77,87,13,339/- and share application pending allotment in two companies i.e. Pune Mumbai Reality Pvt. Ltd. and River View Properties Limited amounted to Rs.86,86,50,600/-. The Assessing Officer was of the view that interest expenditure claimed was not allowable expenditure under section 36(1)(iii) of the Act as the interest bearing funds had not been expended wholly and exclusively for the purpose of business. The assessee had claimed the interest expenditure at Rs.36.22 crores and the average rate of interest expenditure was 10.16%. Accordingly, sum of Rs.18,63,36,188/- was disallowed under section 36(1)(iii) of the Act. 7. The CIT(A) allowed the claim of assessee under section 80IA(4)(iii) of the Act and al....
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....g allotment‟. Thus, the contention of the assessee that the funds have been advanced for the purpose of strategic investment seems to be farce. In so far as advances to Mr. Rajesh Tiwari is concerned no explanations whatsoever has been furnished by the assessee and no business expediency has been shown. The ld. AR of the assessee has contended that the assessee is having own interest free funds sufficient to cover the investments as per the balance sheet as on 31-03-2008. However, it is not evident from the records as to whether the assessee was having sufficient own interest free funds for making investment at the time of giving advances. The authorities below have not verified this fact which is material for adjudicating the issue. Thus, in view of the absence of vital information, we are of the considered view that this issue needs a revisit to the file of Assessing Officer to ascertain the financial position of the assessee at the time of giving advances. In case own interest free funds of the assessee are sufficient to cover the advances at the time of making such advances, no disallowance should be made in view of the decision of Hon'ble Jurisdictional High Court in....
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.... year 2006-07 which was allowed to the assessee. The assessee could not complete the project within the time frame specified in IPS 2002 i.e. 31-03-2006. The assessee applied for notification of the project under IPS 2008. The project was notified by CBDT on 09-07-2010. After notification of the project under IPS 2008, the eligibility of deduction has to be seen with respect to the new scheme. Thus, in view of the facts of the case and the observations of the Co-ordinate Bench of the Tribunal we find no merit in the contentions of the ld. DR that the assessee is not eligible to claim deduction u/s. 80IA(4)(iii) in assessment years under appeal." 12. Further, second objection of the Revenue of not establishing 30 units was also considered by the Tribunal in assessee's own case and following the ratio laid down by the Tribunal in M/s. Kolte Patil Developers Ltd. Vs. DCIT (supra) vide para 6.7 reference was made to the said decision at pages 22 to 25 of the order and held as under:- "... The order of the Tribunal in the case of M/s. Kolte Patil Developers Ltd. Vs. Dy. Commissioner of Income Tax (supra) further strengthens the case of assessee in allowing the deduc....