TaxTMI 
TaxTMI 
2024 (7) TMI 1628
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.... foreign country. 8. The ld.CIT(A) ought to have appreciated the fact that ld.AO erred in not considering the fact that the assessee is eligible to take MAT credit under the provision of section 115JB of the Act." Facts of the case: 3. The assessee is a company engaged in the business of Investment holdings in companies engaged in offshore drilling services. The assessee for the A Y 2014-15 filed its return of income on 28/11/2014, admitting total income of Rs. 16,02,59,960/-. Subsequently, the company filed a revised return of income on 26/11/2015 declaring Rs.NIL income after claiming current year loss of Rs. 112,66,71,006/-. The case was selected for scrutiny under CASS and referred to the DCIT, Transfer pricing -1(1), Chennai for determination of the Arm's length price in respect of the international transactions entered into by the assessee during the financial year 2013-14. The TPO passed an order U/s.92CA(3) of the Act dated 13/10/2017 proposing a total upward adjustment of Rs. 20,69,69,338/- to the ALP of assessee's transaction of extension of corporate guarantee on behalf of its AE. The AO issued a draft assessment order dated 28/12/2017 passed U/s.143(3) r.....
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....petition for AY 2010-11. However, in the submission before the Hon'ble ITAT, the assessee made an elusive claim of deduction u/s 35D for AY 2014- 15 which is not considered in this rectification order." 6. Aggrieved by the action of the AO, the assessee preferred an appeal before the Ld.CIT(A). The ld.CIT(A), was pleased to confirm the action of the AO by passing an order on 03/01/2024. Aggrieved by the action of the Ld.CIT(A), the Assessee is before us. 7. The ld.AR for the assessee stated that both the lower authorities have erred in understanding the assessment orders passed u/s. 143(3) of the Act by the Assessing Officer for the assessment years 2009-10 & 2010-11 and also the Tribunal orders for the assessment years 2009-10 & 2010-11 in ITA Nos. 1947/Mds/2015 &585/Mds/2015 respectively, wherein the assessee had spent Rs. 3.75 crores in each of the above assessment years for expenses towards issue of shares and had claimed 1/5^th deduction u/s.35D of the Act separately. The Assessing Officer has noted in the rectification order u/s. 154 of the Act that the 1/5^th deduction of Rs. 75 lakhs per annum has already been allowed from assessment year 2009-10 to 2013-14 and he....
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.... (Supra) and hence, we are of the considered view that the lower authorities erred in disallowing the deduction U/s.35D of the Act. Therefore, we delete the impugned disallowance of Rs. 75.00 Lakhs U/s.35D of the Act and allow the ground No. 6 of the appeal of the assessee. II. Relief U/s.90 of Rs. 1,17,02,382/- 10. The assessee raised a ground no. 7 against the action of the Ld.CIT(A), confirming the action of the AO by disallowing the withholding tax and Relief U/s.90 of the Act, of Rs. 1,17,02,382/ -. The AO while denying the above claim of the assessee held as under: "1] Relief u/s 90: For the impugned AY 2014-15, relief u/s 90 claimed to the tune of Rs. 1,17,02,382/- was disallowed after detailed discussion of the provisions of DTAA, nature of income from Singapore elaborated in para 6.8 of the order u/s 143(3) r.w.s. 144C dated 30.11.2018. The same is reproduced for ready reference : The assessee company has incurred expenditure on interest of Rs. 159,39,10,000/- for various loans and including for financing the foreign subsidiary as per the details furnished by them. The assessee in its submissions relating to disallowance u/s 14A, etc. has c....
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....: "3.10 The rival contentions are mirrored against the Honourable ITAT's order. The Honourable ITAT in its order has mentioned as under: "22. The next ground is with regard to disallowing the claim of relief u/s 90 of the Act of Rs. 17,63,24,330/- and ignoring the direction of the DRP without verifying the facts on records." As seen from the above finding of the Assessing Officer, it is seen that DRP has not given any such direction and in fact refused to go into the matter. Secondly, Honourable ITAT held as under with respect to the above issue: "In view of the above, following the above order of the Tribunal, we are inclined to hold that once, the interest income subject to tax in any manner in the hands of the assessee, corresponding tax credit to be given. Accordingly, this ground is remitted to the Assessing Officer to examine the issue in the light of our above findings." With respect to the above direction given, the Assessing Officer has clearly stated as under in his rectification order: "But till date, the assessee had not offered any proof for the income offered for taxation, instead making a vague claim ....
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....urn of income. The AO has denied the claim made by the assessee. Before us, the assessee has submitted that since the income of the foreign country was offered for tax by the assessee, the assessee is entitled to get advance credit to tile extent tax paid in foreign country. We find that this issue has been considered by the Co-ordinate Bench of this Tribunal in assessee's own case in ITA No.450/Mds/2017 for A 2012-13 vide order dated 19.06.2017, the issue is remitted back to the file of AO. For the sake of convenience, the relevant portion of the order is extracted as under: "21. After hearing both the parties, we are of the opinion that the similar issue was considered by the Tribunal in assesse's own case in ITA Nos. 585/Md5/2015 & 267/Mds/2016 for the assessment years 2010-11 and 2011-12 dated 14.9.2016 wherein Tribunal held that: "23. We have heard both the parties and perused the material on record. This issue came for consideration in assessee's own case in I. T.A.No. 1159/Mds/2012 challenging the action of the CIT(A) in restricting the assessee's claim of relief u/s 90 of the Act dt 224,67,411/- to the extent of tax payable in India on net ....
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....ndings." Respectfully following the aforesaid order of the Tribunal, this issue is remitted to the file of ld. Assessing Officer and decide accordingly. Hence, this ground of appeal is partly allowed." We therefore respectfully following the order of the Co-ordinate Bench-of this Tribunal, we set aside the order passed by tire AO and remit the 1natter back to the file of AO. We direct the AO to follow the order passed by the Tribunal for AY 2012-13 and pass order thereupon." 8.3 Further, the AR stated that, the assessing officer while giving effect to the directions of the Hon'ble ITAT for AY 2010-11, AY 2011-12 have given the assessee the credit of taxes paid outside India u/s 90 of the Act while passing the orders u/s 143(3) rws 254 of the Act dated 04.01.2018. Also, the Hon'ble ITAT in the assessee's own case for AY 2012-13 in the order vide dated 19.06.2017 in ITA No. 450/Mds/2017 has allowed the same vide Para No. 21. Also, the assessing officer while giving effect to the directions of the Hon'ble ITAT for the AY 2012-13 on 30.11.2018. Also, has allowed the tax credit relief to the assessee company following the directions of the Honourable....
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....not claimed any tax credit u/s 115JB by putting 0 in column no 40f Part B TTI computation of tax liability on total income in the return. Further, the assessment for the impugned AY was completed u/s 143(3) rws 144C under normal of provision by assessing income at Rs. 327,31,22,380/- and resulting tax demand Rs. 108,12,29,300/ whereas the book profit and tax claimed in the return as per schedule MATC was Rs. 43,45,34,753/- and in the schedule right from 2006-07 to 2014-15 no MAT credit was claimed for any of the years. Considering the above facts, this claim is also rejected. 13. The assessee's challenge on this issue before the ld.CIT(A) has been rejected by holding as under: 3.12 Ground of Appeal No. 7 relates to eligibility of the appellant to take MAT Credit u/s 115JB of the Act. With regard to the claim the appellant submitted as under: "In this regard it is to put your goodselves that since, the assessee has paid the tax liability under the provisions of the section 115JB of the Act during the previous years and the assessee is eligible to take credit equal to the difference of tax paid by the assessee under the provisions of the section 115JB at spec....