2025 (9) TMI 1009

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....me for AY 2015-16 declaring total income of Rs. 18,98,37,730/- with deemed total income u/s 115JB of the Act of Rs. 25,34,54,750/-. The case of the assessee was selected for scrutiny and notices u/s 143(2) and 142(1) of the Act were issued. The case was discussed with the Ld. A.R and after that the AO added an amount of Rs. 7,81,40,620/- treated as an income of the assessee as the same was received from the State Government by way of grant. The AO has further disallowed the deduction claimed u/s 36(1)(viia) and 36(1)(vii) an amount of Rs. 1,87,66,374/- and assessed the total income of Rs. 28,64,44,724/-. 3. The said order has been challenged by the assessee before the Ld. CIT(A) wherein the appeal of the assessee has been partly allowed ....

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....rs, hence the company is entitled to claim deduction u/s 36(1)(viia) and 36(1)(vii) of the Act. 5. Contrary to that, the Ld. D.R supports the impugned order. 6. We have perused the order of the AO as well as Ld. CIT(A). The AO has assessed the total income of the assessee at Rs. 28,67,44,724/- by adding income received by the assessee between grant from the State Government and also after disallowing claimed deduction u/s 36(1)(viia) and 36(1)(vii) of the Act. The Ld. CIT(A) has allowed the appeal of the assessee on the issue of grant received but dismissed the claim of deduction u/s 36(1)(viia) and 36(1)(vii) of the Act. We have gone through the order passed by the AO against the same issue for AY 2010-11 up to AY 2014-15 and find th....

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....rther pertinent to mention herein that specified entity as defined in Explanation (a)(i) & (ii) to Section 36(1)(viii) meaning a financial corporation specified in Section 4A of the Companies Act, 1956 and WBIDC satisfies this criterion as we have already discussed in the preceding paragraph that the object clause of memorandum of article of association established that WBIDC is engaged in advancing loans and participating in the share capital of the companies, firms and association involved in the industries to be established within the state in order to secure and assist in the expeditious and orderly establishment, growth and development of industries in the State of West Bengal. The said section has been accepted by the Department consi....

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....d framed certain criteria for declaring a Financial Institution as PFI under section 44. of the Companies Act, 1956 vide General Circular No. 34/2011 dated 2.6.2011. The issue has since been revisited and it has been decided that any Financial Institution applying for declaration as PFI shall fulfill the following criteria :- (a) A company or corporation should be established under a special Act or the Companies Act, 1956 being a central act; (b) Main business of the company should be industrial/infrastructural financing: Document 2 (c) the company must be in existence for atleast 3 years and its financial statements should show that its income from industrial/infrastructural financing activities exceeds 50% of its total income. ....