TaxTMI 
TaxTMI 
2026 (9) TMI 1328
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....8, in ITA No. 1084/Rjt/2010 for Assessment Year 2008-2009 and in ITA No. 343/Rjt/2012 for Assessment Year 2009-2010 respectively. 3. Since issues involved in all these tax appeals are common, substantial question of law is recorded from Tax Appeal No.620 of 2013 as under: "1. Whether in the facts and circumstances of the case and in law the Income Tax Appellate Tribunal is justified in holding that the rent4. Whether in the facts and circumstances of the case the Income Tax Appellate Tribunal was right in law in confirming the increase of book profits u/ s115JB with the amount income earned by the assessee directly springs from the business of Container Freight Station and as such were eligible for deduction u/s 80IA of the Act? 2. Whether in the facts and circumstances of the case and in law the Income Tax Appellate Tribunal was right in law in not following the decision of this Court in assessee's own case with respect to the earlier assessment year wherein it was held that the depreciation calculated as per the rates provided under the Income Tax Rules can be reduced while computing book profit u/s 115JB of the Act and remanding the matter to the Assessing O....
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.... the assessment year 201213 and Rs.75 lakhs in the assessment year 201314, deserves to be added back in the book profit computed for the purpose of section 115JB. 17.1 The ld. Counsel for the assessee at the very outset contended that this issue is covered in favour of the assessee by the judgment of Hon'ble Gujarat High Court in the case of CIT Vs. Alembic Ltd in Tax Appeal No. 1249 of 2014 as well as decision of Hon'ble Bombay High Court in the case of CIT Vs Bengal Finance & Investment P Ltd in Tax Appeal No 337 of 2013. He placed on record copies both these decisions. Apart from the above, he placed upon reliance Special Bench decision of the ITAT in the case of CIT Vs. Vireet Investment P. Ltd. 165 ITD 27 On the other hand, Id. CITDR relied upon the order of DRP. 18. We have duly considered rival contentions and gone through the record carefully. We find that ld DRP has relied upon the order of the ITAT, Mumbai in the case of DCIT Vs. Viraj Profiles Ltd., (2016) 46 ITR (Trib) 0626 (Mum) and held that addition required to be made in the book profit could be calculated as per Rule 8D of the Income Tax Rules. The ld. DRP thereafter made reference to deci....
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....8,292/ to the book profits towards expenditure incurred having nexus with dividend income, which were exempt under Section 10(33) Recording the said statement, the first question is answered in favour of the appellant-Revenue and against the respondent-assessee." The assessee has relied upon the judgment of ITAT special bench in the case of Vireet Investment Pvt. Ltd. In this regard, it is pertinent to mention that Hon'ble Bombay High Court in the case of Vodafone India Services Pvt. Ltd. Vs. Additional Commissioner of Income Tax & Ors. (2014) 264 CTR 0030 (Bom) (2013) 96 DTR 0193 (Bom) (2014) 361 ITR 0531 (Bom) (2014) 221 Taxman 0166 (Bom), has held that the proceedings before DRP are extension of assessment proceedings. Therefore, they are not bound by the decision of Tribunals unlike CIT(A) as long as the issue is not acceptable on merit and/or the issue is being contested by the department. In this case, the decision of Hon'ble Delhi High Court in the case of Goetze (India) Ltd cited above is also in favour to the department on this issue which also shows that the view of AO confirmed by the Panel is a plausible view. 19. There were contradictory order....
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....Apollo Tyres Ltd. V. Commissioner of Income Tax 255 ITR 273 (SC) which held that "the Assessing Officer does not have the jurisdiction to go behind the net profit shown in the profit and loss account except to the extent provided in the Explanation to Section 115J." The Court declines to frame a question on the above issue." 21. Apart from the above, we have a binding precedent before us - one from Hon'ble jurisdictional High Court and other from the Hon'ble Bombay High Court. The question considered by the Hon'ble Gujarat High Court in the case of Alembic Ltd. (supra) is as under: "Whether on the facts and in the circumstances of the case and in law, the ITAT was justified in holding that adjustment made on account of disallowance u/114A of the Act in computation of book profit u/s 115JB of the Act is not as per law without appreciating that the amount disallowable under section 144 is covered under clause (f) of Explanation to section 115JB(2) and, thus, said amount has to be added back while computing amount of book profit? 22. The Hon'ble Gujarat High Court has replied this question as under: 7. So far as issue Nos. (iii) and ....
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....vidend income under Section 14A of the Act, without reiterating the rationale of confirming deletion of such amount as has been elaborately done at the time of deciding question No. 1, this deletion requires to be confirmed." 8. Taking into consideration the evidence on record and considering the decision of this court in the case of Commissioner of Income-tax-I vs. Gujarat State Fertilisers & Chemicals Ltd. (supra), we are of the opinion that issue Nos. (iii) and (iv) required to be answered in favour of the assessee and against the revenue. In that view of the matter, we answer questions (iii) and (iv) referred to us in favour of the assessee and against the revenue. The appeal of revenue is dismissed. 23. Similarly, Hon'ble Bombay High Court has formulated following question in the case of Bengal Finance & Investments P. Ltd. (supra) and replied as under: (b) Whether on the facts and in the circumstances of the case, and in law, the ITAT is justified in deleting the addition of Rs. 78,84,387/ under clause (f) of Explanation 1 to Section 115JB relying upon the decision in the case of Goetze (India) Ltd. Vs. CIT (2009) 32 SOT 101 (Del.), which has be....