2013 (2) TMI 874 - HC - Income Tax

Summary

Issues involved:
1. TDS credit on discounting charges
2. Delayed payment charges dispute with Gujarat Electricity Board
3. Netting of interest for disallowance under Section 80IA of the Act

TDS Credit on Discounting Charges:
The Revenue appealed against the Income Tax Appellate Tribunal's decision regarding TDS credit on discounting charges. The Tribunal had observed that the credit and debit were set off, and hence, there was no reason to interfere with the decision of the CIT(A). The High Court agreed with this finding and saw no reason to interfere with the Tribunal's decision.

Delayed Payment Charges Dispute with Gujarat Electricity Board:
The second issue revolved around delayed payment charges of Rs. 8.78 crores that the assessee was supposed to receive from the Gujarat Electricity Board. The assessee claimed that due to subsequent developments, this amount should not be added to their total income. However, the Revenue argued that the income had accrued during the relevant year, and the subsequent developments were irrelevant for tax liability purposes. The High Court found that a question of law did arise in this matter.

Netting of Interest for Disallowance under Section 80IA of the Act:
The third issue concerned the netting of interest for disallowance under Section 80IA of the Act. Referring to a Supreme Court decision, the High Court held that the net interest income, excluding expenditure, should be considered for deduction under Section 80IA. The Court concluded that the Tribunal had not committed any error in this regard.

In conclusion, the High Court admitted the tax appeal for consideration of the substantial question of law regarding the delayed payment charges dispute with the Gujarat Electricity Board and whether it should be added to the total income of the assessee considering the developments that occurred after the relevant year.