2019 (7) TMI 1518 - AT - Income Tax

Addition on account of leave encashment - HELD THAT - The Hon ble Supreme Court in the case of M/S EXIDE INDUSTRIES LTD. ANR. 2009 (5) TMI 894 - SC ORDER granted stay against the decision of Hon ble High Court of Calcutta in the case of Exide Industries Ltd. 2007 (6) TMI 175 - CALCUTTA HIGH COURT until further orders vide order dated 08.09.2008. Further, during the pendency of Civil appeal the Hon ble Supreme Court was pleased to direct assessee therein to pay tax as if section 43B(f) is on the Statute Book though it would be entitled to make claim in the return vide order dated 08.05.2009. Keeping in view of the above orders of Hon ble Supreme Court, on similar cases, this Tribunal is remanding the matter to the file of Assessing Officer to decide afresh after awaiting final order of Hon ble Supreme Court in the case of Exide Industries Ltd. (supra). We find this Tribunal in assessee s own case remanded the similar issues from Assessment Years 2005-06 to 2011-12 which are placed and respectfully following the same, we deem it proper to remand the matter to the file of Assessing Officer for his fresh consideration taking into account final order of Hon ble Supreme Court. Thus only ground raised by the assessee in this appeal is allowed for statistical purposes. Addition made u/s 80IA - HELD THAT - As decided in assessee's own case similar claim of the assessee for deduction under section 80IA in respect of captive power units has been allowed by the Tribunal relying on the various judicial pronouncements as well as the CBDT Instruction No. 1116. Respectfully following the said decision of the Coordinate Bench, we uphold the impugned order of the ld. CIT(Appeals) allowing the claim of the assessee for deduction under section 80IA on Captive Power Unit. Disallowance made on account of capital investment subsidy and sales tax remission - HELD THAT - As in assessee s own case for A.Ys. 2003-04 and 2004-05 wherein the similar amount of incentive received by the assessee-company under the same scheme of West Bengal Government has been held to be capital in nature not chargeable to tax. Disallowance made u/s 14A - HELD THAT - In the absence of any exempt income, disallowance under Section 14A of the Act of any amount was not permissible.

Summary

Issues:
1. Addition made by the Assessing Officer on account of leave encashment.
2. Deletion of addition made under section 80IA of the Act.
3. Deletion of disallowance made on account of capital investment subsidy and sales tax remission.
4. Deletion of disallowance made under section 14A of the Act.

Issue 1: Addition on account of leave encashment
The Tribunal noted that the only issue to be decided was whether the CIT(A) was justified in confirming the addition made by the Assessing Officer on account of leave encashment. Referring to the orders of the Hon’ble Supreme Court in similar cases, the Tribunal remanded the matter to the Assessing Officer for fresh consideration in light of the final order of the Supreme Court. The Tribunal allowed the ground raised by the assessee in this appeal for statistical purposes.

Issue 2: Deletion of addition under section 80IA of the Act
The Tribunal examined the grounds raised by the Revenue regarding the deletion of addition made under section 80IA of the Act. Citing a similar issue disposed of in the assessee’s own case for previous assessment years, the Tribunal found no infirmity in the order of the CIT(A) and dismissed the ground raised by the Revenue.

Issue 3: Deletion of disallowance on account of capital investment subsidy and sales tax remission
The Tribunal addressed the grounds related to the deletion of disallowance made on account of capital investment subsidy and sales tax remission. Referring to previous decisions by the Coordinate Bench and the Tribunal in the assessee’s own case for earlier assessment years, the Tribunal upheld the order of the CIT(A) and dismissed the ground raised by the Revenue.

Issue 4: Deletion of disallowance under section 14A of the Act
Regarding the deletion of disallowance made under section 14A of the Act, the Tribunal observed that the assessee had not earned any exempt income. By relying on the order of the Hon’ble Delhi High Court and the decision in a similar case, the Tribunal upheld the deletion of the addition made by the Assessing Officer. The Tribunal found no infirmity in the order of the CIT(A) and dismissed the ground raised by the Revenue.

In conclusion, the appeal of the assessee was allowed, and the appeal filed by the Revenue was dismissed. The Tribunal pronounced the order on the specified date, resolving all the issues raised by both parties in the appeals.