2016 (2) TMI 1286 - AT - Income Tax

Disallowance of interest expenditure - HELD THAT - We set aside the issue to the file of the CIT(A) who is directed to adjudicate the matter afresh in accordance with law and in the lines indicated in the aforementioned orders of the Tribunal. Needless to say that the assessee company shall be granted a reasonable opportunity of being heard by the CIT(A). MAT - calculating of book profit u/s 115JB - HELD THAT - We have observed that this ground relating to the calculating of book profit u/s 115JB is consequential to our decision in the ground no 4 raised by the assessee company which we have adjudicated in preceding para s of this order. Levy of interest u/s 234A 234B and 234C - HELD THAT - Restore the issue back to the file of learned assessing officer who would levy interest as per provisions of Section 234 of the Act and give credit for the TDS amount.

Summary

Issues:
1. Condonation of delay in filing appeal before the Tribunal for the assessment year 2010-11.
2. Disallowance of interest expenditure.
3. Calculation of book profit u/s 115JB.
4. Levy of interest u/s 234A, 234B, and 234C of the Act.

Condonation of Delay:
The appeal filed by the assessee company was delayed by 47 days for the assessment year 2010-11. The counsel for the assessee explained the reasons for the delay, citing that the delay was beyond their control and there was no deliberate delay. The Tribunal considered the reasons presented and condoned the delay, allowing the appeal to be adjudicated on its merits.

Disallowance of Interest Expenditure:
The issue of disallowance of interest expenditure amounting to &8377;1,57,85,366/- was raised. The counsel for the assessee referred to previous Tribunal orders on identical issues in the company's case for various assessment years. The Revenue acknowledged the similarity of the issue and agreed that the matter had been remanded for fresh adjudication by the CIT(A). Consequently, the Tribunal set aside the issue to the file of the CIT(A) for fresh consideration in line with previous Tribunal orders, ensuring the assessee's right to be heard.

Calculation of Book Profit u/s 115JB:
The calculation of book profit u/s 115JB amounting to &8377;1,77,97,551/- was challenged, with the counsel arguing that it was consequential to the disallowance of interest expenditure. Both parties agreed that this issue was linked to the previous ground. The Tribunal noted this connection and ordered accordingly, aligning the decision with the resolution of the interest expenditure issue.

Levy of Interest u/s 234A, 234B, and 234C:
The issue of levying interest u/s 234A, 234B, and 234C of the Act was raised. The counsel for the assessee contended that the interest liability should consider tax deducted at source, citing Tribunal decisions and jurisdictional High Court judgments. The Tribunal referred to previous orders in the company's case and upheld the mandatory nature of interest levy while directing the AO to calculate interest after adjusting the tax deducted at source. The issue was remanded to the assessing officer for proper adjudication in accordance with the law, granting credit for TDS amounts.

In conclusion, the Tribunal partly allowed the appeal filed by the assessee company for statistical purposes, addressing each issue raised comprehensively and ensuring a fair consideration of the legal arguments presented by both parties.