9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2020 (3) TMI 1308 - AT - Income TaxDisallowance u/s 14A r.w.r. 8D - HELD THAT - It is an admitted fact that a similar question in had arisen and was decided in favour of the assessee in assessee s own case for the assessment year 89 2010-11 and 2011-12 in assessee s own case as was noticed by the Ld. CIT(A) in the impugned order. Further the facts of this issue are covered by the decision of the Hon ble Punjab and Haryana High Court in assessee s own case for the assessment year 2006-07 also. In the circumstances we are of the considered opinion that the addition made by the assessing officer by invoking section 14A of the Act read with Rule 8D of the Rules cannot be sustained and the Ld. CIT(A) rightly deleted the same. No reasons to interfere with the reasoning given and conclusions reached by the Ld. CIT(A) on this aspect and therefore the same is appended. Ground No. 1 of Revenue s appeal is accordingly dismissed. Completing the book profit under section 115 JB on account of provision for gratuity leave encashment post-Asst. Year 2012-13 retirement medical benefits LTC baggage allowance etc. - HELD THAT - As argued before us that the provision towards meeting definite liability to be discharged on a future date in respect of the present employees and the quantification of such liability on the basis of actuarial valuation and basing on the report is ascertained liability and not covered under explanation 1 (c) of second proviso to section 115 JB of the Act is further submitted that this issue has been covered by the addition of the Hon ble Punjab and Haryana High Court for the Assessment Year 2002-03 in assessee s own case which has been followed consistently both by the Tribunal and the Ld. CIT(A) all through these years. There is no dispute that the decision of the Hon ble Punjab and Haryana High Court for the Assessment Year 2002-03 2010 (10) TMI 1022 - ITAT DELHI in assessee s own case covers this issue and such view of the Hon ble High Court has consistently been followed by the Tribunal and the Ld. CIT(A). Unless and until there is change of circumstances is not possible to take a different view on an issue covered by the decision of the Hon ble High Court and also the Tribunal for earlier years. Computing book profits under section 115 JB of the Act on account of amortisation of leasehold land - There is no dispute that the decision of the Hon ble Punjab and Haryana High Court for the Assessment Year 2002-03 in assessee s own case covers this issue and such view of the Hon ble High Court has consistently been followed by the Tribunal and the Ld. CIT(A). Unless and until there is change of circumstances is not possible to take a different view on an issue covered by the decision of the Hon ble High Court and also the Tribunal for earlier years. Disallowance in computing book profits under section 115 JB of the Act on account of amortisation of leasehold land - Assessing Officer disallowed the same stating that no rate of depreciation was prescribed either in the companies act or in the Income Tax Act 1961 in respect of land - HELD THAT - The submissions made before us could not be contradicted by the Revenue and more particularly the fact that this issue has been covered by the addition of the Hon ble Punjab and Haryana High Court in assessee s own case for the Assessment Year 2006-07 2018 (4) TMI 47 - PUNJAB AND HARYANA HIGH COURT in ITA No. 136/2015 by order dated 28/02/2018. Further it is also not in dispute that a view in consonance with the decision of the Hon ble High Court has been taken by the Tribunal for the Assessment Years 2004-05 to 2011-12. Eligible for deduction under section 80 IA only from adopted from generation and distribution of power and not from other income - HELD THAT - CIT(A) followed the decision of the Tribunal and granted relief to the assessee. Assessee further places reliance on the addition of the Hon ble Delhi High Court in the case of Pr. CIT vs. Bharat Sanchar Nigam 2016 (8) TMI 270 - DELHI HIGH COURT . Disallowance of depreciation claimed by the assessee in respect of Teesta-V power station - HELD THAT - DR submitted that remanding the issue to the file of the learned Assessing Officer to follow the decision of the Hon ble Noida Medicare Centre limited 2015 (8) TMI 665 - DELHI HIGH COURT would meet the ends of Justice. Recording the same we set aside the finding of the Ld. CIT(A) on this issue and remit the same to the file of the assessing officer to take a view in the light of the decision of the Hon ble Apex Court in the case of Noida Medicare Centre limited (supra). Addition on account of income tax on perquisite borne by the assessee in respect of accommodation provided to its employees while computing the book profit under section 115 JB - HELD THAT - Considering the fact that under identical facts and circumstances the Tribunal had taken a view in favour of the Asst. Year 2012-13 assessee in assessee s own case for the Assessment Year 2010-11 and 2011-12 while following the decision of the Mumbai Tribunal in the case of Rashtriya Chemicals and Fertilisers limited 2018 (3) TMI 1564 - ITAT MUMBAI in the absence of any decision to the contrary by any higher forum we hold the issue in favour of the assessee and direct the deletion of the addition made by the learned Assessing Officer on account of income tax on perquisite borne by the assessee in respect of accommodation provided to its employees while computing the book profit under section 115 JB of the Act.
Issues Involved:
1. Disallowance under section 14A of the Income Tax Act read with Rule 8D of the Income Tax Rules. 2. Disallowance in computing book profit under section 115 JB of the Act on account of provision for gratuity, leave encashment, post-retirement medical benefits, LTC, baggage allowance, etc. 3. Disallowance in computing book profits under section 115 JB of the Act on account of amortisation of leasehold land. 4. Disallowance of deduction under section 80 IA of the Act. 5. Disallowance of depreciation claimed by the assessee in respect of Teesta-V power station. 6. Addition on account of income tax on perquisite borne by the assessee in respect of accommodation provided to its employees while computing the book profit under section 115 JB of the Act. Issue-wise Detailed Analysis: 1. Disallowance under section 14A of the Income Tax Act read with Rule 8D of the Income Tax Rules: The assessee earned exempt income and the Assessing Officer (AO) disallowed ?33.46 crores under section 14A read with Rule 8D, citing incurred expenditure for managing investments. The CIT(A) deleted this addition, noting the AO's failure to record proper satisfaction and the fact that investments were made from the assessee's own funds. The Tribunal upheld the CIT(A)'s decision, emphasizing that the AO must record dissatisfaction with the assessee's claim before invoking section 14A and that investments were made from non-borrowed funds. 2. Disallowance in computing book profit under section 115 JB of the Act on account of provision for gratuity, leave encashment, post-retirement medical benefits, LTC, baggage allowance, etc.: The AO disallowed ?173,03,86,645 on the ground that the provisions were not ascertained liabilities. The CIT(A) deleted this disallowance, following the Punjab and Haryana High Court's decision for the Assessment Year (AY) 2002-03 and his own orders for AYs 2010-11 and 2011-12. The Tribunal upheld the CIT(A)'s decision, noting no change in circumstances and consistent application of the High Court's decision. 3. Disallowance in computing book profits under section 115 JB of the Act on account of amortisation of leasehold land: The AO disallowed ?3,32,81,500, stating no prescribed rate of depreciation for land. The CIT(A) deleted the disallowance, relying on his orders for AYs 2010-11 and 2011-12. The Tribunal upheld the CIT(A)'s decision, noting that the amortisation was in line with accounting standards and covered by the Punjab and Haryana High Court's decision for AY 2006-07. 4. Disallowance of deduction under section 80 IA of the Act: The AO restricted the deduction under section 80 IA to profits from generation and distribution of power, disallowing ?3,31,92,441. The CIT(A) granted relief, following the Tribunal's decisions for AYs 2010-11 and 2011-12. The Tribunal upheld the CIT(A)'s decision, noting consistent application of the Tribunal's and Delhi High Court's decisions. 5. Disallowance of depreciation claimed by the assessee in respect of Teesta-V power station: The AO disallowed ?2,52,93,963, stating the liability for sales tax crystallised in AY 2016-17. The CIT(A) upheld the disallowance. The Tribunal remanded the issue to the AO to reconsider in light of the Delhi High Court's decision in CIT vs. Noida Medicare Centre Ltd, which states that amounts should be capitalised in the year the obligation arises. 6. Addition on account of income tax on perquisite borne by the assessee in respect of accommodation provided to its employees while computing the book profit under section 115 JB of the Act: The AO added ?3,24,551 for income tax on perquisites. The CIT(A) upheld this addition. The Tribunal, noting that the issue was covered by the Tribunal's decisions for AYs 2010-11 and 2011-12 and the Mumbai Tribunal's decision in Rashtriya Chemicals and Fertilisers Ltd vs. CIT, deleted the addition. Conclusion: The Tribunal dismissed the Revenue's appeal and partly allowed the assessee's appeal, remanding the issue of depreciation on Teesta-V power station to the AO for reconsideration. The judgment was pronounced on 20th March 2020.
|
