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2020 (11) TMI 1010 - AT - Income Tax


Issues involved:
1. Disallowance under Section 14A of the Income Tax Act, 1961.
2. Claim of additional depreciation by the assessee.
3. Application of Rule 8D while computing disallowance for Book profit under Section 115JB.

Detailed Analysis:
1. Disallowance under Section 14A:
The Revenue appealed against the CIT(A)'s order restricting the disallowance under Section 14A without considering the Supreme Court's decision in Maxopp Investment Ltd. The Tribunal found that the issue was about the computation, not the application, of Section 14A disallowance. The CIT(A) directed the Assessing Officer to quantify the disallowance based on the exempt income, following jurisdictional high court decisions. The Tribunal upheld the CIT(A)'s directions citing relevant case laws and dismissed the Revenue's appeal on this ground.

2. Claim of additional depreciation:
The Revenue challenged the disallowance of the assessee's additional depreciation claim. The CIT(A) reversed the Assessing Officer's action, allowing the claim based on the appellant's submissions and previous year's appellate order. The Tribunal noted that the Revenue's argument based on Goetze (India) Ltd. case did not affect the appellant's right to raise additional claims during assessment proceedings. Citing relevant precedents, the Tribunal upheld the CIT(A)'s decision to allow the additional depreciation claim, as it was consistent with previous year's treatment, and rejected the Revenue's appeal on this ground.

3. Application of Rule 8D for Book profit computation:
The Revenue's appeal also questioned the direction to not apply Rule 8D while computing disallowance for Book profit under Section 115JB. The Tribunal referred to a Special Bench decision that clarified such disallowance should not be included in MAT computation. Consequently, the Tribunal declined the Revenue's argument on this issue as well.

In conclusion, the Tribunal dismissed the Revenue's appeal, upholding the CIT(A)'s directions on all substantive grounds. The judgment emphasized the importance of considering relevant legal precedents and maintaining consistency in decision-making, ultimately leading to the dismissal of the Revenue's appeal.

 

 

 

 

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