2014 (4) TMI 735 - AT - Income Tax

Deduction u/s 80-IA - non claim of Depreciation Held that - As decided in M/s. Time Technoplast Limited Versus Addl. Commissioner of Income Tax 2014 (1) TMI 297 - ITAT MUMBAI , the decision in Plastiblends India Limited Versus Additional Commissioner of Income-Tax 2009 (10) TMI 39 - BOMBAY HIGH COURT followed The quantum of deduction under section 80-IA is not dependent upon the assessee claiming or not claiming depreciation, because, under section 80-IA the quantum of deduction has to be determined by computing total income from business after deducting all deductions allowable under sections 30 to 43D of the Act - Decided against Assessee. Admission of additional ground Applicability of section 14A while computing the book profits u/s 14A of the Act Held that - The CIT(A) is directed to hear the assessee and adjudicate the same after granting a reasonable opportunity of being heard to the assessee - The CIT(A) shall follow the binding judgments relevant to this matters of giving set off of the interest expenses against the interest income for the purpose of computing deduction u/s 80IB of the Act Decided in favour of Assessee.

Summary

Issues:
1. Appeal against the order of CIT(A)-18, Mumbai for the assessment year 2009-10.
2. Grounds covered by earlier orders of the ITAT for A.Y. 2007-08 & 2008-09.
3. Validity of decision based on High court judgment.
4. Setting aside grounds for re-adjudication by CIT(A).
5. Revisiting revenue authorities for determining disallowances u/s 14A.
6. Admitting additional ground for fresh adjudication.

Analysis:
1. The appeal was filed against the order of the CIT(A)-18, Mumbai for the assessment year 2009-10. The assessee submitted a chart showing how the grounds were covered by earlier ITAT orders for A.Y. 2007-08 & 2008-09 in the assessee's own case. Ground no. 1 was found to be covered against the assessee by a High court judgment, leading to its dismissal.

2. Grounds 2 and 3, along with an additional ground, were set aside for re-adjudication by the CIT(A). The CIT(A) was directed to hear the assessee and consider relevant judgments regarding giving set off of interest expenses against interest income for computing deduction u/s 80IB of the Act. Therefore, grounds 2 and 3 were allowed for statistical purposes.

3. The additional ground regarding the applicability of section 14A in computing book profit u/s 115JB was raised. The assessee requested a revisit by revenue authorities for determining disallowances u/s 14A with Rule 8D of the Act. The matter was remanded to the CIT(A) for fresh adjudication, granting a reasonable opportunity to the assessee, and the appeal was partly allowed for statistical purposes.

4. The decision highlighted the need to consider the legal nature of the issues raised in the additional ground and granted the assessee a chance to be heard in accordance with the principles of natural justice. Consequently, the appeal of the assessee was partly allowed for statistical purposes.

This detailed analysis of the judgment covers the various issues raised in the appeal, the decisions made by the tribunal, and the directions given for re-adjudication, ensuring a comprehensive understanding of the legal proceedings.