9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (4) TMI 386 - AT - Income TaxCorrect head of income - interest on margin money, interest on loans to employees, interest on day to day balance with bank in current account, interest on blocked money and interest income on margin money / FDR - business income income from other sources - HELD THAT - We are of the considered view that since the income under consideration is tax neutral and assessee has not pressed this ground being academic in nature, the same is dismissed. However, this issue is kept open and the decision taken for the year under consideration shall not be treated as precedent for the later years. Disallowance u/s 14A r.w.r. 8D while computing the book profits u/s. 115JB - HELD THAT - In view of what has been discussed above and by following the order passed by the Tribunal in assessee s own case for A.Y. 2007-08 2020 (11) TMI 809 - ITAT MUMBAI we are of the considered view that when the assessee while computing the income under normal provisions of the Act had made suo moto disallowance which has been upheld by the Tribunal For A.Y. 2009-10 the same has to be adopted even while computing the book profit under section 115JB of the Act. So we direct the AO to restrict the disallowance under section 14A while computing the book profit under section 115JB of the Act. Consequently, additional grounds No.1 2 raised by the assessee are decided in favour of the assessee.
Issues Involved:
1. Disallowance under Section 14A read with Rule 8D. 2. Classification of interest income as business income or income from other sources. 3. Depreciation on intangible assets (non-compete fees). 4. Disallowance of expenses under Section 35D. 5. Disallowance of commission paid under Section 36(1)(ii). 6. Upward adjustment of disallowance under Section 14A while computing book profit under Section 115JB. Detailed Analysis: Issue 1: Disallowance under Section 14A read with Rule 8D ITA No.2509/M/2012 (A.Y. 2008-09) - The Revenue contended that the CIT(A) erred in restricting the disallowance under Section 14A read with Rule 8D. - The Tribunal noted that the issue was tax neutral and academic, thus dismissed it without setting a precedent for future years. ITA No.3423/M/2012 (A.Y. 2009-10) - The Tribunal upheld the computation made by the assessee for disallowance under Section 14A, as the AO did not provide cogent reasons for rejecting the assessee's computation. - The Tribunal directed the AO to restrict the disallowance to the amount computed by the assessee, i.e., ?26,65,237, while computing book profit under Section 115JB. Issue 2: Classification of Interest Income ITA No.2509/M/2012 (A.Y. 2008-09) - The AO treated interest on loans and advances and bank deposits as income from other sources. - The CIT(A) treated certain interest components as business income, which was upheld by the Tribunal as tax-neutral and academic. ITA No.1500/M/2018 (A.Y. 2013-14) - The AO treated interest income of ?23,17,37,000 as income from other sources. - The Tribunal noted that this issue was academic and tax-neutral, thus dismissed it without setting a precedent for future years. Issue 3: Depreciation on Intangible Assets (Non-compete Fees) ITA No.3423/M/2012 (A.Y. 2009-10) - The CIT(A) confirmed the disallowance of depreciation on non-compete fees. - The Tribunal did not provide a specific ruling on this issue in the summarized judgment. ITA No.1500/M/2018 (A.Y. 2013-14) - The CIT(A) confirmed the disallowance of depreciation on non-compete fees. - The Tribunal did not provide a specific ruling on this issue in the summarized judgment. Issue 4: Disallowance of Expenses under Section 35D ITA No.3423/M/2012 (A.Y. 2009-10) - The CIT(A) confirmed the disallowance of various expenses claimed under Section 35D. - The Tribunal did not provide a specific ruling on this issue in the summarized judgment. ITA No.1500/M/2018 (A.Y. 2013-14) - The CIT(A) confirmed the disallowance of expenses towards the issue of CCPS on the right basis claimed under Section 35D. - The Tribunal did not provide a specific ruling on this issue in the summarized judgment. Issue 5: Disallowance of Commission Paid under Section 36(1)(ii) ITA No.3423/M/2012 (A.Y. 2009-10) - The CIT(A) confirmed the disallowance of commission paid to a director under Section 36(1)(ii). - The Tribunal did not provide a specific ruling on this issue in the summarized judgment. ITA No.1500/M/2018 (A.Y. 2013-14) - The CIT(A) disallowed the commission paid to a director under Section 36(1)(ii). - The Tribunal did not provide a specific ruling on this issue in the summarized judgment. Issue 6: Upward Adjustment of Disallowance under Section 14A while Computing Book Profit under Section 115JB ITA No.3423/M/2012 (A.Y. 2009-10) - The Tribunal held that the upward adjustment of disallowance under Section 14A while computing book profit under Section 115JB is not sustainable, following the decision in the assessee's own case for A.Y. 2007-08. - The Tribunal directed the AO to restrict the disallowance under Section 14A to ?26,65,237 while computing book profit under Section 115JB. Conclusion: - The Tribunal allowed the Revenue's appeal in ITA No.2509/M/2012 (A.Y. 2008-09), dismissed the assessee's appeal in ITA No.1500/M/2018 (A.Y. 2013-14), and partly allowed the assessee's appeal in ITA No.3423/M/2012 (A.Y. 2009-10).
|
