9911796707
TMI Blog2016 (2) TMI 30X X X X Extracts X X X X X X X X Extracts X X X X ..... f such interest was made in view of compulsory requirement of amounting standards as well as Companies Act, 1956 hence, assessee was rightly held not responsible for paying any income by way of interest on securities to debenture holders in such situation provisions of section 193 of the Act are not applicable. In this background CIT(A) was justified in holding that assessee has not committed any default in this regard. Thus, the assessing officer has rightly been directed not to treat as 'assessee in default' accordingly, he was rightly directed to delete the payment of ₹ 2,92,49,251/- as worked out under provisions u/s 201(1)/201(1A) of the Act. This reasoned factual finding of CIT(A) need not interfere from our side we uphold the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tures without appreciating that in the P L account the same has been debited by the assessee. 3. The Ld. CIT(A) has erred in law and on facts by deleting the amount of non deduction of tax determined in respect of interest to debenture holders without appreciating that the assessee has disallowed the expenditure of interest on debentures u/s. 43B and not u/s. 40a(i)(a) and in subsequent year, if the same is allowed on payment basis without considering the issue of non deduction of tax on the interest paid to debenture holders, it will result in loss to the exchequer. 4. The Ld. CIT(A) has erred on facts and in law in deleting the tax by way of non deduction of tax U/s. 201 (1) of ₹ 65.66 lakhs consequential interest U/s. 201 ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e GIC of India 13.97 65.99 None Oriental Insurance Co. 13.24 61 None United India Insurance Co. 14.02 64 None The New India Assurance Co. 27.61 129 None National Insurance Co. 12.31 57 None Unit Trust of India 165.92 767.73 None Canbank Financial Services 8.88 46.23 None ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ducted the tax at source in respect of other expenses incurred but did not deposited the same to the government revenue in time so he worked in tax liability of ₹ 7,28,797/- that delayed payment of tax hence, total demand raised by him against by assessee was ₹ 2,99,78,48/- u/s 201(1)/201(1A) of the Act. 4. The matter was carried before first appellate authority wherein various contentions were raised on behalf of assessee to oppose the order passed by Assessing Officer u/s 201/201 of the Act and having considered the same CIT(A) granted relief to the assessee same has been opposed on behalf of revenue inter alia submitting that CIT(A) erred on fact and law by allowing relief to the assessee. So the order of CIT(A) to be set ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bombay Relief Undertaking (Special Provisions) Act, 1958 with a view to protect the industry. Although the assessee has neither paid nor paid interest to these financial institutions in respect of debentures. However, the liability was provided for, in its account for purpose of compliance of applicable accounting standards and mandatory requirements of Companies Act, 1956. It was, thus, clear no income had accrue to debenture holders, financial institutions. They have also not recognized any such income in their accounts. The entire liability has been finally waived off by them. The debenture holders have considered the investment in the debentures of assessee's companies and interest thereon as Non Performing Assets (NPA) and have not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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