9911796707
TMI Blog2012 (3) TMI 517X X X X Extracts X X X X X X X X Extracts X X X X ..... fits and gains from the eligible business. X X X X Extracts X X X X X X X X Extracts X X X X ..... also verified by the Assessing Officer. The balance amount of ₹ 7,38,038/- consisted of clearing and forwarding charges, security charges and commission charges. The learned CIT(Appeals) thus held that the provisions of section 40(a)(ia) are clearly applicable on those claim of expenses which has to be added over and above the return income. 3. The learned authorised representative did not disputed the applicability of section 40(a)(ia), however vehemently contented that the sum of ₹ 7,38,038/- which has been disallowed u/s.40(a)(ia) will go to enhance the profits of the eligible business u/s.80IC, because such a disallowance is directly related to the manufacturing and business activity of the appellant. In support of her con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re directly attributable/related to the business of the appellant, which is apparent from the heads of expenses under which these disallowances have been made. Income derived from such eligible business must be computed in accordance with the provisions of section 30 to 43D as has been provided under section 29. Section 40 is a non-obstante clause which places embargo on the allowability of expenses / expenditure from section 30 to 38. Therefore, any disallowance u/s.40(a)(ia) will go to enhance the profit of the assessee from the eligible business. This preposition of law is now squarely covered by the decision of the ITAT, Mumbai 'E' Bench in the case of S.B. Builders & Developers v. ITO (supra) wherein it was observed and held as under : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uction or is disallowed and added back to the profits since "computation" would include both allowing a deduction and disallowing or restricting a deduction in accordance with the statutory provisions. Section 40(a)(ia) authorises the disallowance of the deduction if the tax has not been deducted and paid in time. It is part of the provisions for computation of the profits. Sec.80AB advisedly uses the expression "… the amount of income of that nature as computed in accordance with the provisions of this Act….". The section would have been differently worded if the contention of the Revenue is to be accepted. One would be ignoring the mandate of s.80AB r/w s. 29 it one accepts the stand of the Revenue. There is no authority giv ..... X X X X Extracts X X X X X X X X Extracts X X X X
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