9911796707
TMI Blog2015 (6) TMI 1085X X X X Extracts X X X X X X X X Extracts X X X X ..... dication. "1. That on the facts and in the circumstances of the case, the Ld. CIT(A) is wrong and unjustified in not appreciating the facts for allowability of Rs. 39,67,262/- U/s.35D of I.T. Act, 1961. 4. That on the facts and in the circumstances of the case, Ld. CIT(A) has proceeded on erroneous belief and misconception of law in confirming the order of Assessing Officer who enhanced the book profit by Rs. 15,00,095/- in respect of FD interest and Rs. 7,10,093/- in respect of provisions for gratuity, contrary to Explanation 1 of Section 115JB of I.T. Act, 1961." 3. Ground no.1 relates to the disallowance of Rs. 39,67,262/- under section 35D of the Income-Tax Act. Brief facts relating to this ground are that the assessee has incurred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fees to the Registrar of Companies for the issue of the share capital. The said decision has been followed by the Hon'ble Supreme Court in the case of Brook Bond India Ltd. -vs- CIT 225 ITR 798. The decision in the case of Punjab State Industrial Corporation Ltd. -vs- CIT (supra) does not relate to the other expenses related to the issue of share capital. We have perused the provisions of section 35D(2)(c)(iv). We noted that this proviso make the following expenditure to be eligible for deduction, as per the provision of section 35D(2)(c)(iv) "in connection with the issue, for public subscription, of shares in or debentures of the company, being underwriting commission, brokerage and charges for drafting, typing, printing and advertisement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , which are available before us, it is not clear how much amount has been paid by the assessee by way of fees to the Registrar of Companies. If this expenditure is incurred as fees paid to the Registrar of Companies, it cannot be allowed even under section 35D. The rest of the expenditure, in our opinion, can be allowed under section 35D. We, therefore, in the interest of justice and fair play to both the parties, set aside this issue to the file of the AO with the direction that the AO shall verify, after giving the opportunity to the assessee whether the expenditure incurred by the assessee and claimed as amortization under section 35D comply with the condition that in case the AO finds that these expenses comply with the condition under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) to (j), even the interest on FD, which has been added, also does not fall in any of the clauses as given under clauses (a) to (j) to Explanation 1. Sub-section (2) of section 115JB requires that every company, shall, for the purposes of this section, prepare its profit & loss account for the relevant previous year in accordance with provision of part II of Schedule VI to the Companies Act, 1956. It also requires that by preparing the annual accounts including profit and loss account, the accounting policies, accounting standards adopted for preparing such accounts including the profit and loss account, the method and rates adopted for calculating the depreciation, shall be the same as have been adopted for the purpose of preparing such ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
