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TMI Blog2020 (4) TMI 526X X X X Extracts X X X X X X X X Extracts X X X X ..... case before the Assessing Officer. The Assessing Officer is directed to consider the same and decide the issue in accordance with law after affording the assessee an opportunity of being heard. Deduction under Section 10B of the Act without setting off of the loss, depreciation / Business pertaining to non-10B Units - HELD THAT:- We found that the CIT (Appeals) has relied on the jurisdictional High Court decision in YOKOGAWA INDIA LTD. [ 2011 (8) TMI 845 - KARNATAKA HIGH COURT] which was confirmed by the Hon ble Supreme Court [ 2016 (12) TMI 881 - SUPREME COURT]. The learned Departmental Representative could not controvert the observations of the CIT (Appeals) with cogent evidence. Accordingly, we are not inclined to interfere with the order of CIT (A) on this disputed issue No TP adjustment is called for in this case. X X X X Extracts X X X X X X X X Extracts X X X X ..... d in not considering the correct amount of allowable expenses and inadmissible expenses while computing the total Income as per the asessment order. The comparative table is given below As the assessing officer: PARTICULARS EOU EOU NON EOU TOTAL Net Unit wise profit 7,45,07,014 7,04,07,979 (6,86,68,832) 7,62,46,161 Add: Inadmissible Expenses 2,66,71,680 2,04,55,355 4,49,40,845 9,20,67,880 Less: Allowable expenses 19,88,53,490 15,25,07,038 33,50,61,250 68,64,21,778 11,09,94,320 11,09,94,320 Total (9,76,74,796) (6,16,43,704) (46,97,83,557) (62,91,02,057) Add: interest disallowance 10,18,23,738 10,18,23,738 Total (9,76,74,796) (6,16,43,704) (36,97,59,819) (52,72,78,319) As per the assessee PARTICULARS EOU EOU NON EOU TOTAL Net Unit wise profit 7,45,07,014 7,04,07,979 (6,86,68,832) 7,62,46,161 Add: Inadmissible Expenses 37,44,540 73,71,545 9,20,67,890 10,31,83,975 Less: Allowable expenses 75,64,495 52,08,344 68,64,21,779 69,91,94,618 11,09,94,321 11,09,94,321 Total 7,06,87,059 7,25,71,180 (77,40,17,042) (63,07,58,803) Add: interest disallowance 10,18,23,738 10,18,23,738 Total 7,06,87,059 7,25,71,180 (67,21,93,304) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... peals) considered the grounds of appeal and findings of the Assessing Officer, and dealt on the financial statements of earlier years in respect of advances to the sister concerns and observed that the assessee has not furnished the details of advances and justifican of commercial expediency. Hence the CIT (Appeals) directed the Assessing Officer to recalculate interest on incremental advances made to the Gokaldas Images Infrastructure Pvt. Ltd. and Hinduja Realtors Pvt. Ltd. Further in respect of allocation of expenses, the CIT(Appeals) has directed the Assessing Officer to rework the disallowance on the rule of consistency. Whereas for setoff of profit of EOU Units, the CIT(Appeals) relied on the Hon'ble jurisdictional High Court decision of CIT Vs. Yokogawa India Ltd 341 ITR 385 (Kar) and directed the Assessing Officer to recompute the eligible deduction under Section 10B of the Act and partly allowed the appeal of the assessee. Aggrieved of the order of CIT(Appeals), the assessee has filed an appeal with the Tribunal. 5. At the time of hearing, the learned Authorized Representative submitted that the CIT(Appeals) has erred in directing the Assessing Officer to recompute the in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The claim the assessee was that the sum in question was paid not as a loan but as reimbursement of expenses incurred by GIIPL for identification of property for development of textile SEZ. It was the case of the assessee that GIIPL was appointed to identify and acquire land to an extent of 250 acres for setting up a textile SEZ. It is seen that this of the assessee is not supported by any evidence whatsoever as to what was the expenses incurred by GIIPL which was claimed to be reimbursed by the assessee, is also not given. The terms and conditions of appointment of GIIPL for identifying and acquiring land has also not been filed. In these circumstance, we are of the view that the conclusions drawn by the CIT (A) do not call for any interference. At this stage, we may also clarity that the assessee does not dispute the fact that all the loans in question were given out of borrowed funds and not own funds. We find the Ld AR relied on judicial decision of Cit vs. Reliance Utilities and Power Ltd. (supra) and Cit Vs Golf View Homes Ltd (Supra).which are not applicable to the disputed issue, in view of findings of Coordinate Bench of tribunal that loans are given out of barrowed fund ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , and restore the disputed issue to the file of the Assessing Officer for fresh consideration on the similar directions to decide as per provisions of law and a provide adequate opportunity of hearing to the assessee and allow the grounds of appeal of assessee for statistical purposes. 7. Further the Ld. AR submitted that the CIT(Appeals) has not adjudicated, the Grounds of appeal nos.4 to 8 raised before the authority. We found CIT(Appeals) has referred the grounds of appeal in his order at pages 3 & 4 but there is no finding or observations of the appellate authority. Accordingly, we restore the grounds of appeal, to the file of CIT(Appeals) to give appropriate findings and pass a speaking order, and allow the grounds of appeal for statistical purposes. 8. In the result, the assessee appeal is partly allowed for statistical purposes. Now we shall take up Revenue's appeal in ITA No.1557/Bang/2014. 9. The Revenue has raised the following grounds of appeal as under : 1. The order of the learned CIT(A) is opposed to law and facts of the case. 2. On the facts and in the Circumstances of the case the learned CIT(A) erred in holding that the interest disallowance is to be calcula ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. We found the assessee in ITA No.1502/BNG/2014 in above paragraphs could not substantiate with evidence on commercial expediency of advancing the loan. We relied on assessee own case, for the Asst. Year 2008-09 and restored the matter to the file of Assessing officer with the directions to rework the interest calculations on advances. Accordingly, we consider it appropriate to restore the disputed issues in grounds of appeal raised by the revenue, to the file of Assessing officer as the issues are inter-related and allow the ground of appeal of revenue for statistical purposes. 11. On the Ground Nos.3 & 4, the learned Departmental Representative submitted that the CIT (Appeals) was not correct in directing the Assessing Officer to compute, deduction under Section 10B of the Act without setting off of the loss, depreciation / Business pertaining to non-10B Units placing reliance on the decision of jurisdictional High Court in the case of CIT Vs. Yokogawa (supra). Whereas The Ld. AR supported the order of CIT (Appeals) on this ground of appeal. 12. We heard the rival submissions and perused the material on record. We found that the CIT (Appeals) has relied on the jurisdictional H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 in Revenue's appeal ITA No.1557/Bang/2014 and the same decision shall apply. The learned Departmental Representative could not controvert the observations of the DRP with cogent evidence. Accordingly, we are not inclined to interfere with the finding of the DRP on this disputed issue and confirm the same and dismiss the grounds of appeal of the Revenue. 17. In Revenue's appeal Ground Nos.3 & 4 are in respect of directions of the DRP to the TPO/Assessing Officer . 18. The learned Departmental Representative submitted that the DRP has erred in its observations and directions to TPO/AO on no transfer pricing adjustment. We found that DRP at page 3 considering the objections of the assessee in Transfer Pricing has dealt on the issue in detail on Transfer Pricing Adjustment at page 3 and 4 of the order which is read as under : Having heard the assessee, we find that there is no difference in terms of Functions, assests and risks relating to the manufacturing and export or garments by the assessee to the AE as also non AE, GI. Inc.is the only owned subsidiary of the assessee and the goods have been sold at prices fixed between the parties based on the orders specifications. We have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2/Bang/2016, the grounds of appeal raised by Revenue are as under : 1 The directions of the Dispute Resolution Panel are opposed to law and facts of the case 2. Whether the Hon'ble DRP was right in directing the TPO to adopt Cost Plus Method. 3. Whether the Hon'ble DRP was right in stating that the taxpayer's TP document should be accepted, as it was accepted in the earlier years without any adjustment. 4. For these and other grounds that may be urged at the time of hearing, it is prayed that the directions of the Dispute Resolution Panel in so far as it relates to the above grounds may be reversed. 5.The appellant craves leave to add, alter, amend and 'or delete any of the grounds mentioned above. 23. At the time of hearing, the learned Departmental Representative has submitted that DRP has erred on observations and adopting of assessee objections for no Transfer Pricing Adjustment. We found the DRP in order at pages 2 & 3 has held as under : Having heard the submissions, we find that similar issue was also considered by the DRP in respect of the previous year (FY 2009-10) and after careful examination of the issue, the DRP has given its findings as un ..... X X X X Extracts X X X X X X X X Extracts X X X X
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