9911796707
TMI Blog2021 (1) TMI 1244X X X X Extracts X X X X X X X X Extracts X X X X ..... and same does not require any kind of interference at our end. Late delivery charges disallowance - allowable business expenditure - HELD THAT:- As decided in own case [ 2018 (12) TMI 182 - ITAT AHMEDABAD ] there is no dispute that apportion of the sale consideration was retained by the payees on account of /ate delivery of the machineries and as per the terms of contract, the assessee had to compensate the customers if it fails to deliver the goods on time. There is no dispute that such expenditures were incurred during the ordinary course of the business of the assessee and therefore are directly related to the business activity of the assessee. It is also true that these expenditures are not penalty levied for any infraction of any legi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... MBER & SHRI WASEEM AHMED, ACCOUNTANT MEMBER) Appellant by : Shri Dinesh Singh, Sr. D.R. Respondent by : Shri Mehul K Patel, A.R. ORDER PER MAHAVIR PRASAD, J.M. 1. This appeal filed by the Revenue is directed against the order of the Commissioner of Income Tax ('hereinafter called CIT(A)') order no. CIT(A)-2/348/DC. Cir. 2(1)(1)/2015-16 order dated 16/09/2016 arising out of assessment order dated 29/01/2016. Revenue has taken following grounds of appeal: 1. The Ld.CIT(A) has erred in law and on facts in restricting the disallowance U/S.14A r.w. Rule 8D of the Act to ₹ 2,58,225/- as against ₹ 75,63,804/- without properly appreciating the facts of the case and the material brought on record. 2. The Ld.CIT(A) has erred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sh working as per section 14A of the Income Tax Act, 1961 read with Rule 8D of Income Tax Rules, 1962. In response to the same, the assesse filed its reply. 3. We would like to mentioned and inform that instead of considering the gross interest, the net interest cost should be considered and this will substantially reduce the amount to be disallowed. This fact has been considered by the various higher authorities at appellate level also. Accordingly there is only ₹ 10112344/( as per role no 24 there is interest income of ₹ 44478891 whereas the Interest coest as per the P and L tile is ₹ 54591235) i.e. due to this interest disallowance will be less than 25% of the amount what we have given the working earlier. Further disa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contention of the assesse and disallowed expenditure incurred for earning of exempt income to the tune of ₹ 75,63,804/- and same was disallowed by the Assessing Officer. 7. Now question is before us is whether disallowance of ₹ 2,58,225/- should be confirmed or not. It can be seen from the facts of the case that ld. A,.O. has made disallowance of ₹ 75,63,804/- u/s. 14A r.w.r. 8D. 8. On the other hand, Ld. CIT(A) has mentioned in his order that issue is covered by the decision given by his office in appellant own case for A.Y. 2012-13 vide Appellate Order No. CIT(A)-2/400/DCIT, Cir. 2(1)(1)/2014-15 dated 25/01/2016 wherein he has restricted the confirmed exempt income of the assesse. 9. In our considered opinion, we do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and allowable as business expenses and disallowance is reqd to be made. Hear will also submit that in all the earlier years, similar addition has been deleted by the appellate Authority." 14. But ld. A.O. did not agree with the contention of the assesse and made addition of ₹ 1,65,067/- . 15. Thereafter assesse preferred first statutory appeal before the ld. CIT(A) who granted relief to the assesse. 16. Now revenue has come before us by way of second statutory appeal. 17. So far deletion of addition of late delivery charges are concerned, similar addition was deleted in assessee's own case in A.Y. 2010-11 & 2011-12 by the Ld. CIT(A) and Co-ordinate Bench has dismissed the revenue's appeal in ITA No. 154/Ahd/2015 with followin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al in ITA No. 154/Ahd/2015 order dated 19/09/2018 with following observations: 14. We have heard the rival contentions and perused the material on record. It is noticed that the assesse company has been regularly exporting its products with the help of overseas dealers. It is undisputed fact that the commission were paid to such non-resident agents in respect of all the services rendered by them related to the export made by the assesse outside India. There was no permanent establishment/office of these agents or any infrastructure situated in India. These agents have carried out all their activities outside India and commission was paid for the activities carried out side India. Section 195 is applicable only if the payments made to non- ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
