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TMI Blog2015 (8) TMI 1568X X X X Extracts X X X X X X X X Extracts X X X X ..... ng decision has been brought to our notice by the Revenue, respectfully following the orders of the Co-ordinate Bench, we uphold the findings of the Ld. CIT(A). Ground No. 1 to 4 of the Revenue is accordingly dismissed. Sundry receipts from core shipping and reimbursement of managed vessels - As decided in own case [ 2015 (3) TMI 751 - ITAT MUMBAI ] submitted that neither the A.O. nor the ld. CIT(A) has examined the relevant details placed at 157 of the paper book and urged that the matter may be sent back to the A.O. for deciding the same afresh after verifying the said detail. As the ld. D.R. has no objection in this regard, the issue relating to inclusion or exclusion of item No. 3 6 is restored to the file of the A.O. for deciding the same afresh. Receipts relateable to core activity of operation of qualified ship and part of incidental activity - applicability of provisions of Chapter XII-G relating to tonnage income are applicable - HELD THAT:- We find that commission on disbursements (receipts) and Sundries have not been properly explained by supporting demonstrative evidences. We, therefore, restore these issues to the file of the AO. The assessee is directed to demonstrate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law, the Ld. CIT(A) erred in allowing excess provisions written back of Rs. 95,78,424 u/s. 41(1) of the I.T. Act. 3. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in denying application to Tonnage Tax provisions on prior period income u/s. 41(1) of the I.T. Act. 4. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in denying application of Tonnage Tax Provisions to Sundry receipts of liquidate damages of Rs. 3,77,07,022/- by treating it as part and parcel of incidental activity u/s. 41(1) of the I.T. Act, 1961. 5. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in allowing relief to the assessee holding that the reimbursement of overheads for managed vessels to be included in the turnover in working out the income as per the Tonnage Tax Scheme and further, erred in directing to include sundry receipts of Rs. 10,28,28,253/- treating to be from core activities." 3. The assessee is aggrieved by : i) Additions under Sundry receipts ii) Adjustment to the calculation of turnover iii) Disallowance of Administrative expenses iv) Short claim of TDS 4. The grievanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erred to in subsection 5. The issue is, whether the income by way of right back of provisions of sundry credit balances and prior period expenses can be considered as income from core The Shipping Corp. of (I) Ltd. ITA no.145/M./2011 17 activities of a tonnage tax company. In our opinion, write back of these items is to be considered as income from core activity. In a going concern, such write backs and making of supplementary provisions takes place. The Assessing Officer as well as the Commissioner (Appeals) have treated the very same income which is taxable under section 41(1) differently. The first being expenditure claimed in pretonnage tax scheme assessment years and the second being expenditure claimed in post tonnage tax scheme assessment years. Such a segregation is not permissible under the Act. Both the incomes are incomes from core activity and just because tax rates different, they cannot be treated as non-business income. The Assessing Officer as well as the Commissioner (Appeals) seem to have been influenced by the fact that the assessee has an income of ₹ 800 crores in its Profit & Loss account and whereas he has offered only ₹ 18 crores to tax under the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .R. has no objection in this regard, the issue relating to inclusion or exclusion of item No. 3 & 6 is restored to the file of the A.O. for deciding the same afresh after verifying the said details. Ground No. 5 of the assessee's appeal for A.Y. 2006-07 is thus partly allowed." Respectfully following the order of the Co-ordinate Bench, we direct accordingly. 8. In the result, the appeal filed by the Revenue is partly allowed for statistical purpose. 9. Coming to the grievance of the assessee in ITA No. 3546/M/2013, following items of Revenue's have to be considered: Particulars Core Shipping Commission on disbursements (receipts 4,27,948/- Rent on furniture 62,044/- Profit on Bar + Shop sales 4,82,654/- Refund of Director's fees 12,03,547/- Sundries 1,31,38,045/- Application money from Right to info Act 1,878/- 10. It is the claim of the assessee that these receipts (aforementioned) are directly relateable to core activity of operation of qualified ship and part of incidental activity and therefore provisions of Chapter XII-G relating to tonnage income are applicable. 10.1. So far as refund of Director's fees is concerned, the Director's fees must have been all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Revenue authorities in this regard. In our opinion, the Assessing Officer has rightly held that the assessee would not have incurred the expenditure claimed for earning income. The estimation of Rs. 1,00,000 by the Assessing Officer, in our opinion, is reasonable. Coming to reliance placed by the learned Sr. Counsel, on the decision of Hon'ble Jurisdictional High Court Chinai And Co. Pvt. Ltd. The Shipping Corp. of (I) Ltd. ITA no.145/M./2011 21 (supra), we are of the opinion that these are factual matters and the same cannot be taken as a binding precedent. In view of the above discussion, we uphold the finding of the Commissioner (Appeals) and dismiss ground no.7, raided by the assessee." 13. Similarly, in A.Y. 2005-06 and 2006-07, the Tribunal has considered similar issue in ITA Nos. 2944 & 2945/M/2010 at para-18 of its order which reads as under: "As agreed by the ld. Representatives of both the sides, the issues involved in ground No. 3 & 4 of the assessee's appeal for A.Y. 2006-07 are similar to the issues involved in ground No. 3 & 4 of the assessee's appeal for A.Y. 2005-06 except that the claim of the assessee for allocation of administrative expenses against inci ..... X X X X Extracts X X X X X X X X Extracts X X X X
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