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TMI Blog2015 (7) TMI 1433X X X X Extracts X X X X X X X X Extracts X X X X ..... aco, as it relates to Texmaco for a period which was before the date of taking over by the Assessee-company, the same would have to be netted off and there would be no income on this count in the hands of the Assessee. Thus the said amount cannot be treated as income of the Assessee insofar as the conditions prescribed u/s 41(1) are not applicable in the case of the said refund i.e. the Assessee has not claimed deduction of the said Sales tax and consequently, the refund of the same in the hands of the Assessee cannot be taxed by invoking the provisions of Sec. 41(1) - the amount having been transferred by the Assessee to Texmaco, the same is in no way even real income of the Assessee. In the circumstances, the addition as made by the AO and as confirmed by the ld. CIT(A) stands deleted. In the result, the appeal of the Assessee is allowed. Levy of interest u/s 234D - HELD THAT:- Admittedly, in the present case the assessment year relates to 1998-99. The provisions of Sec. 234D was inserted w.e.f. 1.6.2003. The original assessment in the Assessee s case was completed on 29.3.2001 i.e. before the introduction of Sec. 234D. Consequently, we are of the view that the decision of the Ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter of adjournment dt. 2.7.2015 was received mentioning that the counsel is unable to travel to Goa as he is held up before the Hon'ble Nainital High Court at Uttarakhand. On 7.7.2015, another letter dt. 6.7.2015 has been received from the counsel wherein it is mentioned that the counsel's uncle living in Amritsar has expired. In the letter of 6.7.2015, the counsel also mentioned that he would not be appearing in Hon'ble Uttarakhand High Court also on account of the demise of his uncle. As these appeals have been posted repeatedly right from July, 2014 and continuously on one pretext or other, adjournments are being sought, consequently, the adjournment application filed by the Assessee stands rejected and the appeals are being disposed off. 3. ITA No. 123/PNJ/2014 :- In this appeal the Assessee has challenged the action of ld. CIT(A) in upholding the addition of Rs. 92,43,000/- being Sales tax refund due to third parties which have also been paid to third parties but which has been treated as income in the hands of the Assessee by applying the provisions of Sec. 41 of the Act. It was submitted by the ld. AR that the said amount of Rs. 92.43 lacs was Sales tax refund in re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee. In the circumstances, the addition as made by the AO and as confirmed by the ld. CIT(A) stands deleted. In the result, the appeal of the Assessee is allowed. 6. ITA No. 127/PNJ/2014 :- In this appeal the Revenue has challenged the action of ld. CIT(A) in deleting the levy of interest u/s 234D of the Act. It was submitted by the ld. DR that the decision of the Hon'ble Supreme Court in the case of Reliance Energy Ltd. reported in 358 ITR 371 was not applicable to the Assessee's case. 7. In reply, the ld. AR vehemently supported the order of ld. CIT(A). It was the submission that the decision of the Hon'ble Supreme Court in the case of Reliance Energy Ltd. referred to supra was squarely applicable. 8. We have considered the rival submissions. Admittedly, in the present case the assessment year relates to 1998-99. The provisions of Sec. 234D was inserted w.e.f. 1.6.2003. The original assessment in the Assessee's case was completed on 29.3.2001 i.e. before the introduction of Sec. 234D. Consequently, we are of the view that the decision of the Hon'ble Supreme Court in the case of Reliance Energy Ltd. referred to supra is squarely applicable and the ld. CIT(A) was righ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounds in respect of disallowance u/s 14A and the diminution in the value of Government of India Fertilizer Bond loss. It was the submission that consequently the appeal of the Assessee was liable to be dismissed. It was the submission that in respect of disallowance u/s 14A also the issue has been sent to the AO with the direction to verify the working provided by the Assessee. In respect of the Government of India Fertilizer bond loss, the ld. CIT(A) has directed the AO to allow the real loss in the year in which it is incurred i.e. on the redemption of the fertilizer bonds. 14. In reply, the ld. AR submitted that after the order of the ld. CIT(A) there have been further developments in respect of Sec. 14A. It was the submission that he had no objection if the issue in respect of disallowance u/s 14A was restored to the file of the AO for re-adjudication after taking into consideration the decisions of the Hon'ble Allahabad High Court in the case of Sivam Motors Pvt. Ltd. in ITA No. 88 of 2014 dt. 5.5.2014, Hon'ble Gujarat High Court in the case of Corrtech Energy Pvt. Ltd. in Tax Appeal no. 239 of 2014 dt. 24.3.2014, Hon'ble Bombay High Court in the case of Delite En ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... NJ/2014 to the file of the AO for re-adjudication, on similar lines the issue in this case is also restored to the file of the AO for re-adjudication. In the result, the appeal of the Assessee is partly allowed for statistical purpose. 19. ITA No. 327/PNJ/2014 :- In this appeal the Assessee has challenged the disallowance of expenditure u/s 14A. It is fairly agreed by both the sides that in line with the decision in the Assessee's own case in ITA No. 325/PNJ/2014 for the A.Y 1999-2000, the same finding would apply. As we have already restored the issue of disallowance u/s 14A in ITA No. 325/PNJ/2014 to the file of the AO for re-adjudication, on similar lines the issue in this case is also restored to the file of the AO for re-adjudication. In the result, the appeal of the Assessee is partly allowed for statistical purpose. 20. ITA No. 328/PNJ/2014 :- In this appeal the Assessee has challenged the issue of re-opening as also the addition representing MAT credit entitlement for computing the book profits u/s 115JB. As it is noticed that the Assessee has withdrawn these grounds before the ld. CIT(A), we are of the view that the Assessee cannot be permitted to raise these ground befo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e bonds have been received by the Assessee in the course of its business and consequently we are of the view that the finding of the ld. CIT(A) directing the AO to allow the real loss is on the right footing and does not call for any interference. In the result, the appeal of the Revenue stands dismissed. 30. C.O No. 37/PNJ/2014 :- In this Cross objection the Assessee has challenged the issue of re-opening in ground no. 1, the disallowance u/s 14A in ground no. 2, the disallowance of the diminution in the value of the Fertilizer bonds in ground no. 3, the disallowance of expenditure on Plant Revamp study in ground no. 4 and granting of short TDS credit in ground no. 5. 31. As the Assessee itself has withdrawn the issues in ground nos. 1 & 4 for the relevant assessment year before the ld. CIT(A), the same cannot survive before the Tribunal. Consequently, ground nos. 1 in respect of re-opening and ground no. 4 in respect of disallowance of expenditure on Plant Revamp study stands dismissed. 32. In respect of ground no. 2 against disallowance u/s 14A, our findings in ITA No. 325/PNJ/2014 are squarely applicable and the said issue is restored to the file of the AO for re-adjudicatio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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