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TMI Blog2024 (3) TMI 1016X X X X Extracts X X X X X X X X Extracts X X X X ..... reasons why according to him the guarantee amount should be 2.90% and not 3.8%. Therefore, we do not find any error finding arrived at by the ITAT. Interest referable to interest free loans and advances to LIBOR - Tribunal restricting the interest referable to interest free loans and advances to LIBOR +1.50% as against at 7.5%, as determined by the A.O. on the basis of RBI Circular - HELD THAT:- Counsels agreed that this question requires to be admitted. Depreciation directing to adopt the WDV of the assets as on 01.04.2007 - HELD THAT:- This question raises an issue which is merely consequential to the final decisions of the earlier years. Assessee is entitled to depreciation on the opening WDV and the additions made to such WDV during the year. The opening WDV is the amount of the closing WDV of the earlier year as finally determined. In this Question, the Revenue is seeking to reduce the value of the opening WDV on the basis of the stand taken by the Revenue in the earlier years. As the issue raised in this question is only consequential and effect will have to be given to the final decision in the earlier years, there is no question of law which arises for consideration in thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and in law, Hon'ble ITAT was right in deleting the addition on account of notional sales tax, which was treated as revenue receipt by the A.O? b. Whether on the facts and in the circumstances of the case and in law, Hon'ble. Tribunal was right in restricting the expenses u/s. 14A of the Act, at 0.50% of the exempt income as against disallowance of Rs. 87.85 made by the A.O? c. Whether, on the facts and in the circumstances of the case and in law, Hon'ble. Tribunal was right in restricting the guarantee commission to 0.38% of the guaranteed amount as against at 2.90%, as determined by the A.O? d. Whether on the facts and in the circumstances of the case and in law, Hon'ble Tribunal was right in restricting the interest referable to interest free loans and advances to LIBOR +1.50% as against at 7.5%, as determined by the A.O. on the basis of RBI Circular? e. Whether on the facts and in the circumstances of the case and in law, Hon'ble ITAT was right in allowing depreciation at Rs. 5131,68,56,139/- as against the depreciation allowed by the A.O. at Rs. 4899,32,39,084/-.by directing to adopt the WDV of the assets as on 01.04.2007 ? f. Whether on the facts and in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made by the AO to the opening WDV is incorrect and that no such modification to the depreciation allowance claimed ought to have been made in the facts of the assessee's case. The AO is directed to compute the depreciation allowance permissible in accordance with the opening WDV as determined after appeal effect for earlier years. The Revenue's ground of appeal in the Tribunal challenging this part of the order was as follows- 2. On the facts and circumstances of the case and in law the Ld. CIT(A) erred in allowing depreciation as claimed by assessee holding that the claim of depreciation for the year was optional in nature. It is apparent that this ground did not even arise out of the order of the CIT(A). The Tribunal dismissed the Revenue's appeal by adopting the reasoning in its order for assessment years 2007-08 and 2008-09 which had upheld the view of the CIT(A) set out above. It is, therefore, apparent that (apart from what is clearly a typographical error in the question referring to 1/4/2007) the question of law as framed does not arise out of the order of the Tribunal. Further, it is seen that this question raises an issue which is merely consequential to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laimed deduction under Section 80IA of the Income Tax Act, 1961 ( the Act for short) in respect of the profits arising out of such activity. Obviously, therefore the attempt on the part of the assessee was to claim larger profit under the unit which was eligible for such deduction as against this, attempt of the revenue would be see that the ineligible unit shows greater profit. 6. The Tribunal in the impugned judgment extracted extensively from the order of CIT (Appeals) and independent reasons for confirming the same. In such order CIT (Appeals) had placed reliance on an earlier judgment of the Tribunal in case of Reliance Infrastructure Limited Vs. Addl. CIT, Range 1(1). Learned counsel for the assessee had placed on record a copy of the judgment of the Tribunal in case of Reliance Infrastructure limited. In such judgment an identical issue came up for consideration. The Tribunal by detailed judgment had held and observed as under: 44. In the given facts and circumstances of the case, we are of the view that the profits of the business of generation of power worked out by the Assessee on the basis of the price that it paid to TPC for purchase of power continues to be the best ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a consumer in the open market and it should not be compared with the rate of power when it is sold to a supplier as this is not the rate for which a consumer or the Steel Division could have purchased power in the open market. The rate of power to a supplier is not the market rate to a consumer in the open market. 32. In our opinion, the AO committed an illegality in computing the market value by taking into account the rate charged to a supplier: it should have been compared with the market value of power supplied to a consumer. 10. Gujarat High Court in case of Principal Commissioner of Income-Tax Vs. Gujarat Alkalies and Chemicals Ltd. [(2017) 395 ITR 247 (Guj)] also had occasion to examine such an issue. It referred to earlier order in case of Asst. CIT Vs. Pragati Glass Works Pvt. Ltd. [Tax Appeal No. 1646 of 2010 (order dated January 30, 2012) in which following observations were made: 7. To our mind, Tribunal has committed no error. Assessing Officer and CIT(Appeals) while adopting Rs. 4.51 per unit as the value of electricity generated by eligible unit of assessee and supplied through its non-eligible unit only worked out cost of such electricity generation. In fact CIT(App ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing to its conclusion has himself relied on the assessment order for the earlier years. For the reasons given in the said judgment, there is no question of law which arises for consideration. 8. In the circumstances, the appeal is admitted on the following question of law : Whether on the facts and in the circumstances of the case and in law, Hon'ble Tribunal was right in restricting the interest referable to interest free loans and advances to LIBOR +1.50% as against at 7.5%, as determined by the A.O. on the basis of RBI Circular? 9. Respondent waives service. 10. This appeal be listed for hearing in due course. 11. The Registrar (Judicial) / Registrar, High Court, Original Side, Bombay to ensure that the original record in relation to this Appeal is summoned from the tribunal and offered for inspection of the parties. This paper book is treated sufficient for the purpose of admission of this Appeal. However, the Registry must further ensure preparation of complete paper book in accordance with the Rules. The Registry in the first instance must send intimation of admission of this Appeal enclosing therewith a copy of this order so as to enable the Tribunal to act accordingly. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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