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TMI Blog2024 (8) TMI 348X X X X Extracts X X X X X X X X Extracts X X X X ..... that the assessee is not entitled to deduction as claimed by the assessee towards interest paid being the pro rata term paid on FCCD. Argument of the assessee is that the assessee was having free funds is devoid of any merit, as it was not a case before the ld.CIT(A) that the investments were made out of free funds available within it on account of liquidation of the part of the FCCD Bonds Once the specific provision which prohibits the assessee from claiming any deduction, then the question of allowing the deduction of interest on the pretext of availability of mixed funds does not arise. In so far as the case laws relied upon by the assessee, those case laws are not applicable to the present case, as they are on different facts. In light of the above, the ground Nos.2 and 3 raised by the assessee are dismissed. Depreciation on UPS - @ 60% or 15% - HELD THAT:- In the present case, with respect to depreciation on computer is clearly covered in favour of the assessee by the decision of Ushodaya [ 2014 (12) TMI 7 - ITAT HYDERABAD] wherein depreciation on UPS at 60% allowed. - Shri Laliet Kumar, Hon ble Judicial Member And Shri G. Manjunatha, Hon ble Accountant Member For the Asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion from time to time. After verifying the information submitted, Assessing Officer completed the assessment by making disallowance of Rs. 65,04,518/- towards interest on FCCB, Rs. 27,10,61,790/- towards Hedging loss, Rs. 30,09,100/- towards expenditure as per provisions of Section 14A of the Act and Rs. 9,88,343/- towards excess depreciation on UPS and passed assessment order u/s 143(3) of the Act dt.30.12.2011 reducing the loss to Rs. 1,57,77,520/-. 4. Feeling aggrieved by the assessment order, assessee carried the matter before the ld.CIT(A), who granted part relief to the assessee. 5. Feeling aggrieved with the order of ld.CIT(A), assessee is now in appeal before us. 6. Before us, ld.AR submitted that in respect to ground no.2 first ground, it is the contention of the Assessing Officer that the Assessing Officer had disallowed the expenditure claimed by the assessee to the extent of Rs. 65,04,578/- as the assessee has opted for Tonnage Tax Scheme in the provisions of the Act. For the above said purposes, the ld. AR has drawn our attention to the order of the Assessing Officer. 7. Feeling aggrieved such assessment order, the assessee filed the appeal before the ld.CIT(A). The ld ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2009) 313 ITR 340 and South Indian Bank [2021] 130 taxmann.com 178 (SC) to buttress his arguments. In the case of South Indian Bank (supra), the Hon'ble Supreme Court has held as under : 26. Reverting back to the situation here, the Revenue does not contend that the Assessee Banks had held the securities for maintaining the Statutory Liquidity Ratio (SLR), as mentioned in the circular. In view of this position, when there is no finding that the investments of the Assessee are of the related category, tax implication would not arise against the appellants, from the said circular. 27. The aforesaid discussion and the cited judgments advise this Court to conclude that the proportionate disallowance of interest is not warranted, under section 14A of Income Tax Act for investments made in tax-free bonds/securities which yield tax-free dividend and interest to Assessee Banks in those situations where, interest free own funds available with the Assessee, exceeded their investments. With this conclusion, we unhesitatingly agree with the view taken by the learned ITAT favouring the assessees. 9. Per contra, ld. DR has submitted that the assessee has settled the issue arising in the appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... undred, then, if the last figure in that amount is fifty tons or more, the tonnage shall be increased to the next higher tonnage which is a multiple of hundred and if the last figure is less than fifty tons, the tonnage shall be reduced to the next lower tonnage which is a multiple of hundred; and the tonnage so rounded off shall be the tonnage of the ship for the purposes of this section. (6) Notwithstanding anything contained in any other provision of this Act, no deduction or set off shall be allowed in computing the tonnage income under this Chapter. 11. Heard both the parties and perused the material available on record. From the reading of provisions of Section 115VG of the Act, reproduced hereinabove, it is abundantly clear that once the assessee opts for a Tonnage Tax Scheme, then Tonnage income cannot be set off against any deduction provided under the Act. In the present case, it is admitted that the assessee has opted for Tonnage Income Tax which has been accepted by the Assessing Officer and ld.CIT(A). 11.1 Therefore, the question must be considered whether, after opting for the Tonnage Tax Scheme, the assessee can claim the deduction in derogation of the provision of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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