Dy. CIT v. Continental Engines Ltd.

INCOME TAX ACT, 1961

--Deduction under section 10B--100 per cent export-oriented undertakingsAdditional claim----Where assessee had made a claim under section 10B and it sought merely to recompute the claim, it was rightly allowed by CIT(A).--Revenue was in appeal stating that the CIT(A) had erred in directing the AO to allow the revised claim of deduction under section 10B at Rs. 52,46,09,215 from Rs. 50,25,60,163 as claimed by the assessee, other than filing revised return of income and also ignoring the decision of Apex Court in the case of Goetze (India) Ltd. v. CIT (2006) 284 ITR 323 (SC), which was squarely applicable in the instant case. Held: The assesee had made a claim under section 10B in the return of income. It was only a case where the claim under section 10B was sought to be recomputed. It was not a fresh claim and hence, the judgment of the Supreme Court in the case of Goetze (India) Ltd. v. CIT (2006) 284 ITR 323 (SC) did not apply. This was a legal ground and all the facts relatable to this ground were on record. Thus, in view of the decision of Supreme Court in the case of NTPC Ltd. (1998) 229 ITR 383 (SC), there was no infirmity in the action of the first appellate authority. As far as computation of relief under section 10B was concerned, the DR could not controvert the factual finding of the CIT(A) and hence, the same was upheld.

Income Tax Act, 1961, Section 10B

Distinguished: Goetze (India) Ltd. v. CIT (2006) 284 ITR 323 (SC).

REFERRED : NTPC Ltd.'s case (1998) 229 ITR 383 (SC).

FAVOUR : In favour of assessee.

A.Y. : 2008-09 & 2006-07

INCOME TAX ACT, 1961

--Deduction under section 10B--100 per cent export-oriented undertakingsScrap sales----Where assessee earned miscellaneous income by sale of scrap as main activity, deduction was allowable under section 10B.--Assesee was a company engaged in business of manufacturing and auto components. AO made addition on account of disallowance of deduction under section 10B on miscellaneous income earned by assesee from sale of scrap. CIT(A) deleted the addition following her own decision in year 2006-07. Held: Miscellaneous income in question pertained to sale of scrap and write off of certain credit balances. Both these items of income had been assessed under the head 'Income from business or profession' by the AO. It was not the case of AO that these incomes were assessable under some other head of income and not as income from business. Under these circumstances, the order of CIT(A) had to be upheld by applying the decision of the Special Bench of the Tribunal in the case of Maral Overseas Ltd. v. ACIT, ITA Nos. 777 & 999 (Ind) of 2004 & 295 & 356 (Ind) of 2006, dated 28-3-2012.

Income Tax Act, 1961, Section 10B

Applied:Maral Overseas Ltd. v. ACIT, ITA Nos. 777 & 999 (Ind) of 2004 & 295 & 356 (Ind) of 2006, dated 28-3-2012.

REFERRED :

FAVOUR : In favour of assessee.

A.Y. : 2008-09 & 2006-07

INCOME TAX ACT, 1961

--Deduction under section 10B--100 per cent export-oriented undertakingsScrap sales--Interest-free loan to subsidiary--Where the assessee had made investment by purchasing shares of subsidiary company for having control over it, same was not an interest-free loan and disallowance made on account of interest treating it as interest-free loan was to be deleted.--Revenue was in appeal on ground that CIT(A) had erred in deleting the addition made by the AO on account of disallowance of interest on account of interest-free loan advanced to its subsidiary company. Held: The factual position was that the assessee had purchased shares of a subsidiary company for the purpose of having control over it. The amount in question was investment made and not a loan advanced. As there was no interest-free loan given, the findings of the CIT(A) were upheld.

Income Tax Act, 1961, Section 10B

REFERRED :

FAVOUR : In favour of assessee.

SUBSCRIBE FOR FULL CONTENT