THE COMMISSIONER OF INCOME vs. M/S.EAST COAST TERMINAL

Order in TCA Nos.66 & 69 /2016 (The C.I.T -Vs- M/s.East Coast Terminal Operation & Port Services ) dated 09.03.2020 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 09.03.2020 CORAM THE HON'BLE DR.JUSTICE VINEET KOTHARI AND THE HON'BLE MR.JUSTICE R.SURESH KUMAR Tax Case (Appeal) No.66 and 69 of 2016 The Commissioner of Income Tax-II Chennai ... Appellant in both appeals Vs. M/s.East Coast Terminal Operation and Port Services Ltd., No.4, 6th Floor, Buhari Towers, Moores Road, Chennai 600 006. ... Respondent in both appeals Tax Case Appeals filed under Section 260A of the Income Tax Act, 1961 against the order of the Income Tax Appellate Tribunal 'C' Bench, Chennai dated 26.09.2013 in ITA No.563 and 566/Mds/2013. For Appellant : Mr.Karthik Ranganathan Senior Standing Counsel

For Respondent : Ms.S.Sriranjani for M/s.G.Baskar C O M M O N J U D G M E N T (Judgment of the Court was delivered by DR.VINEET KOTHARI,J) These Tax Case Appeals are been filed by the Revenue calling in question the correctness of the order passed by the Income Tax Appellate Tribunal, 'C' Bench, Chennai, by raising the following substantial question of law: Page 1 of 5 http://www.judis.nic.in Order in TCA Nos.66 & 69 /2016 (The C.I.T -Vs- M/s.East Coast Terminal Operation & Port Services ) dated 09.03.2020 T.C.A.No.66 of 2016 "1.Whether on the facts and circumstances of the case, the Tribunal was right in holding that the assessee ship enjoying the benefit of Tonnage tax scheme on the issue regarding the ownership especially when the major shareholders of the assessee company held 99.99% of the shareholding who were based in Dubai? 2.Whether on the facts and circumstances of the case, the Tribunal was right in holding that the tonnage tax scheme was to be granted to the assessee company eventhough the provisions of Sec.115VD and Sec.115VC were not satisfied by the assessee company? 3. Whether on the facts and circumstances of the case, the Tribunal was right in holding that the disallowance made u/s.14A Rule 8D could not be made in cases where the assessee is entitled to tonnage tax scheme? 4. Is not the finding of the Tribunal was bad especially when the A.O., made disallowance as per Section 14A read with Rule 8D(2)(iii) for disallowing the expenses earned on exempted income?” T.C.A.No.69 of 2016 "1.Whether on the facts and circumstances of the case, the Tribunal was right in holding that the assessee ship enjoying the benefit of Tonnage tax scheme on the issue regarding the Page 2 of 5 http://www.judis.nic.in Order in TCA Nos.66 & 69 /2016 (The C.I.T -Vs- M/s.East Coast Terminal Operation & Port Services ) dated 09.03.2020 ownership especially when the major shareholders of the assessee company held 99.99% of the shareholding who were based in Dubai? 2.Whether on the facts and circumstances of the case, the Tribunal was right in holding that the tonnage tax scheme was to be granted to the assessee company eventhough the provisions of Sec.115VD and Sec.115VC were not satisfied by the assessee company? 3. Whether on the facts and circumstances of the case, the Tribunal was right in holding that the provision for restatement of assets as at the end of the year due to fluctuation in foreign currency amounting to Rs.9.93 Crores cannot be disallowed in view of the fact that the assessee was entitled to the benefit of tonnage tax scheme without adjudicating the issue on merits? 4. Whether on the facts and circumstances of the case, the Tribunal was right in holding that the disallowance made u/s.14A r/w Rule 8D could not be made in cases where the assessee is entitled to tonnage tax scheme? 5. Whether the finding of theTribunal was proper in holding that once the assessee is eligible for tonnage tax scheme then further disallowance u/s.14A would not arise?”