CIT v. Reliance Utilities & Power Ltd.

DCIT 10(2), Mumbai vs. Grp Ltd, Mumbai

In the result, the appeal is allowed”

Bench: Shri Amit Shukla & Shri Ramit Kochar

…s Ltd v. CIT (2007) 288 ITR 1 (SC) where it has been held that if the investment is for the commercial expediency , the same can not be disallowed even the same is made in the company under the same management. Similarly CIT v. Reliance Utilities & Power Ltd- 313 ITR 340 (Bom) (2009). it has been held that if the investments are more than interest free funds available with the assessee, no interest can be disallowed. 9.1 AO however, did not agree. He disallowed the proportionate interest of Rs.3,18,600 at 12% of the interest. The learned CIT (A) confirmed the same by stating as under: “7.3 I have gone through the…

DCIT Cir 2(2), Mumbai vs. Kaytee Corporation Ltd, Mumbai

In the result, the appeal of the Revenue is dismissed

…lso noted that assessee had sufficient own interest free funds to cover the impugned advances and, therefore, no disallowance was called for having regard to the judgment of the Hon’ble Bombay High Court in the case of CIT vs. Reliance Utilities & Power Ltd., 313 ITR 340(Bom). Against such decision of the CIT(A), the Revenue is in appeal before us. 6 10. Before us, Ld. Departmental Representative appearing for the Revenue has assailed the order of the CIT(A) by merely reiterating the stand of the Assessing Officer to the effect that the assessee-company was having a common kitty of funds, both interest free as…

ACIT CC-8, Mumbai vs. Jindal Drugs Ltd, Mumbai

In the result, appeals filed by the assessee are allowed in part whereas the appeals filed by the Revenue are dismissed

Bench: Shri R.C. Sharma & Shri Sandeep Gosainassessment Year: - 2005-06 Jindal Drugs Limited Vs. The Asst. Commissioner Of Bakhtawar, 6Th Floor, B&C, Income Tax, Central Circel 229, Nariman Point, – 8 Aaykar Bhavan, Mumbai – 400 021. M.K. Road, Mumbai – 400 020. Appellant Respondent Pan/Gir No. Aaacj1000A Assessment Year: - 2005-06 The Asst. Commissioner Of Vs.` Jindal Drugs Limited Bakhtawar, 6Th Floor, B&C, Income Tax, Central Circel – 8 229, Nariman Point, Old Cgo Bldg, Annexe, Mumbai – 400 021. M.K. Road, Mumbai – 400 020. Pan/Gir No. Aaacj1000A Appellant Respondent Assessment Year: - 2006-07 Jindal Drugs Limited Vs. The Asst. Commissioner Of Bakhtawar, 6Th Floor, Income Tax, Central Circel – 8, B&C, Aaykar Bhavan, 229, Nariman Point, M.K. Road, Mumbai – 400 020. Mumbai – 400 021. Pan/Gir No. Aaacj1000A Appellant Respondent

…ion of own funds was furnished before the lower authorities. From the same, it can be seen that assessee had enough own funds from which it has utilized the funds for purchase of shares. Hon’ble Bombay High Court in the case of Reliance Utilities & Power Ltd. 313 ITR 340, wherein it has been held that where the assessee has both own funds as well as borrowed funds and the own funds are sufficient as compared to the amounts of investments, then it is to be presumed that investments have been made out of own funds. The Co- ordinate Bench of Tribunal in the case of Tata Projects Ltd. (ITA No. 5862/Mum/2006, after co…

ACIT CC.8, Mumbai vs. Jindal Drugs Ltd, Mumbai

In the result, appeals filed by the assessee are allowed in part whereas the appeals filed by the Revenue are dismissed

Bench: Shri R.C. Sharma & Shri Sandeep Gosainassessment Year: - 2005-06 Jindal Drugs Limited Vs. The Asst. Commissioner Of Bakhtawar, 6Th Floor, B&C, Income Tax, Central Circel 229, Nariman Point, – 8 Aaykar Bhavan, Mumbai – 400 021. M.K. Road, Mumbai – 400 020. Appellant Respondent Pan/Gir No. Aaacj1000A Assessment Year: - 2005-06 The Asst. Commissioner Of Vs.` Jindal Drugs Limited Bakhtawar, 6Th Floor, B&C, Income Tax, Central Circel – 8 229, Nariman Point, Old Cgo Bldg, Annexe, Mumbai – 400 021. M.K. Road, Mumbai – 400 020. Pan/Gir No. Aaacj1000A Appellant Respondent Assessment Year: - 2006-07 Jindal Drugs Limited Vs. The Asst. Commissioner Of Bakhtawar, 6Th Floor, Income Tax, Central Circel – 8, B&C, Aaykar Bhavan, 229, Nariman Point, M.K. Road, Mumbai – 400 020. Mumbai – 400 021. Pan/Gir No. Aaacj1000A Appellant Respondent

…ion of own funds was furnished before the lower authorities. From the same, it can be seen that assessee had enough own funds from which it has utilized the funds for purchase of shares. Hon’ble Bombay High Court in the case of Reliance Utilities & Power Ltd. 313 ITR 340, wherein it has been held that where the assessee has both own funds as well as borrowed funds and the own funds are sufficient as compared to the amounts of investments, then it is to be presumed that investments have been made out of own funds. The Co- ordinate Bench of Tribunal in the case of Tata Projects Ltd. (ITA No. 5862/Mum/2006, after co…

ITO (TDS) RG 2, Mumbai vs. Manilal Patel Clearing Forwarding P.Ltd, Mumbai

The appeals of the Revenue are dismissed

Bench: Shri Joginder Singh & Shri Rajesh Kumarassessment Year- 2009-10

…आयकर अपील"य अ"धकरण, मुंबई "यायपीठ,बी,मुंबई । IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES “B”, MUMBAI "ी जो"ग"दर "संह, "या"यक सद"य एवं "ी राजेश कुमार, लेखा सद"य, के सम" Before Shri Joginder Singh, Judicial Member, and Shri Rajesh Kumar, Accountant Member Assessment Year- 2009-10 DCIT-2(2), M/s Manilal Patel Clearing R. No.545, Forwarding Pvt. Ltd. बनाम/ Aayakar Bhavan, 3rd Floor, Kamer Building, 38 Vs. M.K.Road, Cawasji Patel Street, Fort, Mumbai-400020 Mumbai-400001 (राज"व /Revenue) ("नधा"रती /Assessee) PAN. No.AAACM3908L ITA NOs.4856 to 4858/Mum/2013 Assessment Years- 2008-09 to 2010-11 ITO(TDS)(OSD)-…

Addl CIT 3(1), Mumbai vs. Gateway Distriparks Ltd, Navi Mumbai

In the result, Revenue’s appeal is dismissed

Bench: Shri Saktijit Dey & Shri Ashwani Taneja

…eleting the addition of Rs.70,32,644/- made on account of disallowance of interest M/s. Gateway Distriparks Ltd. 19 expense claimed u/s.36(1)(iii) by following the decision of Hon'ble Bombay High Court in the case of Reliance Utilities and Power Ltd [20091 (313 ITR 340) wherein the Hon'ble court has held that it is for assessee to show by production of materials that shares were acquired from funds available in its hand without taking benefit of any loan, without appreciating that the facts of the case relied upon are distinguishable from the facts of the assessee’s case.” 13. Grounds no.1 to 5, relate to the…

Metro Exporters Pvt Ltd, Mumbai vs. Asst. C.I.T.-6(3), Mumbai

In the result, assessee’s appeal is partly allowed

Bench: Shri Saktijit Dey & Shri Ashwani Taneja

…ut of interest free surplus funds and the assessee is not even required to prove commercial expediency. In this context, the learned counsel relied upon the decision of the Hon'ble Jurisdictional High Court in CIT v/s Reliance Utilities and Power Ltd., [2009] 313 ITR 340 (Bom.) and the decision M/s. Metro Exporters Pvt. Ltd. 5 of Hon'ble Delhi High Court in CIT v/s Bharti Tele Venture Ltd., [2013] 313 ITR 502 (Del.). The learned counsel referring to the audited Balance Sheet of the company, a copy of which is at Page–1 of the paper book submitted that assessee had surplus funds of ` 39 crores on account of capi…

DCIT 5(2), Mumbai vs. M. Suresh Company P.Ltd, Mumbai

The appeal of the Revenue is allowed

Bench: Shri Joginder Singh & Shri Rajesh Kumarassessment Year 2009-10 Dy. Commissioner Of M/S M. Suresh Company Income Tax-5(2), Pvt. Ltd. बनाम/ Room No.571, 419 Parekh Market, Vs. Aayakar Bhavan, Opera House, M.K. Road Mumbai-400004 Mumbai-400020 (राज"व /Revenue) ("नधा"रती /Assessee) Pan. No.Aaecm0931D

…/s Sheetal Manufacturing Company vs JCIT (ITA NO.7107/Mum/2011) order dated 28/09/2012, Mehta Brothers Gems Pvt. Ltd. vs ACIT (ITA No.6245/Mum/2010) order dated 25/01/2012 the decision from Hon’ble Bombay High Court in CIT vs Reliance Utilities and Power Ltd. 313 ITR 340 (Bom.). 2.1. We have considered the rival submissions and perused the material available on record. The facts, in brief, are that the assessee company is engaged in the business of 3 M/s M. Suresh Company Pvt. Ltd. cut and polished diamonds, declared income of Rs.5,12,99,150/- in it return filed on 29/09/2009. The case of the assessee was taken…

Cox & Kings Ltd, Mumbai vs. Addl CIT RG 1(1), Mumbai

In the result, both the appeals of the assessee are partly allowed for statistical purposes

Bench: Shri D. Karunakara Rao & Shri Pawan Singh

…of quasi equity as the said company (AE) is wholly owned subsidiary. He also submitted that the loan given to the said AE is not out of any borrowed funds. He relied on the Hon‟ble Bombay High Court judgment in the case of Reliance Utilities and Power Limited 313 ITR 340 for the presumption that the loans are given out of assessee‟s own funds and not out of the borrowed funds. He also objected to the decision of the Revenue Authorities in resorting to levy of notional interest and relied on various binding judgments in favour of the assessee. He was also critical about the rejection of assessee‟s offer of Singapo…

Asst.C.I.T. 2(1), Mumbai vs. Bank of Baroda, Mumbai

The appeal of the Revenue is treated as allowed in the same lines

Bench: Shri D. Karunakara Rao & Shri Sanjay Gargassessment Year: 2008-09 M/S. Bank Of Baroda, Addl. Cit, Range – 2(1), C-26, G-Block, Bandra Kurla Aayakar Bhavan, Queens Road, Complex, Vs. Mumbai - 400020 Bandra (East), Mumbai – 400 051 Pan: Aaacb 1534F (Appellant) (Respondent) Assessment Year: 2008-09 Acit 2(1), M/S. Bank Of Baroda, Aayakar Bhavan, C-26, G-Block, Baroda R.No.561, 5Th Floor, Corporate Centre, Vs. M.K. Road, Bandra Kurla Complex, Mumbai - 400020 Bandra (East), Mumbai – 400 051 Pan: Aaacb 1534F (Appellant) (Respondent)

…agreed with the claim of the appellant that its interest free funds far exceed the amount of investments in assets earning tax free income ought to have followed the ratio laid down by Jurisdictional High Court in the case of Reliance Utilities and Power Ltd 313 ITR 340 and held that no disallowance of interest as contemplated in Rule 8D was warranted. 3 ITA No.4619/M/2012 & ITA No.4873/M/2012 M/s. Bank of Baroda 5. The Ld CIT (A) erred in confirming the taxability of Management fee and Dividend from foreign subsidiaries at 30% instead of 10% as provided for in the Double Tax Avoidance agreements. The CIT (A)…

Bank of Baroda, Mumbai vs. Addl CIT RG 2(1), Mumbai

The appeal of the Revenue is treated as allowed in the same lines

Bench: Shri D. Karunakara Rao & Shri Sanjay Gargassessment Year: 2008-09 M/S. Bank Of Baroda, Addl. Cit, Range – 2(1), C-26, G-Block, Bandra Kurla Aayakar Bhavan, Queens Road, Complex, Vs. Mumbai - 400020 Bandra (East), Mumbai – 400 051 Pan: Aaacb 1534F (Appellant) (Respondent) Assessment Year: 2008-09 Acit 2(1), M/S. Bank Of Baroda, Aayakar Bhavan, C-26, G-Block, Baroda R.No.561, 5Th Floor, Corporate Centre, Vs. M.K. Road, Bandra Kurla Complex, Mumbai - 400020 Bandra (East), Mumbai – 400 051 Pan: Aaacb 1534F (Appellant) (Respondent)

…agreed with the claim of the appellant that its interest free funds far exceed the amount of investments in assets earning tax free income ought to have followed the ratio laid down by Jurisdictional High Court in the case of Reliance Utilities and Power Ltd 313 ITR 340 and held that no disallowance of interest as contemplated in Rule 8D was warranted. 3 ITA No.4619/M/2012 & ITA No.4873/M/2012 M/s. Bank of Baroda 5. The Ld CIT (A) erred in confirming the taxability of Management fee and Dividend from foreign subsidiaries at 30% instead of 10% as provided for in the Double Tax Avoidance agreements. The CIT (A)…

Tikuchand D Jogani, Mumbai vs. DCIT 12(3), Mumbai

In the result, the appeal of the assessee is treated as allowed for statistical purposes

Bench: Shri R.C. Sharma & Shri Sanjay Gargassessment Year: 2008-09 Tikuchand D. Jogani, Dcit – 12(3), 301, Gundecha Chambers, R.No.121, Vs. N.M. Road, Fort, Aayakar Bhavan, Mumbai – 400 023 M.K. Road, Pan: Aaapj8019Q Mumbai - 400020 (Appellant) (Respondent) Present For: Assessee By : Shri Ashok J. Patil, A.R. Revenue By : Shri Neil Philip, D.R. Date Of Hearing : 09.07.2015 Date Of Pronouncement : 30.10.2015

…d before the lower authorities that the interest free loan was advanced out of own funds of the assessee, hence, the interest disallowance was not attracted. Reliance was placed in this respect in the case of “CIT vs. Reliance Utilities and Power Ltd.” (2009) 313 ITR 340 (Bom). It has also been stated by the ld. AR that the AO, while computing the interest disallowance, has made double disallowance as that the same amount has been considered twice for interest disallowance. 11. We have considered the rival contentions made by the parties. It may be observed that the Hon’ble Bombay High Court in the case of “CIT…

Jindal Drugs Ltd, Mumbai vs. ACIT Cen Cir 8, Mumbai

In the result, appeals filed by the assessee are allowed in part whereas the appeals filed by the Revenue are dismissed

Bench: Shri R.C. Sharma & Shri Sandeep Gosainassessment Year: - 2005-06 Jindal Drugs Limited Vs. The Asst. Commissioner Of Bakhtawar, 6Th Floor, B&C, Income Tax, Central Circel 229, Nariman Point, – 8 Aaykar Bhavan, Mumbai – 400 021. M.K. Road, Mumbai – 400 020. Appellant Respondent Pan/Gir No. Aaacj1000A Assessment Year: - 2005-06 The Asst. Commissioner Of Vs.` Jindal Drugs Limited Bakhtawar, 6Th Floor, B&C, Income Tax, Central Circel – 8 229, Nariman Point, Old Cgo Bldg, Annexe, Mumbai – 400 021. M.K. Road, Mumbai – 400 020. Pan/Gir No. Aaacj1000A Appellant Respondent Assessment Year: - 2006-07 Jindal Drugs Limited Vs. The Asst. Commissioner Of Bakhtawar, 6Th Floor, Income Tax, Central Circel – 8, B&C, Aaykar Bhavan, 229, Nariman Point, M.K. Road, Mumbai – 400 020. Mumbai – 400 021. Pan/Gir No. Aaacj1000A Appellant Respondent

…ion of own funds was furnished before the lower authorities. From the same, it can be seen that assessee had enough own funds from which it has utilized the funds for purchase of shares. Hon’ble Bombay High Court in the case of Reliance Utilities & Power Ltd. 313 ITR 340, wherein it has been held that where the assessee has both own funds as well as borrowed funds and the own funds are sufficient as compared to the amounts of investments, then it is to be presumed that investments have been made out of own funds. The Co- ordinate Bench of Tribunal in the case of Tata Projects Ltd. (ITA No. 5862/Mum/2006, after co…