The ACIT, Circle-4, Ahmedabad V. Gujarat State Financial Services Ltd., Ahmedabad

ITA 2157/AHD/2006

• Counselvise Citation: [2009] 114 COUNSELVISE.COM (IT) 9058 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 11 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-09-2009
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 10-08-2009
• Assessment Year: 2000-2001
• Appeal Filed On: 09-10-2006
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: B S GHELOT
• Assessee Lawyers: YERGESH SHAH
• Keywords: Depreciation; Opportunity of being heard; Rule of consistency; Proportionate interest; Set aside
• Section: 143(3); 234B; 14A; 264; 37

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH B AHMEDABAD BEFORE SHRI P.K.BANSAL, ACCOUNTANT MEMBER AND SHRI MAHAVIR SINGH, JUDICIAL MEMBER ITA NO.2157-2158/AHD/2006 ASSESSMENT YEARS:2000-01 & 2003-04 DATE OF HEARING:10.8.09 DRAFTED:7.9.09 ACIT, CIRCLE-4, AHMEDABAD ACIT, CIRCLE-4, AHMEDABAD V/S . V/S . GUJARAT STATE FINANCIAL SERVICES LTD. WING B, 3 RD FLOOR, KHANIJ BHAVAN, 132 FT. RING ROAD, NR. UNIVERSITY GROUND, VASTRAPUR, AHMEDABAD PAN NO.AACG5581B GUJARAT STATE FINANCIAL SERVICES LTD. WING B, 3 RD FLOOR, KHANIJ BHAVAN, 132 FT. RING ROAD, NR. UNIVERSITY GROUND, VASTRAPUR, AHMEDABAD PAN NO.AACG5581B (APPELLANT) .. (RESPONDENT) CO NO.265 & 266/AHD/2006 (ARISING OUT ITA NO.2157 & 2158/AHD/2006) ASSESSMENT YEARS:2000-01 & 2003-04 GUJARAT STATE FINANCIAL SERVICES LTD. WING B, 3 RD FLOOR, KHANIJ BHAVAN, 132 FT. RING ROAD, NR. UNIVERSITY GROUND, VASTRAPUR, AHMEDABAD PAN NO.AACG5581B V/S . ACIT, CIRCLE-4, AHMEDABAD (APPELLANT) .. (RESPONDENT) ASSESSEE BY :- SHRI YERGESH SHAH, AR REVENUE BY:- SHRI B.S. GHELOT, CIT, DR ITA NO.2157-58/AHD/2006 CO 265-66/AHD/2006 A.YS 00-01 & 03-04 ACIT CIR-4, ABD V. GSFS LTD. ABD PAGE 2 O R D E R PER MAHAVIR SINGH JUDICIAL MEMBER:- THESE TWO APPEALS BY THE REVENUE AND TWO CROSS OBJ ECTIONS (CO) BY THE ASSESSEE ARE ARISING OUT OF THE ORDER OF COMMISSION ER OF INCOME-TAX (APPEALS)-VIII, AHMEDABAD IN APPEAL NO. CIT(A)-VIII/AC-4/307, 231, 192, 234/05-06 ALL OF EVEN DATE 28-07-2006. THE ASSESSMENTS WERE FRAMED BY TH E ASSTT. COMMISSIONER OF INCOME-TAX, CIRCLE-4, AHMEDABAD U/S. 143(3) R.W.S. 147 OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) VIDE HIS ORD ERS DATED 30-11-2005 AND 27-12- 2005 FOR THE ASSESSMENT YEARS 2000-01 AND 2003-04 R ESPECTIVELY. 2. THE FIRST COMMON ISSUE IN THESE APPEALS OF THE R EVENUE IS AGAINST THE ORDER OF CIT(A) IN DELETING THE DISALLOWANCE MADE OUT OF DEPRECIATION ON ASSETS OF SALE & LEASE BACK TRANSACTIONS. SINCE THE ISSUE IS COMMON EXCEPT THE AMOUNT, WE WILL TAKE THE GROUND RAISED IN REVENUES APPEAL IN ASSESSMENT YEAR 2000-01 AS UNDER:- 1. THE LD. CIT(A) ERRED IN LAW AND ON THE FACTS OF THE CASE IN DELETING THE DISALLOWANCE MADE OF RS.6,52,56,469/- OUT OF DEPREC IATION ON ASSETS OF SALE AND LEASE BACK TRANSACTIONS. 3. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE FILE D A COPY OF TRIBUNALS ORDER IN ASSESSEES OWN CASE, WHEREIN EXACTLY ON SIMILAR TRA NSACTIONS AND ON EXACTLY IDENTICAL FACTS, THE TRIBUNAL HAS DECIDED THE ISSUE BY GIVING FOLLOWING FINDING IN PARA- 6 AS UNDER:- 6. WE HAVE HEARD LEARNED DR AND LEARNED AR. WE NOT ICED THAT THE ASSESSEE ENTERED INTO FIVE LEASE TRANSACTIONS WITH GSRTC. TH EY ARE FIRST TRANSACTION WAS IN FINANCIAL YEAR 1993-94 WHEN, DEPRECIATION WA S CLAIMED AT RS.59,97,155/-. THE SECOND LEASE TRANSACTION WAS AL SO ENTERED INTO IN A.Y. 1994-95 WHEREIN DEPRECIATION OF RS.40,18,720/- WAS CLAIMED AND ALLOWED. THE THIRD LEASE TRANSACTION WAS ENTERED INTO IN F.Y . 1996-97 ON WHICH THE DEPRECIATION APPROX. OF RS.2,00,06,325/- WAS CLAIME D. FORTH TRANSACTION TOOK PLACE IN A.Y. 1998-99 IN WHICH DEPRECIATION OF RS.4 ,01,38,576/- WAS CLAIMED AND ALLOWED. FIFTH ALSO TOOK PLACE IN A.Y. 1998-99 IN WHICH THE DEPRECIATION OF RS.7,99,42,946/- WAS CLAIMED. IT IS STATED BY THE L EARNED AR OF THE ASSESSEE THAT NO FRESH LEASE TRANSACTION HAS TAKEN PLACE THI S YEAR AND DEPRECIATION IN RESPECT OF OLD LEASE TRANSACTIONS HAS ONLY BEEN CLA IMED THIS YEAR. THEREFORE, FOLLOWING THE PRINCIPLE OF CONSISTENCY, AS PROPOUND ED IN CIT VS. H.P. COTTON TEXTILE MILLS LTD. 311 ITR 436, CIT VS. MALBOROUGH POLYCHEM PVT. LTD ., 309 ITR 43; CIT VS. MOONLIGHT BUILDERS AND DEVELOPERS 307 ITR 197 AND ACIT VS. GENDALAL HAZARILAL & CO. 263 ITR 679 WHEREIN IT IS HELD THAT EVEN THOUGH IN INCOME-TAX PROCEEDINGS PRINCIPLE OF RES-JUDICATA IS NOT APPLICABLE, BUT ITA NO.2157-58/AHD/2006 CO 265-66/AHD/2006 A.YS 00-01 & 03-04 ACIT CIR-4, ABD V. GSFS LTD. ABD PAGE 3 CONSISTENCY HAS TO BE MAINTAINED UNLESS THERE IS MA NIFEST DISTINGUISHABLE FACTS. IN EARLIER YEARS, CLAIM OF DEPRECIATION WAS ACCEPTED BY THE REVENUE WHICH HAS NOW BECOME FINAL, THE REVENUE CANNOT DISA LLOW THE PRESENT CLAIM, UNLESS FACTS AND CIRCUMSTANCES ARE DISTINGUISHABLE. THEREFORE, THE REVENUE IS REQUIRED TO MAINTAIN A JUDICIAL CONSISTENCY BETWEEN ITSELF AND TAXPAYERS. AS A RESULT, WE DO NOT FIND ANY MERIT IN THE CLAIM OF TH E REVENUE AND THIS GROUND OF THE REVENUE IS DISMISSED. 4. THE LD. DR HAS NOT DISPUTED THAT THE TRANSACTION S IN THE PRESENT YEAR ARE REGULAR TRANSACTION FROM EARLIER YEARS. ACCORDINGL Y, WE ARE OF THE VIEW THAT ONCE THE TRIBUNAL HAS TAKE A VIEW ON FACTS OF THE CASE, WE A LSO RESPECTFULLY FOLLOWING THE SAME, ALLOW THE CLAIM OF THE ASSESSEE AND THIS COMM ON ISSUE IN BOTH THE APPEALS OF THE REVENUE IS DISMISSED. 5. THE NEXT ISSUE IN REVENUES APPEAL IN ITA NO.2157/AHD/2006 IS AGAINST THE ORDER OF CIT(A) DIRECTING THE ASSESSING OFFICER TO ALLOW CREDIT FOR MAT FROM THE TOTAL TAX PAYABLE BEFORE CHARGING INTEREST U/S. 234B & 23 4C OF THE ACT. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS, WHICH READ AS UNDER:- 2. THE LD CIT(A) ERRED IN LAW AND ON THE FACTS OF THE CASE IN DIRECTING THE ASSESSING OFFICER TO ADJUST MAT CREDIT FIRST BEFORE CHARGING INTEREST U/S. 234 B & 234C AS MAY BE APPLICABLE THOUGH THE SAME WAS NOT ALLOWABLE AS PER PROVISIONS IN EXPLANATION 1 TO SECTION 23B IN THE R ELEVANT ASSESSMENT YEAR AS THE SET OFF OF MAT CREDIT FOR SECTION 234B FROM 2007 AND HAS NOT BEEN AMENDED RETROSPECTIVELY. 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND GONE THR OUGH THE FACTS AND CIRCUMSTANCES OF THE RECORDS. WE HAVE ALSO PERUSED THE ASSESSMENT ORDER AS WELL AS THE ORDER OF CIT(A). AT THE OUTSET, IT IS NOTICE D THAT THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE BY T HE DECISION OF THE TRIBUNAL OF CHANDRIGARH B BENCH IN THE CASE OF PHILLIPS INDIA LTD. V. ACIT (2005) 92 ITD 441 (CHD.), WHEREIN THE TRIBUNAL HAS HELD AS UNDER:- 19. TAKING THE TOTALITY OF THE FACTS AND CIRCUMSTA NCES OF THIS CASE INTO CONSIDERATION, WE ARE OF THE CONSIDERED VIEW THAT T HE ASSESSING OFFICER WAS NOT JUSTIFIED IN NOT GIVING THE SET OFF OF MAT CRED IT IN WORKING OUT THE TAX PAYABLE BY THE ASSESSEE FOR THE PURPOSE OF DETERMIN ATION OF PAYMENT OF ADVANCE TAX AND CONSEQUENTLY FOR THE PURPOSE OF LEV Y OF INTEREST UNDER SECTIONS 234B AND 234C. WE ACCORDINGLY SET ASIDE H IS ORDER AS WELL AS THE ORDER OF THE CIT(A) AND ALLOWED THE APPEAL OF THE A SSESSEE. THE ASSESSING OFFICER IS DIRECTED TO RECALCULATE THE INTEREST, IF ANY, PAYABLE UNDER SECTIONS 234B AND 234C AS PER THIS DECISION. WE DIRECT ACCOR DINGLY. ITA NO.2157-58/AHD/2006 CO 265-66/AHD/2006 A.YS 00-01 & 03-04 ACIT CIR-4, ABD V. GSFS LTD. ABD PAGE 4 RESPECTFULLY FOLLOWING, THE DECISION OF THIS TRIBUN AL IN THE CASE OF PHILLIPS INDIA LTD. (SUPRA), WE ALLOW THE CLAIM OF THE ASSESSEE. HENCE, THIS ISSUE OF THE REVENUES APPEAL IS DISMISSED. 7. THE NEXT ISSUE IN THIS APPEAL OF REVENUE IN ITA NO.2158/AHD/2006 IS AGAINST THE ORDER OF CIT(A) IN RESTRICTING THE DISALLOWANCE OF PROPORTIONATE INTEREST EXPENDITURE ON THE GROUND THAT THE SAID AMOUNT BEIN G PROPORTIONATE INTEREST EXPENDITURE IS RELATABLE TO EARNING OF EXEMPTED INC OME IN VIEW OF SECTION 14A OF THE ACT. FOR THIS, THE REVENUE HAS RAISED THE FOLLOWIN G EFFECTIVE GROUND NO.2 AS UNDER:- 2. THE LD. CIT(A) ERRED IN LAW AND ON THE FACTS OF THE CASE IN RESTRICTING THE DISALLOWANCE U/S.14A OF RS.6,24,81,435/- AND ALLOWI NG RELIEF OF RS.6,24,53,631/- BEING PROPORTIONATE INTEREST EXPEN DITURE WHICH AS MADE ON THE GROUND THAT THE SAID AMOUNT BEING PROPORTIONATE INTEREST EXPENDITURE AND PROPORTIONATE ADMINISTRATIVE EXPENDITURE WAS RELATA BLE TO EARNING OF EXEMPTED INCOME. 8. AT THE OUTSET THE LD. COUNSEL FOR THE ASSESSEE A S WELL AS LD. DR FAIRLY AGREED THAT THE ISSUE IS SQUARELY COVERED BY THE ASSESSEE S OWN CASE IN ITA NO.403/AHD/2005 FOR ASSESSMENT YEAR 2001-02 DATED 10-07-2009, WHER EIN THE TRIBUNAL HAS SET ASIDE THE ISSUE AS UNDER:- 4. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED MAT ERIAL ON RECORD AND CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIE S. WE ARE OF THE CONSIDERED VIEW THAT THE AUTHORITIES CONCERNED HAVE NOT CORREC TLY APPRECIATED THE FACTS AND BROUGHT RELEVANT MATERIAL ON RECORD FOR MAKING PROPORTIONATE DISALLOWANCE. IT HAS TO BE SHOWN THAT INTEREST HAS BEEN PAID ON FUNDS WHICH WERE INVESTED IN TAX FREE SECURITIES. SINCE THE ASS ESSEE IS MAKING CLAIM OF RS.28.65 CRORES, ONUS IS ON THE ASSESSEE TO PROVE T HAT INTEREST BEARING FUNDS ARE NOT INVESTED IN TAX FREE SECURITIES. IF IT IS U NABLE TO PROVE SO, THEN FOLLOWING THE DECISION OF SPECIAL BENCH ITO VS. DAGA CAPITAL MANAGEMENT PVT. LTD. 312 ITR (AT) 01, A PROPORTIONATE DISALLOWANCE AO FO R DECIDING THE ISSUE AFRESH AFTER GIVING ASSESSEE REASONABLE OPPORTUNITY OF BEING HEARD. THIS GROUND OF THE REVENUE IS ALLOWED FOR STATISTICAL PU RPOSE. 9. RESPECTFULLY FOLLOWING THE ABOVE VIEW OF THIS TR IBUNAL, WE SET ASIDE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER TO DECIDE IN T ERMS OF TRIBUNALS DECISION IN ASSESSMENT YEAR 2001-02. NEEDLESS TO SAY, THAT THE ASSESSING OFFICER WILL PROVIDE REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESS EE. THIS ISSUE OF THE REVENUES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ITA NO.2157-58/AHD/2006 CO 265-66/AHD/2006 A.YS 00-01 & 03-04 ACIT CIR-4, ABD V. GSFS LTD. ABD PAGE 5 10. THE NEXT ISSUE IN ITA NO.2158/AHD/2006 IS AS REGARDS TO PROPORTIONATE DISALLOWANCE OF ADMINISTRATIVE EXPENSES AND FOR THI S THE REVENUE HAS RAISED THE FOLLOWING GROUNDS NO.3 AND 4 :- 3. THE LD. CIT(A) ERRED IN LAW AND ON THE FACTS OF THE CASE IN RESTRICTING THE DISALLOWANCE MADE U/S.14A OF THE INCOME-TAX ACT OF RS.2,70,908/- TO RS.27,804/- BEING THE PROPORTIONATE DISALLOWANCE OF ADMINISTRATIVE EXPENSES. 4. THE APPEAL FILED BY THE DEPARTMENT AGAINST THE O RDER OF LD. CIT(A) FOR THE A.Y. 2001-02 ON SIMILAR ISSUE IS PENDING BEFORE THE HONBLE ITAT AND THE GROUNDS OF APPEAL RAISED IN THAT YEAR BE PERMITTED TO REFER AND RELY FOR THE YEAR UNDER APPEAL. 11. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE AS WELL AS LD. DR FAIRLY AGREED THAT IN VIEW OF THE VIEW TAKEN BY THIS TRIBUNAL IN ASSESSEES OWN CASE IN ITA NO.403/AHD/2005 FOR ASSESSMENT YEAR 2001-02 DATED 10-07-2009, WHER EIN THE TRIBUNAL HAS DISALLOWED THE PROPORTIONATE ADMINISTR ATIVE EXPENSES AT 1% BY GIVING FOLLOWING FINDING:- 10. WE HAVE HEARD LEARNED DR AND LEARNED AR. THIS IS UNDISPUTED FACT THAT THE ADMINISTRATIVE EXPENSES HAVE BEEN INCURRED ON T AX FREE SECURITIES. THE AO DISALLOWED PRO RATA EXPENSES AT RS.92.97 LAKHS A S PER THE WORKING GIVEN BY HIM AND REFERRED ABOVE. THE CLAIM OF ADMINISTRAT IVE EXPENSES AND OTHER EXPENSES AMOUNTED TO RS.9,91,10,622/- AND NOT RS.92 ,97,250/-. IF IT IS CONSIDERED THAT 10% DISALLOWANCE IS TO BE MADE OUT OF ADMINISTRATIVE AND OTHER EXPENSES, THEN TOTAL DISALLOWANCE WOULD AMOUN T TO RS.99,11,062/-. SINCE LEARNED CIT(A) HAS RESTRICTED THE DISALLOWANC E TO RS.9.91 LAKHS, WHICH IS ONLY ABOUT 1% OF THE TOTAL CLAIM AND NOT 10% AND REVENUE HAS NOT FILED ANY APPEAL AGAINST THIS WORKING, THE DISALLOWANCE IS TO BE TREATED AS MOST REASONABLE, AND NO INTERFERENCE IS CALLED FOR IN TH E IMPUGNED ORDER ON THIS ISSUE. THIS GROUND OF THE ASSESSEE IS REJECTED. 12. WE FIND THAT IN THE PRESENT YEAR, THE FACTS ARE NOT AVAILABLE, ACCORDINGLY, THIS ISSUE IS BEING SET ASIDE TO THE FILE OF THE ASSESSI NG OFFICER TO FOLLOW THE DECISION TAKEN IN ASSESSEES OWN CASE IN ITA NO.403/AHD/2005 FOR ASSESSMENT YEAR 2001-02 DATED 0-07-2009 AFTER PROVIDING REASONABLE OPPORTUN ITY OF BEING HEARD TO THE ASSESSEE. THIS ISSUE OF THE REVENUES APPEAL IS AL LOWED FOR STATISTICAL PURPOSES. NOW COMING TO ASSESSEES CO NO.265/AHD/2006. 13. THE FIRST ISSUE IN THIS CO IS AS REGARDS TO PRO VISION MADE FOR DIMINUTION IN THE VALUE OF INVESTMENT. FOR THIS THE ASSESSEE HAS RAI SED THE FOLLOWING GROUND: ITA NO.2157-58/AHD/2006 CO 265-66/AHD/2006 A.YS 00-01 & 03-04 ACIT CIR-4, ABD V. GSFS LTD. ABD PAGE 6 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS )-VIII, AHMEDABAD ERRED CONFIRMING THE DISALLOWANCE OF PROVISION MADE FOR DIMINUTION IN THE VALUE OF THE INVESTMENTS. IT IS SUBMITTED THAT IN T HE FACTS AND CIRCUMSTANCES OF THE CASE PROVISION IS MADE IN ACCORDANCE WITH PRUDE NTIAL NORMS OF RESERVE BANK OF INDIA AND HENCE THE SAME IS ADMISSIBLE AS D EDUCTION U/S.28 / 37 OF THE INCOME TAX ACT, 1961. IT BE SO HELD NOW. 14. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE AS WELL AS LD. DR FAIRLY AGREED THAT IN VIEW OF THE VIEW TAKEN BY THIS TRIBUNAL IN ASSESSEES OWN CASE IN ITA NO.229/AHD/2005 FOR ASSESSMENT YEAR 2001-02 DATED 10-07-2009, WHER EIN THE TRIBUNAL HAS REJECTED THE ISSUE OF THE ASSESSEE VID E PARA-12 AS UNDER:- 12. GROUND NO.3 RELATES TO DISALLOWANCE OF RS.21.9 8 LAKHS BEING THE PROVISION IN DIMINUTION IN VALUE OF INVESTMENT. THI S WAS DISCUSSED BY THE AO IN PARA-4C OF HIS ORDER AND BY LEARNED CIT(A) IN PA RA-5. ISSUE AGAIN GOES AGAINST THE ASSESSEE BY THE SAME DECISION OF THE IT AT IN THE CASE OF GUJARAT GAS FINANCIAL SERVICES (SUPRA). THIS GROUND OF THE ASSESSEE IS ALSO REJECTED. 15. WE FIND THAT THE TRIBUNAL IN ASSESSEES OWN CAS E FOLLOWING THE ITATS DECISION IN THE CASE OF GUJARAT GAS SERVICES LTD. V. ACIT 115 ITD 218 (AHD) HAS REJECTED THE CLAIM OF THE ASSESSEE. RESPECTFULLY F OLLOWING THE TRIBUNALS DECISION IN ASSESSEES OWN CASE, WE REJECT THIS GROUND OF THE C O OF THE ASSESSEE. 16. THE NEXT ISSUE IN CO OF ASSESSEES IS AS REGARD S TO CHARGING OF INTEREST U/S.234B OF THE ACT. 17. WE FIND THAT THIS ISSUE HAS ALREADY BEEN DEALT WITH IN ASSESSEES OWN CASE IN ITA NO.229/AHD/2005 FOR ASSESSMENT YEAR 2001-02 IN PARA-13 , WHEREIN THE TRIBUNAL HAS HELD AS UNDER:- 13. FOURTH ISSUE RELATES TO CHARGING OF INTEREST U NDER SECTION 234B AND 234D OF THE ACT. THE ASSESSEE CLAIMED THAT IT PAID ADVAN CE TAX ON THE BASIS OF THE DECISION OF ITAT MUMBAI IN THE CASE OF DATAMATICS L TD. VS. ACIT, 110 ITR 24. THE TRIBUNAL HAS FOLLOWED THAT DECISION IN HARYANA WAREHOUSING CORPN VS. DCIT, 75 ITD 155. SIMILAR VIEW WAS TAKEN BY HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. K.K. MARKETING, 278 ITR 596 AND BY HONBLE UTTARNCHAL HIGH COURT IN THE CASE OF CIT VS. SEDCON FOREX INTERNATI ONAL DRILLING CO., 264 ITR 320. LEARNED AR SUBMITTED THAT SINCE THE ASSESSEE W AS IN BONA FIDE BELIEF THAT PARTICULAR AMOUNT OF INCOME WAS NOT TAXABLE IT DID NOT DECLARE THE SAME AND DID NOT PAY THE ADVANCE TAX. SUBSEQUENTLY, THE INCOME BECAME TAXABLE. IT HAS BEEN HELD BY THE HONBLE UTTARANCHAL HIGH CO URT THAT INTEREST CANNOT BE LEVIED UNDER SECTION 234B IF THERE IS A DISPUTE REG ARDING TAXABILITY OF AMOUNT. LEARNED DR ON OTHER HAND SUBMITTED THAT CHARGING OF INTEREST UNDER SECTION ITA NO.2157-58/AHD/2006 CO 265-66/AHD/2006 A.YS 00-01 & 03-04 ACIT CIR-4, ABD V. GSFS LTD. ABD PAGE 7 234B IS MANDATORY IN VIEW OF THE DECISION HONBLE S UPREME COURT M.H. GHASWALAS CASE 252 ITR 1 AND THIS HAS TO BE LEVIED ON THE BASIS OF ASSESSED INCOME AND IS CONSEQUENTIAL. IN VIEW OF THIS, INTER EST UNDER SECTION 234B AND FOR THAT MATTER UNDER SECTION 234C DEPENDS UPON THE FINALLY ASSESSED INCOME. THEREFORE, NO INTERFERENCE IS CALLED FOR IN THE ORDER OF LEARNED CIT(A). THIS PART OF THE GROUND IS ALSO REJECTED. RESPECTFULLY FOLLOWING THE ABOVE VIEW OF THIS TRIBU NALS ORDER IN ASSESSEES OWN CASE, WE DISMISS THIS ISSUE OF THE ASSESSEES CO. NOW COMING TO ASSESSEES CO NO.266/AHD/2006 . 16. THE ONLY ISSUE IN THIS CO OF THE ASSESSEE IS AS REGARDS TO PARTLY CONFIRMING THE DISALLOWANCE OF ADMINISTRATIVE EXPENSES. FOR T HIS, THE ASSESSEE HAS RAISED THE FOLLOWING GROUND:- 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS )-VIII, AHMEDABAD ERRED CONFIRMING THE DISALLOWANCE U/S.14A OF THE AC T FOR THE ADMINISTRATIVE EXPENSES TO THE EXTENT OF RS.27,804. IT IS SUBMITTE D THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE NO DISALLOWANCE IS REQUIR ED TO BE MADE U/S.14A OF THE ACT. IT IS SUBMITTED THAT IT BE SO HELD NOW. 17. WE FIND THAT THIS ISSUE HAS ALREADY BEEN DEALT WITH IN PARA-12 OF THIS ORDER AND RESPECTFULLY FOLLOWING THE SAME, WE DISMISS THI S ISSUE OF THE ASSESSEES CO. 18. IN THE RESULT, BOTH THE REVENUES APPEALS ARE PARTL Y ALLOWED FOR STATISTICAL PURPOSES AND THAT OF ASSESSEES CO ARE DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 11/09/2009 SD/- SD/- (P.K.BANSAL) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD, DATED : 11/09/2009 *DKP COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT(APPEALS)-VIII, AHMEDABAD 4. THE CIT CONCERNS. 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER, /TRUE COPY/ DEPUTY / ASSTT.REGISTRAR ITAT, AHMEDABAD