Pr. Commissioner Of Income Tax, Kota v. M/S. Chambal Fertilizers & Chemicals Ltd., Gadepan, Kota

HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH ATJAIPUR D.B. Income Tax Appeal No. 129 / 2017 Pr. Commissioner of Income Tax, Kota ----Appellant Versus M/s. Chambal Fertilizers & Chemicals Ltd., Gadepan, Kota ----Respondent _____________________________________________________ For Appellant(s) : Ms. Parinitoo JainFor Respondent(s) : _____________________________________________________ HON'BLE MR. JUSTICE K.S.JHAVERI HON'BLE MR. JUSTICE INDERJEET SINGHOrder 08/08/2017 By way of this appeal, the appellant has challenged thejudgment and order of the Tribunal whereby the Tribunal hasdisposed of the appeal of the assessee as well as the department. Counsel for the appellant has framed the followingsubstantial questions of law:- “i). Whether the Tribunal was legally justified inreversing the findings of the CIT(A) and allowingthe deduction of Rs. 41,59,57,420/- u/s 80IA tocaptive power plant on DG Set when the powerconsumption was by the assessee company? ii) Whether the Tribunal was legally justified indeleting the addition of Rs. 11,71,382/- made onaccount of depreciation on catalyst which wasnot allowable as per Section 32 and Income TaxRules? iii) Whether the Tribunal was legally justified indeleting the addition of Rs. 2,48,82,876/- onaccount of sales tax collected and converted intoloan? iv) Whether the Tribunal was legally justified in deleting the addition of Rs. 2,48,82,876/- bytreating the pre-payment of deferred sales taxliability as income for A.Y. 2005-06 instead ofA.Y. 2008-09 specifically when the incentive wasnotified and allowed by the State Govt. in A.Y.2008-09 thus being taxable in the current year? v) Whether the Tribunal was legally justified indeleting the addition of Rs. 22,93,923/- madefor donation to DAV trust which was notallowable as per section 40A(9) also being notincurred wholly and exclusively for the purposeof business of the assessee? vi) Whether the Tribunal was legally justified inallowing the club expenses of Rs. 10,16,659/-specifically when the same were incurred by theassessee for the membership of its employeesu/s 37 which could not be held to be incurred forthe purpose of the business? vii) Whether the Tribunal was legally justified inallowing the deduction of Rs. 10,44,19,543/- u/s50B towards net current assets at their bookvalue by treating it as the cost of acquisitionwhile calculating the capital gain arising on thesale of food processing unit? viii) Whether the Tribunal was legally justified indeleting the disallowance for Rs. 10,80,000/-made on account of rent paid to wife of the ViceChairman of Company u/s 40A(2)(b) specificallywhen the premises was taken on lease forresidential purposes and the assessee failed tojustify the said expenditure? ix) Whether the Tribunal was legally justified indeleting the disallowance of Rs. 3,49,57,657/-specifically when the assessee failed to provethat the deduction claimed u/s 43B for leaveencashment, water cess, bonus, gratuity etc. onpayment basis, has been disallowed in earlieryears? x) Whether the Tribunal was legally justified indeleting the addition of Rs. 89,41,361/- made onaccount of brokerage and consultancy expensesu/s 40A(2)(b), paid to M/s Zuari Investment Ltd.specifically when the expenses were in respectof shipping division whose income was offeredon the basis of Tonnage scheme hence noexpenses could be allowed separately and suchexpenditure was also falling within the ambit ofsection 35D? xi) Whether the Tribunal was legally justified indeleting the addition of Rs. 24,39,596/- made onaccount of software consultancy charges u/s40A(2)(b), paid to M/s ISG Novasoft Technology specifically when the expenses were in respectof shipping division whose income was offeredon the basis of Tonnage scheme so therefore noexpenses could be allowed separately and suchexpenditure was falling within the ambit ofsection 35D?” xi) Whether the Tribunal was legally justified indeleting the addition of Rs. 24,39,596/- made onaccount of software consultancy charges u/s40A(2)(b), paid to M/s ISG Novasoft Technology specifically when the expenses were in respectof shipping division whose income was offeredon the basis of Tonnage scheme so therefore noexpenses could be allowed separately and suchexpenditure was falling within the ambit ofsection 35D?” The issue no. 1 to 6 are covered by the decision of this Courtin the case of same assessee in Tax Appeal No. 76/2015 decidedon 15[th] May, 2017. With regard to issue no. 7 to 11, in view of the concurrentfinding and more particularly, the Tribunal while discussing theissues has gone into detail facts as well as law, we find noinfirmity in the order. Therefore, no substantial question of lawarises. Hence, the appeal stands dismissed. (INDERJEET SINGH)J. (K.S.JHAVERI)J. A.Sharma/141