Tax Appeal v. Itxa 6686.10.Doc

k IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.6686 OF 2010WITHINCOME TAX APPEAL NO.6687 OF 2010 M/s. Ultramarine & Pigments Ltd. .. Appellant Vs.Income Tax Officer, Ward 7(3) .. Respondent. Mr. Hiro Rai with Mr. Subhash Shetty with Mr. Mandar Vaidya for the appellant. Mr. Suresh Kumar for the respondent. CORAM: J.P. DEVADHAR & K.K. TATED, JJ.DATE: 20TH OCTOBER, 2011. P.C. 1The Appeal is admitted on the following questions of law: a)Whether on the facts and in the circumstances of the case and in law the Tribunal was justified in upholding the disallowance of interest amounting to Rs.6,86,986/- made by the Assessing Officer on the ground that the investment in the shares was made for gaining controlling interest in the Malaysian company TCLIM?the Tribunal was justified in upholding the disallowance of interest amounting to Rs.6,86,986/- made by the Assessing Officer on the ground that the investment in the shares was made for gaining controlling interest in the Malaysian company TCLIM? b)Whether the finding of the Tribunal that the investment in the shares of the Malaysian Company, TCLIM is made for acquiring controlling interest therein is perverse in so far as the same was not supported by any material or evidence?of the Malaysian Company, TCLIM is made for acquiring controlling interest therein is perverse in so far as the same was not supported by any material or evidence? c)Whether the finding of the Tribunal that the investment in the shares of the Malaysian Company, TCLIM is not made for earning dividend is perverse in so far as the same was not supported by any material or evidence?of the Malaysian Company, TCLIM is not made for earning dividend is perverse in so far as the same was not supported by any material or evidence? d)On the facts and in the circumstances and in law whether processing charges of Rs.7,36,57,815/- received using existing manpower, machines and other allied resources are required to be reduced while computing profits of the business for computing deduction under section 80HHC of the Act?charges of Rs.7,36,57,815/- received using existing manpower, machines and other allied resources are required to be reduced while computing profits of the business for computing deduction under section 80HHC of the Act? e)Whether on the facts and in the circumstances of the case and in law, even if the processing charges are to be reduced, whether 90% of gross processing charges or net processing charges (after deduction of the relevant expenses) are to be reduced while computing “profits of the business” for computing deduction under sections 80HHC of the Act?even if the processing charges are to be reduced, whether 90% of gross processing charges or net processing charges (after deduction of the relevant expenses) are to be reduced while computing “profits of the business” for computing deduction under sections 80HHC of the Act? 2As regards questions (a) to (c) are concerned, counsel for the parties state that similar questions raised by the Appellant - Assessee in Income state that similar questions raised by the Appellant - Assessee in Income Tax Appeal no. 467 of 2010 (M/s Ultramarine and Pigments Ltd. vs. Additional Commissioner of Income Tax), dated 8[th] February, 2011 have been restored to the file of the ITAT for fresh decision in accordance with law. For the reasons stated therein, the first three questions are restored to the file of the ITAT for fresh decision in accordance with law. 3As regards questions (d) and (e) are concerned, counsel for the parties state that the said questions stand answered against the Appellant Assessee by the decision of this court in the case of CIT vs. Dresser Rand parties state that the said questions stand answered against the Appellant Assessee by the decision of this court in the case of CIT vs. Dresser Rand Tax Appeal no. 467 of 2010 (M/s Ultramarine and Pigments Ltd. vs. Additional Commissioner of Income Tax), dated 8[th] February, 2011 have been restored to the file of the ITAT for fresh decision in accordance with law. For the reasons stated therein, the first three questions are restored to the file of the ITAT for fresh decision in accordance with law. 3As regards questions (d) and (e) are concerned, counsel for the parties state that the said questions stand answered against the Appellant Assessee by the decision of this court in the case of CIT vs. Dresser Rand parties state that the said questions stand answered against the Appellant Assessee by the decision of this court in the case of CIT vs. Dresser Rand India Pvt. Ltd. reported in 2010 (223) ITR 429. Accordingly, questions (d) and (e) are answered in favour of the Revenue and against the Assessee. 4The Appeal is accordingly disposed off with no order as to costs. (K.K. TATED, J.) (J.P. DEVADHAR, J.)