1 61 itxa 6270.10.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION K INCOME TAX APPEAL NO. 6270 OF 2010 The Commissioner of Income Tax-7, Mumbai .. Appellant Vs. M/s The Swastik Safe Deposit and Investment Ltd. .. Respondent. Mr.Suresh Kumar for the Appellant. Mr. J.D. Mistri, senior counsel with Mr. Atul K. Jasani for the Respondent. CORAM : J.P. DEVADHAR & K.K. TATED, JJ. DATE : 3RD OCTOBER, 2011. P.C. 1 Five questions of law raised by the Revenue in this Appeal read thus: 1 Whether on the facts and in the circumstances of the case the Tribunal was correct in law in directing to restrict the disallowance under section 14A to Rs.1.19 Crores as against Rs.5.66 Crores worked out by the learned CIT (A)? 2 Whether on the facts and in the circumstances of the case the Tribunal was justified in law in accepting the plea of the assessee that the disallowance can be worked out exactly without appreciating the fact that they had admitted their inability before the Assessing Officer and the learned CIT (A) 2 61 itxa 6270.10.doc and had furnished different amounts of disallowance at Rs.79.97 lac and Rs.162.73 lac? 3 Whether on the facts and in the circumstances of the case the Tribunal was justified in law in admitting the computation relating to disallowance under section 14A of the Income Tax Act which was not made available during the course of assessment proceedings nor in the grounds of appeal filed before the learned CIT (A) and ITAT? 4 Whether on the facts and in the circumstances of the case the Tribunal was correct in law in restoring the issue relating to disallowance of Rs.1.19 Crores on loans advanced at lower rate/interest free loans, relying on the decision of Hon’ble Supreme Court in the case of SA Builders 288 ITR 1 without appreciating the fact that the assessee has not proved before the ITAT the commercial expediency as held in the above case? 5 Whether on the facts and in the circumstances of the case the Tribunal was justified in law in allowing the appeal of the assessee by directing to delete the disallowance of advance discounting charges of Rs.19.3 lac, as revenue expenditure? 2 As regards the first three questions are concerned, the dispute in the present case is, whether the ITAT was justified in directing the Assessing 3 61 itxa 6270.10.doc Officer to make disallowance under section 14A of the Income Tax Act, 1961 in the sum of Rs.1.19 Crores as against the disallowance of Rs.5.66 Crores worked out by the CIT (A). 3 In the present case, the ITAT on the basis of the material on record has computed the actual interest expenditure attributable to the income which do not form part of the total income and arrived at the figure of Rs.1.19 Crores. The counsel for the Revenue on instructions from the Assessing Officer submits that the amount of interest expenditure quantified by the ITAT is fair and reasonable. In these circumstances, no fault can be found with the decision of the ITAT in computing the disallowance of interest at Rs.1.19 Crores. Accordingly, the first three questions raised by the Revenue cannot be entertained. 4 As regards the fourth question is concerned, the ITAT has restored the issue to the file of the Assessing Officer for fresh decision by considering the decision of the Apex Court in the case of S.A. Builders vs. CIT and another reported in (SC) 2007 (288) ITR 1. Since the ITAT has restored the issue to the file of the Assessing Officer for fresh consideration in the light of the judgment of the Apex Court, we are not inclined to entertain the fourth question. 4 61 itxa 6270.10.doc 5 As regards the fifth question is concerned, counsel for the parties state that similar question raised by the Revenue in the Assessee’s own case being Income Tax Appeal No.1132 of 2010 (The Commissioner of Income Tax-7, Mumbai vs. M/s The Swastik Safe Deposit & Investment Ltd.) has been rejected by this Court on 5th September, 2011. Hence, the fifth question cannot be entertained. 6 Appeal is disposed of accordingly with no orders as to costs. (J.P. DEVADHAR, J.) (K.K. TATED, J.)