Commissioner of Income-tax-10 v. Godrej Agrovet Ltd - 2015-LL-0309-26

Citation	2015-LL-0309-26
Appellant Name	Commissioner of Income-tax-10
Respondent Name	Godrej Agrovet Ltd.
Court	HIGH COURT OF BOMBAY
Relevant Act	Income-tax
Date of Order	09/03/2015
Assessment Year	2007-08
Judgment	View Judgment
Keyword Tags	substantial question of law • disallowance of expenditure • computation of disallowance • disallowance of interest • reasonable expenditure • exempt income
Bot Summary:	The impugned order is inrespect of the Assessment Year 2007 08. The revenue has proposed the following question of law for our consideration: Whether on the facts and in the circumstance of the case and in law, the Tribunal was justified rejecting the computation of disallowance of interest made by the AO as per Rule 8D, whereas this Court in Godrej Boyce Mgf Co Ltd 234 CTR 1 had accepted the proposition of a reasonable disallwance to be made in cases of expenditure in relation to exempt income S.S.DESHPANDE 1 / 3 Uploaded on - 10/03/2015 Downloaded on - 13/04/2020 16:51:20 12.ITXA.524. Mr. Pinto, learned Counsel appearing for revenue explains to us the meaning by stating that the revenue does not dispute the applicability of the decision of this Court in Godrej Boyce Mfg. Co. Ltd. Vs. DCIT reported in 328 ITR 81 to the present facts. However the grievance of the revenue is that in terms of decision of this Court in Godrej Boyce Mfg. Co. Ltd. reasonable disallowance of expenditure in relation to exempt income has to be made even in respect of Assessment Year prior to Assessment Year 2008 09 when Rule 8D of the Income Tax Rules, 1962 is applicable. So far as the issue of disallowance of reasonable expenditure to earn exempt income is concerned, we find that the impugned order has followed its decision in case of the respondent assessee for the Assessment Year 2005 06 where disallowance was limited to 2 of the exempt income and the same was held to be fair and reasonable. The revenue being aggrieved by the order of the Tribunal in case of respondent assessee for the Assessment Year 2005 06 has preferred an appeal to this Court being Income Tax Appeal No. 934/2011. Mr. Pinto submits that the issue arising in the proposed question stands concluded against the revenue by the virtue of the decision of this Court rendered on 8 January 2013 in Income Tax Appeal No. 934/2011 in respect of the same respondent assessee.

12.ITXA.524.13.sxw IN HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO. 524 OF 2013 Commissioner of Income Tax 10 Appellant Vs. M/s Godrej Agrovet Ltd. Respondent Mr. Arvind Pinto, Advocate for Appellant. Mr. Atul Jasani, Advocate for Respondent. CORAM : M.S. SANKLECHA & G.S. KULKARNI, JJ. DATED : 09 MARCH 2015 P.C.: This appeal by revenue under Section 260A of Income Tax Act, 1961 (the 'Act') challenges order dated 5 October 2012 passed by Income Tax Appellate Tribunal (the 'Tribunal'). impugned order is inrespect of Assessment Year 2007 08. 2. revenue has proposed following question of law for our consideration: Whether on facts and in circumstance of case and in law, Tribunal was justified rejecting computation of disallowance of interest made by AO as per Rule 8D, whereas this Court in Godrej Boyce Mgf Co Ltd 234 CTR 1 had accepted proposition of reasonable disallwance to be made in cases of expenditure in relation to exempt income S.S.DESHPANDE 1 / 3 Uploaded on - 10/03/2015 Downloaded on - 13/04/2020 16:51:20 12.ITXA.524.13.sxw 3. We were unable to understand proposed question. Mr. Pinto, learned Counsel appearing for revenue explains to us meaning by stating that revenue does not dispute applicability of decision of this Court in Godrej Boyce Mfg. Co. Ltd. Vs. DCIT reported in 328 ITR 81 to present facts. However grievance of revenue is that in terms of decision of this Court in Godrej Boyce Mfg. Co. Ltd. (supra) reasonable disallowance of expenditure in relation to exempt income has to be made even in respect of Assessment Year prior to Assessment Year 2008 09 when Rule 8D of Income Tax Rules, 1962 is applicable. 4. So far as issue of disallowance of reasonable expenditure to earn exempt income is concerned, we find that impugned order has followed its decision in case of respondent assessee for Assessment Year 2005 06 where disallowance was limited to 2% of exempt income and same was held to be fair and reasonable. revenue being aggrieved by order of Tribunal in case of respondent assessee for Assessment Year 2005 06 has preferred appeal to this Court being Income Tax Appeal No. 934/2011. However above appeal of revenue was dismissed by order dated 8 January 2013 by this Court. S.S.DESHPANDE 2 / 3 Uploaded on - 10/03/2015 Downloaded on - 13/04/2020 16:51:20 12.ITXA.524.13.sxw 5. Mr. Pinto submits that issue arising in proposed question stands concluded against revenue by virtue of decision of this Court rendered on 8 January 2013 in Income Tax Appeal No. 934/2011 in respect of same respondent assessee. In view of above, no substantial question of law arises for consideration. 6. Accordingly appeal dismissed. No order as to costs. [G.S. KULKARNI, J] [M.S. SANKLECHA, J.] S.S.DESHPANDE 3 / 3 Uploaded on - 10/03/2015 Downloaded on - 13/04/2020 16:51:20 Commissioner of Income-tax-10 v. Godrej Agrovet Ltd

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