Case Law Details
Asian Paints Ltd Vs ACIT (ITAT Mumbai)
We have considered rival submissions in the light of decisions relied upon and perused material on record. Undisputedly, the assessee in its computation of income has computed disallowance under section 14A of the Act at Rs.23,98,769 by applying certain principles of apportionment. Therefore, it is not a case of any disallowance being made by the assessee. In fact, a perusal of impugned assessment order clearly reveals that though a detailed submission was filed by the assessee justifying the suo motu disallowance, however, the Assessing Officer without recording a proper satisfaction to the effect that the computation made by the assessee is incorrect having regard to the books of account maintained, has proceeded to compute the disallowance simply on the reasoning that disallowance under section 14A of the Act has to be made by applying the methodology of Rule 8D. In our view, the aforesaid reasoning of the Assessing Officer is contrary to the mandate of section 14A(2) of the Act, therefore, unsustainable. Further, while deciding similar disallowance made by the Assessing Officer without recording proper satisfaction, the Tribunal, in assessee’s own case (supra) has deleted the disallowance. The aforesaid decision of the Tribunal was also upheld by the Hon’ble jurisdictional High Court (supra). In view of the above, we find no reason to uphold the disallowance made. Hence, we delete the same. This ground is allowed.
Assessee is eligible to claim deduction of education cess-
we find that the issue is squarely covered by the decision of the Hon’ble jurisdictional High Court in case of Sesa Goa Ltd vs JCIT (supra), wherein, it is held that education cess not being in the nature of rate or tax will not be covered u/s 40(a)(ii). The Hon’ble Rajasthan High Court has also expressed similar view in the decisions cited above. Even, different benches of the Tribunal have expressed identical view. In view of the above, we are unable to accept the submissions of learned Departmental Representative. Respectfully following the decision of the Hon’ble jurisdictional High Court (supra) and other decisions cited before us by the learned Counsel for the assessee, we hold that the assessee is eligible to claim deduction of education cess. This ground is allowed.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
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