Calcutta High Court
Tax-2 vs M/S. National Insurance Co. Ltd on 1 August, 2022
Author: T.S. Sivagnanam
Bench: T.S. Sivagnanam, Hiranmay Bhattacharyya
O-13
ITAT/94/2022
IA No.GA/1/2022
IA No.GA/2/2022
IN THE HIGH COURT AT CALCUTTA
Special Jurisdiction (Income Tax)
ORIGINAL SIDE
PRINCIPAL COMMISSIONER OF INCOME
TAX-2, KOLKATA
-Versus-
M/S. NATIONAL INSURANCE CO. LTD.
Appearance:
Ms. Smita Das De, Adv.
Mr. Prithu Dudheria, Adv.
...for the appellant.
Mr. J. P. Khaitan, Sr. Adv.
Ms. Swapna Das, Adv.
Mr. Debasis Mitra, Adv.
Mr. Siddhartha Das, Adv.
...for the respondent.
BEFORE:
The Hon'ble JUSTICE T.S. SIVAGNANAM
-And-
The Hon'ble JUSTICE HIRANMAY BHATTACHARYYA Date : 1st August, 2022.
The Court : We have heard Mr. Smita Das De, learned standing counsel assisted by Mr. Prithu Dudheria, learned advocate for the appellant/revenue and Mr. J.P. Khaitan, learned senior 2 counsel assisted by Ms. Swapna Das and Mr. Sidhhartha Das, learned advocates for the respondent/assessee.
There is a delay of 802 days in filing the appeal. Though we are not fully satisfied with the reasons assigned in the affidavit filed in support of the condone delay petition, we exercise the discretion on the ground few of the substantial questions of law involved in this appeal have been admitted and appeals have been entertained by this Court. For such reason, we exercise discretion and condone the delay in filing the appeal.
We have heard Mr. Smita Das De, learned standing counsel for the appellant/revenue and Mr. J.P. Khaitan, learned senior counsel for the respondent/assessee.
The question of granting stay of the order passed by the tribunal does not arise at this stage. Therefore, the application for stay being IA No.GA/2/2022 stands closed.
The revenue has raised the following substantial questions of law for consideration :
"(a) Whether the Income Tax Appellate Tribunal erred in law in holding that a sum of Rs.1,33,58,000/- being investment written off is an allowable deduction, ignoring the fact that depreciated investment cannot be allowed as admissible deduction in the Profit & Loss Account inasmuch as the same is not an admissible deduction u/s. 36 or 37 of the Income Tax Act, 1961 ?
(b) Whether the Income Tax Appellate Tribunal erred in law in holding that a sum of 3 Rs.5,89,11,000/- was allowable expenditure being amortisation of premium payment on investment, whereas this was expenditure being related to investment and as such capital in nature and resulted in accretion of investment and cannot be treated as revenue expenditure inasmuch as amortisation is available as provided in section 35D & 35DD of the Act and not otherwise ?
( c) Whether the Income Tax Appellate Tribunal erred in law in holding that the sum of Rs.488,59,39,000/- is to be excluded while computing adjusted book profit for the purpose of computation of MAT u/s. 115JB(2) whereas the said sum represents unascertained liability towards unexpired risk and thus as per clause (c ) to Explanation I below Section 115JB(2) needs to be added back to book profit for the calculation of MAT ?
(d) Whether the Income Tax Appellate Tribunal erred in law in holding that disallowance u/s. 14A should not be added to the total income while computing book profit of the assessee disregarding the implication in the Section 115JB ?"
So far as the substantial questions of law (a) and (d) are concerned, the tribunal had followed the assessee's own case for the assessment years 2005-06, 2007-08 and 2008-09. As against the said order, the appeal was preferred before this Court in ITA 112/2019. Therefore, the substantial questions of law (a) and (b) as suggested above by the revenue are rejected.
This appeal is admitted and will be heard on the substantial questions of law (c) and (d) alone. 4
Mr. J.P. Khaitan, learned senior counsel appearing for the respondent/assessee submits that so far as the substantial question of law (d) is concerned, there is a binding decision of this Court in ITAT No.47 of 2014 in the case of Commissioner of Income Tax Vs. Jayshree Tea & Industries Ltd. This issue will be considered when the appeal is taken up for consideration.
The appellant shall file requisite number of informal paper book prepared out of Court within eight weeks from date by serving copies thereof on the respondent.
Since the respondent is represented by their learned counsel, service of notice of appeal on them is waived.
Settlement of index and all other formalities are dispensed with.
List the appeal (ITAT/94/2022) appear after ten weeks.
(T.S. SIVAGNANAM, J.) (HIRANMAY BHATTACHARYYA, J.) S.Das/As.