CLARIANT CHEMICALS (I) LTD. Vs. ADDL. COMMISSIONER OF INCOME TAX
LAWS(IT)-2014-9-6
INCOME TAX APPELLATE TRIBUNAL
Decided on September 19,2014

Clariant Chemicals (I) Ltd. Appellant
VERSUS
ADDL. COMMISSIONER OF INCOME TAX Respondents

JUDGEMENT

Amit Shukla, Member (J) - (1.) THESE cross appeals are directed against the impugned order dated 13th January 2010, passed by the learned Commissioner (Appeals) -I, Mumbai, for the quantum of assessment passed under section 143(3) of the Income Tax Act, 1961 (for short "the Act"), for the assessment year 2006 -07. We first proceed to dispose off the Revenue's appeal, vide which, following grounds have been raised: - 1. Whether on the facts and in the circumstances of the case and in law, the learned CIT(A) erred in deleting the disallowance of Rs. 33,30,000 on account of entrance fees paid to club? 2.WHETHER on the facts and in the circumstances of the case and in law, the learned CIT(A) erred in deleting he disallowance of Rs. 88,00,992 u/s. 14A r/w rule 8D? Whether on the facts and in the circumstances of the case and in law, the learned CIT(A) erred in deleting the disallowance of expenditure of software charges amounting to Rs. 3,74,37,137?
(2.) At the outset, the learned counsel for the assessee submitted that the issues involved in this appeal are squarely covered by the decision of the Tribunal in assessee's own case for the assessment year 2001 -02 and 2004 -05, passed in ITA no. 270/Mum./2005, ITA no. 4982/Mum./2011 and ITA no. 4280/Mum./2011, order dated 9th May 2014.
(3.) Facts in brief: - The assessee is engaged in the business of manufacturing and trading of dyes and intermediates, specialty, chemicals, textiles, plastic, etc. Regarding disallowance on account of interest and fee paid to the club, the Assessing Officer noted that in the tax audit report, the assessee had shown payment of Rs. 33,30,000, as entrance fees for membership of Cricket Club of India, which was claimed as revenue expenditure. In response to the show cause notice, the assessee submitted that the said payment has been made in the normal course of business promotion and does not generate any asset. The Assessing Officer disallowed the said claim after referring to the decision of the Hon'ble Gujarat High Court in Gujarat State Export Corporation Ltd. v/s. CIT, : [1994] 209 ITR 649, and the decision of Hon'ble Kerala High Court in Framatone Connector Oen Ltd. v/s. DCIT, : [2007] 294 ITR 559 (Ker.).;


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