Silicon Graphics Systems (India) Pvt. ... vs Assessee

M/s. Silicon Graphics Systems (India) Pvt. Ltd. vs. ACIT Regus Business Centre Level Circle-23(1) 15, EROS Corporate Towers, New Delhi. Nehru Place - 110 019. (PAN AAACS4194N) (Appellant) (Respondent)

Appellant by : Shri Piyush Kaushik, Advocate Respondent by : Shri B.R.R. Kumar, Sr. DR

ORDER

PER I.C. SUDHIR, JUDICIAL MEMBER

The assessee has questioned first appellate order solely on the ground

that Ld. CIT(A) has erred in directing the AO to add the disallowance sustained

under the normal provisions of the Act in the computation of book profit u/s

115JB without appreciating that taxation u/s 115JB being a self contained code

wherein adjustments to book profit can only be made with respect to items

specified under Explanation to section 115JB.

2. Ld. AR pointed out that the present appeal has been preferred against

the first appellate order whereby the Ld. CIT(A) has disposed of the application 2 ITA No. 4116/Del/2013

of the assessee u/s 154 of the I.T. Act without passing a speaking order. He

pointed out further that after filing the present appeal before the Tribunal on

4.7.2013 the Tribunal vide its order dated 12.11.2014 in ITA No. 2977/Del/2013

(asstt. year 2008-09) has held the disallowance of Rs. 55,92,254/- sustained by

the Ld. CIT(A) on account of interest on custom duty is not hit by Explanation

below section 37(1) of the Act and such expense is allowable under the provision

of the Act. He submitted further that the other disallowance of Rs. 81,49,561/-

made by the AO on account of reimbursement of repair charges payment to

parent entity was already deleted by the Ld. CIT(A) against which the revenue

had not preferred any appeal . Ld. AR submitted further that no appeal effect

has so far been given by the AO to the impugned order dated 26.4.2013 of the

Ld. CIT(A).

3. Ld. DR on the other hand submitted that both the disallowances made on

account of payment of interest on custom duty and reimbursement of repair

charges payment to parent entity made by the AO have been deleted. Hence the

present appeal has become infructuous.

4. Ld. AR rejoined with this submission that non passing of speaking order

by the Ld. CIT(A) while disposing of the application of the assessee filed u/s 154

of the Act will unnecessarily create a confusion in the mind of the AO while

giving effect to the first appellate order in question.

3 ITA No. 4116/Del/2013

5. Considering the above submissions we find substance in the above

apprehension of the Ld. AR and accordingly set aside the matter to the file of the

Ld. CIT(A) to pass a speaking order while disposing of the application of the

assessee preferred u/s 154 of the Act keeping in mind the subsequent

development by which the Tribunal vide its order dated 12.11.2014 (supra) has

held that the payment of interest on custom duty is not hit by Explanation below

37(1) of the Act and these expenses are allowable under the provision of the Act.

It is needless to mention over here that while disposing of the application u/s

154 of the Act afresh, the Ld. CIT(A) will afford opportunity of being heard to the

assessee. Ground is accordingly allowed for statistical purposes.

6. In the result appeal is allowed for statistical purpose.

Order pronounced in the open court on 30th April, 2015.

sd/- sd/-

(INTURI RAMA RAO) ( I.C. SUDHIR ) ACCOUNTANT MEMBER JUDICIAL MEMBER

Date 30th April, 2015

*Veena

Copy of order forwarded to: 1. Appellant 2. Respondent 3. CIT(A) 4. CIT 5. DR By Order Assistant Registrar, ITAT