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2023 (12) TMI 759 - ITAT MUMBAIAddition u/s 69B - unexplained investment - HELD THAT:- We find that in the share purchase agreement there is no reference of “Escrow agreement” and assessee has not made any compliance of the said Escrow agreement , which is under litigation before the Hon’ble Bombay High Court. In such circumstances, it cannot be held that assessee has paid additional consideration for purchase of the shares. In absence of any proof of payment of additional sale consideration, particularly when owner(s) of the flat i.e M/s Starlight Systems LLP has declined request of the three shareholders for allotment of flats to them. Further documents relating to allotment of those flats to three shareholders have been observed to be defective by the Ld. CIT(A) and this fact has not been controverted by the Ld. DR. Be that as it may be, it is evident that those three flats belonging to the M/s Starlight security LLP mentioned in the Escrow agreement has ultimately not been given to those three shareholders by the assessee on anyone on behalf of the assessee and matter being under litigation before the Hon’ble Bombay High Court, no addition for unexplained investment could survive in the hands of the assessee company. In our opinion order of the Ld. CIT(A) on the issue in dispute is well reasoned and accordingly, we uphold the same. In the result, the ground Nos. 1 and 2 of the appeal of the Revenue are dismissed. Disallowance u/s 14A r.w.r. 8D - HELD THAT:- We have noted that Hon’ble Delhi High Court in the case of M/s Joint investment [2015 (3) TMI 155 - DELHI HIGH COURT] has already held that disallowance u/s 14A of the Act cannot exceed dividend income. Also no disallowance u/s 14A of the Act can be made if the assessee had not earned any exempt income during the year under consideration. Since in the case assessee has already made disallowance to the extent of exempted income, therefore, respectfully following the finding of the Hon’ble Delhi High Court Era Infrastructure (India) Ltd. [2022 (7) TMI 1093 - DELHI HIGH COURT], we set aside the finding of the Ld. CIT(A) on the issue in dispute and delete the addition made by the Assessing Officer. The arguments of the ld counsel for the assessee for restricting the disallowance under rule 8D to the extent of interest corresponding to the investment in mutual funds, are rendered academic only. Revised computation of the income of the assessee in compliance of the amalgamation order - CIT(A) upholding the stand of the AO of not considering the revised computation of the income filed in compliance to the amalgamation of the order of the Hon’ble High Court passed on 12.12.2012 - HELD THAT:- We find that that the Ld. CIT(A) upheld the decision of the Assessing Officer in view of the decision of Goetze (India) Ltd. [2006 (3) TMI 75 - SUPREME COURT] but the Ld. CIT(A) however has mentioned that direction given and the date specified in the original order dated 17.08.2012 as well as revised order dated 10.12.2012 of Hon’ble High Court will have to be complied with by the AO. Accordingly, following the finding of the Hon’ble supreme court in the case of Dalmiya Power Ltd. [2019 (12) TMI 991 - SUPREME COURT] .we uphold the direction of ld CIT(A) to the Assessing Officer to take into consideration revised computation of the income of the assessee in compliance of the amalgamation order approved by the Hon’ble Bombay High Court vide order dated 12.12.2012. The ground No. 5 of the appeal of the assessee is accordingly allowed.
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