TMI Blog2015 (10) TMI 1703X X X X Extracts X X X X X X X X Extracts X X X X ..... hi High Court in the case of Maxopp Investments, reported [2011 (11) TMI 267 - Delhi High Court ], are very much relevant on the issue of working of disallowance u/s.14A r.w.Rule 8 D by the ld. A.O. We thus following the decision of the coordinate bench in assessee’s own case for assessment year 2009-10, set aside the issue back to the file of A.O to decide the disallowance of expenses u/s.14A r.w. Rule 8 D on the investments of shares in question as per the law, keeping in view the guidelines provided for the same in the case of Maxopp (supra), after affording opportunity of being herd to the assessee. - Decided in favour of assessee for statistical purposes - I.T.A .No. 1333/Del/2012 - - - Dated:- 1-9-2015 - SHRI T.S. KAPOOR AND SMT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2) was issued. During the year under consideration the assessee had claimed exempt income of ₹ 9,01,250/-, being dividend received the shares of SRF Ltd., during the year. The assessee offered ₹ 2,00,000/- u/s.14A, during the course of the assessment proceedings on the ground that the amount represents 50% of salary of the concerned executive, who looks after the activities relating to investments. The assessee submitted before ld. A.O that since there was no activity during the year and dividend was received only from one company, the disallowance to the extent of ₹ 2 lacs was justified. In the assessment order passed an amount of ₹ 26,40,830/- was added on account of expenditure related to earning exempt income. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Amount i SRF Equity Shares of ₹ 10 each 503.74 ii Purearth Infrastructure Ltd. Equity Shares of ₹ 10 each 166.50 These investments have been made in the group companies for earning dividend income and retain the controlling stakes. The dividend income earned from such investments is exempt from tax. It has been claimed by the appellant before the Ld. CIT(A) that investment in SRF Shares was made in the F.Y. 2005-06 and in the shares of Purearth Infrastructure Ltd. it was made in the F.Y. 2006- 07 out of the cash flow generated by the company from its profits. It is claimed by the appellant that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rate account is maintained for the investment purposes which could prove that funds used were not from the interest bearing loans obtained by the appellant. The Ld. CIT(A) has decided the issue on the facts stated above that investment in the shares of SRF Ltd. and Purearth Infrastructure Ltd. was made out of the funds available in common account and there is no evidence that these investments were made from the profit earned by the company. The ld. CIT(A) thus confirmed the addition made by the ld. A.O. 7. We have perused the order passed by the authorities below and the decision of coordinate bench in assessee s own case for assessment year 2009-10 in ITA no. 5033/Del/2012 and 4582/Del/2012, which has been produced before us at the tim ..... X X X X Extracts X X X X X X X X Extracts X X X X
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