TMI Blog2014 (9) TMI 1029X X X X Extracts X X X X X X X X Extracts X X X X ..... nses - Held that:- CIT(A) while allowing the claim of the Assessee has given a finding that the claim of Assessee was not a fresh one and hence there was no necessity of filing a revised return. CIT(A) further relying on the various decisions of High Courts has allowed the claim of the Assessee. Before us Revenue has neither brought any material on record to controvert the finding of CIT(A) nor has placed any binding contrary decision in its support. Further the case laws relied by the ld. D.R. are distinguishable on facts. In view of the aforesaid facts, we find no reason to interfere with the order of CIT(A) Taxing short term capital gain at a special rate when the appellant had loss - Held that:- It is assessee’s submission that Assessee also has capital loss of ₹ 86,130/- which should have been adjusted against the short term capital gain of ₹ 2,84,676/- earned by the Assessee and only the net short term capital gain should be taxed. Before us no details of the short term loss has been filed by the Assessee. Further before allowing the netting off of loss, the factual aspect needs examination and we therefore remit the issue to the file of A.O to verify the factu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a remand report in contravention of Rule 46A . 4. 1st ground is with respect to reducing the disallowance u/s 14A. 5. During the course of assessment proceedings, A.O noticed that Assessee has earned tax free income in the form of dividend from mutual fund. He also noticed that Assessee had interest expenses of ₹ 29,84,999/- which it had netted against the interest income of ₹ 26,71,158/- and had shown the net interest expenses of ₹ 3,85,252/-. During the course of assessment proceedings, Assessee was asked to explain as to why no disallowance u/s 14A be made in response to which Assessee submitted that according to its calculations, the disallowance of 14A after considering the interest expenses at ₹ 3,84,252/- worked out to ₹ 1,00,576/-. A.O was however of the view that disallowance u/s 14A has to be worked out on the basis of gross interest of ₹ 29,84,999/-. He accordingly worked out the disallowance u/s 14A as per the provisions of Rule 6D of the ITAT Rules and determined the disallowance u/s 14A at ₹ 5,93,079/-. Aggrieved by the order of A.O, Assessee carried the matter before CIT(A). CIT(A) granted substantial relief to the Asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unds, etc., it may be possible to rework disallowance on reasonable basis instead of strict formula of Rule 8D. Hence in view of the above facts and position of law, I am of the opinion that in computing the disallowance under Rule 8D the net interest expenditure should be taken, not the gross interest as taken by the A.O. Accordingly, the A.O. is directed to disallow only ₹ 1,00,576/- under Rule 8D r.w.s. 14A. Therefore, this ground of appeal is allowed. 6. Aggrieved by the order CIT(A), Revenue is now in appeal before us. 7. Before us, ld. D.R submitted that Assessee has not established any nexus between the interest expenditure and interest income and in such a situation the A.O was fully justified in considering the gross interest for working out the disallowance u/s 14A. He thus supported the order of A.O. ld. A.R. on the other hand reiterated the submissions made before A.O and CIT(A). He further submitted that the Assessee had paid interest of ₹ 29.85 lacs and had received interest of ₹ 26.71 lacs and the net amount of ₹ 3.13 lacs were debited to the Profit and Loss account. He further submitted that the only the net interest has to be considere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 77; 11,24,065/-. 10.During the course of assessment proceedings, A.O noticed that in the computation of income, Assessee had voluntarily added back interest expense of ₹ 11,25,065/- to its income. The Assessee was asked to file the details of interest expenses to which Assessee interalia submitted that the addition made to the computation of total income was on account of voluntary disallowance made u/s 14A. It was further submitted that the voluntary disallowance u/s 14A was incorrect and as per the correct computation , the disallowance should be considered at ₹ 1,00,576/- and therefore the excess disallowance made by the Assessee should be rolled over. The submission of the Assessee was not found acceptable to the A.O as he was of the view that Assessee had itself done the computation of disallowance and that Assessee has to prove its claim of the expense to be genuine. A.O was further of the view that if the claim of the Assessee was allowed the result will be that the income of the Assessee will be reduced and will be below the income shown in the return of income. He accordingly rejected the claim of the Assessee. Aggrieved by the order of A.O, Assessee carried ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of CIT(A) and Tribunal to entertain a new claim for the first time though not made before the A.O. He further submitted that Hon ble Gujarat High Court in the case of CIT vs. Mitesh Impex (2014) 14 Taxman.com 13 (Guj) has held that if a claim though available in law has not made either inadvertently or on account of erroneous belief of complex legal position, such claim cannot be shut out for all times to come merely because it is raised for the first time before the Appellate Authority without resorting to revising the return before the A.O. He thus supported the order of CIT(A). 14. We have heard the rival submissions and perused the material on record. We find that CIT(A) while allowing the claim of the Assessee has given a finding that the claim of Assessee was not a fresh one and hence there was no necessity of filing a revised return. CIT(A) further relying on the various decisions of High Courts has allowed the claim of the Assessee. Before us Revenue has neither brought any material on record to controvert the finding of CIT(A) nor has placed any binding contrary decision in its support. Further the case laws relied by the ld. D.R. are distinguishable on facts. In vie ..... X X X X Extracts X X X X X X X X Extracts X X X X
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