TMI Blog2016 (2) TMI 662X X X X Extracts X X X X X X X X Extracts X X X X ..... fied in confirming the disallowance of ₹ 3,50,000/- made by the AO. At the same time, we find merit in the alternative submission of the assessee. Since the disallowance of ₹ 3,50,000/- has been confirmed by us during the year under consideration, the said amount offered by the assessee in the assessment year 2014-15 is liable to be deleted. Accordingly, we direct the assessee to move an appropriate petition before the AO, who shall act upon it in accordance with the discussions made (supra). Disallowance of repair and maintenance expenditure - Held that:- We notice that the assessee had taken business premises on rent and it has been occupying the same for the last 40 years. The ld. AR, inviting our attention to the details ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and salary expenses stand at ₹ 13.37 lakhs. The assessee was having a turnover of ₹ 14.65 crores in its other business. Thus, we notice that the administrative expenses have been mainly incurred for other business purposes. Considering all these factors, we are of the view that the disallowance made u/s 14A may be determined at ₹ 46,425/-, as worked out by the assessee, since the same works out to about 5% of the dividend income received by the assessee. Accordingly, we set aside the order of ld.CIT(A) and sustain the disallowance u/s 14A at ₹ 46,425/-. - ITA No. 6229/Mum/2013 - - - Dated:- 1-1-2016 - B. R. Baskaran, AM And Amarjit Singh, JM For the Appellants : Shri Kirit Sanghvi Shri Manish Reshmwala ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R submitted that the assessee had given this advance for starting a new venture in the pharmaceutical lines. However, the advance was given during the course of carrying on the business and the loss of the same should be allowed as a trading loss under section 28 of the Act. The ld. AR further submitted that the assessee has ultimately recovered the amount of ₹ 3,50,000/- and the same was offered as income in the assessment year 2014-2015. 4. When it was specifically asked to the ld.AR as to whether the assessee was having any material to show that the advance was given for starting the new venture in the pharmaceutical lines and further whether there was any material to show that the assessee was taking all steps to recover the am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f repairs and maintenance expenditures. The assessee claimed the sum of ₹ 4,59,666/- as repair and maintenance expenditure. The AO noticed that the assessee has paid a sum of ₹ 2,90,000/- to a firm named as M/s Saya Construction Co. for renovation of its business premises. The AO took the view that the assessee has carried out extensive construction work and hence, the amount of ₹ 2,90,000/- referred above should have been capitalized by the assessee. Accordingly, the AO disallowed the amount of ₹ 2,90,000/- treating the same as capital expenditure. The ld. CIT(A) confirmed the same. 8. We heard the parties on this issue and perused the record. We notice that the assessee had taken business premises on rent and it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eration. He submitted that the entire borrowings made by the assessee having used for the business purpose only. He further submitted that the assessee is carrying on the share trading activities and has also made investments. Accordingly, he submitted the disallowance made u/s 14A has to be a made on reasonable basis as held by the Hon ble jurisdictional High Court in the case of Godrej Boyce Manufacturing Co. Ltd. (328 ITR 81)(Bom). 10. On the contrary, the ld. DR submitted that the assessee has earned dividend income of ₹ 8.94 lakhs and hence disallowance has to be made u/s 14A of the Act. 11. In the rejoinder, the ld.AR submitted that the assessee has worked out the disallowance at ₹ 46,425/- and the same is placed a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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