Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

DCIT, Circle-7 (1) , Mumbai Versus M/s. Pan India Network Infravest Pvt. Ltd.

2016 (5) TMI 576 - ITAT MUMBAI

Disallowance made u/s. 14A r. w. Rule 8D - Held that:- There is no doubt that the assessee had not earned exempt income during the year under consideration, so, in our considered opinion, no disallowance can be made u/s. 14A of the Act. - Decided in favour of assessee. - I. T. A. /3378/Mum/2013, I. T. A. / 4170 /Mum/2013 - Dated:- 11-5-2016 - Sh. Joginder Singh, Judicial Member And Rajendra, Accountant Member For the Petitioner : Shri Love Kumar-DR For the Respondent : Shri Niraj Seth-AR ORDER P .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

about disallowance made u/s. 14A r. w. Rule 8D of the Income tax Rules, 1962, (Rules). During the assessment proceedings the AO found that the assessee had made an investment of ₹ 52 crores in equity shares of Western MP Infrastructures, that it had paid interest of ₹ 2. 22crores, that it had not made any disallowance u/s. 14A of the Act. He directed the assessee to explain as to why disallowance should not be made invoking the provisions of the said section. Vide its letter, dt. 4. .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

First Appellate Authority (FAA). Before him, it was argued that the assessee had made strategic investment in unquoted equity shares out of the non interest bearing funds, that nexus was proved with bank statement submitted during the course of assessment proceedings, that the income from such investment was taxable under the head capital gains, that it had not earned/received any exempt income during the year under appeal, that it had not incurred any expense towards maintaining the investment .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

t the investment was made out of its own funds and the same were not interest bearing funds , that the possibility of utilisation of borrowed funds for the purpose of making investment could not be ruled out. He directed the AO to work out the disallowance as per the formula provided in sub clause(ii) of Rule 8D(2). Further he directed the AO to adopt the average value of assets to ₹ 153. 54 crores. He further directed the AO to restrict the disallowance under rule 8D(2)(iii) to ₹ 5. .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e during the year under consideration, so, in our considered opinion, no disallowance can be made u/s. 14A of the Act. We find that in the case of M/s Gateway Distriparks Ltd. (supra), identical issue was adjudicated by us, as under: 3. The next ground pertains to deleting the disallowance made u/s 14A of the Act ignoring the ratio of the Tribunal in Cheminvest Ltd. (121 ITD 318)(Del. ). The crux of argument on behalf of the assessee is that no income was earned by the assessee and merely hypoth .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e High Court relied upon following decisions:- i. Cheminvest Ltd. v. CIT [2009] 317 ITR (AT) 86 (Delhi) [SB] (para 15) ii. CIT v. Chugandas and Co. [1964] 55 ITR 17 (SC) (para 14) iii. CIT v. Cocanada Radhaswami Bank Ltd. [1965] 57 ITR 306 (SC) (para 14) iv. CIT v. Corrtech Energy (P. ) Ltd. [2015] 372 ITR 97 (Guj) (para 15) v. CIT v. Holcim India (P. ) Ltd. (I. T. A. No. 486 of 2014 decided on 5- 9-2014) (para 15) vi. CIT v. Hero Cycles Ltd. [2010] 323 ITR 518 (P&H) (para 15) vii. CIT v. La .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     bird's eye view     ↓  


|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version