Contact us   Feedback   Annual Subscription   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2016 (12) TMI 47 - ITAT MUMBAI

2016 (12) TMI 47 - ITAT MUMBAI - TMI - Disallowance u/s 14A - Held that:- Assessing Officer has not furnished any reasons for rejecting the suo motu disallowance of ₹ 50,000/- computed by the assessee before invoking the formula contained in Rule 8D(2)(iii) to compute the disallowance. Notably, the phraseology of Sec. 14A(2) of the Act itself shows that the computation of disallowance prescribed in Rule 8D of the Rules can be resorted to if the Assessing Officer is not satisfied with the c .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

sallowance of ₹ 50,000/- already made by the assessee. Thus, on this aspect, assessee partly succeeds. - ITA No. 944/MUM/2015 - Dated:- 30-9-2016 - Shri G. S. Pannu, Accountant Member And Shri Amarjit Singh, Judicial Member Assessee by : Shri N.R. Agrawal Revenue by : Shri A.K. Kardam ORDER Per G. S. Pannu, AM This appeal by the assessee is directed against the order of CIT(A)-9, Mumbai dated 01.01.2015, pertaining to the Assessment Year 2011-12, which in turn has arisen from the order pas .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

consideration, assessee had earned dividend income of ₹ 15,68,512/-, which was claimed as exempt. In the return of income, assessee had made a suo motu disallowance of ₹ 50,000/- on account of expenses incurred in relation to earning of such exempt income. The Assessing Officer, however, applied the formula contained in Rule 8D of the Income Tax Rules, 1962 to compute the disallowance u/s 14A of the Act. The Assessing Officer computed disallowance under Rule 8D(2)(ii) - ₹ 28,4 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

g any interest expenditure since the share capital and Reserves & Surplus available with the assessee were more than the investments made and thus, following the ratio of judgment of Hon ble Bombay High Court in the case of HDFC Bank Ltd., 366 ITR 505, no disallowance is called for. Apart therefrom, it was also pointed out that the assessee is an investor as well as a trader in shares and, therefore, so far as the investments in stock-in-trade are concerned, same are to be excluded while cal .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nvestments. It was pointed out on the basis of the balance-sheet for the year under consideration that the fact-situation continues to be same as that considered by the Tribunal in the earlier years. 5. On the other hand, the ld. DR appearing for the Revenue has relied upon the orders of lower authorities in support of the case of Revenue. 6. We have carefully considered the rival submissions. In the present case, the dispute revolves around the action of Assessing Officer in computing disallowa .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ty, 313 ITR 340 it can be presumed that such investments are out of such non-interest bearing funds. The said proposition, in the context of application of Sec. 14A of the Act, has been approved by the Hon ble Bombay High Court in the case of HDFC Bank Ltd. (supra). Factually speaking, the said proposition is clearly attracted in the present case. In the statement of facts annexed to the Grounds of appeal, assessee has brought out that the Share capital plus Reserves and Surplus as on 1.4.2010, .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

arned representative submitted that in a somewhat similar situation in the case of Devkant Synthetics (India) Pvt. Ltd. vide ITA No. 2663, 2664 and 2655/Mum/2015 dated 28.10.2015 read with Corrigendum dated 16.11.2015, the expenses were disallowed @ 5% of such exempt income. It is also pointed out that so far as the shares held as stock-in-trade are concerned, the same are excludible for the purpose of disallowance u/s 14A of the Act. The said proposition asserted before us has been affirmed by .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| 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