TMI Blog2015 (7) TMI 1201X X X X Extracts X X X X X X X X Extracts X X X X ..... nnot be accepted because VSSC has certified the stock under consideration belongs to it and in no way the ownership of the stock pertains to the assessee. Just because the stock is kept with the assessee the same cannot be treated as the stock of the assessee, as it belongs to a third party, viz. VSSC in this case. We agree with the assessee’s contentions on this issue and direct the Assessing Officer to delete the said addition. Addition u/s 14A - Held that:- the principle laid down by different High Courts are to the effect that unless assessee has earned exempt income in a particular FY, provisions of section 14A will not apply. In view of the aforesaid, we do not find any merit in the ground raised by the department. Accordingly, we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stock-in-trade by stating that stock does not belong to them. AO not being convinced with the explanation of assessee held that as assessee is utilizing the advance amount and bringing stock/material into business premises without showing it as stock-intrade, the same has to be treated as deemed purchases. Accordingly, quantifying the value of material held on behalf of customers at ₹ 1,12,35,202, AO added the same to income of assessee. Being aggrieved of the addition so made, assessee preferred appeal before ld. CIT(A). Ld. CIT(A) on consideration of the fact that similar addition made in relation to stock held in metal bank for AY 2009-10 was deleted by ITAT in assessee s own case, followed the same and deleted the addition. Being ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the assessee did not specify how the balance figures are shown in the books of VSSC and what is the effect of this confirmation. This reasoning given by the CIT(A) cannot be accepted because VSSC has certified the stock under consideration belongs to it and in no way the ownership of the stock pertains to the assessee. Just because the stock is kept with the assessee the same cannot be treated as the stock of the assessee, as it belongs to a third party, viz. VSSC in this case. We agree with the assessee s contentions on this issue and direct the Assessing Officer to delete the said addition. 11. Before parting, we would like to state that assessee is a public sector undertaking and VSSC also is a government organization involved ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y AO, assessee submitted that since during the PY assessee has not earned any exempt income by way of dividend, no disallowance of interest expenditure u/s 14A can be made. AO, however, relying upon a decision of ITAT, Delhi Bench in case of Cheminvest Ltd. Vs. ITO [2009] 121 ITD 0318 rejected assessee s claim and proceeded to disallow an amount of ₹ 4,92,319 u/s 14A read with rule 8D(2). Being aggrieved of such disallowance, assessee challenged the same before ld. CIT(A). 7. In course of hearing of appeal before ld. CIT(A), reiterating what was stated before AO, assessee submitted, during the relevant PY, assessee having not earned any exempt income by way of dividend, provisions of section 14A will not apply. In support of such c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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