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M/s. Fedex Finance Pvt. Ltd., Versus DCIT (OSD) , Circle 3 (1) , Mumbai and vice-versa

2016 (1) TMI 1295 - ITAT MUMBAI

Disallowance of expenditure under section 14A read with rule 8D - Held that:- We find that the issue is squarely covered in favour of the assessee in the own case of the assessee for the earlier assessment year. The strategic investments in group companies and sister concerns for having control over the management of the said companies are not intended for the purpose of earning of exempt income. Under such circumstances for computing the average value of investment for the purpose of disallowan .....

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8D(2)(iii) of the IT rules. - ITA No.1073/M/2013, ITA No.1067/M/2013 - Dated:- 8-1-2016 - SHRI SANJAY GARG, JUDICIAL MEMBER AND SHRI ASHWANI TANEJA, ACCOUNTANT MEMBER Assessee by : Shri Kirit Sheth, A.R. Revenue by : Shri Jeetendra Kumar, D.R. O R D E R Per Sanjay Garg, Judicial Member: The above captioned two appeals by different but related assessees have been preferred against the separate orders of the Commissioner of Income Tax (Appeals) [hereinafter referred to as the CIT(A)] both dated 07 .....

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uted the disallowance under section 14A. He has disallowed the interest expenditure of ₹ 5,01,612/- and administrative expenses at ₹ 3,45,432/-. The said disallowance has been confirmed by the Ld. CIT(A). 3. At the outset, the Ld. A.R. of the assessee has invited our attention to page 14 of the paper book which is the copy of the profit & loss account for the year under consideration to show that the assessee had earned income of ₹ 65,03,721/- during the year. Whereas the t .....

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the co-ordinate bench of the Tribunal in this respect in the case of its sister concern M/s. White Water Mass Media Pvt. Ltd. vs. ACIT vide ITA No.2963/M/2013 order dated 17.09.14 and further in the case of M/s. Westex Infotech Pvt. Ltd. vs. ACIT in ITA No.2964/M/2013 vide order dated 17.09.14. The Ld. D.R., on the other hand, has relied upon the findings of the lower authorities. 4. We have considered the rival contentions and have also gone through the decisions relied upon by the Ld. A.R. of .....

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anagement was not liable to be included in the average value of investments while computing the disallowance of expenditure under rule 8D(2)(iii) because of the reason that such investments are not made for earning of any exempt income but because of the business exigencies of the assessee and that even the capital gains derived there from are taxable. He has further submitted that the assessee has not earned any dividend income from investments in unquoted shares of the subsidiaries during the .....

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