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Padmakshi Financial Services Ltd. Versus The Asst. Commissioner of Income Tax, Circle-4 (2) , Mumbai

2017 (11) TMI 677 - ITAT MUMBAI

Disallowance of expenses relatable to exempt income u/s 14A read with rule 8D - Held that:- No disallowance under section 14A read with Rule 8D of the Rules can be made wherein, investments on which income earned is exempted, but the investment held as stock-in-trade. However, the AO will verify that the investment is made in stock-in-trade and will, accordingly decide the claim. This issue in both the appeals of the assessee is allowed for statistical purposes and remanded the matter back to th .....

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cer even now before us, the assessee could not substantiate the disallowance made by the AO, hence, we confirmed the disallowance. - ITA No. 3884-3885/Mum/2016 - Dated:- 10-11-2017 - Sri Mahavir Singh, JM And Sri G. Manjunatha, AM Assessee by : Ravikanth S Pathak, AR Revenue by : Ram Tiwari, DR ORDER Per Mahavir Singh, JM These two appeals by the Assessee are arising out of the different order of Commissioner of Income Tax (Appeals)-9, Mumbai, [in short CIT(A)] in appeal No. CIT(A)-9/Cir.4/64&am .....

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tion 14A of the Act read with rule 8D of the rules, 1962 (hereinafter the Rules). In both the years, the CIT(A) has confirming the disallowance made by AO of ₹ 7,76,186/- in AY 2010-11 and a sum of ₹ 6,73,665/- in AY 2011-12. The facts and circumstances are exactly identical and even the investments are the same in both the years and no new investment has been introduced. Accordingly, we will take the facts from AY 2010-11 and will decide the issue. The ground has raised in AY 2010-1 .....

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rade has been shown separately which has been considered by the AO for making the disallowance u/s 14A r.w. Rule SD of the I.T. Rules. (c) The CIT (A) erred in not adjudicating the ground that investments in subsidiary companies shall not be considered for disallowance under Rule 8D(7)(ii) & (iii) of the I.T. Rules. (d) The CIT (A) erred in not adjudicating the ground that investments in Non-convertible Debentures shall not be considered for making the disallowance under Rule 8D(ii) & (i .....

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d a sum of ₹ 2,26,259/- under section 14A of the Act read with Rule 8D of the Rules. Hence, he disallowed under Rule 8D of the Rules at ₹ 5,49,927/-. 4. We have heard the rival contentions and gone through the facts and circumstances of the case. Before us, the learned Counsel for the assessee stated that the assessee has kept these investments as stock in trade and earned dividend income and it was also claimed by the assessee that the disallowance is not called off on the shares an .....

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ch shares is allowable under section 37 of the Act. The learned Counsel for the assessee relied on the decision of this co-ordinate Bench in the case of DCIT vs. India Advantage Securities Ltd. in ITA No. 6711/Mum/2011 for AY 2008-09 vide order dated 14.09.2012 and which was affirmed by Hon ble Bombay High Court in ITA No. 1131 of 2013 vide order dated 17-03-2015, when this was pointed out to the learned Counsel for the assessee, the investments which are held as stock-in-trade and given exempt .....

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