TMI Blog2014 (6) TMI 1006X X X X Extracts X X X X X X X X Extracts X X X X ..... worked out on a reasonable basis. Section 145A applicability - addition on account of service tax - Held that:- As decided in M/s. Knight Frank (India) Pvt Ltd vs. Addl CIT [2013 (7) TMI 1033 - ITAT MUMBAI] the fact is that the assessee is a service provider company and patently, provisions of section 145A cannot be made applicable, because the provision was specifically introduced for the purposes of manufacture segment of business because section 145A(a)(ii) submitted before the CIT (A) mentions “.by the assessee being goods to be place of location & conditions as on the date of valuation are required to be included”. - I.T.A. No.1893/M/2011 - - - Dated:- 30-6-2014 - SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JU ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o adjustment / addition whatsoever is called for u/s 145A and the CIT (A) ought to have held as such. 2.3. The appellant submits that the AO be directed to delete the addition so made by him and to recompute its total income accordingly. Without prejudice to the foregoing: 2.4. the CIT (A) has while accepting the appellant s alternative contention of allowing the service tax liability as an expense in terms of section 43B of the Act erred in stating that no details and evidence were produced to show how much of the service tax liability had been paid in terms of section 43B of the Act. 2.5. The appellant submits that complete details of the amount of service tax paid by the appellant even after the end of the relevant previous year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income exempt u/s 10(34). Further, income of ₹ 3,09,10,346 from Mutual Funds was also claimed exempt u/s 10(35) of the Act. It was contended that the said income of ₹ 1,08,67,171/- was generated from these bonds which had been claimed exempt u/s 10(15) of the Act and an expenditure of ₹ 2,11,525/- u/s 14A r.w. Rule 8D being expenses for investment in shares, management and consultancy fees and portfolio management services had been suo-moto disallowed by the assessee. For the said suo-moto disallowance of ₹ 2,11,525/- assessee placed reliance on the judgment of the judgment of the Bombay High Court in the case of Godrej Boyce Mfg. Co. Ltd vs. DCIT. CIT (A) considered the submissions of the assessee and directed the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enforce the provisions of section 14A(1) by adopting the reasonable basis on method consistent with all the relevant facts and circumstances after furnishing a reasonable opportunity to the assessee to place all germane material on the record. In this backdrop, I find that the disallowance u/s 14A in the appellant s case being relatable to AY 2007-08 has to be worked out on a reasonable basis. Respectfully following the decision, the appeal being related to AY 2007-08 i.e., prior to AY 2008-2009, I direct the AO to work out the disallowance in terms of the forgoing directions of the Hon ble Bombay High Court. 8. Considering the above, we are of the opinion that the direction given by the CIT (A) is fair and reasonable and it does not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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