TMI Blog2018 (12) TMI 1315X X X X Extracts X X X X X X X X Extracts X X X X ..... dit for TDS once valid TDS certificate had been produced or even where the deductor had not issued TDS certificates on the basis of evidence produced by assessee regarding deduction of tax at source and on the basis of indemnity bond. We, therefore modify the order passed by CIT(A) on this point and direct the AO to proceed in the manner discussed above to give the credit of tax deducted at source to the assessee - Direct the AO to proceed in the manner discussed above to give credit of tax deducted at source to the appellant. - ITA No. 5842/MUM/2013 - - - Dated:- 28-9-2018 - Shri Sandeep Gosain (Judicial Member) And Shri N.K. Pradhan (Accountant Member) For the Assessee : Mr. Farrokh Irani, AR For the Revenue : Mr. Manoj Kumar Singh, DR ORDER PER N.K. PRADHAN, AM This is an appeal filed by the assessee. The relevant assessment year is 2010-11. The appeal is directed against the order of the Commissioner of Income Tax (Appeals)-4 [in short CIT(A) ], Mumbai and arises out of the assessment completed u/s 143(3) of the Income Tax Act 1961, (the Act ). 2. The 1st ground of appeal 1. The CIT(A) erred in confirming disallowance of ₹ 1,75,18,216, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . During the course of assessment proceedings, the Assessing Officer (AO) observed that the appellant had earned dividend income of ₹ 34,52,754/-, against which it has made a disallowance suo motu of ₹ 20,58,424/-. The AO has recorded that on the basis of account of the appellant, he was not satisfied with the correctness of its claim in respect of expenditure in relation to income which does not form part of the total income under the Act. Therefore, the AO made a disallowance of ₹ 1,95,76,640/- u/s 14A r.w. Rule 8D of the Income Tax Rules 1962 (the Rules). The breakup of such disallowance is ₹ 1,75,18,216/- under Rule 8D(2)(ii) and ₹ 20,58,424/- under Rule 8D(2)(iii). After allowing the disallowance made by the appellant amounting to ₹ 20,58,424/-, the AO made a disallowance of the balance amount of ₹ 1,75,18,216/- 4. Aggrieved by the order of the AO, the assessee filed an appeal before the Ld. CIT(A). We find that the Ld. CIT(A) agreed with the computation done by the AO and confirmed the above disallowance of ₹ 1,75,18,216/-. 5. Before us, the Ld. counsel of the appellant submits that the appellant had ₹ 305.03 lakh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of HDFC Bank Ltd. (supra) that this Court took a view that the presumption which has been laid down in Reliance Utilities Power Ltd. (supra) with regard to investment in tax free securities coming out of assessee's own funds in case the same are in excess of the investments made in the securities (notwithstanding the fact that the assessee concerned may also have taken some funds on interest) applies, when applying Section 14A of the Act. Thus, the decision of this Court in HDFC Bank Ltd. (supra) for the first time on 23rd July, 2014 has settled the issue by holding that the test of presumption as held by this Court in Reliance Utilities and Power Ltd. (supra) while considering Section 36(1)(iii) of the Act would apply while considering the application of Section 14A of the Act. The aforesaid decision of this Court in HDFC Bank Ltd. (supra) on the above issue has also been accepted by the Revenue in as much as even though they have filed an appeal to the Supreme Court against that order on the other issue therein viz. broken period interest, no appeal has been preferred by the Revenue on the issue of invoking the principles laid down in Reliance Utilities Power Ltd. (supra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IR may not tally with the appellant records/accounts; d. In absence of any contrary material brought by the Department that the Appellant has received more than the income declared by the Appellant, no addition should have been made. 6. The Appellant prays that addition of ₹ 5,83,777 on account of transaction reflected in AIR be deleted. 9. During the course of assessment proceedings, the AO provided the appellant a copy of the Annual Information Return (AIR) details for reconciliation. After going through the reply filed by the appellant, the AO observed that transactions worth ₹ 5,83,777/- were still pending for reconciliation. As the assessment was to be made, the AO made an addition of the above sum of ₹ 5,83,777/-. 10. Having heard the rival contentions and perused the relevant records, we are of the considered view that the above matter be reexamined by the AO, because he was running short of time while making the assessment u/s 143(3) on 25.02.2013. Therefore, we set aside the order of the Ld. CIT(A) on the above issue and restore the matter to the file of the AO to make a fresh order, after giving (i) the relevant documents and (ii) reasonable opp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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