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TMI Blog2017 (7) TMI 1255X X X X Extracts X X X X X X X X Extracts X X X X ..... 011 declaring an income of Rs..19,78,00,330/-. The return filed by the assessee was processed under section 143(1) of the Act on 10.01.2012 and accepted the income filed. Subsequently, the case of the assessee was selected for scrutiny and notice under section 143(2) of the Act dated 25.09.2011 was issued. In response thereto, the assessee has filed all details including audit report, computation of income, evidence for payment/credit for taxes claimed, etc. Thereafter, notice under section 142(1) of the Act dated 27.08.2013 issued on the assessee to furnish specific details as contained in the notice. After considering the submissions of the assessee and verification of particulars furnished by the assessee, the Assessing Officer has completed the assessment under section 143(3) of the Act by making disallowance of Rs..14,82,23,866/- under section 14A of the Act r.w. Rule 8D. 3. The assessee carried the matter in appeal before the ld. CIT(A). After considering the submissions of the assessee and facts of the case, the ld. CIT(A) has confirmed the disallowance made under section 14A of the Act. 4. On being aggrieved, the assessee is in appeal before the Tribunal. By referring to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd that the share capital and reserves & surplus are Rs..274,01,39,063.31, whereas the unsecured loans are only Rs..259,89,49,644.25. Therefore, the assessee has sufficient amount for making investment and it cannot be said that the borrowed funds have been utilized for making investment. Moreover, all the investments have been made in the earlier years and therefore, no I.5 T.A. Nos.691 & 692/M/17 part of the interest payable on the borrowing for the year can be attributed to the investment. 6.2 From the balance sheet, we noticed that the investment as on 31.03.2010 was Rs..331.90 crores, whereas, the investment as on 31.03.2011 was Rs..331.06 crores and therefore, it is clear that there was no fresh investment during the year ended 31.03.2011. From the investments made in the earlier years, the assessee has earned exempt income for which it has been voluntarily admitted expenditure and either the Assessing Officer, or the ld. CIT(A), in their orders have not given any findings as to under what count the admitted expenditure was found incorrect, in violation of the provisions of section 14(A)2 of the Act. The disallowance under section 14A(1) of the Act can only be made, once the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been made for the earlier years and therefore, no part of the interest payable on the borrowing for the year can be attributed to this investment and pleaded that if at all only 0.5% of the investment from which dividend has been earned can be disallowed under section 14A of the Act. 7.2 Per contra, the ld. DR vehemently argued that even though there was no fresh investment in the assessment year 2011-12, with regard to administrative and managerial activities, the assessee has admitted expenditure and voluntarily disallowed at Rs..2,64,14,439/- when the assessee has received dividend income of Rs..24,83,08,996/-, where, there was no fresh investment. However, in the assessment year 2012-13, the assessee has earned dividend income of Rs..38,76,11,013/- and also made fresh investment of Rs..20 crores as per the details under 'Note on issues' and not admitted any expenses towards administrative and managerial. Therefore, the disallowance made under section 14A of the Act r.w. Rule 8D by the Assessing Officer should be sustained. 7.3 We have heard both sides, perused the materials available on record and gone through the orders of authorities below. Against the disallowance made un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ..20,91,312/-. On appeal, the ld. CIT(A) confirmed the disallowances. Before us, by filing the details of unpaid expenditure under section 43B of the Act, the ld. Counsel for the assessee has submitted that the assessee itself has disallowed the expenditure in the computation of income, and therefore, he has pleaded that the Assessing Officer cannot make double disallowance, which was already disallowed by the assessee. In view of the above submissions, we direct the Assessing Officer to verify as to whether the assessee has disallowed the employer's contribution to other fund/leave salary paid, etc. in its account and if is found that the assessee has disallowed in its account, the same cannot be again disallowed by the Assessing Officer. Hence, we remit the matter back to the file of the Assessing Officer to verify and decide the issue afresh in accordance with law after allowing an opportunity of being heard to the assessee. 9. The next ground raised in the appeal of the assessee is with regard to confirmation of disallowance of provision for enhanced compensation. 9.1 The Assessing Officer noticed that the assessee has made provision for enhanced compensation of Rs..16,77,14, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isallowance made by the Assessing Officer. By reiterating the submissions made before the ld. CIT(A), the assessee has further submitted that as on 31.03.2012, the assessee has made payment to the extent of Rs..3,52,61,472/- and pleaded that if the provision for enhanced compensation of Rs..25.66 crores is not allowed for the assessment year 2009-10, then the payment of Rs..3,52,61,472/- towards land leased to L & T Shipping Building should be allowed for the year on payment basis. As per trading account of the assessee, filed before us, vide cheque No. 139189 dated 29.03.2012, the assessee has made payment of Rs..12,500/- for the land acquired for PCP in Kattupalli Village. Similarly, vide cheque No. 139189 dated 30.03.2012 and the assessee is stated to have made payment of Rs..1,4074,027/- for the land acquired for PCP in Kattupalli Village. Since there is no possibility to issue one cheque on two different dates with different amounts, the same need to be verified. Further, no payment details are available with regard to the amount stated to have paid to Petrochem Park Project of Rs..2,11,74,945/-, which required to be furnished by the assessee before the Assessing Officer for v ..... X X X X Extracts X X X X X X X X Extracts X X X X
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