TMI Blog2018 (4) TMI 1751X X X X Extracts X X X X X X X X Extracts X X X X ..... ent case the impugned assessment year 2009 10, which is a concluded assessment, cannot be disturbed without any incriminating material. For both the above additions the AO as well as the Ld. CIT (A) and the Ld. DR could not show us any incriminating material. In view of this we without going into the merit of the disallowances, direct the Ld. assessing officer to delete as they are not based on any incriminating material found during the course of the search. Addition u/s 14A - HELD THAT:- In the instant case the assessee has made an investment in the shares of foreign companies, income from which cannot be exempt as per the provisions of the Income Tax Act. Even otherwise the assessee on its own has disallowed a sum of ₹ 5767092/- only on the assumption that the provisions of section 14A read with Rule 8D is automatic and mandatory. Even otherwise the Ld. assessing officer has not recorded any satisfaction with regard to the disallowance offered by the assessee on its own. Without recording such satisfaction the AO proceeds to make any disallowance invoking rule 8D of the income tax rules is bad in law. In view of above facts we dismiss ground No. 2 of the appeal o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stances of the case the ld CIT(A) has erred in law in deleting the addition of ₹ 4416836/- made by the AO on account of explained advertisement expenses. 3. Brief facts of the case shows that assessee is a company. The search and seizure operations under section 132 of The Income Tax Act were carried out on M/s Jaipuria group of cases on 27/3/2012. The assessee was one of the company belonging to that group. Therefore, the notice under section 153A of the Act was issued on 8/4/2013. In response to that assessee filed its return of income on 20/6/2013 declaring an income of ₹ 351,23,800/ . The Ld. assessing officer passed an order under section 153A of the act at ₹ 518,04,550/-. The Ld. AO made disallowance of unexplained expenditure on advertisement of ₹ 4416836/ and under section 14A of ₹ 12263917/-. 4. Assessee aggrieved with the order of the Ld. AO preferred an appeal before the Ld. CIT (A) who as per order dated 14/11/2014 deleted the disallowance on account of advertisement expenditure of ₹ 4416,836/ . However with respect to the disallowance under section 14 A of the Act of ₹ 12263917/ , though held that that Ld ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2009-10 and which is framed pursuant to the search carried out on 27/3/2012. Therefore as on the date of the search AY 2009 10 was concluded assessment as the last date for issue of the notice under section 143(2) of the Act was only up to 30/9/2010. Therefore, apparently the assessment year involved is a completed assessment and does not abate. Hence, any adjustment to the total income returned or assessed for that particular assessment year under the normal provisions of the Income Tax Act is required to be disturbed only if any incriminating evidences are found during the course of search. 9. On this premises the Ld. CIT DR vehemently submitted that with respect to the advertisement expenditure during the post-search enquiries the assessee was asked to furnish the details of the advertisement expenditure hence there is some incriminating material found during the course of search. Therefore, she submitted that as far as the addition with respect to the advertisement expenditure is made the incriminating evidences were found during the course of post search investigation made by the investigation wing. She further stated that there is no requirement that addition is req ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11-12 11. This appeal is filed by the revenue against the order of the Ld. CIT appeals XXXI, New Delhi dated 14/11/2014 for assessment year 2011 12. 12. The revenue has raised the following grounds of appeal in ITA No. 862/Del/2015 for the Assessment Year 2011-12:- 1. The order of the ld CIT(A) is not correct in law and facts. 2. On the facts and circumstances of the case, the ld CIT(A) has erred in law in deleting the addition of ₹ 6970436/- made by the Assessing Officer being expenditure incurred to earn exempt income u/s 14A. 3. On the fact and circumstances of the case the ld CIT(A) has erred in law in deleting the addition of ₹ 19189959/- made by the AO on account of explained advertisement expenses. 13. The assessee has raised the following grounds of appeal in CO No. 294/Del/2015 for the Assessment Year 2011-12:- 1. That the ld. Commissioner of Income Tax (Appeals) has erred in law in upholding the disallowance of ₹ 5767092/- u/s 14A read with rule 8D of the Income Tax Act Rules respectively. 2. That the ld CIT(A) erred in holding that some expenses are to be allocated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Income Tax Act. As the cross objection filed by the assessee is also on section 14 A of the income tax act the same are also considered together. 19. The brief facts of the issue is that Ld. assessing officer noted that the assessee has made investment of ₹ 11,58,30,000/- during the year under consideration and therefore the assessee was asked to explain about the applicability of rule 8D of the income tax rules 1962. The assessee did not file any explanation regarding the above query. Therefore, the Ld. assessing officer invoking the provisions of Rule 8D made a disallowance of ₹ 6970436/. The assessee preferred appeal before the Ld. CIT (A) who held that the Ld. assessing officer has not recorded the satisfaction before invoking rule 8D of the income tax rules for working out disallowance under section 14 A of the income tax act. He further held that assessee has only incurred the bank charges and interest paid on purchase of vehicle, thus, there is no link between the exempt income with such bank charges and interest. Therefore, he submitted that no interest disallowance can be made. He further held that Ld. Assessing Officer has failed to consider the fac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the advertisement and publicity expenses of ₹ 13,75,82,635/ under the head selling and distribution expenditure in its profit and loss account, during the financial year under consideration. The Ld. assessing officer asked the assessee to furnish the details of major expenses debited to the profit and loss account which also includes advertisement and publicity expenses and justification with documentary evidences for its allowability. The assessee submitted the party wise details of advertisement expenses claimed in the profit and loss account. However the ld Assessing Officer disallowed the expenditure of ₹ 19189959/ on the basis of non receipt of confirmation. According to assessee the conformation have been received only in respect of 2 parties amounting to ₹ 11,83,92,676/ . Further,according to the ld AO, the assessee did not file complete details in respect of those parties. Further in one of the cases the notice under section 133(6) was also not complied with. The assessee aggrieved with the order of the ld Assessing Officer preferred an appeal before the Ld. CIT (A). He deleted the disallowance relying on order for the Assessment Year 2010-11. He noted ..... X X X X Extracts X X X X X X X X Extracts X X X X
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