TMI Blog2019 (11) TMI 1356X X X X Extracts X X X X X X X X Extracts X X X X ..... he same were not claimed by the assessee. If the amount of dividend income is not reduced against the disallowance of the expenses, then such income has to be treated as exempted income under section 10(34). Finally, the amount of dividend will be reduced and disallowance of the expenses will increase. Thus in effect the entire exercise will be tax neutral. Therefore, in our considered view the order passed by the AO at the most can be held as erroneous but it does not cause any prejudice to the interest of Revenue. Thus in our considered view, on this count, the order of the AO cannot be held as erroneous insofar prejudicial to the interest of Revenue. Prior period expenses - HELD THAT:- There is no error in the order of the AO as alleged by the Ld. CIT. Hence in our considered view the order of the AO cannot be held erroneous insofar prejudicial to the interest of Revenue on this reasoning. AO is erroneous in so far prejudicial to the interest of revenue to the extent of the benefit granted by the AO on account of brought forward losses and unabsorbed depreciation. The assessee on this count fails. However, the assessee on other 2 items as discussed above succeeds for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3.0 The learned Commissioner of Income Tax-1, Baroda has erred in law and on facts in directing the Assessing Officer to enhance the disallowance made under section 14A r.w Rule 8D of the IT Act to ₹ 148,83,18,280/- on account of dividend income of dividend income of ₹ 11,60,62,000/- being reduced from the disallowance made under that section. 4.0 The learned Commissioner of Income Tax-1, Baroda has erred in law and on facts in directing the Assessing Officer to verify the issue relating to disallowance of prior period expenses amounting to ₹ 2,15,28,000/- without Appreciating the fact that the Assessing Officer had already made such' disallowance both under normal provisions as well as section 115JB of the I f Act, 1961 while completing assessment. The appellant had brought the fact to the learned Commissioner's notice vide its letter dated 28-01-2016 which has also been reproduced in the impugned order. 5.0 The learned Commissioner of Income Tax-1, Baroda erred in law and on facts has set aside the assessment order passed on 30-01-2014 under section 143{3)of the lT Act. 6.0 The above ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der the normal computation of income added the prior period expenses to the total income of the assessee. But the AO under MAT computation of income omitted to add such prior period expenses. In view of the above, the notice was served upon the assessee under section 263 of the Act proposing the order passed by the AO as erroneous insofar prejudicial to the Revenue. 4. The assessee before the Ld. CIT submitted that it has claimed the set off of the brought forward losses and the unabsorbed depreciation as declared in the income tax return. Moreover, the issue regarding the brought forward losses and the unabsorbed depreciation is pending before the Hon ble ITAT for the assessment years 2007-08 and onwards and some of them have been decided in favour of the assessee which are pending for giving the appeal effects. 4.1 The assessee regarding the dividend income of ₹ 11,60,62,000/- submitted that it has not claim the exemption of such dividend income. Therefore, the same is liable to be reduced from the amount of disallowance made by the AO under section 14A read with rule 8D of income tax rule. 4.2 The assessee reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e part of the A.O. with regard to examination/verification of the vital issue discussed in Para 3.1, 3.2 3.3 (including sub-paras) herein above has rendered the assessment erroneous, in so far as, it is prejudicial to the interest of revenue. Therefore in exercise of the powers conferred by the Section 263 of the Income-tax Act, 1961, the assessment is set-aside with the direction that the assessment should be framed afresh by the A.O. after proper enquiries / verification on the aforementioned issues, examining the accounts and records of the assessee and after allowing reasonable opportunity of being heard to the assessee. Being aggrieved by the order of the Ld. CIT, the assessee is in appeal before us. 5. The Ld. AR before us, regarding the set-off of the brought forward losses and unabsorbed depreciation, fairly agreed that the order passed by the AO is erroneous insofar prejudicial to the interest of Revenue which certainly requires verification. 5.1 The Ld. AR before us regarding the disallowance under section 14A read with rule 8D submitted that the amount of dividend income was not claimed as exempted and therefore the same ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ignorance of an assessee as to his rights. It is one of their duties to assist a taxpayer in every reasonable way, particularly in the matter of claiming and securing reliefs and in this regard the Officers should take the initiative in guiding a taxpayer where proceedings or other particulars before them indicate that some refund or relief is due to him. This attitude would, in the long run, benefit the department for it would inspire confidence in him that he may be sure of getting a square deal from the department. Although, therefore, the responsibility for claiming refunds and reliefs rests with assessee on whom it is imposed by law, officers should- (a) draw their attention to any refunds or reliefs to which they appear to be clearly entitled but which they have omitted to claim for some reason or other ; (b) freely advise them when approached by them as to their rights and liabilities and as to the procedure to be adopted for claiming refunds and reliefs. In view of the above, if the amount of dividend income is not reduced against the disallowance of the expenses, then such income has to be treated as exempted income und ..... X X X X Extracts X X X X X X X X Extracts X X X X
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