TMI Blog2020 (5) TMI 545X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee has not established in the cash flow statements about the availability of enough own funds at the time of making investments in the exempted income yielding assets before the lower authorities. Hence, it is appropriate to verify the fact whether enough own funds are available with the assessee as on the date of making investments in the exempted income yielding assets. Being so, the assessee is directed to produce cash flow statements showing availability of enough own funds for making such investments with supporting documents which have to be examined by the Assessing Officer before making disallowance u/s. 14A read with Rule 8D of the I.T. Rules. Accordingly, we remit this entire issue in dispute to the file of the Assessing Officer for fresh consideration - Appeals filed by the assessee are partly allowed for statistical purposes. - I.T.A. Nos. 277 to 279/Coch/2019 - - - Dated:- 19-5-2020 - S/Shri Chandra Poojari, AM And George George K., JM For the Assessee : Shri Thomas Cherian, FCA For the Revenue : Shri Mritunjaya Sharma, Sr. DR ORDER PER CHANDRA POOJARI, AM: These three appeals filed by the assessee are directed against the common orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment year 2012- 13 which reads as follows: The calculation made in the assessment for the AY 2012-13 under section 14A is totally wrong. While applying the rule 8D, Assessing Officer has violated the principles and procedures he himself had adopted previously in the assessment in respect of previous year. According to rule 8D, the expenditure in relation to the exempt income would be aggregate of the following: . 2.2 At the time of hearing, the Ld. AR submitted that he did not wish to press the above additional ground and accordingly, made an endorsement to this effect. Acceding to the request of the Ld. AR, the additional ground of the assessee is dismissed as not pressed. 3. The first common ground is with regard to depreciation on letting out of building for business purposes. 3.1 The facts of the case as narrated in ITA No. 277/Coch/2019 for the assessment year 2010-11 are that the assessee declared income from letting out property as income from business. For the assessment year 2012-13, the assessee declared income from letting out property under the head income from house property. However, in all these years, the Assessing Officer disallo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as follows: 7. We have heard the rival submissions and perused the facts of the case. As regards the facts of the case as on record and argued by the Ld. AR, it is found to be convincing because the Inspector who visited the site on 04/12/2009, submitted the report on 04/12/2009 only and also visited the portion which is not even occupied and owned by the assessee, i.e., basement. As regards 5th and 6th Floors, they have been rented out which is a matter of record which has also been the matter of report of the Inspector and therefore, should not have been in any dispute. 8. As regards 1st to 4th floors, the assessee submitted the explanation that the floors have been used for occupation of the staff and also used as training centre of the staff and no defect has been pointed out by any of the authorities below. 9. No report or verification or counter verification or cross examination has been done from any neighbour or occupants inside the building or nearby buildings, etc. Moreover, once the building has been occupied and even if the building is lying vacant for some period for renting out which even, according to the Ld. CIT(A), has been rented out during th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vestments in equity shares of following companies to the tune of ₹ 13,81,88,297/- which remained intact during the block of assessment years: 1) India Vision Satellite Communications Ltd. ₹ 7,10,00,000/- 2) Yes Communications ₹ 3,04,27,328/- 3) Kapico Kerala Resorts (P) Ltd. ₹ 3,67,60,969/- The Assessing Officer made additions by applying Rule 8D r.w.s.14A by holding that the assessee had diverted the interest bearing funds to non income generative investments as follows: Assessment Year Section 14A Disallowance 2010-11 ₹ 81,47,388/- 2011-12 ₹ 1,06,48,910/- 2012-13 ₹ 4,66,92,824/- 4.2 Before the CIT(A), the assessee submitted that the investment being treated as exempt income bearing investment were actually interest free loans which were converted to equity during AY 2009-2010. The CIT(A) called for banks a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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