TMI Blog2019 (3) TMI 1840X X X X Extracts X X X X X X X X Extracts X X X X ..... t : Shri M. K. Singh (DR) ORDER PER AMARJIT SINGH, JM: The assessee has filed the above mentioned appeals against the order dated 30.06.2017 passed by the Commissioner of Income Tax (Appeals)-2, Mumbai [hereinafter referred to as the CIT(A) ] relevant to the assessment years2012-13 2013-14. ITA NO.5519/M/2017:- 2. The assessee has filed the present appeal against the order dated 30.06.2017 passed by the Commissioner of Income Tax (Appeals)-2, Mumbai [hereinafter referred to as the CIT(A) ] relevant to the assessment year 2012-13. 3. The assessee has raised the following grounds: - 1. That on the facts and in the circumstances of the case, the learned Commissioner of income Tax (Appeal) - 2 (hereinafter re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 22,05,729/- earned from investment in the tax-free secured redeemable non-convertible bonds issued by National Highway Authority of India (NHAI) Indian Railway Finance Corporation (IRFC). The same has been exempt under I.T. Act, 1961. The assessee did not make any disallowance u/s 14A r.w. Rule 8D of the Act, therefore, the AO applied the provision u/s 14A r.w. Rule 8D of the Act and raised the addition in view of the provisions u/s 8D(iii) in sum of ₹ 2,34,17,801/-. Accordingly, the income of the assessee was assessed in sum of ₹ 345,88,57,040/-. Feeling aggrieved, the assessee filed an appeal before the CIT(A) who confirmed the addition, therefore, the assessee has filed the present appeal before us. ISSUE Nos. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich is exempt, made by the assessee company are in the schemes of HDFC Mutual Fund. These investments made in the various schemes of HDFC Mutual Fund are usually made out of business policy and the same does not require complex analysis by technical experts and does not involve or requires any incurrence of expenditure. Hence, these investments should not be considered in working out disallowance under Rule 8D. Reliance was placed on the decision of Tribunal in Reliance Capital Asset Management Ltd. vs. DCIT (ITA No. 4459/Mum/2012) on identical sets of facts held that Rule 8D(iii) should not be applied as investments made by the assessee is mainly in schemes of Reliance Mutual Fund and group concern which does not requires incurrence of any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vidend income from the investments in HDFC Mutual Fund (Growth Plan) is taxable when the dividend is received and also the capital gains is attracted for the gain received on sale of these investments. The Assessing Officer should also consider as to whether investment in foreign subsidiary company is also taxable or not. In case, the return from these investments are taxable, the question of applying disallowance under section 14A does not arise. The Assessing Officer should examine all these aspects and decide the issue in accordance with law after providing adequate opportunity to the Assessee. 6. Since the matter of controversy has already restored before the AO, therefore, in the said circumstances by following the order of coordin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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