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TMI Blog2024 (6) TMI 1060X X X X Extracts X X X X X X X X Extracts X X X X ..... r Section 14A of the Income Tax Act, 1961, since section 14A is not applicable in the case of appellant. Ground No. 2: It is contended that the Ld. Commissioner of Income Tax (Appeal) has erred in law and on facts confirming the disallowance of Rs. 23.85,191/- u/s. 14A read with rule 8D in computing the book profit u/s. 115JB of The Income Tax Act, 1961. Ground No. 3: It is contended that the Ld. Commissioner of Income Tax (Appeal) has erred in law and on facts in confirming the inclusion of self CENVAT CREDIT of Rs. 71,65,295/- in the book profit under section 115JB of the Income Tax Act, 1961. Ground No. 4: It is contended that the Ld. Commissioner of Income Tax (Appeal) has erred in law and on facts in confirming the Self CENVAT credit availment amounting to Rs. 71,65,295/-as an income not derived from industrial undertaking and accordingly reducing the deduction under section 80IB of the Income Tax Act. Ground No.5 : It is contended that the Ld. Commissioner of Income Tax (Appeal) has erred in law and on facts in confirming the reduction of certain other income while computing deduction under section 80IB and 80IC of the Income Tax Act, 1961." 3. Whereas in the Revenue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further submitted that assessee has failed to explain the source of cash seized from the premises. 8. Perusal of the order of the AO reveals that the assessee has earned dividend Rs. 5291268/- from the investment which has been claimed as exempted. The AO has disallowed Rs. 5561011/- u/s. 14A read with rule 8D. It is seen that during the year, the assessee company has earned dividend income of Rs. 52,91,268/-. The assessee asked as to why disallowance should not be made u/s. 14A the same has been claimed to be exempt. 9. The Ld. CIT(A) has partly allowed the appeal and the relevant findings are as under :- "9. Ground No.2 for all the three years relates to contention of the appellant against addition made by the AO under section 14A r.w.s. 8D of the IT Rules. In this regard, being identical facts, the decision of my predecessor in the appellate order passed for the AY 2011-12 in the appellant's own case is followed in which it is held that:- "......8. Since in the year under consideration also the same issues and facts are there as were existing in the AY 2009-10 and 2010-11, therefore, relying on my orders for said assessment years, I hold that application of section 14 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. Since, the addition/disallowance while adjudicating ground no.2 (supra) has been restricted to Rs. 22,26,265/- for the AY 2012-13, Rs. 24,12,364/- for the AY 2013-14 and Rs. 23,85,191/- for the AY 2014- 15, therefore, the AO is directed to restrict the amounts of additions accordingly while calculating book profit to the impugned amounts only. Accordingly, the appeals are disposed off. 16. Ground nos. 9 & 10 for the AY 2014-15 relate to contention of the appellant against addition of Rs. 2,05,00,000/- made by the AO under section 68 of the IT Act. The fact of the case is that the AO found that there was a cash of Rs. 2.05 crores seized during the course of search action, however, nature and source of the same was not explained, therefore, he made addition of the same under section 68 of the IT Act." 10. We find that this Tribunal in assessee's own case for the Assessment years 2009-10 to 2011-12 vide order dated 29-03-2018 have allowed the appeals after holding as under :- "22. Since, the issue involved in grounds no.1, 5 and 6 in assessee's appeal and grounds no.1 and 2 in the Revenue's appeal were exactly the same as were involved in Assessment Year 2008-09, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cern, he submitted that there is a categorical finding by the CIT(A) which is also borne out from the record that no borrowed funds have been diverted for the purpose of investment and hence no disallowance can be made on account of interest. 26. On the other hand, learned DR strongly relied upon the order of the Assessing Officer and Id. CIT (A) and submitted that, once the assessee has a dividend income which is claimed as exempt then expenditure needs to be attributable. 27. After considering the aforesaid submissions and on perusal of the relevant finding given in the impugned orders as well as material referred to before us, we find that in so far as disallowance of interest expenditure is concern, the same has rightly been deleted by the Id. CIT (A) after due verification of the records that none of the investments have been made out of borrowed funds and has been made by assessee's own fund. In view of such a clear cut finding, no disallowance of interest can be made. With regard to other disallowance on account of administrative cost, we find that assessee has given a categorical explanation that no expenditure can be said to be attributable especially when all the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that same were allowed in favour of the assessee by the Ld CIT(A) by the common order dated 13-10-2017. 15. The Ld. DR has submitted that assessee has failed to explain the source of cash seized from the assessee premise. The Ld CIT(A) has observed in his order in para no 16.1 as under :- 16.1 I have considered the facts and circumstances of the case, submission of the appellant and perused the assessment order. I find from the copy of cash book of the appellant which was also available before the AO for verification that total cash of Rs. 2.17 crores was available in the cash book on the day of search on 19.02.2014 out of which Rs. 2.05 crores was seized. There was opening cash balance of Rs. 2,09,46,463/- available as on 18.02.2014. On the same day Rs. 1,38,10,000/- was received from the customers out of which Rs. 1.30 crore were deposited into their bank account maintained with Axis Bank and Rs. 44,935/- was paid on account imprest and other expenses. All these facts were duly supported by the document/evidences as mentioned by the appellant in their submission. Thereby, the closing balance as on 18.02.2014 was of Rs. 2,17,11,538/- and the same is verifiable from the cash bo ..... 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