TaxTMI 
TaxTMI 
2015 (1) TMI 301
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....-16, Mumbai, [CIT(A) for short] your appellant submits the following grounds of appeal for Your Honours sympathetic consideration :- 1. On the facts and in the circumstances of the case, the learned CIT(A) erred in directing Assessing Officer to recomputed disallowance u/s.14A. He ought to have allowed the entire expenditure of Rs. 22,12,093/- disallowed by the Assessing Officer u/s.14A. 2. On the facts and in the circumstances of the case, the learned CIT(A) further erred in confirming treatment of redemption of debentures (OFCD) of Rs. 80,01,043/- as "Income From Other Sources" as against "Long Term Capital Gains". 2. We have heard the rival contentions and found from record that the AO has disallowed Rs. 22,12,093/- under Sectio....
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....; A X B / C = 215.33 0.5% of the average value of investment, the income from which does not form part of total income 32.81 Total disallowance is aggregate of (i) + (ii) + (iii) = 252.79 4.3 The assessee in the computation of total income has disallowed an amount of Rs. 2,30,66,907/- on interest disallowed u/s.14A of the Act. In view of the above, an amount of Rs. 22,12,093/- (Rs.2,52,79,000 - Rs. 2,30,66,907) is treated as expenditure incurred for earning the dividend income and the same is disallowed u/s.14A of the Act." 3. By the impugned order, the CIT(A) observed that in view of deci....
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....bentures of Rs. 80.02 lakhs. However, the AO computed disallowance of other expenditure at Rs. 22.12 lakhs as against total expenditure of Rs. 4.65 lakhs incurred by assessee. The AO has nowhere pointed out mistake in the disallowance proposed by the assessee amounting to Rs. 230 lakhs. However, he has applied Rule 14A. The year under consideration is assessment year 2007-08, whereas Rule 14A was made applicable from Assessment Year 2008-09 as held by Hon'ble jurisdictional High Court in the case of Godrej Boyce Mfg. Ltd., 328 ITR 81. However, the Hon'ble High Court has further stated that even in earlier years reasonable disallowance is required to be made. Thus, there is no reason to compute disallowance as per Rule 8D during the ....
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....ved was in the nature of capital gain on capital receipt. Reliance was placed on the decision of M.P. High Curt in the case of Madhya Pradesh Financial Corporation Vs. CIT, MP, reported in 1980-(IT2)-GJX-0629-MP, wherein it was held that excess amount received on redemption bonds was in the nature of capital receipt, therefore, liable to be taxed as capital gains. Action of the AO for treating the same as business income of assessee was held to be not justified. 9. Reliance was also placed on the decision of the coordinate bench in the case of Mrs. Perviz Wang Chuk Basi Vs. JCIT, reported in 2006-(102)-ITD-0123-T-BOM, wherein it was observed that the word, "relinquishment" would mean that asset is existing and assessee on his own relinqu....