TaxTMI 
TaxTMI 
2015 (6) TMI 208
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....gether and are being disposed of by way of this consolidated order for the sake of convenience. 2. First, we take up the Assessee's appeal in ITA No.1667/Ahd/2011 for AY 2008-09. The assessee has raised the following grounds of appeal:- 1. Your appellant being aggrieved by the order passed by Learned CIT(Appeals)-VIII, Ahmedabad presents this appeal on following grounds. 2. The Learned CIT(Appeals)-VIII, Ahmedabad, has erred in making disallowance u/s.14A of Rs. 17,14,615/- being though explained. The addition made be deleted. 3. The appellant craves, leave to add, amend, alter, edit, delete, modify or change all or any of the grounds of appeal at the time of or before hearing of this appeal. 2.1. Briefly stated facts are that the case....
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....7,210/-, (iii) interest to other of Rs. 1,66,241/-, (iv) interest on unsecured loan of Rs. 10,54,049/-, (v) interest on tem loan of Rs. 25,74,770/- and (vi) interest on vehicle loan of Rs. 5,34,167/-. The ld.counsel for the assessee submitted that the AO made disallowance of Rs. 23,87,072/- in respect of interest expenses u/s.14A of the Act under the assumption that the entire interest expenses appearing under the profit and loss account is related to investment and, accordingly, wrongly applying Rule 8D and made the disallowance. He submitted that the AO ought to have excluded the interest paid for the purpose of working capital facility while calculating the disallowance u/s.14A of the Act. The assessee has availed the term loan for exhib....
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.... taxmann.com 427 (Guj.). 3.2. On the contrary, ld.Sr.DR supported the orders of the authorities below. 4. We have heard the rival submissions, perused the material available on record and gone through the orders of the authorities below. Since the assessment under appeal, i.e. AY 2008-09, therefore there is no dispute with regard to the fact that Rule 8D is applicable. It is also not in dispute that during the year, the assessee has earned dividend income amounting to Rs. 59,36,503/-. For earning this dividend income, the assessee has made investment of Rs. 2,20,01,000/- (Rs.1,37,500/- + Rs. 2,16,08,500/- and Rs. 2,55,000/-). The contention of assessee is that the assessee has invested out of interest-free funds and the details submitted ....
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....ule 8D of the IT Rules, 1962, the expenditure should be related to the exempt income which does not form part of the total income. Therefore, the AO should have verified whether the expenditure which he proposed to disallow related to the exempt income or not. In the case in hand, the assessee's contention qua the interest expenditure is that it had sufficient interest-free funds and the investment has been made out of such funds. The fact that the expenditure is not related to the exempt income and the investment wherefrom exempt income is earned is made out of interest-free fund needs verification. Therefore, the issue is restored to the file of AO for verifying the contention of the assessee that the interest expenditure is not related t....
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....sed in the Revenue's appeal, is also restored back to the file of AO for decision afresh with the same direction. Accordingly, this ground of Revenue's appeal is allowed for statistical purposes. 7. Second ground of Revenue's appeal is against the deletion of addition of Rs. 3,28,175/- made on account of excess depreciation on vehicle. The ld.Sr.DR submitted that the ld.CIT(A) was not justified in deleting the addition. He submitted that the first requirement for allowing the claim of depreciation, the assessee is required to demonstrate that the asset has been used for business purposes. He submitted that the assessee has not furnished any evidence in support of its contention that the vehicles were put to use for business purposes. He su....
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....ivery challan issued by the dealer of the vehicles in question. However, the ld.counsel for the assessee expressed its inability to furnish the delivery challan. In our considered view, the assessee is required to demonstrate that assessee-company has purchased vehicles during the year under consideration, the delivery of such vehicles has also been taken and such vehicles were put to use for business purposes. It would not be sufficient that the assessee obtained the registration certificate from the state transport authority to prove that the vehicles have been put to use for business purposes. For claiming depreciation, onus is on the assessee that the vehicles so purchased have been put to business as in the case in hand delivery of veh....