2016 (8) TMI 594

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.... upholding disallowance u/s. 40A(2)(b) amounting to Rs. 22,22,000 out of electricity expense being 50% of the expenses claimed. The learned CIT (A) further failed to appreciate the arguments and contentions advanced in this behalf. 2. The learned CIT (A) erred on facts and in law in upholding disallowance of Rs. 3,04,830 u/s. 14A of the Act. He also failed to appreciate that the AO had failed to record her satisfaction as required under rule 8D. The learned CIT (A) further failed to appreciate the arguments and contentions advanced in this behalf. 3. The appellant craves leave to add, alter, delete or substitute all or any of the above grounds of appeal." 3. The brief facts of the case as emanating from records are: The assessee is....

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.....w. Rule 8D. Against the findings of Commissioner of Income Tax (Appeals), the assessee is in second appeal before the Tribunal. 4. Shri C.H. Naniwadekar appearing on behalf of the assessee submitted that the assessee company has been set up for upliftment of the women from the down trodden strata of the society by providing job opportunities. All the employees of the assessee company are women. M/s. Kirloskar Oil Engines Ltd. has provided factory shed at a very nominal rent to the assessee company. M/s. Kirloskar Oil Engines Ltd. is also sharing electricity expenses and has provided its own machinery free of cost to the assessee. The authorities below have brushed aside all the submissions made by the assessee while making disallowance ....

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....4,830/- u/s. 14A of the Act. The assessee has not incurred any expenditure whatsoever towards the earning of exempt income. The disallowance made is much more than the investment made. In support of his submissions the ld. Counsel for the assessee placed reliance on the decision of Hon'ble Karnataka High Court in the case of CCI Ltd. Vs. JCIT reported as 71 DTR 141 (Kar.). 5 On the other hand Shri Mukesh Jha representing the Department vehemently supported the findings of Commissioner of Income Tax (Appeals) in respect of disallowance confirmed. The ld. DR contended that the assessee has failed to show from the records the work done by the assessee. Since, the assessee has failed to show the quantum of work there is no question of gr....

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....It has been contended that the assessee is performing job work for M/s. Kirloskar Oil Engines Ltd. It is an admitted fact that the assessee is carrying on its activity from the premises/shed of M/s. Kirloskar Oil Engines Ltd. for which the assessee is paying very nominal rent. M/s. Kirloskar Oil Engines Ltd. has also provided machinery to the assessee for performing job work. The assessee has claimed electricity consumption charges which have been disallowed by the authorities below on ground that there is no corelation between the work performed and the consumption of electricity. We do not concur with the findings of authorities below on this issue. The Department has not disputed the fact that the assessee company has been promoted by....