TaxTMI 
TaxTMI 
2016 (11) TMI 534
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.... 30.01.2013 for assessment year 2010-11. The grounds raised by the assessee per its appeal are as under:- "1) That for both the facts and circumstances of the case and in law, the C.I.T.(A) has erred in confirming the addition of Rs. 9,27,329/- as made by A.O under section 14A of the IT Act, 1961 read with Rule-8D of the IT Rules 1962. (2) That the CIT(A) has likewise, erred in confirming the addition of Rs. 1,02,130/- as made by AO under section 40(a)(ia) of the T Act, 1961." Shri V.N. Purohit, Ld. Authorized Representative appeared on behalf of assessee and Shri Anand Kumar Singh, Ld. Departmental Representative appeared on behalf of Revenue. 2. First issue raised by assessee in its appeal is that Ld. CIT(A) erred in ....
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....er:- "5. I have considered the submission of the appellant and perused the assessment order. On careful consideration of the facts, I am not inclined to agree with the submission of appellant. It is observed that the tax auditor has computed the disallowance u/s. 14A by applying the provisions of Rule 8D at Rs. 7,82,695/- having regard to books of account of the appellant company as the tax audit was completed by him. Therefore, it is not correct to say that the auditor has committed a mistake by computing the disallowance under Rule 8D (2)(ii) and 8D(2)(iii). Further, the disallowance u/s 14A computed by the Tax Auditor, having regard to books of account, of appellant company was also accepted by it and therefore same was added to....
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....provision of Sec. 14A r.w.s. Rule 8D of the IT Rules. In this regard, Ld. AR before us submitted that these expenses were disallowed by mistake as all the investments in equity shares are strategic investment. In rejoinder, Ld DR has not brought anything contrary to the advanced argument made by Ld. AR with regard to strategic investment made by the assessee. We also find that various Tribunals have held that there should not be any disallowance u/s. 14A of the Act in relation to investment held by assessee as strategic investment. Therefore, we are inclined to reverse the order of Authorities Below in relation to investment in equity share which is strategic investment made by assessee. In this connection, we rely in the order of Hon'ble L....
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....s appeal allowed In view of above, the investment made in the group companies shall not to be considered while applying the provision of Sec. 14A of the Act. However, with regard to investment made in the interest free bonds of HUDCO. In this regard, Ld. AR for the assessee has not brought anything on record to justify that such investment was made out of its own fund. At the time of hearing, Ld. AR requested the Bench to restore the matter back to the file of AO to check whether the investment was made out of the borrowed fund or own fund of assessee. To this point, Ld. DR raised no objection if the matter is restored back to the file of AO for fresh adjudication. Considering the facts and circumstances of the case and in the interest o....