TaxTMI 
TaxTMI 
TaxTMI 
2017 (12) TMI 47
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....) of the 1962 Rules, vide assessment order dated 29-01-2014 u/s 143(3), which was later confirmed by learned Commissioner of Income-tax(Appeals) (hereinafter called "the CIT(A)) vide appellate orders dated 30-10-2015 both under the normal provisions as well under the provisions of Section 115JB concerning computation of book profits for determining minimum alternate tax (MAT). The assessee has raised grounds of appeal in memo of appeal challenging disallowance u/s 14A as well additional grounds of appeal are raised before the Income Tax Appellate Tribunal(hereinafter called as "the tribunal") challenging computation of book profits u/s 115JB for computing disallowance under MAT provisions, The Revenue is aggrieved by the relief granted by learned CIT(A) vide his appellate order in deleting disallowance to the tune of Rs. 46,92,218/- u/r 8D(2)(ii) and 8D(2)(iii) of Income-tax Rules, 1962 r.w.s. 14A. 3. The assessee is engaged in the business of manufacturing and export of dyes and dye intermediates and other chemicals. The assessee has received dividend income of Rs. 1,60,62,485/- which was claimed exempt. The assessee has voluntarily disallowed Rs. 37,55,126/- u/r 8D(2)(iii) r.w.s....
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....ejected by the learned CIT(A) relying on Hon‟ble Supreme Court decision in the case of Goetze India Limited v. CIT 284 ITR 323(SC). The learned CIT(A) ordered deletion of mutual funds, quoted and unquoted investments and investment in subsidiary companies for the purposes of computing average investment for computing disallowance u/r 8D(2)(iii) r.w.s. 14A, as the same were subject to tax u/s 45 on capital gains. The learned CIT(A) ordered that investment in partnership firm amounting to Rs. 3,08,53,421/- subject to verification shall be included for the purposes of computing average investment for computing disallowance u/s 14A r.w.s. 8D(2)(iii) and directions were issued to the AO to compute disallowance, vide appellate orders dated 30-10-2015 passed by learned CIT(A). 5. Aggrieved, both assessee and Revenue have come in appeal before the tribunal. Heard both the rival parties, perused the orders of authorities below, order of the tribunal in assessee‟s own case for preceding year and other material on record. The assessee is engaged in the business of manufacturing and export of dyes and dye intermediates and other chemicals. The whole controversy revolves around co....
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....ks of accounts and after verifications can be conducted by the AO and the AO should consider HO expenses only for disallowance u/r 8D(2)(iii) r.w.s. 14A. It is claimed that this ground was raised before the learned CIT(A) but doors of justice was shut by learned CIT(A) as no revised return was filed by the assessee. It is claimed that since the assessee never raised this issue in preceding year i.e. 2010-11, the ITAT had no occasion to deal with the same but the assessee did raise this issue in earlier years i.e. 2007-08 to 2009-10, wherein ITAT had set aside the matter to the AO for necessary verifications. The learned counsel for assessee will rely on judgment of Hon‟ble Bombay High Court in the case of CIT v. Pruthvi Brokers and Shareholders Private Limited (2012) 349 ITR 0336(Bom HC) and CIT v. B G Shirke Construction Technology Private Limited (2017) 395 ITR 0371(Bom HC) to contend that even if revised return of income was not filed but the appellate authorities can always look into these grounds agitated before them. We find merit in the contention of the assessee but the claim raised by the assessee need verification and the matter is restored to the file of the AO to ....
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....vious year relevant to the impugned assessment year shall be considered for computing disallowance u/s 14A r.w.r. 8D. The Special Bench in para 11.16 held that only those investments are to be considered for computing average value of investment which yielded exempt income during the year. We are bound by decision of Special Bench and Respectfully following the same, we direct the AO to compute disallowance u/s 14A r.w.r. 8D(2)(iii) in accordance with the ratio of law laid down by Special Bench - ITAT, Delhi in the case of Vireet Investment Private Limited(supra). We order accordingly. The next contention is w.r.t. computation of book profits u/s 115JB vis-a-vis disallowance u/s 14A . The issue is now decided by Special Bench, Delhi ITAT in the case of Vireet Investment Private Limited (supra) . Both the parties fairly agreed that issue is covered by decision of Special Bench of ITAT, Delhi in the case of Vireet Investment Private Limited(supra). The AO is directed to decide the issue in the light of ratio of decision of Special Bench in the case of Vireet Investment Private Limited(supra). We order accordingly. The last grievance under these appeal is of the assessee as to wheth....