TaxTMI 
TaxTMI 
2018 (4) TMI 748
X X X X Extracts X X X X
X X X X Extracts X X X X
....e Act). The impugned notice dated 21st July, 2000 seeks to reopen the Assessment for Assessment Year 1995-96. 3. This Petition was admitted on 11th December, 2000. At that time, interim relief, restraining the Respondents from acting further upon the impugned notice dated 21st July, 2000, was passed. 4. For the subject Assessment Year i.e. A.Y. 199596, Petitioner had filed its return of income, declaring a loss of Rs. 9.53 Crores. To its return of income, the Petitioner had annexed a statement, claiming aggregate deduction of Rs. 1.98 Crores (Rs.11.1 lakhs under Section 80G of the Act and Rs. 1.87 Crores under Section 80M of the Act) under Chapter VIA of the Act. Further, in its computation of income, Petitioner has appended a ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e for A.Y. 199596 was filed on 28.11.1995 declaring total income at Rs.NIL. No deduction under Chapter VIA was claimed as the gross total income was loss. In the return, the assessee offered dividend income at Rs. 3,20,56,763/under the head 'Income from Other Sources'. It appended a note to the computation stating that though it was eligible for deduction u/s. 80M, the same was not claimed as the gross total income was NIL. Assessment was completed u/s.143(3) on 27.03.1998 determining total income at Rs. 50,26,91,525/. In the assessment order, the Assessing Officer included dividend income of Rs. 3,20,56,723/under the head 'Income from Other Sources' and allowed deduction of Rs. 1,98,05,010/u/ s. 80M. From the details ava....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nd trading in shares and units of UTI, the A.O. did not consider a part of expenditure incurred on its share dealing against dividend income while computing deduction u/s. 80M. This is besides the cost of interest on funs borrowed and utilized for investments and trading in shares. In the above circumstances, the managerial and administrative expenditure relating to earning dividend income can be estimated at 5% of gross dividend income. This works out to Rs. 16,02,836/. In such a case, eligible deduction u/s. 80M works out to Rs. 1,77,67,967/(computed below) as against Rs. 1,98,05,010/allowed by the Assessing Officer. (i) Net dividend received from UTI @ 95% ofgross dividend) Rs.2,11,43,200/- (ii) Net dividend from oth....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d of four years from the end of the relevant Assessment Year. Further, while completing the Assessment under Section 143(3) of the Act, the Assessing Officer applied his mind to the claim for deduction to the extent of Rs. 1.98 Crores under Section 80M of the Act and granted the deduction. Thus, a view was taken/ opinion formed with regard to claim of deduction in the order dated 27th March, 1998. The impugned notice has been issued on facts which has been subject matter of consideration while passing the Assessment Order under Section 143(3) of the Act. 9. The reasons in support of the impugned notice suggests that the Petitioner had claimed excess deduction under Section 80M of the Act to the extent of Rs. 11.1 lakhs. This is factually....