2017 (11) TMI 1644

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... submitted as follows :- "2. In Ground Nos. 1,2,3 & 4 of the Petitioner's appeal it had objected to the CIT (A)'s order confirming AO's order making disallowance u/s 14A read with Rule 8D(2)(ii) & (iii) amounting to Rs. 17,15,98,000/-. The amount disallowed by the AO u/ s 14A inter-alia included interest disallowance of Rs. 1,573.03 Lacs and Administrative Expenses of Rs. 143.00 Lacs. 3. In Para - 7.1 of the appellate order dated 10.03.2017 the Ld. ITAT dealt with the issue of disallowance u/s 14A read with Rule 8D(2). The ITAT noted that the Petitioner had offered the disallowance only in respect of administrative expenses, under Rule 8D(2)(iii), but no disallowance was offered towards interest as required und....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....in Profit & Loss AI c together aggregated Rs. 1,733.81 crores. The investments in dividend yielding securities as on 31.03.2008 came down to Rs. 283.46 crores whereas the Petitioner's own funds in the form of share capital, free reserves and balance of profit & loss account together aggregated Rs. 2,569.19 crores. In fact the profit of the Petitioner for the year itself was Rs. 1,256.55 crores. These material facts proved beyond doubt that the investments capable of yielding dividend income had recorded a net decrease of Rs. 12.27 crores during F.Y. 2007-. 5. The attention of the Ld. Tribunal is further invited to the CIT(A)'s order for the A.Y. 2007-08 in the Petitioner's own case which was at Pages 64 to 69 of the Sup....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....pellate order passed by the "A" Bench of the ITAT, Kolkata in I.T.A. Nos. 352 & 589 /Kol/20 11 dated 20.05.2016 for the A.Y. 2007 -08 in the Petitioner's own case. On perusal of Paras 25 to 29 of the said order, it will be noted that in Ground No. 2 of I.T.A. No. 589/Kol/2011 the Revenue had objected to the relief allowed by the CIT(A) out of interest paid and administrative expenses. After taking due note of the findings recorded by the CIT (A) in Para 7.1 of his appellate order the Hon'ble Tribunal in Para 29 of the order dated 20.05.2016 dismissed the revenue's appeal. It will therefore be appreciated that the CIT(A)'s finding recorded in the appellate order for A.Y. 2007-08 stood merged in the order of the ITAT. It will ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....fact which is contrary to the one recorded in A.Y. 2007-08 particularly when by 31.03.2008 the net investment in shares & securities had recorded net decrease by Rs. 12.27 crores meaning thereby no incremental investment was made during F.Y. 2007-08. 8. The Petitioner submits that even though all these material facts & figures were available before the Hon'ble Tribunal there is no discussion about these facts in Para 7.1 of the Hon'ble Tribunal order. The Petitioner further finds that in deciding the issue of applicability of Rule 8D(2)(ii) the Hon'ble Tribunal neither considered nor dealt with the findings recorded by the CIT(A) & upheld by the ITAT for the A.Y. 2007-08 even though these findings had material bearing on th....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....s also important to note that the above details were duly filed before the lower authorities as well as before the Hon'ble ITAT at the time of hearing. We also note that in this similar and identical facts and circumstances the Hon'ble ITAT in the own case of the assessee for A.Y.2007-08 was pleased to decide the issue in favour of the assessee in ITA No. 589/Kol/2011 order dated 25.05.2016 wherein the Hon'ble ITAT after considering the order of the ld. CIT(A) deleted the addition made by the AO. The relevant extract of the ld. CIT(A) as well as the Hon'ble ITAT order is reproduced below :- "The following were the relevant observations of the CIT(A) in this regard :- "In the above decision Hon'ble Bombay High Court has....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....tted that ITAT, Kolkata Bench has been taking a consistent view that 1% of the exempt income would be appropriate and disallowance of other expenses prior to A.Y.2008-09 and this view has also been held by the decision of Hon'ble Calcutta High Court. The following decisions were referred to in this regard : 1. Himtaj Consultants Pvt. Ltd. vs. I.T.O. (ITA No. 721/Ko1l2007- AY. 2004-05) Order dated 27.04.2007. 2. CHNHS Association vs. ACIT(ITA No.74/KoI/2008-AY.2004-05) Order Dated 19.02.2008. 3. I.T.O. vs. M/s S.P.S. Securities (P) Ltd. (ITA NO.123/KoI/2010- AY.2000-01 Order dated 19.08.2010 He further pointed out that the Hon'ble Calcutta High Court in the case of CIT Vs. M/S.R.R.Sen & Brothers Pvt.Ltd. in GA N....