TaxTMI 
TaxTMI 
2018 (2) TMI 1768
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....ssment Year 2012-13 2. The first issue raised in the Departmental appeal is against the deletion of disallowance of deduction of Rs. 1,35,93,691/- u/s 80IC of the Income-tax Act, 1961 (hereinafter also called `the Act'). The assessee is in appeal against the confirmation of disallowance of certain expenses by way of allocation out of common Head office expenses to the eligible Kotdwar Units - II and III. 3. Briefly stated, the facts of the case are that the assessee claimed deduction amounting to Rs. 1,35,93,691/- u/s 80IC of the Act in respect of Unit-III Kotdwar. The Assessing Officer, following his view for the immediately preceding year, i.e., assessment year 2011-12, held that this eligible unit was formed after splitting up the exi....
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....C on the ground that Unit-III Kotdwar was set up by splitting up and reconstruction of a business already in existence at the Noida unit. In this regard, it is observed that there is no splitting up of the existing unit inasmuch as there is no finding by the Assessing Officer that any machinery earlier used in Noida unit was transferred to Kotdwar-III unit. The fact of the matter is that the assessee started supplying its products to Hero Honda and other customers from the new undertaking at Kotdwar-III unit which were earlier manufactured at Noida unit. Except for the fact that the assessee purchased raw material from its Noida Unit, there is no reference to any interconnectivity between Kotdwar-III unit and Noida Unit. It is not the case ....
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....he assessee earned exempt dividend income of Rs. 1,79,68,892/- and a sum of Rs. 2,42,047/- was offered for disallowance u/s 14A towards management fees, custody fees, audit fees and portfolio management fees. The Assessing Officer invoked the provisions of section 14A and computed disallowance in terms of Rule 8D at Rs. 31,66,268/-. The ld. CIT(A) observed that apart from offering disallowance of Rs. 2,66,688/- (noted by the AO as Rs. 2,42,047), the assessee had also offered additional disallowance of Rs. 3,79,432/- which escaped the Assessing Officer's attention. Thus, it was found that the assessee offered disallowance for a total sum of Rs. 6,46,120/- and not Rs. 2,66,688/-. Considering the fact that the investment portfolio of the asses....
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....xpenses in relation to the exempt income. It can be seen from the impugned order that the Assessing Officer even did not consider the correct amount offered by the assessee for disallowance at Rs. 6.46 lac. In view of the fact that no proper satisfaction was recorded, in our considered opinion, the Assessing Officer did not acquire any valid jurisdiction for computing disallowance u/s 14A. Since the ld. CIT(A) has sustained the amount disallowable u/s 14A at Rs. 6,42,120/-, being the amount voluntarily offered by the assessee, we uphold the impugned order to pro tanto. 10. In the result, both the appeals are dismissed. Assessment Year 2011-12 11. The only issue raised in this appeal is against deletion of disallowance of deduction u/s 8....