2018 (10) TMI 850

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....T(A) has erred in deleting the disallowance of Rs. 1,70,13,192/- which was over & above suo moto disallowance made by the assessee without appreciating the fact that the amount of disallowance u/s.14A of the I.T.Act, 1961 has to be computed as per Rule 8D of I.T.Rules, 1962 as held in the order of the Hon'ble High Court in the case of M/s. Godrej & Boyce Manufacturing Co. Ltd. 2. Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the disallowance u/s.14A to the book profit u/s.115JB of the I.T.Act, 1961 ignoring the decisions of the Hon'ble ITAT, Mumbai in the case of M/s. Viraj Profiles Ltd. In ITA No.4439/Mum/2013 dated 21/10/2015 - 46 ITR(T) 626 (Mumbai - Trib.)/[2016] and in Ferani Hote....

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....e investments in partnership firms aggregating to Rs. 294 crores while arriving at the aforesaid disallowance. The assessee defended the same, inter-alia, on the premises that no expenditure was incurred and no efforts were made by the assessee to earn any income from the partnership firm. However, it was noted that pursuant to terms of respective partnership deeds, the director of the assessee company, being partner in those firms, was required to devote their full time and attention to the partnership business and all the firms were operating from the address of the assessee. Therefore, not convinced, Ld. AO applying Rule 8D, worked out expenses disallowance of Rs. 246.97 Lacs as against Rs. 76.84 Lacs computed by the assessee and added t....

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.... of which has been placed on record. The same is noted and we proceed to adjudicate the issue on merits. 6. We have carefully heard the rival contentions and perused relevant material on record including the decision of Tribunal in assessee's own case for earlier years. We find that identical issue in revenue's appeal for AY 2013-14 has been remitted back to the file of Ld. AO, by this very bench vide ITA No. 1028/Mum/2017 dated 27/07/2018 with the following observations:- 5.2 We have carefully heard the rival contentions and perused relevant material on record including the decision of Tribunal in assessee's own case for earlier years. The Ld. AR has primarily placed reliance on the stand of this Tribunal for AYs 2009- 10 to 2011-12, ....

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....with due application of mind has rejected the computations offered by the assessee. 5.6 Another aspect of the issue is quantum of investments. The perusal of Balance Sheet, prima-facie, reveal that the assessee's year end current investments and non-current investments aggregate to Rs. 787.43 Crores which is approx. 76% of total assets i.e. Rs. 1037.69 Crores as reflected in the Balance Sheet. The same reveal that the assessee is pre-dominantly an investment company. At this juncture, we find that we stood benefitted by the recent judgment of Hon'ble Apex Court rendered in Maxopp Investment Ltd. Vs. CIT [12/02/2018 91 Taxmann.com 154] wherein it has categorically been held that the objective of holding the investments was immaterial and t....