2016 (1) TMI 1401

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....e ACIT u/s 143(3) of the IT Act, 1961, without fully and properly appreciating the prevalent facts as submitted during the course of the hearing proceedings. 2. On the facts and in the circumstances of the case and in law, the Learned CIT Appeals erred in confirming the order passed by the ACIT u/s 143(3) of the IT Act, 1961, without fully and properly appreciating the written submission submitted during the course of hearing proceedings along with relevant judgements which justify the appellants arguments. 3. The Learned CIT Appeals has confirmed the addition made by the ACIT u/s 14A of Rs. 289992/- on account of expenses deemed to have been incurred for earning of Dividend (Exempt) Income for reasons which are unreasonable and unjusti....

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....who upheld the order of the AO by observing as under. "I have considered the facts and perused the material on record. It is seen that the appellant has earned dividend income of Rs. 5,91,333 and interest on PPF at Rs. 2,09,015 which are claimed as exempt under the Income-tax Act, 1961. The appellant has debited expenditure of Rs. 1,741 being Demat charges against income from other source and transferred net income of Rs. 12,64,818 to Capital Account. Similarly, the appellant has also debited repairs and maintenance expenses of Rs. 7,447, conveyance expenses of Rs. 1757 tax expenses of Rs. 1281, office expenses of Rs. 6165 printing & stationery expenses of Rs. 5,305, telephone expenses of Rs. 31,539 and professional charges of Rs. 5,000 a....

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....efore, ground no. 1to 3 of appeal is dismissed." 4. The ld. AR submitted before us that the expenses disallowed by the AO and confirmed by the CIT(A) were excessive and unreasonable. The ld. Counsel further submitted that the ld. AO had not given any calculation of the said disallowance. The ld. Counsel further argued that the assesee had investments which included those investments which did not yield any tax free dividend during the year and further submitted that while working out the disallowance u/s 14A r.w. Rule 8D(2)(iii) only dividend yielded investments should be taken and not the entire investments. The ld. Counsel relied heavily on the judgemnent of Delhi High Court in the case of ACB India Ltd. Vs. Assistant Commissioner of Inc....