TaxTMI 
TaxTMI 
2019 (4) TMI 1225
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....ain object is to carry on the business of construction and development of airport by itself which is not undertaken and also to invest in other companies as promoter, sponsor, which is the only activity undertaken by the Appellant. The Appellant wishes to point out that as per the Memorandum of Association of the appellant, the appellant can carry out any of its main objects out of various main objects. There is no requirement for the appellant to carry out all activities as mentioned in the object clause. As per the main object clause, the appellant has carried out activities as provided in Sl. No.2 of the main object clause and thus the Appellant should be considered to have carried out the business activity as set-out in its main object clause. (ii) In para 6.16 of the order passed, the Hon'ble IT AT has held that Appellant can earn income only by way of dividend from sister concern or by way of interest on the deposits made in the bank. In this regard, the Appellant wishes to point out that it has a right to charge interest on the advances made by the Appellant to the level - 2 company [i.e. GVK Airport Holdings Private Limited ('GVKAHPL')....
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....;s main source of income is only in the nature of dividend; there is evident of nexus of borrowing funds being invested in sister concern, the entire interest expenses has to be considered for disallowance under section 14A read with Rule 8D(2)(i)/ 8D(2)(ii) of the Rules. In this regard the Appellant wishes to submit that the Hon'ble ITAT seem to have wrongly appreciate the fact a disallowance in terms of [as mentioned in para (iii) above] section 14A can trigger only if borrowed funds were utilized for making investment in level 2 company by way of equity and which is not the case. 6. Given the above, it seems that the Hon'ble Members were of view that the Appellant has utilized the borrowings to make investment in the level - 2 company which is not the fact and the Appellant believe that the same may have had a bearing on the final judgment/ conclusion. In the circumstances stated above, the Appellant most humbly prays before the Hon'ble Members for recalling of the Order passed by the Hon'ble Tribunal." 3. Ld. AR submitted that assessee has filed additional evidence before ITAT, but, this was completely ignored by ITAT while passing ....
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....t. 3. At paragraph 6.16 also, the Hon'ble ITAT correctly stated the factual position as evident from the income profile of the assessee. It is a fact that the assessee was not carrying on business on its own, the Hon'ble ITAT correctly observed that there is no question of allowing deduction u/s 36(1)(iii). On this point, the appellant wishes to put forward certain events that happened in F.Y 2016-17 with regard to charging of interest pursuant to sale of equity shares of BIAL (Level - 3 company) to BAIDL. It is humbly submitted that the subsequent events have no bearing on the facts of the case for the present assessment year. Besides, the sale of equity shares and charging of interest pursuant to such sale would not alter the facts of the case. Further, it is not understandable that how interest on an amount pursuant to share of shares would become business expenditure in the hands of the assessee when the assessee is not in the business of trading in shares and investment are different activities. If certain shares are sold as part of investment activity and interest is realized, it would be in the nature of income from other sources and not business income. It ....
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....A are applicable and on that count also, deduction claimed by the assessee is not allowable. Through the present MA, the assessee brings in a claim that the entire amount is to be considered for disallowance u/s 14A even when the investment in Level - 2 company is not in the nature of equity. It is humbly submitted that this argument is self-contradictory with the assertions made by the assessee in this MA with reference to the observations of the Hon'ble ITAT at paragraph 6.16 of the order. Besides, the issue was not raised by way of any ground of appeal and the assessee cannot make it good through an MA because it would amount to review of the entire order. Even on merits, advances would not be treated as investments in the nature of those yielding exempt income. Again, this is a highly debatable issue and is not a mistake apparent from record. 7. It is humbly submitted that in summary, the appellant is seeking review of the order of Hon'ble ITAT through the MA and the same is not permissible under law. In this regard, reliance is placed on the decision of the Jurisdictional Bench of Hon'ble ITAT in the case of Dharti Dredging & Infrastructure ltd [2013] 38 t....