2019 (5) TMI 1054

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....sue raised by the assessee is against the confirmation of addition of Rs. 53,95,230/- by Ld. CIT(A) as made by the AO under section 14A of the Act read with rule 8D of the Act which is approximately 80.10% of the actual expenses claimed of Rs. 67,35,894/-. The assessee has also challenged the addition/disallowance to the book profit as computed under section 115JB of the Act. 3. The facts in brief are that AO, during the course of assessment proceedings, observed that assessee has received exempt income by way of dividend, interest and profit on sale of investments to the tune of Rs. 7,98,91,254/-. The assessee has submitted during the course of assessment proceedings that out of total expenses of Rs. 1,56,74,085/- , it claimed only to the....

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....mpt income bears to the total income of the appellant. Therefore, I'm of the opinion that the AO is justified in making the disallowance by applying the decision of honourable Tribunal in the case of the appellant for A.Y. 2008 - 09. So far as working of the disallowance by the AO is concerned, I am in agreement with the same except that in my opinion, the AO should have excluded the depreciation amounting to Rs. 14,42,021 from the total expenses considered for disallowance in view of the decision of Honourable Tribunal in the case of Hoshang D. Nanavati Vs ACIT [20 12] 16 ITR(T) 614 (Mumbai- Tnb.). Accordingly, total expenses actually claimed in the return of income work out to Rs. 69,87,133. As per the assessment order, the exempt inc....

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....Interest on late payment Of TDS 1,678/- Added while computing the total income. Less: Securities Transaction Tax 12,253/- Added while computing the total income. Less: Establishment Charges -.KIREF IV 3,20,000/- Added while computing the total income. Claim in return of income as an Expense 67,35,894/-   6. We observe that out of these expenses the majority of the expenses were not relating to the earning of exempt income as the expenses were incurred for the purpose of running of business of the assessee. Therefore, we are not in agreement with the conclusion drawn by the Ld. CIT(A) of attributing the expenses to earning of exempt income in the ratio of exempt income to total income. We, further, note that the co-or....