TaxTMI 
TaxTMI 
2019 (1) TMI 1569
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....amely ingots, billets, sponge iron etc. Assessee electronically filed return of income for A.Y. 2012-13 on 22-09-2012 declaring total income of Rs. 86,43,670/-. The case was selected for scrutiny and thereafter the assessment was framed u/s 143(3) vide order dated 14-11-2014 and the total income was determined at Rs. 1,26,60,910/-. Aggrieved by the order of AO, assessee carried the matter before Ld. CIT(A), who vide order dated 01-02-2016 (in Appeal No. 03/14-15) dismissed the appeal of assessee. Aggrieved by the order of Ld. CIT(A), assessee is now in appeal before us and raised following grounds : "1. That on the facts and on the circumstances of the case, Learned CIT(A) has erred in sustaining the disallowance of Rs. 40,17,237/-....
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....d that the "no deduction shall be allowed in respect of expenditure incurred by in relation to income 'which does not form part of the total income". Here section does not say that the tax free income should be earned during the financial year relevant to the particular assessment year for making disallowance u/s 14A. The section simply talks about the income whether earned during the year or not, which does not form part of the total income. The appellant has invested in shares. As and when the income is received it will be tax free. Therefore, relatable expenditure has to be disallowed in terms of his section. The amount to be disallowed has been computed as per Rule 8D. Appellant has claimed that the investment was made out ....
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....e been used for the purpose of making investment. He thus, supported the order of lower authorities. 6. We have heard the rival submissions and perused the material on record. The issue in present ground with respect to disallowance u/s. 14A of the Act. It is an undisputed fact that on the investment made by the assessee, no exempt income has been earned during the year. We find that Hon'ble Gujarat High Court in the case of CIT Vs. Cortech Energy P. Ltd. (2015) 372 ITR 97 (Gujarat) has held that when there is no claim for exempt income, Section 14A would have no application. We also find that Hon'ble Delhi High Court in the case of CIT Vs. Holcim India P. Ltd. (2014) 90 CCH 81 (Delhi) has held that where no dividend income was earned by....
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....inst that order on the other issue therein, viz., broken period interest, no appeal has been preferred by the Revenue on the issue of invoking the principles laid down in Reliance Utilities and Power Ltd. (Supra) in its application to Section 14A of the Act. Therefore, the issue which arose for consideration before the Tribunal had not been decided by this Court in Godrej and Boyce Manufacturing Co. Ltd. (Supra). It arose and was so decided for the first time by this Court in HDFC Bank Ltd. (Supra). Thus, there is no conflict as sought to be made out by the impugned order. Thus, impugned order has proceeded on a fundamentally erroneous basis as the ratio decidendi of the order in Godrej and Boyce manufacturing Co. Ltd. (Supra) had nothing t....