2019 (8) TMI 978

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....return of income declaring income of Rs. 27,65,90,490/- on 30th Sep, 2014. Subsequently, the case was selected under scrutiny by issuing of notice u/s. 143(2) of the act on 3rd Sep, 2015. During the course of assessment, the assessing officer noticed that assessee has earned dividend income of 2,64,87,948/- which was exempt from tax. The assessing officer has asked the assessee to explain why not the expenses incurred for earing exempt income should not be disallowed u/s.14A r.w. Rule 8D of the IT Rule. In response, the assessee stated that it has invested in the shares from its own fund and has not incurred any expenditure for the same. The assessing officer had not accepted the contention of the assessee stating that assessee had not prod....

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....re ld. CIT(A) has erred in confirming the addition made by assessing officer without any reason. He also referred to page no. 12 of paper book which is balance sheet of the assessee company as on 31st March, 2014 as per which the total interest free fund with the assessee was to the amount of Rs. 44 crores as against total investment was to the amount of Rs. 42 crores. He has also referred page no. 43 of paper book demonstrating that assessee has made investment out of its own fund. On the other hand, ld. departmental representative has supported the order of lower authorities. 5. We have heard the rival contention and perused the material on record carefully. With the assistance of ld. representatives, we have gone through the material ....