TaxTMI 
TaxTMI 
2018 (5) TMI 1942
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....A) was correct in stating that the interest portion of Rs. 6,32,96,027/- be not considered in computing disallowance u/s 14A r.w. Rule 8D2(ii). Being the final fact finding authority, the Hon'ble ITAT may be requested to set aside the issue for fresh consideration to the filed of the AO. Whether on facts and in circumstances of the case and in law, the Ld. CIT(A) was correct in restricting the disallowance made u/s 14A of the Act r.w. Rule 8D of the Rules to the extent of dividend income from non-trade investment. The appellant craves leave to amend or alter any ground or add a new ground which may be necessary." 3. The brief facts of the case are that the assessee filed its return of income on 29.09.2011 decla....
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.... is necessary to consider the application for condonation of delay. The appeal has been filed 7 days delay which is not so long. The appeal is required to be decided on merits in the interest of justice, therefore, we condone the delay. Under this issue, the contention of the revenue is that the CIT(A) is not correct in no considering the interest portion of Rs. 6,32,96,027/- in computing to disallowance u/s 14A r.w. Rule 8D 2 (ii) of the Act. It is necessary to advert the finding of the CIT(A) on record: - 3.4, I have considered the AG's order as well as appellant's submission in this regard. The appellant has provided year wise details of the investment made and the statement of own funds. As appellant had sufficient fund....
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.... lacs) Investment as on 31.03.2010 (Rs. In lacs) Average Investment (Rs. In lacs) Investment in subsidiaries 6,764.85 1,956.98 4,360.92 Trade investments - 433.53 216.77 Non-trade investmets 40.03 0.03 20.03 Misc.Investment 3.24 - 1.62 Investment in Government Securities 0.48 0.48 0.48 The appellants submission on the same are as under: Investment in subsidiary company 5.3 It is submitted that no dividend has been received by the appellant from any of its subsidiary company during the aforesaid assessment year. As no exempt income is earned therefrom, the same cannot be considered for the purpose of computing the disallowance u/s 14A of the Act. ....
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.... Mumbai Tribunal its the case of Avshesh Mercantile Mercantile Pvt. Ltd. (HA No. 5779/Mum/2006) (refer pages 371 to 59. Further, your Honour wilt kindly appreciate that investment in subsidiaries have not been made with a view is earn dividends, but with a view to have controlling Make in these Companies. Accordingly, these investments am in the nature of strategic investments 60 Reliance in this connection is placed on the following decision: a. Decision of the Delhi high Court in the case of CIT v. Oriental Securities Engineers (P) Ltd 35 taxmann com 210) (Refer pages 338 to 339) b. Decision of the Mumbai ITAT in the case of Garware Wail Ropes Ltd v. ACIT (65 SOT 86) (Refer pages 340 to 344) c.....
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....from non-trade investment. The Ld. Representative of the revenue has argued that the investment is liable to be considered for the purpose of disallowance u/s 14A of the Act r.w. Rule 8D of the Act. On the other hand, the Ld. Representative of the assessee has refuted the said contention and argued that the Ld. CIT(A) has rightly restricted the disallowance to the extent of dividend income from non-trade investment. It is also argued that the case of the assessee has duly been covered by the decision of the Special Bench title as ACIT, Circle 17(1) New Delhi Vs. Vireet Investment P. Ltd. (2017) 82 taxmann.com 415 (Delhi Trib.) Before going further we deemed it necessary to advert the finding of the CIT(A) on record: - "3.5 I have c....