TaxTMI 
TaxTMI 
2019 (11) TMI 1548
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.... in the memorandum of appeal however, there are only two effective issues in all the grounds of appeal. The first issue raised by the Revenue is against the order of the ld.CIT(A) deleting the disallowance made by the AO u/s.36(1)(iii) of the Act by relying on the decision of the Hon'ble Mumbai High Court in the case of Reliance Utilities and Power Ltd without appreciating the facts that the facts of the assessee's case were distinguishable. 3. The facts in brief are that certain entities were amalgamated with the assessee with the appointed date as on 01.10.2013. The approval was granted by Hon'ble High Court on 31.10.2014. In the meantime, the individual entities had prepared the respective standalone financial statements and f....
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....ue after taking into consideration of submissions and contentions as raised during the course of appellate proceedings by observing and holding as under:- "4.2 I have examined the submission made by the appellant and the reasons recorded by the AO. I am in agreement with the submission of the appellant that the AO should have examined the standalone accounts of the merged entities before drawing any adverse inference. If we examine the standalone accounts we find that capital work in progress of MCIE is Rs. 11,79,64,135 and own funds of this entity in form of share capital and reserve are Rs. 931,51,30,000. Similarly, capital work in progress of MCL is Rs. 91,95,418 and own funds of this entity in form of share capital and reserves....
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....ailable on record, we observe that the assessee has sufficient funds in the form of share capital and reserves. Ld.CIT(A) noted that in the case of MCIE , CWIP was Rs. 11,79,64,135 and own funds of this entity in form of share capital and reserves were Rs. 931,51,30,000. In MCL, CWIP was Rs. 91,95,418 and own funds of this entity in form of share capital and reserves were Rs. 15,42,05,700. Similarly, CWIP in MHIL was Rs. 1,20,36,692 and own funds of this entity in form of share capital and reserves were Rs. 154,20,10,000. We find that clear cut findings have been recorded by the ld.CIT(A) and came to a conclusion that no interest disallowance can be made as the funds used for work in progress has been paid out of own sources . Ld.CIT(A) whi....
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.... under Rule 8D(2)(ii) and Rs. 581.97 under Rule 8D(2)(iii). 8. In the appellate proceedings, ld.CIT(A) allowed the appeal of assessee by holding that no disallowance u/s.14A of the Act was called for by observing and holding as under:- "7.2 I have conidered the submission made by the appellant and the reasons recorded by the AO. I am in agreement with the submission of the appellant that no disallowance u/s.14A was called for in respect of investment of Rs. 25,500 in the shares of The Saraswat Co-op. Bank Ltd., investment of Rs. 14,56,81,52,195 in the shares of Foreign Companies because income from these shares is not exempt as per the provisions of the Act. Similarly, no disallowance is called for in respect of investment in th....
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....ly two entities MCIE and MUSCO, both of which have sufficient interest-free loan funds, as mentioned in the preceding paras, to make investment of Rs. 39,08,34,000 amd 7,00,00,000 respectively. In view of these facts, I am in agreement with the contention of the appellant that no disallowance was called for under Rule 8D(ii) because it had sufficient interest-free own funds in form of capital and reserved. As per the submission of the appellant, disallowance under Rule 8D(2)(iii) in respect of this investment works out to Rs. 25,43,361. The AO is directed to verify the computation made by the appellant and restrict the disallowance to this amount, if the computation made by the appellant is found to be correct. This ground of appea....