AI Drafter 
TaxTMI 
TaxTMI 
2019 (5) TMI 1888
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.... & 2014-15, all passed U/s. 250(6) r.w.s. 143(3) of the Act. 2. The Revenue has raised four identical grounds in its appeals however the cruxes of the issues are that (i) The Ld.CIT(A) has erred in deleting the addition made by the Ld.AO amounting to Rs. 4,47,37,892/-, Rs. 4,22,13,104/- and Rs. 3,18,67,156/- for the assessment years 2012-13, 2013-14 & 2014-15 respectively towards disallowance U/s.14A r.w.r. 8D of the Rules. (ii) The Ld.CIT(A) has erred in deleting the addition made by the Ld.AO amounting to Rs. 26,25,530/-, Rs. 24,08,632/- & Rs. 43,02,591/- for the assessment years 2012-13, 2013-14 & 2014-15 respectively towards disallowance U/s.36(1)(ii) of the Act being the commission paid to the Managing Director of ....
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....3-14 & 2014-15 respectively. 4.1 Before the Ld.CIT(A), the Ld.AR had made the following submissions:- (i) The assessee had computed the expenditure incurred for earning exempt income as Rs. 53,950/-, Rs. 1,08,805/- & Rs. 8,23,331/- for the assessment years 2012-13, 2013-14 & 2014-15 respectively and offered the same for disallowance. (ii) However the Ld.AO has simply rejected the computation made by the assessee without examining the actual expenditure incurred by the assessee for earning exempt income and worked out the disallowance at Rs. 4,47,37,892/-, Rs. 4,22,13,104/- & Rs. 3,18,67,156/- for the assessment years 2012-13, 2013-14 & 2014-15 respectively by invoking Rule 8D of the Rules. (iii) The entire inve....
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....riate or cannot be relied upon. Therefore it is mandatory for the Assessing Officer to record such satisfaction as to why the computation made by the assessee is to be rejected. In the case of the assessee, it is apparent that the Ld.AO had not even ventured to examine the computation made by the assessee with respect to the expenditure incurred by the assessee for earning exempt income for all the relevant assessment years. Therefore following the decision of the Hon'ble Delhi High Court, the Ld.CIT(A) has held the issue in favour of the assessee for the assessment year 2012-13 by observing as under:- "6. I have gone through the assessment order, grounds of appeal, written submissions and case laws relied on by the appellant and t....
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....provisions made a disallowance for both the years. Contesting the disallowance, the appellant submitted that it had earned a dividend of Rs. 2,65,815/- for AY 2013- 14 and Rs. 1,19,410/- for AY 2014-15. The appellant company had disallowed a sum of Rs. 1,08,805/- for AY 2013-14 and Rs. 8,23,331 for AY 2014-15. Ignoring the said disallowances made by the appellant, the AO proceeded to make the said disallowances. The AO while resorting to action u/s.14A rwr 8D has omitted to see that the appellant was in possession of its own funds to make investments and there being no borrowed funds was invested to earn exempted income. In the circumstances, the action of the AO is incorrect and the said disallowance for both the years is directed to be de....
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....ration to its Managing Director during the relevant assessment years 2012-13, 2013-14 & 2014-15 in the form of commission amounting to Rs. 26,25,530/-, Rs. 24,08,632/- & Rs. 43,02,591/- respectively. On query the assessee had made the following submissions before the Ld.AO:- (i) As per the terms & conditions of the appointment of Managing Director which is in accordance with the provisions of Section 309 of the Companies Act, 1956, one percent of the net profit is to be paid to the Managing Director as commission. (ii) The commission of 1% on net profit of the company could be determined only after the completion of the finalization of the accounts and audit of the assessee company's account whereby the net profit is final....
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....Revenue in the factual matrix of the present case. Ashok Gupta is the Managing Director and in terms of the Board resolution is entitled to receive commission for services rendered to the company. It is a term of employment on the basis of which he had rendered service. Accordingly, he was entitled to the said amount. Commission was treated as a part and parcel of salary and TDS has been deducted. Ashok Gupta was liable to pay tax on both the salary component and the commission. Payment of dividend is made in terms of the Companies Act, 1956. Dividend has to be paid to llshareholders equally. This position cannot be disputed by the Revenue. Dividend is a return on investment and not salary or part thereof. Herein the consideration in the fo....