TaxTMI 
TaxTMI 
2021 (8) TMI 627
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....at the case of the Assessee was selected for scrutiny under CASS, have not been disputed by the ld. AO as well the CIT(A); 2. The ld. CIT(A) erred in holding that even under CASS the AO selects the case after keying in the criteria, particularly without any supporting evidence; 3. The ld. CIT(A) erred in holding that even under CASS the independence of the AO to select case for scrutiny remains; 4. The ld. CIT(A) erred in holding that he is not in agreement with the contentions of the Assessee and dismissing the ground. Disallowance of Corporate Social Responsibility expenses 5. The ld. CIT(A) erred in upholding the disallowance of Corporate Social Responsibility expenses of Rs. 1,65,84,000 out of total expenses of Rs. 2,20,84,000; and without prejudice and alternatively, the ld. CIT(A) having held major expenditure to be capital expenditure, ought to have allowed depreciation thereon. Interest u/s. 244A 6. Interest under section 244A has not been allowed particularly on refund of tax paid under section 140A of the Act. " 3. The ld. AO has raised following grounds of appeal: I.T.A. No. 4165/Del/2017 - (By th....
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....ollowing three disallowances were made: a. Disallowance under Section 14A of the Act of Rs. 72,72,713/-; b. Disallowance of Rs. 1,92,30,000/- on account of non-deduction of tax on bank guarantee charges paid to various banks; c. Disallowance of CSR expenditure of Rs. 2,20,84,000/-. 6. Assessee preferred an appeal before the ld. CIT (Appeals). The ld. CIT (Appeals) after considering the remand report filed by the ld. Assessing Officer deleted the disallowance under Section 14A of the Act. The disallowance of the bank guarantees commission paid by the assessee to the various banks on which no tax deduction at source has been made. The ld. CIT (Appeals) deleted the same holding that the Notification issued on 31st December, 2012 is for reduction in hardship and compliance and, therefore, as bank guarantee charges are paid to the banks, no tax was required to be deducted, he deleted the addition. With respect to the CSR expenditure of Rs. 2,20,84,000/- he held that Explanation (2) of Section 37(1) of the Act providing for non-deduction of CSR expenditure is applicable from assessment year 2015-16 and the present assessment year is 2012-13 and, therefore, t....
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....t also cannot be said to be an expenditure for business purposes. The claim of the assessee is that this expenditure were incurred to maintain good relationship with the Govt. and to get the new business and on the school sign-board of the assessee is shown. All these expenditure should have been allowed to the assessee. 11. The ld. AR submitted that these expenditure should have been allowed to the assessee as deduction. He submitted a written note. The ld. CIT (Appeals) vehemently supported the order of the ld. CIT (Appeals). 12. We have carefully considered the rival contentions and perused the orders of the ld. CIT (Appeals). The assessee has incurred CSR expenditure amounting to Rs. 1,42,29,282/- for construction of training institute for workers at NBCC Complex, Ghitorni, New Delhi. Assessee has submitted that this expenditure should have been allowed to the assessee as deduction. We find that this expenditure have been incurred by the assessee under the head of CSR expenditure. Assessee has paid premium of land for this facility. The building is constructed of prefabricated steel structure and cannot be held to be a temporary structure. Therefore, this expenditure cann....
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....ing securities is less than the amount of share capital and free reserve owned by the assessee. He submitted that total investment made by the assessee is Rs. 22,359/- lakhs whereas the total own funds are Rs. 79,549 lakhs. Thus, no disallowance of interest can be made under 8D(2)(i) and (ii). With respect to administrative expenditure under Section 8D(2)(iii), he submitted that the Assessing Officer has computed 0.5% of all investments of the assessee whether exempt income earned/received during the year or not. He submitted that assessee has worked out the average value of investment from which the exempt income are received and 0.5% of such disallowances thereon is worked out at Rs. 68,00,000/-, same is made in the computation of total income. He submitted that suo moto allowance is disallowance as envisaged under Rule 8D(2) (iii) only. He submitted that, therefore, the disallowance made by the ld. Assessing Officer is incorrect and the ld. CIT (Appeals) correctly deleted the disallowance. 18. We have carefully considered the rival contentions and perused the orders of the lower authorities. In the present case the assessee has earned an exempt income of Rs. 8.39 crores being....