TaxTMI 
TaxTMI 
2021 (9) TMI 1076
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.... appeals were heard together and are being disposed of by this common order. 2. Brief facts leading to the grounds raised by the assessee are that as per the balance sheet of the assessee as on 31.03.2013 and 31.03.2013, the Assessing Officer found that the assessee has invested in equity shares and mutual funds and the amount of investment as on 31.03.2012 and 31.03.2013 amounted to Rs. 30,11,36,563/- and Rs. 28,63,06,563/- respectively. The assessee earned dividend income at Rs. 7,51,15,949/- during the year under consideration and claimed the same as exempted under section 10(34) of the Act. Since, the assessee has not admitted any expenditure to earn the dividend income, after considering the submissions of the assessee and by invoking....
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....oks filed by the assessee. Against the investments in equity shares and mutual funds for the year ending 31.03.2012 and 31.03.2013 of Rs. 30,11,36,563/- & Rs. 28,63,06,563/- respectively, the assessee earned dividend income at Rs. 7,51,15,949/- during the year under consideration and claimed the same as exempted under section 10(34) of the Act. However, the assessee has not admitted any expenditure for earning the exempt income. Accordingly, by invoking the provisions of section 14A r.w. Rule 8D, the Assessing Officer determined the expenditure attributable for earning such exempt income by applying Rule 8D(2)(ii) at Rs. 77,02,566/- and Rule 8D(2)(iii) at Rs. 14,68,608/- totalling to Rs. 91,71,174/- and brought to tax. Before the ld. CIT(A)....
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.... for the assessment year 2013-14. 6. As far as issue of disallowance under section 14A of the Act vis-à-vis computation of book profits under section 115JB of the Act is concerned, the issue is now settled by the decision of Special Bench of Delhi Tribunal in the case of ACIT v. Vireet Investment Private Limited reported in (2017) 165 ITD 27(Delh-trib.)(SB) is relevant, wherein, it is held at para 6.22 that computation under clause (f) of Explanation 1 to Section 115JB(2) is to be made without resorting to the computation as contemplated under section 14A read with Rule 8D of the 1962 Rules. It further held that the disallowance of actual expenditure incurred for earning exempt income is required to be made under clause (f) of secti....
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....lowed Rs. 20,31,919/- as expenditure for earning the dividend income. Before us, by raising specific ground, the ld. Counsel for the assessee has vehemently argued that without recording appropriate satisfaction on the quantification of the disallowance voluntarily by the assessee, the Assessing Officer was not justified in making disallowance of Rs. 88,21,550/-. We find force in the arguments of the ld. Counsel. In this case, we find that the assessee has voluntarily disallowed Rs. 20,31,919/- as expenditure for earning the dividend income and the Assessing Officer has not recorded any satisfaction. Thus, in view of the decision in the case of Maxopp Investment Ltd. v. CIT [2018] 402 ITR 640, wherein, the Hon'ble Supreme Court has held....
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....l of the books of accounts of the assessee, the Assessing Officer has observed that the assessee has claimed a sum of Rs. 15,64,589/- towards membership and subscription charges. From the details produced by the AR of the assessee, the Assessing Officer noticed that the assessee company has paid the above amount towards membership and subscription fee for Managing Director's son's Tennis academy, which is personnel in nature and is not connected to the business of the assessee. Accordingly, the above claim of expenditure was disallowed under section 37 of the Act and brought to tax. On appeal, the ld. CIT(A) confirmed the addition. 8.1. We have considered the rival submissions, perused the materials available on record and gone thr....