TaxTMI 
TaxTMI 
2022 (8) TMI 861
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....by Ld. Assessing Officer [AO] u/s. 143(3) of the Act on 31-12-2011. The grounds raised by the Revenue read as under: 1. The order of the learned CIT(A) is contrary to law and facts and circumstances of the case. 2.1 The ld. CIT(A) erred in directing the AO to re-compute the disallowance under Rule 8D after excluding the appellant's investment in subsidiary/associated companies which are strategic in nature though the assessee company has declared income on dividend of Rs.1,05,53,559/- from its sister concern/associated companies and claimed the same as exempted income. 2.2 The learned CIT(A) failed to appreciate that Rule 8D(2) does not differentiate between strategic investments and investments in subsidiary/....
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....ars and hence cannot be allowed. 3.3 The learned CIT(A) erred in accepting the assessee company plea that share value will be fixed for retail investors are more than the corporate investors and the decision of the Hon'ble Tribunal on similar issue was not accepted by the Department and appeal filed before the Hon'ble High Court is pending in the case of M/s. TVS Motors Limited for the AY 2010-11. 3.3 It is humbly submitted that the learned CIT(A) ought to have followed the ratio held by the Hon'ble Supreme Court in the case of M/s. Ashini Lease and Finance Vs. CIT(2008) reported in 217 CTR 17(SC), the Hon'ble Delhi High Court in the case of CIT Vs. Vachanband Investment Limited, reported in (2012) 208 Taxm....
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....ule 8D, computed disallowance u/s 14A for Rs.1033.90 Lacs. The assessee earned exempt income of Rs.105.53 Lacs from one of its subsidiary-company and offered disallowance of Rs.1.17 Lacs during assessment proceedings. The assessee submitted that the investment was made in the year 2002 and no expenditure was incurred to earn the exempt income. 4.2 The Ld. CIT(A), considering the decision of Tribunal for AY 2011-12, directed Ld. AO to exclude strategic investments. The Ld. AO was further directed to consider the availability of surplus funds and thereafter, apply Rule 8D. Aggrieved as aforesaid, the revenue is in further appeal before us. 4.3 We find that, in terms of decision of Hon'ble Apex Court in the case of Maxopp Investment Ltd.....
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....was falling short of capital adequacy norms, the assessee sold the shares which resulted into Long-Term Capital Losses. Comparing the same with the sale of shares by Ms. Mallika Srinivasan was not correct since she was public category shareholder holding a few hundred shares which was offered by her in the exit route provided in the public under the book building process associated with delisting of shares as per SEBI guidelines. Therefore, the average sale price of Rs.12.50 as received by the assessee could not be compares since one was through delisting process and another was arrangement of the promoters to recognize the 'Nil' value of shares held by them as promoters. The findings of Ld. AO that it was a colorable device, was assailed o....
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....y decided to reduce the capital base and offered to buy-back the shares as per extant rules @Rs.0.32 per share on the basis of independent valuation made by external valuer in accordance with the provisions of Companies Act and Buy Back Rules. Similar issue stood covered in assessee's favor by first appellate order for AY 2010-11 in case of TMCL (other promoter) which was upheld by Tribunal in ITA No.329/Mds/2016 order dated 11.08.2016. The Ld. CIT(A) also relied on the decision of Hon'ble High Court of Bombay in the case of Capgemini India P. Ltd. (CP No.4343 dated 28.04.2015) wherein it was held that buy-back of shares as per the Companies Act could not be termed as colorable device to evade taxes. It was legally permissible procedure. Ac....