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2021 (5) TMI 501 - ITAT MUMBAIDisallowance u/s.14A of the Act r.w.r. 8D(2)(iii) - HELD THAT:- As assessee had not made any physical investment in joint ventures and the figures represent in the investment schedule is nothing but the share of profit from joint ventures over all the years and hence, the entire computation mechanism provided in Rule 8D(2) of the Rules fails as the substance of the transaction would prevail over its form. Though the assessee had shown that the accumulated share of profits from joint ventures under the head ‘investment’, it is effectively a current account transaction or loans given to the joint ventures by the assessee and the same does not partake the character of actual investments, if any, made by the assessee in the joint venture. Hence, we hold that the entire computation mechanism of Rule 8D(2) of the Rules fails and hence, there could not be any disallowance u/s.14A of the Act that could be made in the facts and circumstances of the instant case. Levy of the dividend distribution tax on the dividend distributed / paid to Italian Thai Development Public Company Limited, Thailand - @15% in terms of Article 10 -Dividends of the Double Taxation Avoidance Agreement (DTAA) between India and Thailand instead of 16.995% levied in terms of section 115-O of the Act - HELD THAT:- The assessee pleaded before us that as per Article 10 of the Double Taxation Avoidance Agreement (DTAA) between India and Thailand, the rate of dividend distribution tax to be applied is 15%. Accordingly, the ld. AR pleaded that the excess dividend distribution tax paid by the assessee 1.995% (16.995% – 15%) may kindly be directed to be refunded to the assessee. As this aspect is purely a legal issue going to the root of the matter and does not involve verification of any facts, we are inclined to admit this additional ground and take up the same for adjudication in the light of the decision of NTPC Ltd. [1996 (12) TMI 7 - SUPREME COURT] We deem it fit to set aside this additional ground to the file of the ld. AO to examine the same in the light of judgment of the Hon’ble Supreme Court in the case of M/s. Tata Tea Company Ltd.[2017 (9) TMI 1300 - SUPREME COURT] and Godrej and Boyce Manufacturing Company Ltd.[2010 (8) TMI 77 - BOMBAY HIGH COURT] - The assessee is at liberty to furnish fresh evidences, if any in support of its contentions. Accordingly, the additional ground raised by the assessee is allowed for statistical purposes.
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