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TMI Blog2014 (2) TMI 1062X X X X Extracts X X X X X X X X Extracts X X X X ..... JJ. For the Appellant : Sh Sameer Sharma, Sr DR For the Respondent : Sh K V S R Krishna, CA ORDER:- PER : Diva Singh These are three appeals filed by the Revenue against the consolidated order dated 28.02.2013 of CIT(A)-XXI, New Delhi pertaining to 2004-05, 2008-09 and 2009-10 assessment year on identical grounds for each of these years. For ready-reference, we reproduce the departmental ground from ITA No-2834/Del/2013:- "(i) The Ld. CIT(A) erred in law and on the facts of the case in directing the AO to recalculate the disallowance u/s 14A of the I.T. Act. (ii) The appellant craves, leave or reserving the right to amend modify, alter, add or forego any ground(s) of appeal at any time before or during the hearing of the appeal." 2. The relevant facts of the case are as available on record for 2004-05 assessment years are that the assessee company who had declared its income as NIL in scrutiny assessment was subjected to a proportionate disallowance of Rs.11,28,050/- u/s 14A of the Income Tax Act, 1961 vide order dated 07.12.2006 by the AO u/s 143(3). Against this the assessee came in appeal before CIT(A) who deleted the disallowance made by the AO. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order passed by AO in pursuant to direction of the Hon'ble ITAT, wherein, Hon'ble ITAT has directed the AO to pass a speaking order. Taking into account all the facts of the case, the AO vide order dated 29.11.2011 has decided the issue, wherein, AO has applied the Rule 8D and has arrived at disallowance of Rs.7,76,363/-. It the computation chart it has been mentioned by AO that 14A disallowance as per earlier order is to the tune of Rs.11,28,050/-. However, as per instant order, it has been reduced to Rs.7,76,363/-. However, as per appellant, disallowance tomes to Rs.74,600/-. So, there is dispute in between the figures. In this regard AO has discussed in the body of assessment order that there are various expenses which are exclusively for other business activities, so, he has taken out the sum of Rs.75,98,432/- and has applied ratio of exact income to total income. Thus, he has arrived a figure of Rs.7,76,363/-.During the course of the appellate proceedings Ld. AR of the appellant attended and submitted that substantial portion of dividend income from one company, namely, TEXMACO Ltd. and the investment in TEXMACO was made in the year 1996-97. The dividend received from the sai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nvestments are made in the earlier years and that too in a Group Companies. There is hardly any time which is deputed by any of the executives of the company. So, appellant has disallowed 25% of remuneration voluntarily. It has been further argued that core business of the assessee is depository services, financial consultancy, share broking services and making investment earning dividend is only incidental to business activities. It has been further reiterated that total dividend income of Rs.1,15,88,060/- comes from one company, namely TAXMACO Ltd.. The negligible amount is received from another company. So, as per appellant's view further disallowance of $Rs.74,856/- should be made. In the light of finding of the Delhi High Court in the case of MAXOPP, AO is required to pin point the expenditure directly attributable to earning the dividend income. During the course of the appellate proceedings ld. AR of the appellant has also submitted his working of Rs.74,856-94. In my considered opinion, opportunity was given to AO to make comment the working of the appellant, but, he has decided to stick on his own working made during the course of assessment proceedings. So, after putting m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act. Reliance in support of the impugned order was placed upon the order of the ITAT in its own case wherein the relief granted by the CIT(A) was upheld by the ITAT by a consolidated order dated 22.01.2013 of ITA No-4824- 4826/Del/2012 for 2001-02, 2006-07 and 2007-08 assessment years. It was his submission that the said order on facts cannot be ignored by the Revenue. 5. We have heard the rival submissions and perused the material available on record. As far as the legal position is concerned there is no dispute on the fact that the power to set aside which earlier vested with the CIT(A) has been removed by the Finance Act, 2011 w.e.f 01.06.2001. For ready-reference the relevant provisions is extracted hereunder :- "251 (1)(a) in an appeal against an order of assessment, he may confirm, reduce, enhance or annul the assessee." 5.1. A perusal of the same shows that the CIT(A) as per the amended provision while deciding the appeal filed by the assessee may either confirm, reduce, enhance or annul the assessment. The power to set aside has been withdrawn by the Legislature. In the light of the afore-mentioned legal position, we are called upon to decide whether the CIT(A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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