9911796707
TMI Blog2017 (1) TMI 1202X X X X Extracts X X X X X X X X Extracts X X X X ..... of disallowance has to be modified, accordingly. - Decided against assessee Disallowance under section 14A read with Rule 8D - Held that:- Perusal of the order of assessment shows that the AO, except for stating that assessee’s explanation is not acceptable for the reason proper values have not been taken, has not spelt out what examination of accounts of the assessee have been made by him and in respect of which portion/items of values in the assessee’s accounts he is not satisfied with. Nothing to this effect, as required under section 14A(2) & (3) of the Act, has been brought out by the AO in the order of assessment and in our considered view, the disallowance has been computed mechanically and without any application of mind of the legal position in this regard. In this factual and legal matrix of the case, we set aside the orders of the AO making the disallowance under section 14A read with Rule 8D at ₹ 53,81,133/- and restore this matter to the file of the AO for fresh consideration and adjudication in the manner prescribed under section 14A of the Act read with Rule 8 by way of a speaking order after affording the assessee adequate opportunity of being heard and to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rounds of appeal at the time of or before the hearing of appeal. 4. This case was fixed for hearing on a couple of occasions, but none was present for the assessee nor was any letter filed for adjournment of hearing. Even notice for hearing issued by RPAD did not elicit any response from the assessee. When the case was called for hearing on 20.12.2016, none was present for the assessee, but the learned D.R. for Revenue was present and ready to present Revenue s side of the case. In the circumstances, as mentioned above, we are of the opinion that the assessee is not interested in pursuing its appeal seriously and therefore proceed to decide this appeal with the assistance of the learned D.R. for Revenue and the material on record. 5. Ground No. 1 Foreign Exchange Loss 5.1 In this ground (supra), the assessee assails the impugned order of the learned CIT(A) as erroneous in upholding the Assessing Officer s (AO) action in reducing foreign exchange loss claimed by the company to the extent of ₹ 85,99,187/- on outstanding foreign sundry credits. 5.2 The learned D.R. supported the finding rendered by the learned CIT(A) on this issue. It is submitted that in the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere is no justification whatsoever with the appellant to apply different exchange rate without any substantiation. Ld. Assessing Officer has rightly adopted ₹ 50.64 or rate of exchange as on 31.3.2009 against the rate adopted by the appellant ranging from ₹ 48.53 to ₹ 59.29. Obviously, there is no justification whatsoever with the appellant to adopt different rate or exchange for the valuation of sundry credit as on 31.3.2009. Therefore, so far as rate of exchange is concerned the finding of the Assessing Officer is sustained. As regards, contention of the appellant that there was clerical error from its side as the value of imports of M/s. Lamco Trading Company was taken at ₹ 4,76,07,249/- as against the actual value of ₹ 4,08,91,028/- whereas this import value of ₹ 4,76,07,249/- was of M/s. H. K. Impex, there is some confusion. Ld. Assessing Officer has not commented on this aspect, though appellant by letter dated 18.04.2012 had represented this fact. It is however, pertinent to mention that if there is import of goods / diamond and if there is wrong entry of import value in respect of credit as on 31.3.2009, it is not understood as to h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , we dismiss ground No. 1 raised by the assessee. 6. Ground No. 2 Disallowance under section 14A r.w. Rule 8D 6.1 In this ground, the assessee assails the finding of the learned CIT(A) in the impugned order upholding the disallowance made by the AO under section 14A read with Rule 8D. 6.2 The learned D.R. for Revenue supported the impugned order of the learned CIT(A) in upholding the disallowance under section 14A read with Rule 8D. 6.3.1 We have heard the learned D.R. for Revenue and perused and carefully considered the material on record. From the details on record it is seen that the AO noticed that the assessee had earned dividend income of ₹ 21,700/- which was exempt under section 10(34) of the Act and that no disallowance of expense incurred for earning such income was disallowed suo moto by the assessee. We find that after observing these facts, the AO sought the explanation of the assessee in the matter and brushed aside the same as not acceptable for the stated reasons that the assessee has not taken proper values of respective part of Rule 8D. In our view, from a perusal of material on record he then proceeded to summarily compute the disallowance un ..... X X X X Extracts X X X X X X X X Extracts X X X X
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