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TMI Blog2015 (7) TMI 1202X X X X Extracts X X X X X X X X Extracts X X X X ..... ting in the equity share holding and management of the project companies. The First Appellate Authority has on the ground of consistency allowed the claim of the assessee. We find no infirmity in this order of the Ld.CIT(A). Hence we uphold the same and dismiss this ground of Revenue. Addition u/s 14A - Held that:- The assessee has shown turnover from execution of contracts. In our view this is not material as the investment in this case is made in the form of SPVs to undertake contracts and thus trade investment. Applying the propositions laid down in this case law to the facts of the case, we hold that no disallowance can be made u/s 14A of the Act. - I.T.A. No. 3456/Del/2013 - - - Dated:- 3-7-2015 - Diva Singh (Judicial Member ) An ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raised any specific query on the business being carried out by the appellant and had disallowed the expenses claimed as business expenses. The addl.evidence running into as many as 958 pages was referred to the AO for his version. The AO submitted his report as per a letter dt. 30.1.2013 in which he has not resisted the admission of addl. Evidence, it has however been submitted by him that without prejudice to the observation made in para 4 of the order u/s 143(3), even if the contention of the assessee is given credence that it is carrying activities that should be considered as business being business of holding of investments then the expenses debited under P L account have direct correlation with the dividend income from the investmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Referring to assessee s paper book page 40, he submitted that the cash flow does not indicate that the assessee has done any business. She distinguished the case laws cited by the assessee and prayed that the order of First Appellate Authority be upheld. 6. Dr.Rakesh Gupta, the Ld.Counsel for the assessee submitted that the Ld.CIT(A) has given a finding that the assessee is in the business of setting up of power projects and since there is a gestation period, mere non receipt of business income, cannot lead to a conclusion that business has not commenced. He filed computation of income, audited balance sheets, assessment orders for the A.Y. 2007-08, 2008-09, 2009-10 and 2010-11 and submitted that in the earlier A.Y. 2008-09 and in subs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case of CIT vs. Oriental Structure Engineers P.Ltd. in ITA 605/2012 judgement dt. 15.1.2013. 7. Rival contentions heard. On a careful consideration of the facts and circumstances of the case, on perusal of material on record, orders of the authorities below, case laws cited, we hold as follows. 8. The A.O. in this case had not raised any specific query during the course of assessment proceedings on the aspect as to whether the assessee has set up business and whether the business is being carried out by the assessee. He simply disallowed the expenditure claimed on the presumption that the assessee has not commenced business. Before the First Appellate Authority the assessee filed additional evidences. The A.O. did not object to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Oriental Structural Engineers P.Ltd. in ITA 605/2012 dt. 15.1.2013 (supra) has held as follows. It was the contention of the revenue that Rule 8D of the I.T. Rules, 1962 had not been applied properly in respect of the A.Y. 2008-09. This aspect has been considered by the Tribunal in detail and it has observed as under: 6.3. We have carefully considered the submissions and perused the records. We find that Ld.CIT(A) has given a finding that only interest of ₹ 2,96,731/- was paid on funds utilised for making investments on which exempted income was receivable. Further Ld.CIT(A) has observed that in respect of investment of ₹ 6,07,775,000/- made in subsidiary companies as per documents produced before him, they are attr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the only dispute is with regard to facts which have been settled by the Tribunal. The appeal is dismissed. 10.1. The Ld.D.R. tried to distinguish the case by submitting that in the case of Oriental Structural Engineers P.Ltd. (supra) in the P L account the assessee has shown turnover from execution of contracts. In our view this is not material as the investment in this case is made in the form of SPVs to undertake contracts and thus trade investment. 11. Applying the propositions laid down in this case law to the facts of the case, we hold that no disallowance can be made u/s 14A of the Act. 12. In the result, Revenue s appeal is dismissed. Order pronounced in the Open Court on 03rd July, 2015. - - TaxTMI - TMITax - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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