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TMI Blog2021 (4) TMI 371X X X X Extracts X X X X X X X X Extracts X X X X ..... has erred in directing to exclude investment which was not yielded exempt income without appreciating the fact that no such exclusion is provided under Rule 8D(2)(ii) & 8D(2) (iii) of the Act and that the intention of making investment is immaterial to applicability of sec. 14A of the Act." 3. The Brief facts of the case are that, the assessee company is engaged in the business of providing facilities for storage and Terminal ling of bulk liquid chemicals, petrochemicals, and liquefied gas and oil. The assessee has filed the return of income for the AY 2014-15 on 28.11.2015 disclosing the total income of Rs. 1,10,82,03,630/-. Subsequently, the case was selected for scrutiny and notice u/s 143 (2) and 142 (1) of the Act along with question ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... own case for the earlier assessment year on similar and identical issues and prayed for dismissal of the revenue appeal. 6. We have heard the rival submissions and perused the material on record. The sole matrix of the disputed issue is with respect to disallowance made u/s 14A r.w.r. 8D (2) (ii) and 8D(2) (iii). The Ld.DR submitted that the Ld.CIT (A) has erred in directing the A.O. to exclude the investments which are not yielding any exempt income for calculation of Average Value Of Investments. Whereas the Ld.AR substantiated his arguments on facts and relied on the earlier years assessee's own case. The Ld.AR emphasized that in assessee's own case the Hon'ble Tribunal in ITA No. 1945/Mum/2016 for the AY 2011-12 in revenue's appeal ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... minution in value of current investments - Profit on sale of long term investments(non-trade) - Profit on sale of current investments (non-trade) Rs. 41.69 Lease Rent Rs. 81.36 Interest on investments (long term, non-trade) Rs. 8.09 Miscellaneous receipts Rs. 85.43 From the above break-up of other income of the appellant it is understood that the appellant company received Rs. 118.17 lacs as dividend income from non-trade investments. Accordingly, the AO is directed to re-work section 14A disallowances with regard to administrative expenditure limited to Rs. 118.17 lacs. Accordingly, this ground of appeal is partly allowed." 7. On appraisal of the above mentioned finding, we noticed that the CIT(A) ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... find that in AY 2011-12, the appellant had suo moto made a disallowance of Rs. 172,085/- and had not made any disallowance on its own u/sl4A in respect of interest expenditure whereas in AY 2015-16, the appellant has suo moto disallowed Rs. 14,32,930/under Rule 8D2(ii) in respect of interest expenditure. Disallowance under Rule 8D2(ii) in AY 2015-16 has been computed with reference to interest expenditure, which was not directly attributable to earning of any particular income or receipt at Rs. 858,26,147/-, after excluding the interest expenditure which was directly attributable to earning of any particular income like, interest on ear loan, interest on LC import and interest on Axis Loan used for business projects. Therefore the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hi in the case of Cheminvest Ltd. (supra) This amount was shown by the appellant in its computation of income at Rs. 597,92,55,500/- and this does not include the investment in 6% cumulative redeemable preference shares of Sea Lord Containers Ltd. of Rs. 1200 lacs as on 31.03.2014, which has yielded exempt income of Rs. 166.59 lacs during the year. The appellant's submission that the said investment was disposed off during the income resulting in capital gains is found to be without merit as the said investment has yielded exempt dividend income and should have been considered for computing the average value of investment as on 31.03.2014. The average investment has been re-computed by the appellant at Rs. 15,98,28,000/-, which inclu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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