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TMI Blog2021 (5) TMI 380X X X X Extracts X X X X X X X X Extracts X X X X ..... stainable on the touchstone of ITAT Special Bench decision in the case of Vireet Investment (P.) Ltd. [ 2017 (6) TMI 1124 - ITAT DELHI] - I.T.A. No. 3822/Mum/2018, I.T.A. No. 6654/Mum/2017, I.T.A. No. 6193/Mum/2016 - - - Dated:- 8-4-2021 - Shri Shamim Yahya (AM) And Shri Pavankumar Gadale (JM) For the Assessee : Shri Yogesh Thar For the Department : Shri Brajendra Kumar ORDER PER SHAMIM YAHYA (AM) :- These are appeals by the assessee for A.Y. 2012-13 and Revenue s appeal for A.Y. 2013-14 2014-15. 2. ITA No. 6193/mum/2016 Assessee s appeal for A.Y. 2012-13 :- The grounds of appeal read as under :- GROUND NO. I: DISALLOWANCE U/S 14A OF THE ACT: ₹ 91,55,480/- 1. On the facts and the circumstances of the case and in law, the Hon'ble CIT(A) erred in upholding the action of the Ld. AO in disallowing a sum of ₹ 91,55,480/- u/s 14A of the Act being the disallowance computed as per Rule 8D of the Income Tax Rules, 1962 ( the Rules ). 2. The Appellant prays that the AO be directed to delete the disallowance u/s 14A of the Act amounting to ₹ 91,55,480/- or the disallowance be appropriately reduced. 3. Without prejudi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd circumstances of the case and in law, the Ld. CIT(A) erred in deleting the disallowance u/s 14A r.w.r. 8D(2)(ii) considering that the assessee made investment from its own funds and interest expenses are not attributable to earn exempt income, when the assessee has invested total fund at ₹ 101 crores as against its borrowed fund of ₹ 86 crores. 2. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in restricting the disallowance to ₹ 2,15,738/-holding that the disallowance cannot be more than the actual expenses debited in the P L account. 3. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred not considering the decision of the Supreme Court in Maxopp Investment Ltd. vs. CIT [TS-5170-SC-2018-0] and in the case of Avon Cycles Ltd. vs. CIT [TS-6251-HC-2014(P H-0)] wherein apportionment principle was upheld in the case of mixed funding of investment. 4. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in deleting the disallowance u/s 14A made for the purpose of computing book profit u/s 115JB of the Act relying on the ITAT special bench, Delhi in the case of Pr. CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .T.Act, 1961. On the contrary, in Para 3.1, the Ld. Assessing Officer has rightly mentioned that assessee has shown investment of ₹ 53,90,42,813/-, however, it has not shown expenditure hence, the Appellant was asked as to why expenditure should not be disallowed by applying Rule 8D of the Income-tax Rule, 1962. Thus, there is a recording of reason that the Assessee has not shown any expenditure, therefore, the various case laws referred to and relied upon by the Ld. A.R. in written submission are not at all applicable to the facts of the case. There is no need to discuss each every case when facts are visible from assessment order itself. Further contention that the investment of ₹ 52,72,20,197/- is strategic investment, same to be excluded while working disallowable expenditure under Rule 8D of the Income-tax Rule, 1962, it is pertinent to mention that when the Appellant claims that it is Non-Banking Financial Company and is engaged in the business of lending borrowing money and making investments. Such investments are not at all strategic investment. It is very evident that in Profit Loss A/c., the Appellant has shown revenue from operation of ₹ 3,17,55,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icer made further disallowance under section 14A of the Act amounting to ₹ 3,52,73,379/-. 14. Upon assessee's appeal learned CIT(A) adjudicated the same observing as under :- 5.4 I have carefully considered the facts of the case as well as oral contentions and written submission of the assessee. It is seen that the Hon'ble ITAT in appellant's own case in ITA N0.8461/M/2010 and 5598/M/2011 and ITA No.948/M/2011, 7215/M/2012 6013/M/2011 for A.Yrs. 2007-08 and 2008-09 in their combined order have decided the issue pertaining to disallowance u/s.14A in the case of the assessee. From para 18, page 6 to para 23, page 9 of the said order deals with the issue wherein after dealing with the facts and the related decisions, Hon'ble ITAT have directed to exclude the strategic investments made in group/associate companies for the purposes of computation of disallowance u/s.14A r.w.r.SD. Respectfully following such decision of the Hon'ble ITAT in the appellant's own case, the Assessing Officer is directed to exclude the strategic investments made in the group/associate companies for the purposes of computation of disallowance u/s.14A r.w.r.SD of the Income- ..... X X X X Extracts X X X X X X X X Extracts X X X X
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