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TMI Blog2021 (8) TMI 770X X X X Extracts X X X X X X X X Extracts X X X X ..... essee company therefore the ld. CIT(A)'s order was misdelivered/ misplaced. The assessee has stated that except assessment year 2013-14 in all the subsequent assessment years appeal was filed in time. After considering the facts reported by the assessee, it appears, there is reasonable cause for delay in filing the instant appeal by 105 days because of non-receiving of the order of the ld. CIT(A) by the authorized person of the assessee. In the light of the above fact and decision of the Hon'ble Supreme Court in the case of Collector Land Acquisition Vs. MST Katgirors Civil Appeal No. 460 of 1987 holding that "sufficient cause" for the purpose of condonation should be interpreted with a view to do even-handed justice on merit in preference to approach which scuttles a decision on merits, we condone the delay in filing this appeal. ITA No. 1528/Ahd/2017 for A.Y. 2013-14 3. The fact of the case is that assessee filed return of income on 29th Nov, 2013 declaring total income at Rs. 12,28,38,184/-. The case was subject to scrutiny assessment and notice u/s. 143(2) of the Act was issued on 4th Sep, 2014. The assessment u/s. 143(3) of the Act was finalized on 30th December, 2015. Furth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed for making investment on which exempt income was earned. The assessee also furnished tax audit report and relevant annexure of account indicating that investment was made in tax free bonds and mutual fund in earlier years and claimed that because of nature of investment it had correctly computed the amount of disallowance of administrative expenditure. With the assistance of ld. representatives, we have gone though the decision of Co-ordinate Bench of the ITAT Ahmedabad in the case of the assessee for assessment year 2010-11 vide 2334/Ahd/2015 dated 30th Jan, 2019 vide which the disallowance u/s. 14A on account of administrative expenditure was restricted to Rs. 7 lacs after considering the nature of investment made in the form of bonds and securities. The relevant part of the decision of the ITAT is reproduced as under:- "27. We have heard the rival contention and perused the material on record carefully. It is noticed that assessee was having sufficient interest free fund as against the investment made on which exempt income was earned. We have gone through working of disallowance made u/s. 14A r.w. Rule 8D of the I.T. Rule and it is noticed that major part of the disallowa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the assessment order is reproduced as under:- "In A.Y. 2012-13 amount of Rs. 5,69,414/- was treated as allocable and accordingly disallowance of deduction u/s. 80IC of this amount was made. During the year there is net allocable bank interest is Rs. 6,24,072/- and bank charges is Rs. 3,13,703/- aggregating Rs. 9,37,775/- and the allocable amount on the basis of ratio of 58,67% it will come to Rs. 5,50,193/- ". Accordingly, on the basis of allocation of rate of 58.69%, the Assessing Officer has computed an amount of Rs. 27,89,536/- being 58.69% of the financial expenses to 80IC unit. The same was reduced from the deduction claimed by the assessee u/s. 80IC 9. Aggrieved assessee has filed appeal before the ld. CIT(A). The ld. CIT(A) has dismissed the appeal of the assessee holding that during the course of appellate proceedings the assessee had not pressed the similar ground of appeal in assessment year 2012-13. 10. Heard both the sides and perused the material on record. During the course appellate proceedings the ld. counsel has neither disproved the findings of the lower authorities nor brought any material on record in contrary to the finding of the lower authority. Ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowed. ITA No. 2870/Ahd/2017 A.Y. 2014-15 Ground No. 1 (a) (Disallowance u/s. 14A of Rs. 43,49,310/-) 15. During the course of assessment, the Assessing Officer noticed that assessee claimed exempt income of Rs. 2,87,28,799/- including dividend income of Rs. 26,63,671/- in the computation of income. The assessee has disallowed a sum of Rs. 12,55,562/- u/s. 14A. The assessee explained that disallowance u/s. 14A was made of Rs. 12,55,562/- in view of interest bearing fund/surplus fund available no further disallowance to be made in the case of the assessee. The Assessing Officer has not agreed with the submission of the assessee and stated that no reason has been furnished for non-allocation of common management expenses. The Assessing Officer has computed the amount of disallowance in accordance in the provision of section 14A(2) r.w.r. 8D to the amount of Rs. 56,04,872/- after reducing the suo moto disallowance made by the assessee of Rs. 12,55,562/- further disallowance of Rs. 43,49,310 was made u/s. 14A of the act and added to the total income of the assessee. 16. The assessee has filed appeal before the ld. CIT(A). The ld. CIT(A) after referring the decision of his predec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and added to the total income of the assessee. 20. The ld. CIT(A) has sustained the disallowance following the decision of Jurisdictional Hon'ble High Court of Gujarat in the case of CIT vs. Gujarat State Road Transport Corporation (2014) 41 taxman.com 100 (Gujarat) 21. Without reiterating the similar submission of the assessee as mentioned at para 11 of this order while adjudicating the ground of appeal no. 3 of the assessee vide ITA No. 1528/Ahd/2017 for assessment year 2013-14, this ground of appeal of the assessee stands dismissed after applying the finding given at para 13 of this order pertaining to the above referred similar issue and identical facts in the case of the assessee. Therefore, this ground of appeal of the assessee is dismissed. Ground No. 3 (interest u/s. 234A of Rs. 98, 316) 22. This ground of appeal stands dismissed as levying of interest u/s. 234A is mandatory as prescribed in the law. ITA No. 1788/Ahd/2017 A.Y. 2015-16 Ground No. 1 (Disallowance u/s. 14A of Rs. 30,13,733/-) 23. During the course of assessment, the Assessing Officer noticed that assessee has claimed exempt income from dividend, tax free bond etc. On query, regarding disallowance u/s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee in respect of such expenditure therefore applying the findings of ground of no. 1(d) vide ITA 1528/Ahd/2017 as per para 7 of this order, we are of the view that it would be appropriate to restrict the disallowance on account of administrative expenditure incurred towards earning exempt income to the extent of Rs. 12 lacs as against similar disallowance of Rs. 32,14,661/-made by the Assessing Officer. The Assessing Officer is directed to allow deduction of suo-moto disallowance already made by the assessee. Therefore, this ground of appeal of the assessee is partly allowed. Ground No. 3 (Disallowance u/s. 36(1)(va) of Rs. 292,657/- 27. During the course of assessment, the Assessing Officer noticed that assessee has not deposited the employee's contribution to ESIC in the employee's account in the relevant fund on or before the due date. The detail of such amount was computed by the Assessing Officer at page no. 13 of the assessment order at Rs. 2,92,658/-. In view of the specific provision of section 36(1)(va) r.w.r. 2(24)(v) of the act the deduction for the employees contribution is allowable only if such sum is credited by the assessee to the employees account in the rel ..... X X X X Extracts X X X X X X X X Extracts X X X X
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