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TMI Blog2022 (3) TMI 150X X X X Extracts X X X X X X X X Extracts X X X X ..... ions of 14A r.w.r 8D is not applicable. It is settled issue that if the assessee has not received dividend income, section 14A r.w.r.8D of the Act cannot be made applicable in the absence of exempt income. Therefore, we do not find any infirmity in the order passed by the Ld.CIT(A). Disallowance of expenditure which is preliminary and capital in nature - as per CIT-A AO is not justified in disallowing the expenditure - HELD THAT:- As assessee has submitted that majority of the expenses are for pre-bid studies of road projects and investment maintenance charges was already disallowed by the assessee in its computation of income. CIT(A) considered all these aspects and rightly allowed the ground raised by the assessee. We are of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A.Y.2012-13. The return was processed u/s 143(1) of the Act. Subsequently, the case was selected for scrutiny under CASS. In response to the notice issued u/s 143(2) and 142(1) of the Act, the representative of the assessee furnished the information and explained the case. The assessment was completed on 10.02.2014, 23.03.2015 and the total income was assessed at ₹ 10,50,90,857/- and ₹ 24,57,02,960/- for the A.Y.2011-12 and 2012- 13 respectively after making additions and disallowances. 3. On being aggrieved, the assessee preferred an appeal before the Ld.CIT(A) by raising six grounds along with one additional ground which is as follows : On the facts and in the circumstances of the case and in law, the disallowance und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the time of appeal hearing, it is prayed that these above additions made on relevant disallowances be restored. In the revenue s appeal, the main grievance of the revenue is that, the Ld.CIT(A) allowed the additional ground raised by the assessee, even though revised return of income was not filed. 5. Before us, the Ld.DR submitted that the Ld.CIT(A) wrongly admitted and allowed the additional ground raised by the assessee by simply following the decision of this Tribunal in assessee s own case in the A.Y.2013-14 and 2014-15 without considering the fact that the appellate authority has no power to consider the issue which was not raised before the AO. Therefore, he pleaded for setting aside the orders passed by the Ld.CIT(A) and c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... computation of both as per section 115JB of the Act. It was the further submission of the assessee that the amount ₹ 14,21,11,203/- is the interest on loans availed and the said amount was utilised for giving advances to subsidiaries / associates, hence the provisions of section 14A are not applicable. Further, a sum of ₹ 36,37,795/- was the loan processing fee in respect of these loans, hence this ground is also outside the scope of disallowance u/s 14A leaving only a sum of ₹ 5,52,505/- being the demat account maintenance charges. It was the further submission that the claim is legal in nature and the omission to raise this issue at the time of filing the return of income was due to inadvertence. It was the submission o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s 14A of any amount was not permissible. After considering the decisions cited by the assessee, the Ld.CIT(A) restricted the disallowance u/s 14A r.w.r 8D at ₹ 5,52,505/- though the assessee made disallowance of ₹ 14,63,01,503/- u/s 14A, considering the fact that the assessee has not received any exempt income. Accordingly, the Ld.CIT(A) admitted the additional ground raised by the assessee, even though the revised return of income was not filed. 9. After considering the submissions of Ld.AR and Ld.DR and also the material available on record, in the present case, the assessee has made disallowance of ₹ 14,63,01,503/- u/s 14A r.r.8D even though the assessee has not received any exempt income. We are of the view that i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 545/- which is preliminary and capital in nature. As per the contention of the revenue, on this aspect, the Ld.CIT(A) has considered the nature of expenditure and passed order which is as follows :- Thus as could be seen from the above, majority of the expenses are for pre-bid studies of Road Projects and investment maintenance charges. It is on record that the appellant is engaged in the business of bidding for various infrastructure projects and if successful to form companies (SPVs) to undertake the projects. Thus the expenditure is incurred by the appellant only in the course of carrying on its business. Investment maintenance charges of ₹ 13,56,630/- paid to Pinakini Share Stock Brokers Ltd. was already disallowed by the A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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