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TMI Blog2022 (4) TMI 956X X X X Extracts X X X X X X X X Extracts X X X X ..... e circumstances of the case and in law the Id.CIT(A) has erred in deleting an addition of Rs. 11.49,35,029/- made u/s 14A of the I.T Act without appreciating that the provisions of Rule 8D are mandatory. 2. On the facts and in the circumstances of the case and in law the Id. CIT(A) has erred in treating the amount of Rs. 7,14,67,252/- as short term capital gain as against the business income assessed by the AO. 3. On the facts and in the circumstances of the case and in law, the Id CIT(A) erred in deleting Rs. 9,79,68,016/- being bad debt written off in the profit and loss account without appreciating that the same are liable to be set off against the provisions of bad debt made by the company. 4. On the facts and in the circumstances ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id dividend income. The A.O did not agree with the submission of the assessee and he was of the view that making investment was a most scientific and research oriented activity for which most experienced staff and highly technological infrastructure was required to carry out investment activity. The A.O stated that the disallowance of expenditure incurred towards earning exempt income was required to be determined in accordance with rule 8D and stated that amendment to Sec. 14A was retrospective. Accordingly, the assessing officer had worked out disallowance u/s 14A r.w.Rule 8D to the amount of Rs. 11,49,35,029/- and added to the total income of the assessee. 4. The assessee had filed appeal before the ld. CIT(A). The ld.CIT(A) had deleted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year 2008-09. Therefore, we don't find any error in the finding of ld. CIT(A). Accordingly, this ground of appeal of the revenue stand dismissed. 2nd Ground: Treating the amount of Rs. 7,14,67,252/- as Short Term Capital Gain as against business income assessed by the A.O: 6. During the course of assessment the A.O noticed that assessee has shown short term capital gain of Rs. 7,14,67,252/- and paid taxes u/s 111A of the Act. The assessee was asked to explain why such capital gain should not be considered as business income. The assessee explained that during the year it had invested in many IPO's which came during the year and earned a short term capital gain of Rs. 7.14 cores and same was fully offered to tax u/s 111A of the Act. It wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ally incorrect. Considering the facts and findings elaborated in the decision of ld. CIT(A) that the investment made in shares in various IPO's cannot be considered as trading activity, we don't find any infirmity in his decision, therefore, this ground of appeal of the revenue stand dismissed. 3rd Ground: Deleting to Rs. 9,79,68,016/- being bad debt written off: 9. During the course of assessment the A.O noticed that in the computation of total income the assessee has disallowed the bad debt of Rs. 24,14,97,278/- u/s 36(2)(v) on the ground that the bad debt related to advances to which Section 36(1)(viia) of the Act applicable and the bad debt have to be necessarily debited to the provisions for bad and doubtful debt. The assessee explai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n accordance with Section 36(1)(viia) at 7.5% of gross total income. We consider that the bad debt actually written off was at Rs. 24,14,97,278/- against opening balance in the provision of amount at Rs. 14,35,29,262/-, therefore, the difference of Rs. 9,79,68,016/- is allowable as deduction. Therefore, we don't find any error in the decision of ld. CIT(A), accordingly, this ground of appeal stand dismissed. 4th Ground: Deleting the addition of Rs. 12,52,771/- being entrance fee paid to club: 11. During the course of assessment the A.O noticed that assessee has claimed entrance fees paid to various clubs of Rs. 12,52,771/- the A.O was of the view that such fees paid to clubs for using club facility provide advantage to the assessee of an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... loose their individual identity once they form past of the block of assets. 3. The Appellant prays that the AO be directed to delete the entire disallowance made, on an adhoc basis, out of depreciation on block of premises amounting to Rs. 14,54,391. 4. Without prejudice, the Appellant prays that such disallowance the AO be directed to substantially reduce the disallowance of depreciation. GROUND NO. II - Depreciation on lease asset 1. Consequent upon the recharacterisation of various lease transactions in earlier years as Hire Purchase / Financing transactions, the AO erred in disallowing the depreciation on such assets put to lease and excluded the capital component embedded in lease rentals while arriving at taxable income of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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