Case Law Details
Deven Supercriticals Pvt. Ltd. Vs DCIT (ITAT Pune)
Admittedly, the assessee has its own funds under Capital and Reserve to an extent of Rs. 15.62 crores which is not disputed by the AO nor the CIT(A). Further, there is no dispute with regard to investments made to an extent of Rs. 11.40 crores as on 31-03-2014 by the AO and the CIT(A). It is clearly establishes that the Capital and Reserve of assessee are more than the investments made under the year under consideration. Therefore, It is to be presumed that the assessee made investments from its own funds but not from borrowed funds. If that is the case the disallowance under interest is not warranted. Therefore, disallowance under Rule 8D(ii) to an extent of Rs. 1,78,490/- is not maintainable. Therefore, the order of CIT(A) is not justified in confirming the disallowance under Rule 8D(2)(ii) on account of interest expenditure and to that extent the order of CIT(A) is set aside. Coming to the disallowance under Rule 8D(2)(iii) to an extent of Rs.5,40,395/-, I note that the ld. AR contended to remand the issue to the file of AO for computation of disallowance concerning the investments which yielded exempt income. I note that the AO did not examine the said disallowance on this aspect and proceeded to disallow at 0.5% on an average value of investments concerning the first day and last day of previous year to an extent of Rs.10,80,79,007/-. It is settled principle to restrict the disallowance to those investments earned dividend income. Therefore, following the same I direct the AO to compute the disallowance taking into consideration those investments which yielded exempt income. The assessee is liberty to file evidence, if any, in this regard.
FULL TEXT OF THE ORDER OF ITAT PUNE
This appeal by the assessee against the order dated 29-06-2017 passed by the Commissioner of Income Tax (Appeals)-1, Pune [‘CIT(A)’] for assessment year 20 13-14.
2. I find this appeal was filed with a delay of 972 days. The assessee filed notarized affidavit dated 18-04-2022 stating that the assessee realized that the appeal to be filed before this Tribunal against the order passed by the CIT(A) through Income Tax port. The delay involved was not intentional nor deliberate but due to old age and physical limitation of the Director of assessee by name Ashok Nandlal Baser. The ld. AR submits that the assessee was in compliance of all the procedures but however due to old age of Director the delay of 972 days crept unfortunately. Further, he submits that the age of said Director is around 80 years and contesting the similar issue for A.Y. 2009-10 and drew our attention to the order dated 17-05-2018 in ITA No. 176/PUN/2016 in assessee’s own case at page 8 of the paper book. The ld. AR argued that the assessee has no deliberate intention in filing the appeal belatedly but however the age concerning of Director the delay of 972 days was caused. He prayed to condone the said delay in the interest of justice.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
