BAROOAHS & ASSOCIATES PRIVATE LIMITED ,KOLKATA vs. DCIT, CIRCLE - 4(1) , KOLKATA

2. After hearing rival contentions we find that the Assessing Officer has disallowed expenditure u/s 14A of the Act by recording as follows:- “It was evident from the relevant balance sheets of the assessee that the assets shown therein included a significant amount of investments. Besides, the assessee claimed to have earned an amount of dividend of Rs.2,46,352/- in the previous year under consideration. Logically, related expenses ought to have been added back by the assessee in its computation of total income in accordance with the provisions of section 14A of the Act. But no such addition was made by the assessee of its own accord.”[emphasis ours] 3. While doing so, he has not excluded this dividend income from the total income by applying Section 10(34) of the Act. This mistake is apparent on record. Both the Assessing Officer as well as the ld. CIT(A) are in error in not rectifying this mistake. Hence, we direct the Assessing Officer to exclude the dividend income of Rs.2,46,352/- from the total income as the same cannot be brought to tax in view of Section 10(34) of the Act.

In the result, appeal of the assessee is allowed. Kolkata, the 22nd day of April, 2021.

Deputy Commissioner of Income Tax, Circle Deputy Commissioner of Income Tax, Circle -4 (1), Kolkata 3. CIT(A)- 4. CIT- , 5. CIT(DR), Kolkata Benches, Kolkata. 5. CIT(DR), Kolkata Benches, Kolkata.