M/S SAGAR HEALTHCARE & DIAGNOSTIC SERVICE PVT LTD,BANGALORE vs. ADDL. COMMISSIONER OF INCOME TAX, RANGE-5, BANGALORE

O R D E R

PER SHRI PAVAN KUMAR GADALE, JM :

3. The Brief facts of the case are that the as is engaged in Hospital Services and filed the Return of Income on 30.09.2009 declaring total income of Rs.9,1,32,370 and the case was selected for scrutiny and Notices under Section143(2) and 142(1) of the Act were issued. In compliance, the learned Authorised Representative Assessing Officer and submitted the details. The Assessing Officer considering the financial statements of the assessee found that the assessee has received dividend income of Rs.1,84,229 and has made investments to the extent of Rs.15,14,06,308 and called for details of expenditure incurred for such dividend income. The Assessing Officer considering the investments made addition under Section 14A r.w. Rule 8D(iii) of Rs.6,59,951 and disallowed the penal interest of Rs.52,912 and assessed the total income of Rs.9,19,45,233. Aggrieved by the order of assessment, the assessee filed an appeal before the CIT(Appeals). The CIT(Appeals) considering the submissions of the assessee and findings of the Assessing Officer confirmed the addition made by the Assessing Officer under Section 14A of the Act and the disallowance of penal interest and dismissed the assessee's appeal. Aggrieved by the order of CIT(Appeals), the assessee filed an appeal before the Tribunal.

4. At the time of hearing, the learned Authorised Representative submitted on the first disputed issue of disallowance under Section 14A r.w. Rule 8D(2)(iii) in the computation of income, the learned Authorised Representative emphasized that such disallowance shall not exceed the dividend income and filed writtensubmissions in Paper Book to support the stand and for the payment of interest of Rs.52,912 in respect of delay in payment of service tax and TDS are