MACWEAR, MUMBAI vs. DCIT, CIRCLE 22(1), MUMBAI, MUMBAI

This appeal has been preferred by the Assessee against the order dated 05.08.2025, impugned herein, passed by the Ld. Commissioner of Income Tax (Appeals) (in short Ld. Commissioner) u/s 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y. 2017-18.

In the instant case, the AO vide assessment order dated 13.11.2019 under Section 143(3) of the Act, has made an addition of Rs.13,01,267/- being 1% of the average investments of Rs.13,01,26,690/-, mainly on the reason that the Assessee has failed to provide calculation/submissions and also, in the computation of total income, has not disallowed any expenditure attributable to the earning of exempt income as required under the 2 Macwear provision of Section 14A of the Act. The Ld. Commissioner, on the aforesaid reasons, dismissed the appeal of the Assessee, affirming the addition made by the AO. Thus, the Assessee has preferred the instant appeal.

The Assessee on the contrary has submitted that it has duly provided the calculation and/or submissions in respect of disallowance under Section 14A of the Act. Further the Assessee has also submitted the audited balance sheet along with annexure no.7, wherefrom it clearly appears that the Assessee has computed the disallowance u/s.14A of the Act to the tune of Rs.43,79,752/- and also depicted investments made by the Assessee, as well as, dividend (tax free) earned to the tune of Rs.20,25,585/- and administrative expense incurred however, reason best known to the authorities below, they side lined the aforesaid submissions and documents. The aforesaid facts mentioned by the Assessee are not in denial by the Ld. A.R.