AURA SECURITIES PRIVATE LIMITED,AHMEDABAD vs. NFAC, DELHI PRESENT JURISDICTION THE DCIT, CIRCLE-1(1)(1), AHMEDABAD

ITA 1725/AHD/2024Status: DisposedITAT Ahmedabad12 February 2026AY 2018-19Bench: SHRI TR SENTHIL KUMAR (Judicial Member), SHRI NARENDRA PRASAD SINHA (Accountant Member)11 pages
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What did the Tribunal hold?

The Tribunal held that the disallowance of common expenses made by the AO was correct. However, regarding interest expenses, the matter was set aside to the AO for fresh adjudication with a direction to allow the assessee an opportunity to explain the utilization of borrowed funds.

What were the facts?

The assessee company filed its return declaring Nil income. The AO made an addition of Rs. 99,18,279/- on account of disallowance under Section 14A. The CIT(A) dismissed the assessee's appeal.

What were the issues?

Whether the disallowance of common expenses under Section 14A was justified and whether the AO correctly disallowed interest expenses without considering the net interest or proper utilization of borrowed funds.

Which sections of the Income-tax Act were involved?

Section 14A,Section 36(1)(iii)

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Income Tax Appellate Tribunal, “B” BENCH, AHMEDABAD

Before: SHRI TR SENTHIL KUMAR & SHRI NARENDRA PRASAD SINHA

For Appellant: Shri Biren Shah, A.R
For Respondent: Shri Abhijit, SR- DR
Hearing: 04.02.2026Pronounced: 12.02.2026

PER NARENDRA PRASAD SINHA, ACCOUNTANT MEMBER:

This appeal is filed by the assessee against the order of National Faceless Appeal Centre(NFAC), Delhi [hereinafter referred to as ‘CIT(A)’], dated 29.07.2024 for the Assessment Year (A.Y.) 2018-19 in the proceeding u/s 143(3) of the Income Tax Act.

2.

The brief facts of the case are that the assessee had filed its return of income for A.Y. 2018-19 on 31.10.2018 declaring total income of Rs. Nil. The case was selected for complete scrutiny under the e-assessment scheme. In the course of assessment, the AO had made addition of Aura Securities Private Limited Vs. DCIT, AY-2

The order continues below.

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