SARYU PROPERTIES AND HOTELS P.LTD,MUMBAI vs. DCIT CC 4(2), MUMBAI

The learned CIT (A)erred in not taking into account following decisions holding that disallowance u/s 14(a)cannot exceed exempted income i) DAGA Global Chemicals vs ACIT-ITA No. 5592/M/12 dated 02.02.20 13 ii) Sahara India Fin. Corp. vs DCIT (2014)-105 DTR I (DEL) iii) CIT vs GL!jaratNarmade Valley-221 Taxman 479 (GUi)

6. The appellant craves liberty to add, amend, alter and /or withdraw any of the abovegrounds of appeal.

4. The brief facts of the case are that the assessee is a private limited company and is engaged in the business of hotel, construction and real estate development. The return of income for AY 2012-13 was filed on 30.09.12 declaring total income of Rs. 93,66,060/-. Subsequently, the case of the assessee was selected for scrutiny and after serving statutory notices and seeking reply of 4 & 5676/Mum/2016 M/s Saryu Properties & Hotels Pvt. Ltd. assessee; the AO passed order of assessment u/s 143(3) on 31.03.15 thereby determining the total income of Rs. 1,90,64,290/- thereby making disallowance of Rs. 92,69,723 under the provisions of section 14A of the Act r.wr. 8D of Income Tax Rules and expenses of Rs. 4,62,799/-. Aggrieved by the order of AO, assessee preferred appeal before Ld. CIT(A) and Ld. CIT(A) after considering the case of both the parties dismissed the appeal of the assessee. Now before us, the assessee has preferred the present appeal by raising the above grounds.

5. Although the assessee has raised many grounds against challenging the order of Ld. CIT(A). However vide ground 2(b), the assessee has challenged the order of Ld. CIT(A) on the ground that the assessee had not received any exempted income either as dividend or share of profit from the firm during the relevant year. Since this ground is a substantial ground and in case the said ground is answered in favour of assessee the other ground being academic. Therefore, we first of all we taken up ground no. 2(b) for deciding of merits.

raised by the assessee.

6. In the net result, the appeal filed by the assessee stands allowed.

6 & 5676/Mum/2016 M/s Saryu Properties & Hotels Pvt. Ltd. I.T.A. No. 5676/Mum/2016 (AY 2013-14) 9. Now we take up assessee’s appeal in I.T.A. No. 5676/Mum/2016 (AY 2013-14). Since, we have already decided the identical grounds raised in this appeal, in the aforementioned appeal filed by the assessee bearing AY 2012-13, therefore, based on our findings on the similar ground in the aforementioned appeal, we allow this appeal as well.