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Income Tax Appellate Tribunal, “D” BENCH, MUMBAI
Before: HON’BLE S/SHRI JOGINDER SINGH (JM), & RAJESH KUMAR,(AM)
PAN : AAHCA1523A सुनवाई की तारीख /Date of Hearing : 26.10.2017 घोषणा की तारीख /Date of Pronouncement : 24.11.2017 आदेश / O R D E R PER RAJESH KUMAR, A. M: This is an appeal filed by the assessee challenging the order of the ld.CIT(A), Mumbai, dated 20.11.2016 for the assessment year 2012-13 wherein the assessee challenged the confirmation of disallowance of Rs.31,04,835/- u/s 14A of the Income Tax Act, 1961 r.w.rule 8D of the Income Tax Rules, 1962 without appreciating the facts that 99.999% investments made by the assessee are in its subsidiary companies made for strategic purposes.
2 /M um /20 1 6 2. At the outset, we would like to mention here that neither the assessee nor his authorized representative appeared before this Tribunal when the appeal was called for hearing nor there was any application seeking adjournment of the hearing received in the office of the Tribunal despite service of notice through RPAD. Therefore, we proceed to dispose of the appeal of the assessee ex-parte after hearing the ld. DR.
The facts in brief are that the assessee has filed return of income on 29.9.2012 declaring a total income of Rs.3,24,66,900/- which was processed under section 143(1) of the Act. The case of the assessee was selected for scrutiny and accordingly statutory notices u/s 143(2) and 142(1) were issued and served upon the assessee. During the course of assessment proceedings, the AO observed that the assessee has made investments in shares which are capable of yielding dividend income nevertheless no dividend income was received during the year. The total investments of the assessee in shares and securities were Rs.62,09,54,000/- and according to the AO, the assessee should have made disallowance of expenditure in relation to the income which was not forming part of the total income of the assessee under section 14A read with rule 8D of the Act/Rules. A show cause notice was issued calling upon the assessee as to why the provisions of section 14A read with rule 8D should not be applied to work out the disallowance. It was submitted before the AO that the assessee has not incurred any expenditure on earning of