CIT v. Reliance Utilities & Power Ltd.

Assistant Commissioner of Income Tax 2(3)(2), Mumbai vs. Kotak Mahindra Bank Limited, Mumbai

In the result, both the appeals filed by the revenue are dismissed

Bench: Shri Shamim Yahya & Shri Pawan Singh

…trategic interest, no disallowance could be made. The following are the decisions, the Ld.Counsel relied upon:- 1. HDFC Bank Ltd vs DCIT (2016) 383 ITR 529 (Bom) 2. CIT vs HDFC Bank Ltd (2016) 383 ITR 529 (Bom) 3. CIT vs Reliance Utilities & Power Ltd (2009) 313 ITR 340 (Bom) 4. CIT vs Bombay Oil Industries Ltd 23014) 42 Taxmann.com 440 (Bom) 5. CIT vs Reliance Industries Ltd CA No. 10 of 2010 (SLP(c) no.37/2010 6. PCIT vs Sintex Industries Ltd (2018) 255 Taxman 171 (SC) 7. PCIT vs Sintex Industries Ltd (2017) 82 taxmann.com 171 (Guj) 8. DCIT vs Bennet Coleman & Co Ltd ITA No.1951/M/2016 9. DCIT vs Ageis Logist…

ACIT CC 6(4), Mumbai vs. Arshiya Ltd, Mumbai

In the result the ground of appeal raised by the

Bench: Shri G.S. Pannu, Vice- & Shri Pawan Singhacit, Cc-6(4), M/S Arshiya Ltd. Room No. 32(1), Ground 308, Level 3, Ceejay House, Vs. Floor, Aayakar Bhavan, F Block, Shiv Sagar Estate, M.K. Road, Dr. A.B. Road, Worli, Mumbai-400020 Mumbai-400018. Pan: Aaaci2679A Appellant Respondent Dcit Cc-6(4), M/S Arshiya International Ltd. Room No. 32(1), Ground 7Th Floor, Twin Arcade, Vs. Floor, Aayakar Bhavan, C Wing, Military Road, M.K. Road, Marol Maroshi, Andheri (E), Mumbai-400020 Mumbai-400059. Pan: Aaaci2679A Appellant Respondent M/S Arshiya Ltd. [Formerly Dcit Cc-6(4), Known As Arshiya International Room No. 32(1), Ground Vs. Ltd.] 3021, Ceejay House, Floor, Aayakar Bhavan, Level-3, Shiv Sagar Estate, M.K. Road, F-Block, Dr. A.B. Road, Mumbai-400020 Worli, Mumbai-400018. Pan: Aaaci2679A Appellant Respondent M/S Arshiya Ltd. [Formerly Dcit Cc-6(4), Known As Arshiya International Room No. 32(1), Ground Vs. Ltd.] 3021, Ceejay House, Floor, Aayakar Bhavan, Level-3, Shiv Sagar Estate, M.K. Road, F-Block, Dr. A.B. Road, Mumbai-400020 Worli, Mumbai-400018. M/S Arshiya International Ltd.

…lus and M/s Arshiya International Ltd. share capital of Rs. 458.35 crore against the investment in share of Rs. 145.89 crore. The ld. CIT(A) deleted the disallowance by following the decision of Hon’ble Bombay High Court in Reliance Utility and Power Ltd. (313 ITR 340) and CIT vs. HDFC Bank Ltd. (366 ITR 505). However, addition/disallowances under clause (iii) of Rule 8D(2) of Rs. 33,42,417/- was confirmed by ld. CIT(A). Aggrieved by the order of ld. CIT(A) in deleting the addition of Rs. 281370/- under Rule 8D(2)(ii), the revenue has filed appeal before the Tribunal. The assessee has challenged the disallow…

Asst CIT 5(3)(2), Mumbai vs. Spaco Technologies (I) P.Ltd, Mumbai

In the result, appeal of the assessee is partly allowed and appeal of the Revenue is dismissed

Bench: Shri C.N. Prasad, Hon'Ble & Shri Manoj Kumar Aggarwal, Hon’Blem/S. Spaco Technologies (I) Private Ltd., V. Acit – 5(3)(2) 901, Prasad Chambers, Opera House Aayakar Bhavan Mumbai 400 004 M.K. Road Mumbai-400 020 Pan: Aabcs5307E (Appellant) (Respondent) Dcit– 5(3)(2) V. M/S. Spaco Technologies (I) Private Ltd., Room No. 573, 5Th Floor 901, Prasad Chambers, Opera House Aayakar Bhavan Mumbai 400 004 M.K. Road Mumbai-400 020 Pan: Aabcs5307E (Appellant) (Respondent) Assessee By : Milin Dattani Department By : Shri Chaudhary Arunkumar Singh

…22.01.2018 submits that M/s Spaco Technologies (I) Private Ltd., identical issue came up before the Tribunal for the A.Y. 2011-12 and the Tribunal following the decision of the Hon'ble Bombay High Court in the case of CIT v. Reliance Utilities and Power Ltd. [313 ITR 340] and HDFC Ltd v. DCIT [383 ITR 529] deleted the interest expenses as the assessee had sufficient reserves and surplus more than the investments made. Ld. Counsel for the assessee referring to Page No. 6 of the Paper Book which is the balance sheet of the assessee company as on 31.03.2013 submits that for the current Assessment Year the assessee i…

Spaco Technologies (I) P.Ltd, Mumbai vs. Asst CIT 5(3)(2), Mumbai

In the result, appeal of the assessee is partly allowed and appeal of the Revenue is dismissed

Bench: Shri C.N. Prasad, Hon'Ble & Shri Manoj Kumar Aggarwal, Hon’Blem/S. Spaco Technologies (I) Private Ltd., V. Acit – 5(3)(2) 901, Prasad Chambers, Opera House Aayakar Bhavan Mumbai 400 004 M.K. Road Mumbai-400 020 Pan: Aabcs5307E (Appellant) (Respondent) Dcit– 5(3)(2) V. M/S. Spaco Technologies (I) Private Ltd., Room No. 573, 5Th Floor 901, Prasad Chambers, Opera House Aayakar Bhavan Mumbai 400 004 M.K. Road Mumbai-400 020 Pan: Aabcs5307E (Appellant) (Respondent) Assessee By : Milin Dattani Department By : Shri Chaudhary Arunkumar Singh

…22.01.2018 submits that M/s Spaco Technologies (I) Private Ltd., identical issue came up before the Tribunal for the A.Y. 2011-12 and the Tribunal following the decision of the Hon'ble Bombay High Court in the case of CIT v. Reliance Utilities and Power Ltd. [313 ITR 340] and HDFC Ltd v. DCIT [383 ITR 529] deleted the interest expenses as the assessee had sufficient reserves and surplus more than the investments made. Ld. Counsel for the assessee referring to Page No. 6 of the Paper Book which is the balance sheet of the assessee company as on 31.03.2013 submits that for the current Assessment Year the assessee i…

Sicom Investments & Finance Limited, Mumbai vs. DCIT - Circle-3(3)(1), Mumbai

In the result, appeal of the assessee is partly allowed and appeal of the Revenue is dismissed

Bench: Shri C.N. Prasad, Hon'Ble & Shri Manoj Kumar Aggarwal, Hon’Blem/S. Sicom Investments & Finance Limited V. Dcit – Circle – 3(3)(1) Solitaire Corporate Park Room No. 609, 6Th Floor Building No. 4, Ground Floor Aayakar Bhavan Guru Hargovindji Road M.K. Road (Andheri Ghatkopar Link Road) Mumbai-400 020 Chakala, Andheri (E), Mumbai – 400 093 Pan: Aabcs1131L (Appellant) (Respondent) Dcit – Circle – 3(3)(1) V. M/S. Sicom Investments & Finance Limited Solitaire Corporate Park Room No. 609, 6Th Floor Building No. 4, Ground Floor Aayakar Bhavan Guru Hargovindji Road M.K. Road (Andheri Ghatkopar Link Road) Mumbai-400 020 Chakala, Andheri (E), Mumbai – 400 093 Pan: Aabcs1131L (Appellant) (Respondent) Assessee By : None Department By : Shri Chaudhary Arunkumar Singh

…ds available with the assessee. For this purpose, reliance can be placed on the decision of the jurisdictional High Court in the case of Reliance Utilities and Power Ltd,, 4 ITA NO. 3811 & 3346/MUM/2018 (A.Y: 2013-14) M/s. SICOM Investments & Finance Limited 313 ITR 340. Keeping in view the facts and circumstances of the case, we restore the matter back to the file of AO for deciding afresh after verifying the interest free funds available with the assessee for utilization in the investment The AO is to decide the issue as per the decision of the Hon'ble jurisdictional High Court in the case of Reliance Utilitie…

DCIT - 3(3)(1), Mumbai vs. Sicom Investment & Finance Ltd., Mumbai

In the result, appeal of the assessee is partly allowed and appeal of the Revenue is dismissed

Bench: Shri C.N. Prasad, Hon'Ble & Shri Manoj Kumar Aggarwal, Hon’Blem/S. Sicom Investments & Finance Limited V. Dcit – Circle – 3(3)(1) Solitaire Corporate Park Room No. 609, 6Th Floor Building No. 4, Ground Floor Aayakar Bhavan Guru Hargovindji Road M.K. Road (Andheri Ghatkopar Link Road) Mumbai-400 020 Chakala, Andheri (E), Mumbai – 400 093 Pan: Aabcs1131L (Appellant) (Respondent) Dcit – Circle – 3(3)(1) V. M/S. Sicom Investments & Finance Limited Solitaire Corporate Park Room No. 609, 6Th Floor Building No. 4, Ground Floor Aayakar Bhavan Guru Hargovindji Road M.K. Road (Andheri Ghatkopar Link Road) Mumbai-400 020 Chakala, Andheri (E), Mumbai – 400 093 Pan: Aabcs1131L (Appellant) (Respondent) Assessee By : None Department By : Shri Chaudhary Arunkumar Singh

…ds available with the assessee. For this purpose, reliance can be placed on the decision of the jurisdictional High Court in the case of Reliance Utilities and Power Ltd,, 4 ITA NO. 3811 & 3346/MUM/2018 (A.Y: 2013-14) M/s. SICOM Investments & Finance Limited 313 ITR 340. Keeping in view the facts and circumstances of the case, we restore the matter back to the file of AO for deciding afresh after verifying the interest free funds available with the assessee for utilization in the investment The AO is to decide the issue as per the decision of the Hon'ble jurisdictional High Court in the case of Reliance Utilitie…

Dy. Commissioner of Income Tax 1(1)(1), Mumbai vs. M/S. Gcil Finance Ltd., Mumbai

In the result, the appeal of the Revenue in ITA no

Bench: Shri Sandeep Gosain & Shri Ramit Kochar

…o disallowance of interest expenses can be made by invoking provisions of Section 14A of the 1961 Act to the extent of these investments. The assessee relied upon the decision of Hon’ble Bombay High Court in the case of CIT v. Reliance Utilities & Power Ltd., 313 ITR 340. The assessee also submitted that for ay: 2010-11 on similar facts , the issue was decided by learned CIT(A) in favour of the assessee. 4.5 The assessee also submitted before learned CIT(A) that so far as administrative expenses being disallowed by invoking Rule 8D2(iii) of the 1962 Rules @0.5% , it was submitted by the assessee that the AO even…

K.Raheja Corp P.Ltd, Mumbai vs. Asst CIT Cen Cir 29, Mumbai

In the result, appeal of the assessee is partly allowed for statistical purposes

Bench: Shri Mahavir Singh, Jm & Shri M.Balaganesh, Am M/S. K. Raheja Corporation Vs. Asst. Commissioner Of Pvt. Ltd., Income Tax, Plot No.C-30, G-Block Central Circle – 29 Opp: Sidbi, Bandra Kurla Mumbai Complex, Bandra East Mumbai – 400 051 Pan/Gir No.Aaacp0522B (Appellant) .. (Respondent)

…hence, the presumption that own funds have been used for making investments in various companies goes in favour of the assessee in the light of the decision of the Hon’ble Jurisdictional High Court in the case of Reliance Utilities and Power Ltd., reported in 313 ITR 340. This Tribunal in A.Y.2008-09 in assessee’s own case had deleted the disallowance of interest made under second limb of rule 8D(2) of the Rules. We find from perusal of the balance sheet as on 31/03/2010, total own funds available with the assessee is Rs.295,23,58,270/-, whereas the investments made were only Rs.131,21,08,283/-. Hence, the presum…

DCIT CC 6(3), Mumbai vs. Horizon Infrastructure Ltd, Mumbai

In the result, appeal filed by the assessee ITA No

Bench: Shri G. Manjunatha & Shri Ravish Soodita No.2471/Mum/2018 (Assessment Year: 2013-14) (Assessment Year: 2014-15) Horizon Infrastructure Ltd. Vs. Dcit,Cc-6(3) (Now Known As Skil Air India Building Infrastructure Ltd.) Nariman Point Mumbai-400 021 Skil House, 209 Bank Street Cross Lane, Fort Mumbai-400 023

…nterest and also for strategic purpose, investments in shares and securities out of own funds in light of decision of Hon’ble Bombay High Court in the case of HDFC bank Ltd. Vs DCIT (2016) 383 ITR 529 and CIT vs. Reliance Utilities and Power Limited (2009) 313 ITR 340 that no disallowance could be made, in respect of interest expenditure, where own funds in form of share capital and reserves is in excess of investment in shares. The assesee had also taken one more argument, in respect of disallowances of expenditure under Rule 8D(2)(iii) of I.T.Rules, 1962, @ 0.5% of average value of investment, on the gr…

Horizon Infrastructure Ltd(Now Known As Skil Infrastructure Limited), Mumbai vs. DCIT CC 6(3), Mumbai

In the result, appeal filed by the assessee ITA No

Bench: Shri G. Manjunatha & Shri Ravish Soodita No.2471/Mum/2018 (Assessment Year: 2013-14) (Assessment Year: 2014-15) Horizon Infrastructure Ltd. Vs. Dcit,Cc-6(3) (Now Known As Skil Air India Building Infrastructure Ltd.) Nariman Point Mumbai-400 021 Skil House, 209 Bank Street Cross Lane, Fort Mumbai-400 023

…nterest and also for strategic purpose, investments in shares and securities out of own funds in light of decision of Hon’ble Bombay High Court in the case of HDFC bank Ltd. Vs DCIT (2016) 383 ITR 529 and CIT vs. Reliance Utilities and Power Limited (2009) 313 ITR 340 that no disallowance could be made, in respect of interest expenditure, where own funds in form of share capital and reserves is in excess of investment in shares. The assesee had also taken one more argument, in respect of disallowances of expenditure under Rule 8D(2)(iii) of I.T.Rules, 1962, @ 0.5% of average value of investment, on the gr…

Horizon Country Wide Logistics Ltd(Now Succeeded on Amalgamation by Skil Infrastructure Limited ), Mumbai vs. DCIT 1(2)(Presently ACIT--6(3)), Mumbai

In the result, appeal filed by the assessee ITA No

Bench: Shri G. Manjunatha & Shri Ravish Soodita No.2471/Mum/2018 (Assessment Year: 2013-14) (Assessment Year: 2014-15) Horizon Infrastructure Ltd. Vs. Dcit,Cc-6(3) (Now Known As Skil Air India Building Infrastructure Ltd.) Nariman Point Mumbai-400 021 Skil House, 209 Bank Street Cross Lane, Fort Mumbai-400 023

…nterest and also for strategic purpose, investments in shares and securities out of own funds in light of decision of Hon’ble Bombay High Court in the case of HDFC bank Ltd. Vs DCIT (2016) 383 ITR 529 and CIT vs. Reliance Utilities and Power Limited (2009) 313 ITR 340 that no disallowance could be made, in respect of interest expenditure, where own funds in form of share capital and reserves is in excess of investment in shares. The assesee had also taken one more argument, in respect of disallowances of expenditure under Rule 8D(2)(iii) of I.T.Rules, 1962, @ 0.5% of average value of investment, on the gr…

DCIT CC 6(3), Mumbai vs. Horizon Infrastructure Ltd, Mumbai

In the result, appeal filed by the assessee ITA No

Bench: Shri G. Manjunatha & Shri Ravish Soodita No.2471/Mum/2018 (Assessment Year: 2013-14) (Assessment Year: 2014-15) Horizon Infrastructure Ltd. Vs. Dcit,Cc-6(3) (Now Known As Skil Air India Building Infrastructure Ltd.) Nariman Point Mumbai-400 021 Skil House, 209 Bank Street Cross Lane, Fort Mumbai-400 023

…nterest and also for strategic purpose, investments in shares and securities out of own funds in light of decision of Hon’ble Bombay High Court in the case of HDFC bank Ltd. Vs DCIT (2016) 383 ITR 529 and CIT vs. Reliance Utilities and Power Limited (2009) 313 ITR 340 that no disallowance could be made, in respect of interest expenditure, where own funds in form of share capital and reserves is in excess of investment in shares. The assesee had also taken one more argument, in respect of disallowances of expenditure under Rule 8D(2)(iii) of I.T.Rules, 1962, @ 0.5% of average value of investment, on the gr…

Mega Management Services Private Limited, Mumbai vs. Deputy Commissioner of Income Tax 10(2)(2), Mumbai

Bench: Shri Ravish Sood & Shri N.K. Pradhanm/S Mega Management Deputy Commissioner Of Service Limited, Income Tax, Circle-10(2)(2), 301, Level-3, Ceejay House, Room No. 209, 2Nd Floor, Vs. Shiv Sagar Estate, F-Block, Aayakar Bhavan, M.K. Road, Dr. Annie Besant Road, Mumbai – 400 020 Worli, Mumbai- 400 018 Pan – Aaacm4143K (Appellant) (Respondent) Appellant By: Shri Navnit Choudhari, A.R Respondent By: Shri Rajesh Ojha, D.R Date Of Hearing: 25.07.2019 Date Of Pronouncement: 07.08.2019

…refore, no disallowance under Sec. 14A r.w. Rule 8D(2)(ii) was called for in its hands. In support of his aforesaid contention the ld. A.R relied on the judgment of the Hon’ble High Court of Bombay in the case of CIT Vs. Reliance Utilities & Power Ltd. (2009) 313 ITR 340 (Bom). Also, the ld. A.R submitted that as the A.O without recording his satisfaction after referring to the accounts of the assessee had summarily dislodged its claim that no part of the expenses were incurred for earning of exempt dividend income, therefore, the disallowance made by him u/s 14A was also not sustainable on the said count. 6. Per…

Bharat Petroleum Corporation Ltd, Mumbai vs. ACIT 2(1)(1), Mumbai

In the result, the appeals of the assessee are partly allowed and that of the Revenue in AY 2011-12 is dismissed

Bench: Sri Mahavir Singh, Jm & Sri Manoj Kumar Aggarwal, Am

…utilized its self owned funds for the purpose of investing in the tax free securities, therefore, no expenditure was liable to be disallowed in view of the judgment of the Hon’ble High Court of Bombay in the case of CIT Vs. Reliance Utility Powers Ltd. (2009) 313 ITR 340) (Bom). The ld. A.R further submitted that the assessee company had not incurred any expenditure for earning of the exempt income, therefore no disallowance u/s. 14A was called for in its hands. The ld. A.R. submitted that a similar adhoc disallowance involving identical facts had been looked into by the ITAT „B‟ bench, Mumbai in the case of the…