Ashok Fattechand Ajmere, Ahmednagar V. Deputy Commissioner of Income-tax,

ITA 1241/PUN/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 0426 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 13-07-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 06-06-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: PRADEEP SAGAR
• Keywords: Depreciation; Business expenditure; Earning of tax free income
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE PUNE BENCH A , PUNE , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO. 1241 /PN/20 1 4 / ASSESSMENT YEAR: 20 0 7 - 0 8 ASHOK FATTECHAND AJMERE, ASHOK FATTECHAND AJMERE, C/O ARIHANT INVESTMENTS BHAGWAN MAHAVIR PATH, POST KOPERGAON, DIST. AHMEDNAGAR . / APPELLANT PAN: ACLPA3020F VS. THE DY. COMMISSIONER OF I NCOME TAX, AHMEDNAGAR CIRCLE, AHMEDNAGAR . / RESPONDENT / APPELLANT BY : SHRI PRADEEP SAGAR / RESPONDENT BY : S HRI SUHAS KULKARNI / DATE OF HEARING : 2 4 . 1 1 .201 6 / DATE OF PRONOUNCEMENT: 30 . 1 1 .201 6 / ORDER PER SUSHMA CHOWLA, JM: TH IS APPEAL FILED BY THE ASSESSEE IS AGAINST ORDER OF CIT( A ) - IT/TP , PUNE , DATED 08 . 0 4 .201 4 RELATING TO ASSESSMENT YEAR 20 0 7 - 0 8 AGAINST ORDER PASSED UNDER SECTION 1 43(3) OF THE INCOME - TAX ACT , 1961 (IN SHORT THE ACT) . 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUND OF APPEAL: - ITA NO . 1241 / PN /201 4 ASHOK FATTECHAND AJMERE 2 1. SECTION 14A DISALLOWANCE DISALLOWANCE OF INTEREST (RS. 21,52,504/ - ) U/S. 14A OF I.T. THE ACT WHEN PART OF THE INVESTMENT OUT OF BORROW ED FUND HAD RESULTED INTO TAXABLE GAIN (SHORT TERM CAPITAL GAIN) & THERE WAS NO TAX EXEMPT INCOME IN THE FORM OF DIVIDEND INCOME OR LONG TERM GAIN FROM THE INVESTMENT SO MADE [VIDE PARA NO. 2.1.24 ON PAGE NO. 10 OF THE ORDER ] ON FACTS, IN THE CIRCUMSTANC ES OF THE CASE AND IN LAW, THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) ERRED IN CONFIRMING THE ORDER PASSED BY THE DEPUTY COMMISSIONER OF INCOME TAX WHEREBY DISALLOWANCE U/S. 14A WAS MADE OF INTEREST ON BORROWED FUNDS UTILIZED FOR THE PURPOSE OF INVES TMENT IN SHARES IN SPITE OF THE FACT THAT NO TAX EXEMPT INCOME EITHER IN THE FORM OF DIVIDEND INCOME OR LONG TERM CAPITAL GAIN WAS EARNED BY THE APPELLANT OUT OF SUCH INVESTMENT AND ON THE CONTRARY THE APPELLANT EARNED TAXABLE INCOME IN THE FORM OF SHORT T ERM CAPITAL GAIN ON SALE OF PART OF SUCH INVESTMENT. 1.1 THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) FAILED TO APPRECIATE - A ) THAT UTILIZATION OF BORROWED FUNDS ON WHICH INTEREST WAS PAID BY THE APPELLANT HAD RESULTED IN TO TAXABLE INCOME IN THE FORM OF SHORT TERM CAPITAL GAIN AND THAT THERE WAS NO TAX EXEMPT INCOME EITHER IN THE FORM OF DIVIDEND INCOME OR IN THE FORM OF LONG TERM CAPITAL GAIN EARNED BY THE APPELLANT FROM THE INVESTMENT IN SHARES SO MADE OUT OF BORROWED FUNDS; AND B ) THAT THERE WAS DIRE CT NEXUS BETWEEN TAXABLE INCOME AND THE INTEREST PAID ON BORROWED FUNDS AND THAT THERE WAS NO DIRECT OR INDIRECT NEXUS BETWEEN INTEREST PAID ON BORROWED FUNDS AND TAX INDIRECT NEXUS BETWEEN INTEREST PAID ON BORROWED FUNDS AND TAX EXEMPT INCOME AS SUCH NO PART OF SUCH INTEREST WAS SUBJECT TO DISALLOWANCE U/S. 14A OF TH E ACT AS SEC 14A WAS TO BE INVOKED ONLY IN RESPECT OF EXPENDITURE INCURRED IN RESPECT OF TAX EXEMPT INCOME. 2. SECTION 14A DISALLOWANCE DISALLOWANCE OF INTEREST PAID (R S .5,80,523/10) ON FUNDS BORROWED FOR THE PURPOSE OF BUSINESS TOTALLY DISALLOWED BY IN VOKING PROVISIONS OF SECTION 14A OF THE ACT . [VIDE PARA NO.2.1.23 ON PAGE NO. 10 OF THE ORDER ]. ON FACTS, IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE ID. COMMISSIONER OF INCOME - TAX (APPEAL) ERRED IN HOLDING THAT ENTIRE BORROWED FUNDS ARE USED FOR TH E PURPOSE OF PURCHASE AND SALE OF SHARES WHICH IS INVESTMENT ACTIVITY AND HENCE INTEREST SO PAID ON SUCH BORROWING IS NOT DEDUCTIBLE BY VIRTUE OF PROVISIONS OF SEC. 14A OF THE INCOME TAX ACT. 3. SECTION 14A DISALLOWANCE RESTRICTING DISALLOWANCE OF ADMIN ISTRATIVE AND COMMON EXPENSES ONLY AT 50% BY INVOKING PROVISIONS OF SECTION 14A WAS EXCESSIVE AND UNREASONABLE [VIDE PARA NO. 2.1.26 ON PAGE NO.11 OF THE ORDER] ON FACTS, IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) ERRED CONFIRMING DISALLOWANCE OF COMMON AND ADMINISTRATIVE EXPENSES BY INVOKING PROVISIONS OF SEC 14A OF THE ACT AND RESTRICTING DISALLOWANCE AT 50% BY PRESUMING AND THEREBY HOLDING THAT ONLY 50% OF THE ACTIVITIES OF THE APPELLANT IS FOR BUSINESS AND THAT BALANCE 50% OF THE ACTIVITIES ARE FOR INVESTMENT PURPOSE. ITA NO . 1241 / PN /201 4 ASHOK FATTECHAND AJMERE 3 3. THE ISSUE RAISED IN THE PRESENT APPEAL IS AGAINST THE DISALLOWANCE MADE UNDER SECTION 14A OF THE ACT. 4. BRIEFLY, IN THE FACTS OF THE CASE, THE ASSESSEE FOR THE YEAR UNDER CONSIDERATI ON HAD FURNISHED RETURN OF INCOME DECLARING TOTAL LOSS OF RS. 31 ,11,815/ - . THE ASSESSEE IS CHARTERED ACCOUNTANT AND WAS ALSO ENGAGED IN SHARE AND STOCK BROKER BUSINESS. FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD DECLARED DIVIDEND INCOME OF RS. 86,0 06/ - ALONG WITH PROFIT ON SALE OF INVESTMENT IN SHARES AT RS. 60,52,805/ - AND PROFIT ON TRADING IN SHARES AT RS. 1,63,498/ - . THE SAME WAS IN ADDITION TO PROFESSIONAL INCOME DECLARED BY THE ASSESSEE. THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAD CLAIMED THE DIVIDEND INCOME ON PROFIT OF SALE OF INVESTMENT IN SHARES IS EXEMPT UNDER SECTION 10(34) OF THE ACT. FURTHER, PROFIT OF RS. 60,52,805/ - INCLUDED LONG TERM CAPITAL GAINS OF RS. 62,43,462/ - , SHORT TERM CAPITAL GAINS OF RS. 16,19,706/ - AND SHORT TERM CAPIT AL LOSS OF RS. 18,10,364/ - . THE NEXT ASPECT TAKEN NOTE OF BY THE ASSESSING OFFICER WAS THAT AGAINST THE SAID RECEIPTS , THE ASSESSEE HAD BOOKED THE NET PROFIT OF RS. 30,03,548/ - I.E. EXPENDITURE OF RS. 32,98,761/ - WAS CLAIMED BY THE ASSESSEE. THE ASSESSING O FFICER WAS OF THE VIEW THAT THE SAID EXPENDITURE WAS ALLOWABLE ONLY OUT OF TAXABLE INCOME AND NOT AGAINST EXEMPT INCOME. RELYING ON SERIES OF DECISIONS, THE ASSESSING OFFICER CONCLUDED THAT THE PROVISIONS OF SECTION 14A OF THE ACT WERE APPLICABLE TO THE A SSESSEE AND HENCE, THE DISALLOWANCE UNDER SECTION 14A OF THE ACT WAS TO BE MADE. THE ASSESSING OFFICER NOTED THAT AS AGAINST EXEMPT INCOME OF RS. 61,38,811/ - , TAXABLE INCOME WAS RS. 1,63,498/ - I.E. ABOUT 2.66% , THEREFORE 2.66% OF THE TOTAL DEBITED EXPENDITU RE AT RS. 87,747/ - WAS HELD TO BE ALLOWABLE AND BALANCE EXPENDITURE OF RS.32,11,013/ - WAS DISALLOWED UNDER SECTION 14A OF THE ACT. ITA NO . 1241 / PN /201 4 ASHOK FATTECHAND AJMERE 4 5. BEFORE THE CIT(A), THE ASSESSEE POINTED OUT THAT CERTAIN EXPENDITURE SHOULD NOT BE CONSIDERED FOR DISALLOWANCE UNDER SECTI ON 14A OF THE ACT AS PER PARA 2.1.7 AT PAGES 4 AND 5 OF THE APPELLATE ORDER. THE SAID EXPENDITURE WAS TOTALED TO RS. 5,65,734/ - . FURTHER, THE PLEA RAISED BY THE ASSESSEE WAS THAT THERE WAS NO MERIT IN MAKING ANY DISALLOWANCE OUT OF BALANCE EXPENDITURE OF RS. 27,33,027/ - . RELIANCE WAS PLACED ON SERIES OF DECISIONS AND THE ASSESSEE POINTED OUT THAT DISALLOWANCE, IF ANY, TO BE MADE UNDER SECTION 14A OF THE ACT SHOULD BE ON ACCOUNT OF EXPENDITURE TOTALING RS. 6,64,051/ - AS TABULATED UNDER PARA 2.1.15 AT PAGES 7 AND 8 OF THE APPELLATE ORDER. IT WAS FURTHER POINTED OUT BY THE ASSESSEE BEFORE THE CIT(A) THAT AT BEST SOME REASONABLE DISALLOWANCE SHOULD BE MADE AS MADE IN THE HANDS OF OTHER ASSESSEE. WITHOUT PREJUDICE, THE ASSESSEE CLAIMED THAT THE DISALLOWANCE, IF ANY, SHOULD BE RESTRICTED TO 5% OR 10% OF THE EXPENDITURE OF RS. 1,99,768/ - I.E. AFTER EXCLUDING THE GAIN ARISING ON SALE OF NTPC SHARES WHICH WAS MAJOR INCOME UNDER THE HEAD LONG TERM CAPITAL GAINS. THE CIT(A) NOTED THE INVESTMENT MADE IN SHARES BY THE ASSESSEE AND THE INCOME DECLARED BY THE ASSESSEE UNDER VARIOUS HEADS OF INCOME AND CONCLUDED THAT THE ASSESSEE WAS CARRYING OUT THE ACTIVITIES AS AN INVESTOR AND NOT AS TRADER IN SHARES. THE ASSESSEE HAD TABULATED THE TOTAL EXPENDITURE OF RS. 32,98,760/ - IN PROFIT & LOSS ACCOUNT AND EXPLAINED THAT THE INTEREST EXPENDITURE OF RS. 21,52,504/ - WAS INCURRED ON SPECIFIC SHARES AND THE SAME SHOULD BE EXCLUDED. THE BALANCE INTEREST EXPENDITURE WAS CLAIMED TO BE UTILIZED FOR THE PURPOSE OF INVESTMENT ON WHICH INCO ME FROM SHORT TERM CAPITAL GAINS OR LOSS HAS BEEN SHOWN AND HENCE, NO DISALLOWANCE. HOWEVER, THE CIT(A) HELD THAT THE ENTIRE AMOUNT OF INTEREST OF RS.27,33,027/ - WAS TO BE DISALLOWED UNDER SECTION 14A OF THE ACT. THE CIT(A) HELD THAT THERE IS NO MERIT IN THE PLEA OF ASSESSEE THAT NO DISALLOWANCE IS TO BE MADE IN THE HANDS OF ASSESSEE , WHERE THE TAX PAYER HAS NOT EARNED ANY EXEMPT INCOME. THE CIT(A) IN VIEW OF THE CBDT CIRCULAR NO.5 OF 2014, DATED 11.02.2014 HELD THAT THE INTEREST EXPENDITURE OF RS. 21,52, 504/ - MERITS TO BE DISALLOWED UNDER ITA NO . 1241 / PN /201 4 ASHOK FATTECHAND AJMERE 5 SECTION 14A OF THE ACT. FURTHER DISALLOWANCE OF INTEREST OF RS.5,80,523/ - WAS ALSO UPHELD. IN RESPECT OF BALANCE EXPENDITURE OF RS. 5,65,733/ - , THE CIT(A) VIDE PARA 2.1.25 HELD AS UNDER: - 2.1.25 WITH RESPECT TO THE BA LANCE EXPENDITURE OF RS.5,65,733/ - (RS.32,98,760/ - - RS.27,33,027/ - ), THE APPELLANT HAS STATED THAT DEPRECIATION DISALLOWANCE OF RS.18,699/ - , PROPERTY TAXES OF RS.58,655/ - AND STT OF RS.1,29,146/ - SHOULD BE EXCLUDED. THIS IS BECAUSE, PROPERTY TAXES AND ST T ARE ALREADY DISALLOWED BY THE APPELLANT. FURTHER, AS FAR AS DEPRECIATION OF RS. 18,699/ - IS CONCERNED, IT IS NOT IN NATURE OF EXPENDITURE BUT IS IN THE NATURE OF ALLOWANCE. IN VIEW OF THIS FACTUAL POSITION, THE APPELLANT HAS REQUESTED THAT TOTAL AMOUNT OF RS.2,06,500/ - SHOULD NOT BE CONSIDERED FOR THE DISALLOWANCE U/S. 14A. THUS, NET EXPENDITURE RS.3,59,233/ - (RS.5,65,733/ - - RS.2,06,500/ - ) SHOULD BE CONSIDERED FOR DISALLOWANCE U/S 14A. I AGREE WITH THE APPELLANTS CONTENTION AND I EXCLUDE RS.2,06,500/ - FROM THE EXPENDITURE FOR CONSIDERATION OF DISALLOWANCE U/S.14A. 6. THE CIT(A) FURTHER UPHELD 50% OUT OF BUSINESS EXPENDITURE OF RS. 3,59,233/ - I.E. DISALLOWANCE OF RS. 1,79,616/ - . TOTAL DISALLOWANCE WAS THUS MADE AT RS. 26,22,382/ - . 7. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF CIT(A). 8. THE FIRST GROUND OF APPEAL RAISED BY THE ASSESSEE IS AGAINST THE DISALLOWANCE OF INTEREST MADE AT RS. 21,52,504/ - . THE SECOND GROUND OF APPEAL RAISED BY THE ASSESSEE IS AGAINST DISALLOWANCE OF INTEREST PAID AT RS . 5,80,523/ - AND THE THIRD GROUND OF APPEAL IS IN RESTRICTING THE DISALLOWANCE OF ADMINISTRATIVE AND COMMON EXPENSES AT RS. 1,79,616/ - . 9. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE LIST OF DIVIDEND INCOME RECEIVED BY THE AS SESSEE IS PLACED AT PAGE 2 OF THE PAPER BOOK. FURTHER, OUR ATTENTION WAS DRAWN TO THE LIST OF EXPENSES WHICH WERE PART OF PROFIT & LOSS ACCOUNT PLACED AT PAGE 9 OF THE PAPER BOOK. HE FURTHER STATED THAT SINCE NO EXEMPT INCOME HAD BEEN EARNED BY THE ASSES SEE AND SINCE THE FUNDS WERE BORROWED FOR THE PURPOSE OF INVESTMENT IN RPL SHARES, THEN THERE IS NO MERIT IN DISALLOWANCE MADE OF INTEREST EXPENDITURE OF RS. 21,52,504/ - . THE ITA NO . 1241 / PN /201 4 ASHOK FATTECHAND AJMERE 6 LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE IN THIS REGARD PLACED RELIANCE ON THE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN CIT VS. M/S. DELITE ENTERPRISES IN INCOME TAX APPEAL NO.110 OF 2009 , JUDGMENT DATED 26.02.2009 . WITH REGARD TO DISALLOWANCE OF BALANCE INTEREST EXPENDITURE OF RS. 5,80,523/ - , THE LEARNED AUTHORIZE D REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT LOANS WERE BORROWED FOR BUSINESS PURPOSES AND IN ANY CASE, THE ASSESSEE HAD ABOUT RS.51 CRORES AS WORKING CAPITAL WHICH WAS SUFFICIENT TO MAKE INVESTMENT AND PLACING RELIANCE ON THE RATIO LAID DOWN IN CIT VS. HDFC BANK LTD. REPORTED IN 366 ITR 505 (BOM) , THERE WAS NO MERIT IN MAKING ANY DISALLOWANCE UNDER SECTION 14A OF THE ACT. THE THIRD ISSUE IN THE PRESENT APPEAL IS AGAINST RESTRICTING ADMINISTRATIVE AND COMMON EXPENSES WHICH IS CLAIMED TO BE AT HIGHER SIDE, IN VIEW OF THE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF GODREJ & BOYCE MANUFACTURING CO. LTD. REPORTED IN 194 TAXMAN 203 (BOM) . 10. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE ON THE OTHER HAND PLACED RELIANCE ON T HE ORDER OF CIT(A). 11. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ISSUE WHICH ARISES FOR ADJUDICATION IN THE PRESENT APPEAL IS IN RELATION TO THE DISALLOWANCE TO BE MADE UNDER SECTION 14A OF THE ACT. THE YEAR UNDER APPEAL IS ASSESS MENT YEAR 2007 - 08 I.E. THE YEAR IN WHICH THE REGIME OF PROVISIONS OF RULE 8D OF THE INCOME TAX RULES, 1962 CANNOT BE APPLIED . S UCH IS THE RATIO LAID DOWN BY HONBLE BOMBAY HIGH COURT IN THE CASE OF GODREJ & BOYCE MANUFACTURING CO. LTD. (SUPRA). THE HONB LE BOMBAY HIGH COURT HAS SUGGESTED THAT REASONABLE DISALLOWANCE OF EXPENDITURE BE MADE IN THE HANDS OF ASSESSEE FOR ADMINISTRATIVE PURPOSES. HOWEVER, THE SAID DECISION DOES NOT HOLD THAT THE EXPENDITURE WHICH IS CLEARLY RELATABLE TO THE INVESTMENT MADE BY THE ASSESSEE, INCOME FROM WHICH IS EXEMPT FROM TAXES IS NOT TO BE MADE IN THE HANDS OF ASSESSEE. IN THIS REGARD, FIRST WE ITA NO . 1241 / PN /201 4 ASHOK FATTECHAND AJMERE 7 SHALL TAKE UP THE CASE OF REVENUE VIS - - VIS INTEREST EXPENDITURE INCURRED BY THE ASSESSEE. THE FIRST SET OF INVESTMENT MADE BY THE ASSESSEE WAS IN RPL SHARES FOR WHICH, ADMITTEDLY, IT HAD BORROWED THE FUNDS ON WHICH INTEREST EXPENDITURE OF RS. 21,52,504/ - HAD BEEN INCURRED. THE CASE OF THE ASSESSEE BEFORE US IS THAT AGAINST THE SAID INVESTMENT INCOME, NO EXEMPT INCOME HAS BEEN RECEIVE D OR DECLARED BY THE ASSESSEE AND CONSEQUENTLY, NO DISALLOWANCE COULD BE MADE UNDER SECTION 14A OF THE ACT. THE HONBLE BOMBAY HIGH COURT IN CIT VS. M/S. DELITE ENTERPRISES (SUPRA) HAVE HELD THAT WHERE THERE IS NO INCOME ARISING TO THE ASSESSEE ON ITS INV ESTMENT, THEN NO DISALLOWANCE IS TO BE MADE UNDER SECTION 14A OF THE ACT I.E. INTEREST EXPENSES RELATED TO SUCH TAX PROFITS ARE NOT TO BE DISALLOWED UNDER SECTION 14A OF THE ACT. ACCORDINGLY, WE HOLD THAT IN SO FAR AS THE INTEREST EXPENDITURE BEING ATTRIB UTABLE TO SUCH INVESTMENTS, AGAINST WHICH THE ASSESSEE HAD NOT RECEIVED ANY EXEMPT INCOME, NO DISALLOWANCE OF INTEREST EXPENDITURE COULD BE MADE UNDER SECTION 14A OF THE ACT. ACCORDINGLY, WE ALLOW THE CLAIM OF ASSESSEE IN RESPECT OF INTEREST EXPENDITURE O F RS. 21,52,504/ - AND ALLOW THE GROUND OF APPEAL NO.1 RAISED BY THE ASSESSEE. 12. NOW, COMING TO THE ISSUE RAISED BY WAY OF GROUND OF APPEAL NO.2 I.E. BALANCE INTEREST EXPENDITURE OF RS. 5,80,523/ - . ADMITTEDLY, THE ASSESSEE HAD BORROWED THE FUNDS BUT ON TH E OTHER HAND, THE ASSESSEE HAS SUFFICIENT INTEREST FREE FUNDS AVAILABLE WITH IT, WHICH IS APPARENT FROM THE COPY OF BALANCE SHEET FILED BY THE ASSESSEE. THE HONBLE BOMBAY HIGH COURT IN CIT VS. HDFC BANK LTD. (SUPRA) HAVE CLEARLY LAID DOWN THAT IN SUCH CA SES, WHERE THE ASSESSEE HAS SUFFICIENT CAPITAL AVAILABLE WITH IT, NO DISALLOWANCE WAS TO BE MADE OUT OF INTEREST EXPENDITURE UNDER SECTION 14A OF THE ACT. APPLYING THE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT, WE HOLD THAT NO DISALLOWANCE IS TO BE MADE OUT OF BALANCE INTEREST EXPENDITURE OF RS.5,80,523/ - . THE GROUND OF APPEAL NO.2 RAISED BY THE ASSESSEE IS THUS, ALLOWED. ITA NO . 1241 / PN /201 4 ASHOK FATTECHAND AJMERE 8 13. NOW, COMING TO THE LAST ISSUE OF DISALLOWANCE OF PART OF ADMINISTRATIVE EXPENSES UNDER SECTION 14A OF THE ACT. APPLYING TH E RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF GODREJ & BOYCE MANUFACTURING CO. LTD. (SUPRA), WE DIRECT THE ASSESSING OFFICER IN RESTRICTING THE DISALLOWANCE UNDER SECTION 14A OF THE ACT ON ACCOUNT OF ADMINISTRATIVE EXPENSES TO RS.50,000 / - . ACCORDINGLY, WE PARTIALLY ALLOW THE CLAIM OF ASSESSEE AND GROUND OF APPEAL NO.3 RAISED BY THE ASSESSEE IS THUS, PARTLY ALLOWED. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE THUS, PARTLY ALLOWED. 14 . IN THE RESULT, APPEAL OF ASSESSEE IS PARTLY AL LOWED. ORDER PRONOUNCED ON THIS 3 0 TH DAY OF NOVEM BER , 201 6 . SD/ - SD/ - SD/ - SD/ - ( ANIL CHATURVEDI ) ( SUSHMA CHOWLA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; D ATED : 30 TH NOVEM BER , 201 6 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE C I T (A) - IT/TP , PUNE ; 4. / THE C I T - I, PUNE ; 5. , , / DR A , ITAT, PUNE; 6. / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE