ITO 2 (1)(1), MUMBAI V. ARCHWAY INVESTMENT CO.LTD., MUMBAI

ITA 3822/MUM/2018

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 5000 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 10 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-04-2021
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 31-05-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: BRAJENDRA KUMAR
• Keywords: Capital asset; Earning of tax free income; Rule 8D; Set aside
• Section: 14A; 115JB

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI SHRI SHAMIM YAHYA (AM) & SHRI PAVANKUMAR GADALE ( JM) I.T.A. NO. 3822/MUM/2018 (ASSESSMENT YEAR 2014-15) I.T.A. NO. 6654/MUM/2017 (ASSESSMENT YEAR 2013-14 ) ITO-2(1)(1) ROOM NO. 543 AAYAKAR BHAVAN M.K. ROAD MUMBAI-400 020. VS. M/S. ARCHWAY INVESTMENT COMPANY LIMITED NEVILLE HOUSE, JN HEREDIA MARG, BALLARD ESTATE MUMBAI-400 001. ( APPELLANT ) ( RESPONDENT ) I.T.A. NO. 6193/MUM/2016 (ASSESSMENT YEAR 2012-13) M/S. ARCHWAY INVESTMENT COMPANY LIMITED NEVILLE HOUSE, JN HEREDIA MARG, BALLARD ESTATE MUMBAI-400 001. VS. ITO-2(1)(1) ROOM NO. 543 AAYAKAR BHAVAN M.K. ROAD MUMBAI- 400 020. (APPELLANT) (RESPONDENT) PAN : AAACA5507H ASSESSEE BY SHRI YOGESH THAR DEPARTMENT BY SHRI BRAJENDRA KUMAR DATE OF HEARING 0 9 .0 2 .2021 DATE OF PRONOUNCEMENT 08.04.2021 O R D E R PER SHAMIM YAHYA (AM) :- THESE ARE APPEALS BY THE ASSESSEE FOR A.Y. 2012-1 3 AND REVENUES APPEAL FOR A.Y. 2013-14 & 2014-15. 2. ITA NO. 6193/MUM/2016 ASSESSEES APPEAL FOR A. Y. 2012-13 :- THE GROUNDS OF APPEAL READ AS UNDER :- GROUND NO. I: DISALLOWANCE U/S 14A OF THE ACT: RS. 91,55,480/- 1. ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE AN D IN LAW, THE HON'BLE CIT(A) ERRED IN UPHOLDING THE ACTION OF THE LD. AO IN DISALLOWING A SUM OF RS. 91,55,480/- U/S 14A OF THE ACT BEING THE DISALLOWANCE COMPUTED AS PER RULE 8D OF THE INCOME TAX RULES, 1962 ('THE RULES'). M/S. ARCHWAY INVESTMENT COMPANY LIMITED 2 2. THE APPELLANT PRAYS THAT THE AO BE DIRECTED TO DE LETE THE DISALLOWANCE U/S 14A OF THE ACT AMOUNTING TO RS. 91,55,480/- OR THE DISALLOWANCE BE APPROPRIATELY REDUCED. 3. WITHOUT PREJUDICE TO ABOVE, WHERE ASSESSEE HAS S UFFICIENT INTEREST FREE FUNDS EXCEEDING TAX FREE INVESTMENTS, IT IS PRESUMED THAT INVESTMENTS ARE MADE OUT OF SUCH INTEREST FREE FUNDS AND THEREFORE NO DISALLOWANCE U/S. 14A R.W.R 8D(2)(II) OF THE RULES IS CALLED FOR; 4. WITHOUT PREJUDICE TO ABOVE, WHILE COMPUTING AVE RAGE INVESTMENTS FOR THE PURPOSE OF RULE 8D OF THE RULES, ONLY THOSE INVESTMEN T FROM WHICH EXEMPT INCOME HAS BEEN EARNED DURING THE YEAR SHOULD BE CON SIDERED; 5. WITHOUT PREJUDICE TO ABOVE, WHILE COMPUTING AVE RAGE INVESTMENTS FOR THE PURPOSE OF RULE 8D OF THE RULES, INVESTMENTS WHICH ARE STRATEGIC IN NATURE ARE TO BE EXCLUDED. 6. WITHOUT PREJUDICE TO ABOVE, FOR THE PURPOSE OF CA LCULATION OF DISALLOWANCE AS PER RULE 8D OF THE RULES, IT IS ONLY THE NET INTEREST DEBITED TO PROFIT AND LOSS ACCOUNT WHICH SHOULD BE CONSIDERED AN D NOT THE GROSS INTEREST AS CONSIDERED BY THE AO; 7. WITHOUT PREJUDICE TO ABOVE, TOTAL EXPENSES WHIC H CAN BE INDIRECTLY BE ATTRIBUTABLE TO EARNING INCOME WHICH DOES NOT FORM PART OF TOTAL INCOME, SHOULD BE RESTRICTED TO AMOUNT WHICH HAVE BEEN ACTUAL LY DEBITED TO P&L ACCOUNT AND CLAIMED IN THE RETURN OF INCOME. 3. ITA NO. 6654/MUM/2017- REVENUES APPEAL FOR A.Y. 2013-14 :- GROUNDS OF APPEAL READ AS UNDER :- 1. 'ON THE FACTS AND CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD. CIT(A) HAS ERRED IN DIRECTING THE AO TO EXCLUDE THE STRATEG IC INVESTMENTS MADE IN GROUP/ASSOCIATE COMPANIES FOR THE PURPOSE OF DISALLO WANCE U/S 14A R.W.R. 8D.' 2. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD. C1T(A) HAS ERRED IN DIRECTING TO EXCLUDE THE VALUE O F INVESTMENT IN D. B. REALITY FOR THE PURPOSE OF COMPUTATION OF DISALLOWANC E U/S 14A, ON ASSESSEE'S CONTENTION THAT NO DIVIDEND WAS EARNED FROM SUCH INVESTMENTS, WHEN SUCH INVESTMENT MAY YIELD DIVIDEND INCOME IN FU TURE WHICH IS EXEMPT FROM TAX.' 3. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DIRECTING THAT THE COMPUTATION UND ER CLAUSE (F) OF EXPLANATION TO SECTION 115JB(2) IS TO HE MADE WITHOUT R ESORTING TO THE COMPUTATION AS CONTEMPLATED U/S 14A R.W. RULE 80 OF T HE I.T. RULES, 1961.' 4. ITA NO. 3822/MUM/2018- REVENUES APPEAL FOR A.Y. 2014-15 :- GROUNDS OF APPEAL READ AS UNDER :- M/S. ARCHWAY INVESTMENT COMPANY LIMITED 3 CIT(A) HAS ERRED IN ALLOWING RELIEF TO THE ASSESSEE TO THE EXTENT IMPUGNED IN THE GROUNDS ENUMERATED BELOW: 1. 'ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE DISALLOWANCE U/S 14A R.W.R. 8D( 2)(II) CONSIDERING THAT THE ASSESSEE MADE INVESTMENT FROM ITS OWN FUNDS AND I NTEREST EXPENSES ARE NOT ATTRIBUTABLE TO EARN EXEMPT INCOME, WHEN THE ASSESSEE HAS INVESTED TOTAL FUND AT RS. 101 CRORES AS AGAINST ITS BORROWED FUND OF RS. 86 CRORES.' 2. 'ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW , THE LD. CIT(A) ERRED IN RESTRICTING THE DISALLOWANCE TO RS. 2,15,738/ -HOLDING THAT THE DISALLOWANCE CANNOT BE MORE THAN THE ACTUAL EXPENSES DEBITED IN THE P&L ACCOUNT.' 3. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD. CIT(A) ERRED NOT CONSIDERING THE DECISION OF THE SUPRE ME COURT IN MAXOPP INVESTMENT LTD. VS. CIT [TS-5170-SC-2018-0] AND IN T HE CASE OF AVON CYCLES LTD. VS. CIT [TS-6251-HC-2014(P&H-0)] WHEREIN APPORT IONMENT PRINCIPLE WAS UPHELD IN THE CASE OF MIXED FUNDING OF INVESTMENT.' 4. 'ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE DISALLOWANCE U/S 14A MADE FOR THE PURPOSE OF COMPUTING BOOK PROFIT U/S 115JB OF THE ACT RELYING ON THE ITAT SPECIAL BENCH, DELHI IN THE CASE OF PR. CIT V/S VIREET INVEST MENTS WITHOUT CONSIDERING THE FACT THAT THE ISSUE HAS NOT REACHED JUD ICIAL FINALITY.' 5. 'FOR THESE AND OTHER GROUNDS THAT MAY BE URGED AT TH E TIME OF HEARING, THE DECISION OF THE CIT(A) MAY BE SET ASIDE AND THAT OF TH E AO BE RESTORED.' 5. THE ASSESSEE HAS RAISED ADDITIONAL GROUND OF APP EAL WHICH READ AS UNDER :- ADDITIONAL GROUND NO. I: ADDITION OF RS. 91,55,480 /- MADE UNDER SECTION 14A READ WITH RULE 8D CANNOT BE MADE WHILE COMPUTING BOOK PROFITS UNDER SECTION 115JB OF THE A CT. ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE AND IN LA W, THE HON'BLE CIT(A) ERRED IN CONFIRMING THAT THE DISALLOWANCE MADE U/S. 14 A READ WITH RULE 8D OF RS. 91,55,480/- ALSO OUGHT TO BE ADDED TO THE BOOK P ROFIT UNDER SECTION 115JB OF THE ACT. 6. ASSESSMENT YEAR 12-13 DURING THE YEAR ASSESSEE COMPANY HAS EARNED EXEMPT DIVIDEND INCOME OF RS. 2,16,75,690/-. THE ASSESSING OFFICER MADE DISALLOWA NCE UNDER SECTION 14 A OF THE I.T. ACT AMOUNTING TO RS. 91,55,480/-. M/S. ARCHWAY INVESTMENT COMPANY LIMITED 4 7. UPON ASSESSEE'S APPEAL LEARNED CIT(A) CONFIRMED THE SAME OBSERVING AS UNDER:- I HAVE CONSIDERED THE FINDINGS OF THE ASSESSING OFF ICER AS WELL AS RIVAL SUBMISSION OF THE APPELLANT, CAREFULLY. IT IS SEEN FR OM THE PROFIT & LOSS ACCOUNT THAT THE APPELLANT HAS SHOWN DIVIDEND ON SHARE S OF RS.2,16,75,690/- AS REVENUE FROM OPERATIONS AND NOT A S INCOME FROM OTHER SOURCES. IT CAN BE SEEN FROM THE EVIDENCE ON REC ORD THAT THE APPELLANT IS A NON-BANKING FINANCIAL COMPANY, ENGAGE D IN LENDING AND BORROWING MONEY AND MAKING INVESTMENT. THUS, IT IS EV IDENT THAT WHATEVER INVESTMENT HAS BEEN MADE WHICH IS IN THE CO URSE OF BUSINESS ACTIVITIES, THEREFORE, WHEN ENTIRE INVESTMENT IS MADE O UT OF OWN FUNDS AS WELL AS SHORT-TERM BORROWINGS BY THE OTHER CURRENT LIA BILITIES, SUCH INVESTMENT IS DEFINITELY HAVING FINANCE COST. THE APPE LLANT HAS SHOWN FINANCE COST AS INTEREST EXPENDITURE OF RS.89,53,630/ - AND BANK CHARGES OF RS.1,550/- AND FURTHERMORE, THERE IS AN ADMINISTR ATIVE EXPENSES DEBITED IN PROFIT & LOSS ACCOUNT OF RS.1,06,815/-. TH US, IT CANNOT BE SAID THAT THE DIVIDEND IS EARNED WITHOUT ANY ELEMENT OF EXPEND ITURE. CONTRARY TO THE ARGUMENTS OF LD. A.R., IT IS VERY EVIDENT THAT EX PENDITURE HAS BEEN INCURRED FOR EARNING SUCH DIVIDEND. I FIND NO MERIT IN THE ARGUMENTS THAT THE LD. ASSESSING OFFICER HAS NOT RECORDED HER SATIS FACTION FOR INVOKING SEC.14A OF THE L.T.ACT, 1961. ON THE CONTRARY, IN PAR A 3.1, THE LD. ASSESSING OFFICER HAS RIGHTLY MENTIONED THAT ASSESSEE HAS SHOWN INVESTMENT OF RS.53,90,42,813/-, HOWEVER, IT HAS NOT SH OWN EXPENDITURE HENCE, THE APPELLANT WAS ASKED AS TO WHY EXPENDITURE SH OULD NOT BE DISALLOWED BY APPLYING RULE 8D OF THE INCOME-TAX RULE , 1962. THUS, THERE IS A RECORDING OF REASON THAT THE ASSESSEE HAS NO T SHOWN ANY EXPENDITURE, THEREFORE, THE VARIOUS CASE LAWS REFERRE D TO AND RELIED UPON BY THE LD. A.R. IN WRITTEN SUBMISSION ARE NOT AT ALL APPLICABLE TO THE FACTS OF THE CASE. THERE IS NO NEED TO DISCUSS EACH & EVERY CASE WHEN FACTS ARE VISIBLE FROM ASSESSMENT ORDER ITSELF. FURTHER CONTENTI ON THAT THE INVESTMENT OF RS.52,72,20,197/- IS STRATEGIC INVESTMENT , SAME TO BE EXCLUDED WHILE WORKING DISALLOWABLE EXPENDITURE UNDE R RULE 8D OF THE INCOME-TAX RULE, 1962, IT IS PERTINENT TO MENTION THAT W HEN THE APPELLANT CLAIMS THAT IT IS NON-BANKING FINANCIAL COM PANY AND IS ENGAGED IN THE BUSINESS OF LENDING & BORROWING MONEY AND MAKING INVESTMENTS. SUCH INVESTMENTS ARE NOT AT ALL STRATEGIC IN VESTMENT. IT IS VERY EVIDENT THAT IN PROFIT & LOSS A/C., THE APPELLANT HA S SHOWN REVENUE FROM OPERATION OF RS.3,17,55,020/- WHICH INCLUDES I NTEREST ON INTER- CORPORATE DEPOSIT OF RS.1,00,79,330/- AND DIVIDEND ON SHARES OF RS.2,16,75,690/-, IT MEANS THERE IS NO STRATEGIC INVE STMENT BUT ENTIRE INVESTMENT HAS BEEN MADE FOR BUSINESS PURPOSE OR FOR EARNING DIVIDEND THAT IS WHY AS COMPARED TO INTEREST INCOME, DIVIDEND IS ON HIGHER SIDE. THEREFORE, THE APPELLANT'S CASE IS SUITABLE CASE WHER E RULE 8D OF THE INCOME-TAX RULE, 1962 IS TO BE APPLIED. THE LD. ASSES SING OFFICER HAS RIGHTLY REFUTED THE CONTENTION OF THE APPELLANT THAT THERE IS A STRATEGIC INVESTMENT AND SEC.14A DOES NOT APPLY. THEREFORE, I FI ND NO INFIRMITY IN THE FINDING OF THE LD. ASSESSING OFFICER. M/S. ARCHWAY INVESTMENT COMPANY LIMITED 5 CONSIDERING THE FACTS OF THE CASE, NATURE OF BUSINES S, NATURE OF INVESTMENT AND APPLICABILITY OF RULE 8D, I FIND THAT RULE 8D HAS RIGHTLY CALCULATED THE DISALLOWABLE EXPENSE AS PROVIDED IN R ULE 8D AND THEREFORE, HAS RIGHTLY DISALLOWED AN AMOUNT OF RS.91, 55,480/- UNDER RULE 8D. THUS, DISALLOWANCE OF EXPENDITURE IS SUSTAIN ED. 8. AGAINST THIS ORDER ASSESSEE IS IN APPEAL BEFORE US. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE RECORDS. 9. WE FIND THAT THE ASSESSEE'S PLEA OF INVESTMENT B EING STRATEGIC IN NATURE IS NO MORE SUSTAINABLE IN VIEW OF HONOURABLE SUPREM E COURT DECISION IN THE CASE OF MAXOPP INVESTMENT LTD V/S CIT 402 ITR 640. HENCE, THIS GROUND IS DISMISSED. 10. THE ASSESSEE'S PLEA THAT WHEN INTEREST FREE FUN DS ARE AVAILABLE, WHICH ARE MORE THAN THE IMPUGNED INVESTMENT THEN NO DISAL LOWANCE UNDER SECTION 8D(II) OF THE ACT IS PERMISSIBLE IS SUSTAINABLE ON THE TOUCHSTONE OF HONOURABLE JURISDICTIONAL HIGH COURT DECISION IN THE CASE OF H DFC BANK LTD. (366 ITR 505) AND RELIANCE CAPITAL ASSET MANAGEMENT LTD. (INCOME TAX APPEAL NO. 487 OF 2015 DATED 19.9.2017). HENCE THIS GROUND IS ALLOWED. 11. AS REGARDS THE DISALLOWANCE UNDER SECTION 8D(II I) ONLY THOSE INVESTMENTS ARE TO BE CONSIDERED WHICH HAVE EARNED EXEMPT INCOM E ON THE TOUCHSTONE OF ITAT SPECIAL MEN DECISION IN THE CASE OF VIREET INV ESTMENT P. LTD.(SUPRA). 12. AS REGARDS DISALLOWANCE UNDER SECTION 115JB BY IMPORTING THE PROVISIONS OF SECTION 14A THE SAME IS NOT SUSTAINAB LE ON THE TOUCHSTONE OF ITAT SPECIAL BENCH DECISION IN THE CASE OF VIREET I NVESTMENT (P.) LTD. (ITA NO.502 OF 2012). 13. ASSESSMENT YEAR 13-14 DURING THE YEAR ASSESSEE COMPANY HAS EARNED EXEMPT DIVIDEND INCOME OF RS.2,16,76,190/-. THE ASSESSING OFFICER MADE FURTHE R DISALLOWANCE UNDER SECTION 14A OF THE ACT AMOUNTING TO RS. 3,52,73,379 /-. M/S. ARCHWAY INVESTMENT COMPANY LIMITED 6 14. UPON ASSESSEE'S APPEAL LEARNED CIT(A) ADJUDICAT ED THE SAME OBSERVING AS UNDER :- 5.4 I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE AS WELL AS ORAL CONTENTIONS AND WRITTEN SUBMISSION OF THE ASSESSEE. I T IS SEEN THAT THE HON'BLE ITAT IN APPELLANT'S OWN CASE IN ITA N0.8461 /M/2010 AND 5598/M/2011 AND ITA NO.948/M/2011, 7215/M/2012 & 60 13/M/2011 FOR A.YRS.2007-08 AND 2008-09 IN THEIR COMBINED ORDER HA VE DECIDED THE ISSUE PERTAINING TO DISALLOWANCE U/S.14A IN THE CASE OF THE ASSESSEE. FROM PARA 18, PAGE 6 TO PARA 23, PAGE 9 OF THE SAID ORDER DEA LS WITH THE ISSUE WHEREIN AFTER DEALING WITH THE FACTS AND THE RELATED DECISIO NS, HON'BLE ITAT HAVE DIRECTED TO EXCLUDE THE STRATEGIC INVESTMENTS MADE IN GROUP/ASSOCIATE COMPANIES FOR THE PURPOSES OF COMPUTATION OF DISALLO WANCE U/S.14A R.W.R.SD. RESPECTFULLY FOLLOWING SUCH DECISION OF TH E HON'BLE ITAT IN THE APPELLANT'S OWN CASE, THE ASSESSING OFFICER IS DIREC TED TO EXCLUDE THE STRATEGIC INVESTMENTS MADE IN THE GROUP/ASSOCIATE COMPA NIES FOR THE PURPOSES OF COMPUTATION OF DISALLOWANCE U/S.14A R.W. R.SD OF THE INCOME-TAX RULES. THE APPELLANT HAS FURTHER STATED THAT THE REMAININ G INVESTMENT IS IN THE CASE OF D B REALTY LTD. FROM WHERE THEY HAVE NOT E ARNED DIVIDEND DURING THE YEAR. THE AO IS ACCORDINGLY DIRECTED TO VERIFY S UCH INVESTMENT OF THE ASSESSEE AND IF THERE IS NO EXEMPT INCOME EARNED DUR ING THE YEAR FROM SUCH INVESTMENT, THEN AS PER THE JURISPRUDENCE PREVAILIN G ON THE ISSUE, THE AO IS DIRECTED TO EXCLUDE THE VALUE OF SUCH INVESTMENTS FOR THE PURPOSES OF COMPUTATION OF DISALLOWANCE U/S.14A R.W.R.SD. ACCORDI NGLY, THESE GROUNDS OF APPEAL ARE TREATED AS PARTLY ALLOWED SUBJECT TO COMPUTA TION OF DISALLOWANCE BY THE AO AS DIRECTED HEREINABOVE. I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE AS WELL AS ORAL CONTENTIONS AND WRITTEN SUBMISSION OF THE ASSESSEE. THE ISSUE ON HAND HAS BEEN DECIDED BY THE HON'BLE SPECIAL BENCH, NEW DELHI IN THE CASE O F ACIT.CIRCLE-17(1), NEW DELHI V. VIREET INVESTMENT (P.) LTD. (ITA NO.50 2 OF 2012) WHEREIN IT HAS BEEN HELD THAT THE COMPUTATION UNDER CLAUSE (F) OF EXPLA NATION TO SECTION 115JB(2) IS TO BE MADE WITHOUT RESORTING TO THE COMPUTATI ON AS CONTEMPLATED UNDER SECTION 14A READ WITH RULE 8D OF THE INCOME-TAX RULES, 1962. RESPECTFULLY FOLLOWING THE SAME, THE GROUND OF APPEAL RAISED BY THE APPELLANT IS ALLOWED. 15. AGAINST THE ABOVE ORDER REVENUE IS IN APPEAL BE FORE US. 16. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE RECORDS. AS REGARDS REVENUES GROUND THAT LEARNED CIT(A) HAS ERRED IN HO LDING THAT NO DISALLOWANCE UNDER SECTION 14A IS TO BE DONE WHEN THE INVESTMENT S ARE STRATEGIC IN NATURE, THE SAME IS SUSTAINABLE ON THE TOUCHSTONE OF HONOUR ABLE SUPREME COURT M/S. ARCHWAY INVESTMENT COMPANY LIMITED 7 DECISION IN THE CASE OF MAXOPP INVESTMENT LTD V/S C IT (402 ITR 640). ACCORDINGLY THIS LIMBER OF ADJUDICATION OF LEARNED CIT(A) IS REVERSED. 17. THE DECISION OF LEARNED CIT(A) THAT DISALLOWANC E UNDER SECTION 8D(II) IS NOT PERMISSIBLE IF THE INTEREST FREE FUNDS AVAILABL E ARE MORE THAN THE IMPUGNED INVESTMENT IS SUSTAINABLE ON THE TOUCHSTONE OF REAS ONING IN OUR DECISION FOR ASSESSMENT YEAR 12-13 AS ABOVE. 18. THE LEARNED CIT(A) DECISION THAT DISALLOWANCE U NDER SECTION 14A OF THE ACT SHOULD NOT BE IMPORTED UNDER SECTION 115 JB OF THE ACT IS ALSO SUSTAINABLE ON THE TOUCHSTONE OF ITAT SPECIAL BENCH DECISION IN THE CASE OF VIREET INVESTMENT (P) LTD.(SUPRA). LEARNED COUNSEL OF THE ASSESSEE HAS ALSO MADE THE SUBMISSION UNDER RULE 27 OF THE ITAT RULES THAT FOR DISALLOWANCE UNDER SECTION 8D(III) OF THE ACT ONLY THOSE INVESTMENTS S HOULD BE CONSIDERED WHICH HAVE EARNED EXEMPT INCOME. THIS PLEA IS ALSO SUSTAI NABLE ON THE TOUCHSTONE OF ITAT SPECIAL BENCH DECISION IN THE CASE OF THE VIRE ET INVESTMENT (P) LTD.(SUPRA). THE ASSESSEES PLEA THAT ONLY NET INTEREST SHOULD B E CONSIDERED IS NOT SUSTAINABLE WHEN ASSESSEE IS ALREADY TAKING BENEFIT OF THE DECISION OF HON'BLE BOMBAY HIGH COURT IN THE CASE OF HDFC BANK LTD. (36 6 ITR 505) AND VIREET INVESTMENT P. LTD. (SUPRA). 19. ASSESSMENT YEAR 2014-15 THE FACTS AND ISSUES ARE SIMILAR TO ASSESSMENT YEAR 2013-14 ABOVE. OUR ADJUDICATION FOR ASSESSMENT YEAR 2013-14 APPLIES MU TATIS MUTANDIS TO A.Y. 2014-15 ALSO. 20. IN THE RESULT, THE APPEALS ARE PARTLY ALLOWED A S ABOVE. PRONOUNCED IN THE OPEN COURT ON 8.4.2021. SD/- SD/- (PAVANKUMAR GADALE) (SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTAN T MEMBER MUMBAI; DATED : 08/04/2021 M/S. ARCHWAY INVESTMENT COMPANY LIMITED 8 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( ASSISTANT REGISTRAR) PS ITAT, MUMBAI