ALKA MANDKE, MUMBAI V. ASST CIT 11(2), MUMBAI

ITA 5029/MUM/2012

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 5847 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-03-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 20-03-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 06-08-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: M L PERUMAL
• Keywords: Earning of tax free income
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH A, MUMBAI BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND DR. S.T.M. PAVALAN, JUDICIAL MEMBER ITA NO. 5029/MUM/2012 ASSESSMENT YEAR: 2008-09 MRS. ALKA N. MANDKE 1 ST FLOOR KADAMGIRI HANUMAN ROAD, VILLE PARLEY (EAST) MUMBAI-400 057 VS. ASST. CIT-11(2) AAYAKAR BHAVAN, M.K. ROAD MUMBAI-400 020 (APPELLANT) (RESPONDENT) PERMANENT ACCOUNT NO. :- AAFPM 7755 D APPELLANT BY : SHRI SANJAY PARIKH RESPONDENT BY : SHRI M. L. PERUMAL DATE OF HEARING : 20.03.2014 DATE OF PRONOUNCEMENT : 28.03.2014 O R D E R PER DR. S.T.M. PAVALAN, JM: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF THE LD.CIT(A) -3, MUMBAI DATED 10.07.2012 FOR THE ASSES SMENT YEAR 2008-09. IN THIS APPEAL, THE ASSESSEE HAS AGITATED THE ACTION OF THE LD.CIT(A) IN CONFIRMING THE DISALLOWANCE/ADDITION OF RS.3,15,387/- MADE BY THE AO U/S 14 OF THE INCOME TAX ACT READ WITH RULE 8D OF THE INCOME TAX RULES. 2. BRIEFLY STATED, THE ASSESSEE, AN INDIVIDUAL, DOC TOR BY PROFESSION, DURING THE YEAR UNDER CONSIDERATION, WHILE DECLARING THE INCOM E, HAD SHOWN INVESTMENTS IN SHARES, MUTUAL FUNDS ETC. AGGREGATING TO RS.6,30,77 ,406/- AND HAD EARNED DIVIDEND INCOME OF RS.21,20,744/- WHICH SHE CLAIMED EXEMPT. THE ASSESSEE DID NOT OFFER ANY DISALLOWANCE U/S 14A OF THE ACT. DURING THE ASSESSM ENT PROCEEDINGS, WHEN THE ASSESSEE WAS REQUIRED TO FILE WORKING OF DISALLOWAN CE, VIDE LETTER DATED 10.11.2010, THE ASSESSEE SUBMITTED THE WORKING OF THE DISALLOWA NCE AT RS.2,72,324/- BY TAKING THE AMOUNT OF INVESTMENT AT RS.5,44,64,703/-. HOWEV ER, FROM THE PERUSAL OF THE ITA NO. 5029/MUM/2012 MRS. ALKA N. MANDKE ASSESSMENT YEAR: 2008-09 2 BALANCE SHEET AS ON 31.03.2008, THE AO NOTED THAT T HE ASSESSEE HAD MADE THE INVESTMENT IN SHARES AND MUTUAL FUNDS FOR AN AGGREG ATE AMOUNT OF RS.6,30,77,406/ AND ACCORDINGLY, THE AO RE-WORKED THE DISALLOWANCE AT RS.3,15,387/- @ 0.5% OF THE INVESTMENT OF 6,30,77,406/-. ON APPEAL, THE LD.CIT( A) CONFIRMED THE SAID DISALLOWANCE MADE BY THE AO. AGGRIEVED BY THE IMPUG NED DECISION, THE ASSESSEE HAS PREFERRED THIS APPEAL BEFORE US. 3. WE HAVE HEARD BOTH THE SIDES AND PERUSED THE MAT ERIAL ON RECORD. IT IS THE CONTENTION OF THE LD.AR THAT THE ASSESSEE HAS NOT I NCURRED ANY EXPENDITURE FOR EARNING THE EXEMPT INCOME AND THE DISALLOWANCE CONF IRMED/MADE BY THE LD.CIT(A) /AO IS UNWARRANTED AND HENCE THE SAME IS TO BE DELE TED. HOWEVER, IT IS FOUND THAT THE ASSESSEE HAS NOT RAISED SUCH PLEA BEFORE THE AO DURING THE ASSESSMENT PROCEEDINGS. INSTEAD, THE ASSESSEE VIDE LETTER DATE D 10.11.2011 HAS SUBMITTED A WORKING OF DISALLOWANCE U/S 14A R.W.R 8D WHEREBY TH E DISALLOWANCE HAS BEEN WORKED OUT AT RS.2,72,324/-. THE ASSESSEE, INSTEAD OF CONSIDERING THE AGGREGATE AMOUNT OF RS.6,30,77,406/- HAS CONSIDERED AN AMOUNT OF RS.5,44,64,703/- FOR SUCH WORKING. THE AO HAS RE-WORKED THE DISALLOWANCE AT R S.3,15,387/- BY TAKING INTO ACCOUNT OF THE CORRECT FIGURE OF INVESTMENT AND THE REBY MADE THE DISALLOWANCE WHICH HAS BEEN CONFIRMED BY THE LD.CIT(A). CONSIDE RING THE AFOREMENTIONED FACTS, WE ARE NOT INCLINED TO ACCEPT THE ARGUMENTS OF THE LD.AR THAT THE ASSESSEE HAS NOT INCURRED ANY EXPENDITURE FOR EARNING THE DIVIDEND I NCOME, WHICH IS IN OUR VIEW APPEARS TO BE AN AFTER THOUGHT DEFENSE. MOREOVER, RULE 8D IS APPLICABLE FOR THE ASSESSMENT YEAR UNDER CONSIDERATION. IN VIEW OF THE AFOREMENTIONED DISCUSSION, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD.CI T(A) CONFIRMING THE IMPUGNED DISALLOWANCE/ADDITION AND THUS THE SAME IS UPHELD. 4. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 28 TH DAY OF MARCH, 2014. SD/- SD/- (P.M. JAGTAP) (DR. S.T.M. PAVALAN) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 28.03.2014. *SRIVASTAVA ITA NO. 5029/MUM/2012 MRS. ALKA N. MANDKE ASSESSMENT YEAR: 2008-09 3 COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR A BENCH //TRUE COPY// BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.