SHAREKHAN COMMODITIES P.LTD, MUMBAI V. DCIT CC 3(3) , MUMBAI

ITA 5286/MUM/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 8915 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2015-2016
• Appeal Filed On: 12-09-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Capital asset; Earning of tax free income; Rule 8D
• Section: 14A; 115JB; 201; 251; 143(2); 20

Judgement Text

P A G E | 1 ITA NO. 5286 /MUM/201 8 A.Y. 201 5 - 1 6 SHAREKHAN COMMODITIES PVT. LTD PVT. LTD. VS. DEPUTY COMMISSIONER OF INCOME TAX, CC 3 (3) IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI BEFORE SHRI S . RIFAUR RAHMAN , ACCOUNTANT MEMBER AND SHRI RAVISH SOOD, JUDICIAL MEMBER ITA NO. 5286 /MUM/201 8 (ASSESSMENT YEAR: 201 5 - 1 6 ) M/S SHAREKHAN COMMODITIES PVT. LTD; 10 TH FLOOR, BETA BUILDING, LODHA 1 THIK TECHNO PARK, OPP. KANJUMARG STATION, MUMBAI 400 042. VS. DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE - 3 (3), MUMBAI - 400 020 PAN AAFCS6396F (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI HIRO RAI , ADVOCATE . RESPONDENT BY: SHRI V. VINOD KUMAR , D.R DATE OF HEARING: 27 .1 1 .201 9 DATE OF PRONOUNCEMENT: 1 0 . 01 .20 20 O R D E R PER RAVISH SOOD, JM THE PRESENT APPEAL FILED BY THE ASSESSEE COMPANY IS DIRECTED AGAINST THE ORDER PASSED BY THE CIT(A) - 5 1 , MUMBAI , DATED 19.07.2018 , WHICH IN TURN ARISES FROM THE ORDER PASSED BY THE A.O UNDER SEC.143(3) OF THE INCOME TAX ACT, 1961 (FOR SHORT I.T. ACT), DATED 20.09.2017 . THE ASSESSEE HAS ASSAILED THE IMP UGNED ORDER ON THE FOLLOWING GROUNDS OF APPEAL BEFORE US : 1. UNDER THE FACTS AND IN LAW, THE HONBLE CIT(A) HAS ERRED IN DISALLOWING RS. 14,74,750/ - UNDER RULE 8D(III) R.W.S 14A OF THE INCOME - TAX ACT, 1961. 1.1 THE HONBLE CIT( A) FAILED TO APPRECIATE THE SUBMISSION MADE BY THE APPELLANT. 1.2 THE HONBLE CIT(A) FAILED TO APPRECIATE THE FACT THAT CONSIDERING ITS BUSINESS OPERATIONS, THE APPELLANT SUO MOTTO HAS DISALLOWED RS. 2,59,674/ - AS ADMINISTRATIVE EXPENSES. 2. UNDER THE FACT AND IN LAW, THE APPEAL ORDER PASSED BY THE HON. CIT(A) - 51, IS NOT IN ACCORDANCE WITH LAW. 3. YOUR APPELLANT CRAVES LEAVE TO ALLOW AMENDING/ALTERING/ADDING /WITHDRAWING ANY OF THE ABOVE GROUNDS OF APPEAL. P A G E | 2 ITA NO. 5286 /MUM/201 8 A.Y. 201 5 - 1 6 SHAREKHAN COMMODITIES PVT. LTD PVT. LTD. VS. DEPUTY COMMISSIONER OF INCOME TAX, CC 3 (3) 2. BRIEFLY STATED, THE ASSESSEE COMPANY WHICH IS ENGAGED IN THE BUSINESS OF COMMODITY TRADING HAD E - FILED ITS RETURN OF INCOME FOR A.Y 2015 - 16 ON 24.11.2015, DECLARING ITS TOTAL INCOME AT RS. 13,18,15,800/ - . SUBSEQUENTLY, THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY ASSESSMENT UNDER SEC. 143(2) OF THE I.T. ACT. 3. DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS , IT WAS OBSERVED BY THE A.O THAT THE ASSESSEE WAS IN RECEIPT OF DIVIDEND INCOME WHICH WAS CLAIMED AS EXEMPT. THE A.O CALLED UPON THE ASSESSEE TO EXPLAIN AS TO WHY THE EXPENSES ATTRIBUTABLE TO EARNING OF THE EXEMPT DIVIDEND INCOME MAY NOT BE DISALLOWED AS PER SEC. 14A OF THE ACT. IT WAS OBSERVED BY THE A.O , THAT THE ASSESSEE HAD MADE INVESTMENTS IN SHARES, MUTUAL FUNDS OUT OF ITS CONSOLIDATED FUNDS (INCLUDING BORROWED FUNDS). ALSO, THE A.O W AS OF THE VIEW THAT INVESTMENTS IN PRIVATE LIMITED COMPANIES MADE BY THE ASSESSEE WOUL D REQUIRE DAY TO DAY MONITORING AS WELL AS APPRAISAL OF VARIOUS FACTS INCLUDING BUSINESS STRATEGIES, DAY TO DAY OPERATION ETC. AS THE ASSESSEE COULD NOT PROVIDE ANY JUSTI FIABLE METHOD/BASIS OF THE DISALLOWANCE WORKED OUT BY IT UNDER SEC. 14A, THEREFORE, THE A.O COMPUTED THE DISALLOWANCE AS PER RULE 8D, AS UNDER : THE AMOUNT OF EXPENDITURE DIRECTLY RELATING TO INCOME WHICH DOES NOT FORM PART OF TOTAL INCOME 0 EXPENDITURE BY WAY OF INTEREST +A X (B/C) 2,556,670 X 294,950,000 1,432,267,168 526,501 A= THE AMOUNT OF EXPENDITURE BY WAY OF INTEREST OTHER THAN AMOUNT OF INTEREST INCLUDED IN CLAUSE (I) INCURRED DURING THE PREVIOUS YEAR, PARTICULARS AMT. INTEREST 2,556,670 B= THE AVERAGE OF VALUE OF INVESTMENT, INCOME FROM WHICH DOES NOT OR SHALL NOT FORM PART OF THE TOTAL INCOME, AS APPEARING IN THE BALANCE SHEET OF THE ASSESSEE, ON THE FIRST DAY AND THE LAST DAY OF THE PREVIOUS YEAR. PARTICULARS INVST. OPENING BALANCE 439,900,000 CLOSING BALANCE 150,000,000 TOTAL 589,900,000 AVERAGE 294,950,000 C= THE AVERAGE OF TOTAL ASSETS AS APPEARING IN THE BALANCE SHEET OF THE ASSESSEE, ON THE FIRST DAY AND THE LAST DAY OF THE PREVIOUS YEAR. PARTICULARS TOTAL OPENING BALANCE 1,305,423,000 CLOSING BALANCE 1,559,111,335 TOTAL 2,864,534,335 AVERAGE 1,432,267,168 AN AMOUNT EQUAL TO ONE - HALF PER CENT OF THE AVERAGE OF THE VALUE OF INVESTMENT, INCOME FROM WHICH DOES NOT OR SHALL NOT FORM PART OF THE TOTAL INCOME, AS APPEARING IN THE BALANCE SHEET OF THE ASSESSEE, ON THE FIRST DAY AND THE LAST DAY OF THE PREVIOUS YEAR. 1,474,750 DISALLOWANCE U/S. 14A READ WITH RULE 8D 2,001,251 ON THE BASIS OF HIS AFORESAID OBSERVATIONS THE A.O WORKED OUT THE DISALLOWANCE UNDER SEC. 14A R.W RULE 8D AT RS. 20,01,251. AS THE ASSESSEE HAD VOLUNTARILY OFFERED A DISALLOWANCE OF RS. 2,59,674/ - , THEREFORE, THE A.O RESTRICTED THE FURTHER DISALLOWANCE AT RS. 17,41,577/ - [RS. 20,01,251/ - ( - ) RS. P A G E | 3 ITA NO. 5286 /MUM/201 8 A.Y. 201 5 - 1 6 SHAREKHAN COMMODITIES PVT. LTD PVT. LTD. VS. DEPUTY COMMISSIONER OF INCOME TAX, CC 3 (3) 2,59,764/ - ]. AFTER INTER ALIA MAKING THE AFORESAID ADDITIONAL DISALLOWANCE UNDER SEC. 14A R.W RULE 8D, THE INCOME OF THE ASSESSEE WAS ASSESSED AT RS. 13,45,32,647/ - . ALSO, THE BOOK PROFIT UNDER SEC. 115JB AFTER MA KING AN ADJUSTMENT FOR THE DISALLOWANCE UNDER SEC. 14A R.W RULE 8D WAS REWORKED AT RS. 16,06,28,516/ - . 4. AGGRIEVED, THE ASSES S EE ASSAILED THE ASSESSMENT BEFORE THE CIT(A). IT WAS OBSERVED BY THE CIT(A) THAT THE DISALLOWANCE WORKED OUT BY THE A.O UNDER SEC . 14A AT RS. 20,01,251/ - COMPRISED OF TWO PARTS VIZ. (I). U/RULE 8D(2)(II) : RS. 5,26,501/ - ; AND (II). U/RULE 8D(2)(III) : RS. 14.74,750/ - . OBSERVING, THAT THE ASSESSEE DURING THE YEAR HAD SUFFICIENT OWN FUNDS TO MAKE INVESTMENTS IN THE EXEMPT INCOME YIELD ING ASSETS , THE CIT(A) DELETED THE DISALLOWANCE MADE BY THE A.O U/RULE 8D(2)(II). IT WAS ALSO OBSERVED BY THE CIT(A) THAT INVOLVING IDENTICAL FA C TS IN THE CASE OF A RELATED CONCERN OF THE ASSESEEE VIZ. M/S SHAREKHAN FINANCIAL SERVICES PVT. LTD. , THE DELETI ON OF THE DISALLOWANCE U/RULE 8D(2)(II) BY HIS PREDECESSOR WAS UPHELD BY THE TRIBUNAL. AS REGARDS THE DISALLOWANCE THAT WAS MADE BY THE A.O U/RULE 8D(2)(III) IN THE CASE OF THE RELATED PARTY, IT WAS OBSERVED BY THE CIT(A) THAT THE SAME WAS UPHELD BY THE CI T(A). ALSO, IT WAS OBSERVED BY HIM THAT AS THE UPHOLDING OF THE DISALLOWANCE U/RULE 8D(2)(III) BY THE CIT(A) WAS NOT ASSAILED ANY FURTHER IN THE CASE OF THE RELATED PARTY BEFORE THE TRIBUNAL, THEREFORE, THE SAME HAD ATTAINED FINALITY. ON THE BASIS OF HIS A FORESAID OBSERVATIONS THE CIT(A) SUSTAINED THE DISALLOWANCE U/RULE 8D(2)(III) OF RS. 14,74,750/ - THAT WAS MADE BY THE A.O IN THE CASE OF THE PRESENT ASSESSEE . 5 . THE ASSESSEE BEING AGGRIEVED WITH THE ORDER OF THE CIT(A) HAS CARRIED THE MATTER IN APPEAL B EFORE US. IT WAS SUBMITTED BY THE LD. A.R THAT THE A.O WHILE DISLODGING THE CLAIM OF THE ASSESSEE AS REGARDS THE EXPENDITURE THAT WAS STATED TO HAVE BEEN INCURRED FOR EARNING OF THE EXEMPT DIVIDEND INCOME, HAD FAILED TO RECORD HIS SATISFACTION AS REGARDS THE INCORRECTNESS OF THE SAME . IT WAS AVERRED BY THE LD. A.R THAT THE A.O HAD DISLODGED THE CLAIM OF THE ASSESSEE THAT ONLY AN AMOUNT OF RS. 2,59,674/ - WAS ATTRIBUTABLE TOWARDS EARNING OF THE EXEMPT DIVIDEND INCOME WITHOUT RECORDING HIS SATISFACTION AS TO WHY THE SAME WAS NOT TO BE ACCEPTED. IN SUPPORT OF HIS CONTENTION THAT THE A.O HAVING REGARD TO THE ACCOUNTS OF THE ASSESSEE, AS PLACED BEFOR E HIM, BEFORE RESORTING TO AND CARRYING OUT A DISALLOWANCE UNDER SEC. 14 A(2) AND (3) R.W RULE 8D , REMAINED UNDER A BOUNDEN DUTY TO OBSERVE THAT AS TO WHY IT WAS NOT POSSIBLE FOR HIM TO GENERATE THE REQUISITE SATISFACTION WITH REGARD TO THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE , THE LD. A.R HAD RELIED ON A HOST OF JUDICIAL PRONOUNCEMENTS VIZ. (I). GODREJ & BOYCE MANUFACTURING CO. LTD. VS. DY. CIT (2017) 394 ITR 449 (SC); (II). MAXOPPP INVESTMENT LTD. VS. CIT (2018) 402 ITR 640 (SC); (III). PR. CIT VS. BAJAJ FINANCE LTD. (2019) 309 CTR (BOM) 28; (IV). PR. CIT VS. RELIANCE CAPITAL ASSET MANAGEMENT LTD. (2017) 251 TAXMAN 68 P A G E | 4 ITA NO. 5286 /MUM/201 8 A.Y. 201 5 - 1 6 SHAREKHAN COMMODITIES PVT. LTD PVT. LTD. VS. DEPUTY COMMISSIONER OF INCOME TAX, CC 3 (3) (BOM); (V). H.T MEDIA LTD. VS. PR. CIT (2017) 399 ITR 576 (DEL); (VI). M/S TAURIAN ENGINEERING PVT. LTD. VS. ITO, 1 7(1), MUMBAI [ITA NO. 7239/MUM/2016; DATED 25.04.2018]; AND (VII). ANSHUL SPECIALITY MOLECULES LIMITED VS. THE DY. CIT, CENTRAL CIRCLE - 6(3), MUMBAI [ITA NO. 4436/MUM/2016; DATED 13.06.2018] . IT WAS SUBMITTED BY THE LD. A.R THAT AS THE A.O HAD FAILED TO RE CORD ANY SATISFACTION AS REGARDS THE INCORRECTNESS OF THE CLAIM OF THE ASSESSEE THAT ONLY AN AMOUNT OF RS.2,59,624/ - WAS INCURRED/BORNE FOR EARNING OF THE EXEMPT DIVIDEND INCOME , THEREFORE, THE VERY ASSUMPTION OF JURISDICTION BY HIM FOR WORKING OUT TH E DISALLOWANCE UNDER SEC. 14A WAS DEVOID AND BEREFT OF ANY LEGAL SANCTITY . ALTERNATIVELY, IT WAS SUBMITTED BY THE LD. A.R, THAT EVEN OTHERWISE THE A.O WHILE WORKING OUT THE AVERAGE INVESTMENTS FOR THE PURPOSE OF COMPUTING THE DISALLOWANCE U/RULE 8D(2)(II I) HAD WRONGLY INCLUDED SUCH INVESTMENTS WHICH HAD NOT YIELDED ANY EXEMPT INCOME DURING THE YEAR UNDER CONSIDERATION. IT WAS AVERRED BY THE LD. A.R THAT A DIRECTION BE ISSUED TO THE A.O FOR EXCLUDING THE VALUE OF THE INVESTMENTS WHICH HAD NOT YIELDED AN Y E XEMPT INCOME DURING THE YEAR WHILE COMPUTING THE AVERAGE VALUE OF THE INVESTMENTS FOR WORKING OUT THE DISALLOWANCE U/RULE 8D(2)(III) . 6. PER CONTRA, THE LD. DEPARTMENTAL REPRESENTATIVE (FOR SHORT D.R ) RELIED ON THE ORDERS OF THE LOWER AUTHORITIES. IT WAS THE CONTENTION OF THE LD. D.R THAT THE A.O HAD RIGHTLY MADE THE DISALLOWANCE OF RS. 20,01,251/ - UNDER SEC.14A R.W. RULE 8D OF THE EXPENSES THAT WERE INCURRED BY THE ASSESSEE FOR EARNING OF THE EXEMPT DIVIDEND INCOME DURING THE YEAR UNDER CONSIDERATION. 7. WE HAVE HEARD THE AUTHORIZED REPRESENTATIVES FOR BOTH THE PARTIES, PERUSED THE ORDERS OF THE LOWER AUTHORITIES AND THE MATERIAL AVAILABLE ON RECORD , AS WELL AS THE JUDICIAL PRONOUNCEMENTS RELIED UPON BY THEM . WE FIND THAT THE CLAIM OF THE ASSESSEE THAT ONLY AN AMOUNT OF RS. 2,59,674/ - WAS ATTRIBUTABLE TOWARDS EARNING OF THE EXEMPT DIVIDEND INCO ME WAS REJECTED BY THE A.O. AS IS DISCERNIBLE FROM THE ASSESSMENT ORDER, WE FIND, THAT THOUGH THE ASSESSEE HAD SUO MOTTO OFFERED A DISALLOWANCE UNDER SEC. 14A OF RS. 2,59,674/ - IN ITS RETURN OF INCOME, HOWEVER, THE A.O HAD OBSERVED THAT THE ASSESSEE HAD WRONGLY CONTEST ED THAT NO EXPENDITURE HAD BEEN INCURRED FOR EARNING THE DIVIDEND INCOME OR MAKIN G OF INVESTMENTS . BE THAT AS IT MAY , THE A.O INSTEAD OF RECORDING HIS SATISFACTION THAT HAVING REGARD TO THE ACCOUNTS OF THE ASSESSEE AS PLACED BEFORE HIM , IT WAS NOT POSSIBLE TO GENERATE THE REASONABLE SATISFACTION WITH REGARD TO THE CORRECTNESS OF THE CL AIM OF THE ASSESSEE, HAD HOWEVER , SUMMARILY REJECTED THE SAME, FOR THE REASON, THAT THE ASSESSEE COULD NOT PROVIDE ANY METHOD/BASIS WHICH WOULD BE ACCEPTABLE TO THE DEPARTMENT. IN OUR CONSIDERED VIEW , THE A.O HAD REJECTED THE AFORESAID CLAIM OF THE ASSESSE E WITHOUT RECORDING HIS SATISFACTION AS TO WHY THE SAME WAS NOT TO BE ACCEPTED HAVING REGARD TO THE ACCOUNTS OF THE ASSESSEE . ON APPEAL , THE CIT(A) HAD UPHELD THE P A G E | 5 ITA NO. 5286 /MUM/201 8 A.Y. 201 5 - 1 6 SHAREKHAN COMMODITIES PVT. LTD PVT. LTD. VS. DEPUTY COMMISSIONER OF INCOME TAX, CC 3 (3) DISALLOWANCE U/S 14A R.W RULE 8D(2)(III) BY MERELY REFERRING TO THE VIEW TAKEN BY HIS PREDECE SSOR IN THE CASE OF A RELATED PARTY OF THE ASSESSEE. 8. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE ISSUE BEFORE US AND ARE UNABLE TO PERSUADE OURSELVES TO SUBSCRIBE TO THE VIEW TAKEN BY THE LOWER AUTHORITIES . ADMITTEDLY, THE A.O HAVING REGARD TO THE ACCOUNTS OF THE ASSESSEE HAD FAILED TO RECORD HIS DIS SATISFACTION AS REGARDS THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE IN RESPECT OF THE EXPENSES WHICH WERE STATED TO HAVE BEEN INCURRED FOR EARNING OF THE EXEMPT DIVIDEND INCOME. IN OUR CONSIDERE D VIEW , THE ISSUE AS TO WHETHER IT IS OBLIGATORY ON THE PART OF THE A.O TO RECORD HIS SATISFACTION AS TO WHY THE CLAIM OF THE ASSESSEE IN RESPECT OF THE EXPENSES INCURRED FOR EARNING OF THE EXEMPT DIVIDEND INCOME WAS NOT TO BE ACCEPTED , HAVING REGARD TO TH E ACCOUNTS OF THE ASSESSEE , IS NO MORE RES INTEGRA AND HAS BEEN SETTLED BY THE HONBLE SUPREME COURT IN THE CASE OF GODREJ & BOYCE MANUFACTURING COMPANY LTD. VS. DCIT & ANR. (2017) 394 ITR 449 (SC) . THE HONBLE APEX COURT IN ITS AFORESAID ORDER HAD OBSERVE D THAT IT IS OBLIGATORY ON THE PART OF THE A.O TO RECORD HIS SATISFACTION THAT HAVING REGARD TO THE ACCOUNTS OF THE ASSESSEE AS PLACED BEFORE HIM, IT WAS NOT POSSIBLE TO GENERATE THE REASONABLE SATISFACTION WITH REGARD TO THE CORRECTNESS OF THE CLAIM OF TH E ASSESSEE. WE ARE OF STRONG CONVICTION THAT THE OBSERVATION OF THE A.O IN THE PRESENT CASE THAT THE ASSESSEE COULD NOT PROVIDE ANY METHOD/BASIS WHICH WOULD BE ACCEPTABLE TO THE DEPARTMENT FOR WORKING OUT THE DISALLOWANCE U/S 14A , WOULD NOT JUSTIFY THE DISPENSING OF THE STATUTORY OBLIGATION THAT WAS CAST UPON HIM FOR RECORDING HIS SATISFACTION AS REGARDS THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE, HAVING REGARD TO ITS ACCOUNTS PLACED BEFORE HIM . IT WAS OBSERVED BY THE HONBLE APEX COURT IN THE CASE OF GODREJ & BOYCE MANUFACTURING COMPANY LTD. VS. DCIT & ANR. (2017) 394 ITR 449 (SC) THAT IT WAS ONLY AFTER THE A.O HAD RECORDED HIS DISSATISFACTION AS REGARDS THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE THAT THE PROVISIONS OF SEC.14A(2) AND (3) R.W. RULE 8D COULD BE INVOKED. IT WAS OBSERVED BY THE HONBLE APEX COURT, AS UNDER: 37. WE DO NOT SEE HOW IN THE AFORESAID FACT SITUATION A DIFFERENT VIEW COULD HAVE BEEN TAKEN FOR THE ASSESSMENT YEAR 2002 - 2003. SUB - SECTIONS (2) AND (3) OF SECTION 14A OF THE ACT READ WITH RULE SD OF THE RULES MERELY PRESCRIBE A FORMULA FOR DETERMINATION OF EXPENDITURE INCURRED IN RELATION TO INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME UNDER THE ACT IN A SITUATION WHERE THE ASSESSING OFFICER IS NOT SATISFIED WITH TH E CLAIM OF THE ASSESSEE. WHETHER SUCH DETERMINATION IS TO BE MADE ON APPLICATION OF THE FORMULA PRESCRIBED UNDER RULE 8D OR IN THE BEST JUDGMENT OF THE ASSESSING OFFICER, WHAT THE LAW POSTULATES IS THE REQUIREMENT OF A SATISFACTION IN THE ASSESSING OFFICER THAT HAVING REGARD TO THE ACCOUNTS OF THE ASSESSEE, AS PLACED BEFORE HIM, IT IS NOT POSSIBLE TO GENERATE THE REQUISITE SATISFACTION WITH REGARD TO THE CORRECTNESS OF THE CLAIM OF THE ASSESSEE. IT IS ONLY THEREAFTER THAT THE PROVISIONS OF SECTION 14A(2) AN D (3) READ WITH RULE 8D OF THE RULES OR A BEST JUDGMENT DETERMINATION, AS EARLIER PREVAILING, WOULD BECOME APPLICABLE. 9. AS OBSERVED BY US HEREINABOVE, THE A.O HAD DISLODGED THE AFORESAID CLAIM OF DISALLOWANCE U/S 14A OF THE ASSESSEE, WITHOUT RECORDING HIS SATISFACTION AS TO WHY THE SAME WAS NOT TO BE ACCEPTED HAVING REGARD TO THE ACCOUNTS OF THE ASSESSEE WHICH WERE PLACED BEFORE HIM . WE THUS IN TERMS OF OUR AFORESAID OBSERVATIONS RESPECTFULLY FOLLOWING THE JUDGMENT OF THE HONBLE SUPRE ME COURT IN THE CASE P A G E | 6 ITA NO. 5286 /MUM/201 8 A.Y. 201 5 - 1 6 SHAREKHAN COMMODITIES PVT. LTD PVT. LTD. VS. DEPUTY COMMISSIONER OF INCOME TAX, CC 3 (3) OF GODREJ & BOYCE MANUFACTURING COMPANY LTD. VS. DCIT & ANR. (2017) 394 ITR 449 (SC) , THEREIN VACATE THE FURTHER DISALLOWANCE OF RS. 17,41,577/ - [RS. 20,01,251/ - ( - ) RS. 2,59,674/ - ] MADE BY THE A.O UNDER SEC.14A R.W. RULE 8D. 1 0 . AS WE HAVE VACATED THE DISALLOWANCE MADE BY THE A.O UNDER SEC. 14A R.W RULE 8D ON THE GROUND OF INVALID ASSUMPTION OF JURISDICTION BY THE A.O, THEREFORE, THE OTHER GROUNDS WHICH HAD BEEN RAISED BY THE ASSESSEE BEFORE US FOR ASSAILING THE AFORE SAID DISALLOWANCE, HAVING BEEN RENDERED AS ACADEMIC IN NATURE ARE THEREFORE NOT BEING ADVERT ED TO AND ADJUDICAT ED UPON BY US . 1 1 . THE APPEAL OF THE ASSESSEE IS ALLOWED IN TERMS OF OUR AFORESAID OBSERVATIONS. ORDER PR ONOUNCED IN THE OPEN COURT ON 1 0 . 01 .20 20 S D / - S D / - ( S . RIFAUR RAHMAN ) (RAVISH SOOD) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI ; 10.01.2020 PS. ROHIT / 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 . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI