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Alembic Pharmaceuticals Limited,, ... vs The Dy.Cit.,Circle-1(1)(1),, Baroda on 26 October, 2018
cites
Section 14A in The Income Tax Act, 1961 [Entire Act]
Section 3 in The Income Tax Act, 1961 [Entire Act]
Dcit 6(3)(2), Mumbai vs Essar Properties P. Ltd, Mumbai on 30 May, 2018
"8. We have heard the rival contentions, perused the material available on record
and gone through the orders of the authorities below. As the facts emerge, we find that
the assessee's own funds, i.e., equity, reserve and surplus funds amounting to
Rs.32,699.06 lakhs far exceed the tax free investments. The impugned investments are
old and out of own funds have not been rebutted. Relying on the Hon'ble Gujarat High
Court judgments in the case of Hitachi Home and Life Solutions (I) Ltd (supra), Torrent
Power Ltd (supra) and other judgments mentioned above, we are of the view that when
the assessee possesses own funds much more than the tax free investments, the
disallowance u/s 14A read with Rule 8D cannot be made. There is also merit in the plea
of ld. Counsel on the count that the burden of establishing the nexus has been wrongly
attributed to the assessee and it was for the Assessing Officer to rebut the assessee's
contention and demonstrate that the tax free investments were not from own funds but
from borrowed funds. In the absence of such rebuttal, it cannot be assumed that the
assessee made tax free investments out of borrowed funds. The assessee has suo moto
I.T.A No. 2329 & CO No. 176/Ahd/2014 A.Y. 2012-13 Page No 5
DCIT vs. M/s. Alembic Pharmaceuticals Ltd.
Section 2 in The Income Tax Act, 1961 [Entire Act]
The Income Tax Act, 1961
The Public Provident Fund Act, 1968
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