Comoro Technologies (P) Ltd. vs. ACIT

Parties Involved

Facts Summary

The assessee, Comoro Technologies (P) Ltd., a private limited company, filed its return of income for the assessment year 2017-18 declaring an income of Rs.1,63,56,850/-. The case was selected for limited scrutiny under CASS, where one of the reasons was that the exempt income was significantly lower compared to the investment made to earn such income. The assessment was completed under section 143(3) with a total income of Rs. 2,01,54,906/- by making a disallowance under section 14A at Rs. 37,98,056/-. The assessee challenged this disallowance before the Commissioner of Income Tax (Appeals), which was dismissed. The assessee then appealed to the Tribunal against the order of the NFAC.…

Legal Issues

• 1. Whether the order of the CIT (A) is bad in law.
• 2. Whether the CIT (A) erred in sustaining the addition of Rs. 37,98,056/- made by the Assessing Officer under section 14A.
• 3. Whether the CIT(A) established any nexus of expenditure to the dividend earned during the year.
• 4. Whether the CIT(A) erred in sustaining the addition under section 14A without recording satisfaction.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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