https://www.taxtmi.com/caselaws?id=346904 Delhi HC ruled in favor of the assessee in a case involving disallowance of interest under Rule 8D(2)(ii). The court held that the Assessing Officer failed to record mandatory satisfaction under Section 14A(2) read with Rule 8D(1)(a), making application of Rule 8D(2)(iii) inappropriate. The assessee, engaged in printing and publishing with investments in shares/mutual funds/bonds, demonstrated direct nexus between all interest expenditure and specific loans from earlier years. The court emphasized that Rule 8D(2)(ii) formula applies only when interest expense cannot be attributed to particular income or receipts. Since no such unattributable interest was identified by the AO, the disallowance formula was inapplicable. The ITAT's remand order was criticized as the AO's procedural failures precluded proper application of the disallowance provisions. en-us Wed, 23 Aug 2017 00:00:00 +0530 Tue, 22 Jul 2025 12:20:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=346904 Delhi HC ruled in favor of the assessee in a case involving disallowance of interest under Rule 8D(2)(ii). The court held that the Assessing Officer failed to record mandatory satisfaction under Section 14A(2) read with Rule 8D(1)(a), making application of Rule 8D(2)(iii) inappropriate. The assessee, engaged in printing and publishing with investments in shares/mutual funds/bonds, demonstrated direct nexus between all interest expenditure and specific loans from earlier years. The court emphasized that Rule 8D(2)(ii) formula applies only when interest expense cannot be attributed to particular income or receipts. Since no such unattributable interest was identified by the AO, the disallowance formula was inapplicable. The ITAT's remand order was criticized as the AO's procedural failures precluded proper application of the disallowance provisions. Case-Laws Income Tax Wed, 23 Aug 2017 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=346904