TaxTMI 
TaxTMI 
2012 (5) TMI 108
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....efore disposing them of by this consolidated order for the sake of convenience. A.Y. 2003-04 (Assessee's appeal): 2. The only issue raised in this appeal is against confirmation of disallowance of Rs.2,15,265/- claimed by the assessee as write off of old unrecoverable earnest money deposits deductible u/s. 37(1) of the Act. 3. Briefly stated, the facts of the case are that the assessee wrote off Rs.2,15,265/- as bad and doubtful debts in its books of account. On being called upon to justify the deduction, the assessee stated that these were old earnest money deposits made by the assessee in the course of business which became irrecoverable and were forfeited by the parties. Not convinced, the AO made the addition because the assess....
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....lace on record any evidence showing, firstly, that the amounts in question were given in earlier years on account of earnest money deposits in the course of business to its business associates and secondly the said parties refused to refund such amount to it. It was, however, maintained that the assessee made strenuous efforts to recover the said amount but could not get it back. The ld. AR submitted that he has got the evidence in this regard, but the same was not readily available. It was, therefore, prayed that one more opportunity be granted to the assessee to lead evidence in support of it case on both these issues. No serious objection was taken by the ld. DR. Having regard to the facts and circumstances of the instant case, we are of....
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.... to make disallowance u/s.14A on a reasonable basis in conformity with the judgment of the Hon'ble Bombay High Court in the case of Godrej & Boyce Mfg. Co.Ltd. vs. DCIT [since reported in (2010) 328 ITR 81 (Bom) ]. From the ground taken by the Revenue, it is observed that they are aggrieved against the application of the judgment in the case of Godrej & Boyce Mfg. Co. Ltd. on the ground that the said judgment has not been accepted by the Revenue and SLP has been proposed. In our considered opinion, the force of judgment of any High Court is not diluted simply because the aggrieved party prefers SLP before the Hon'ble Supreme Court or even if such SLP is admitted. It is only when the Hon'ble Supreme court reverses the judgment of Hon'ble Hig....
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....itted before the ld. CIT(A) that there was no nexus whatsoever of the interest bearing deposits with the investments made by the company from which such exempt income was earned. Relying on certain judgments and certain orders passed by the Tribunal, the assessee contended that in order to invoke the provisions of sec. 14A, it was required to be determined first whether any expenditure was actually incurred to earn such exempt income. Not convinced with the assessee's submission, the ld. CIT(A) observed that the Hon'ble jurisdictional High Court in the case of Godrej & Boyce Mfg. Co. Ltd. has held that Rule 8D is applicable w.e.f. assessment year 2008-09. He, therefore, upheld the action of the AO in computing disallowance as per Rule 8D. ....
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....rd to the accounts of the assessee, is not satisfied with the correctness of the claim of the assessee in respect of such expenditure in relation to income which does not form part of the total income under this Act. (3) The provisions of sub-section (2) shall also apply in relation to a case where an assessee claims that no expenditure has been incurred by him in relation to income which does not form part of the total income under this Act." 15. A bare perusal of the above provisions indicates that the AO shall determine the amount disallowable as per Rule 8D, if he, "is not satisfied with the correctness of the claim of the assessee" in respect of such expenditure in relation to exempt income. Even if the assessee claims tha....