TaxTMI 
TaxTMI 
TaxTMI 
2017 (9) TMI 312
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....alia that :- "1. That without appreciating the facts and circumstances of the case and in law, the Ld CIT (A) was not justified in upholding that the Ld AO had correctly noted his satisfaction for applying section 14A read with Rule 8D and that the disallowance made by him as per Rule 8D amounting to Rs. 4,11,355 is correct. It is prayed that appropriate orders be passed to delete the disallowances in the interest of justice. 2. That without considering the correct facts and circumstances of the case and in law the Ld CIT (A) has wrongly concluded that the appellant company had incurred expenditure for earning of exempt income and completely overlooked the ratios laid down by various Hon'ble courts regarding the applicability of th....
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....the disallowance filed by the assessee is worked out as per the provisions of Rule 80 (2) as under :- ASSESSMENT YEAR 2011-12 Particulars Amount (Rs) i) Interest cost under clause (ii) of Rule 8D(2) [As per Working below] NIL ii) 0.5% of Average value of - Investment * - (0.5% of Rs. 8,22,70,927/-) 4,11,355 Total 4,11,355 Disallowance of Interest cost under Clause (ii) Particulars Amount (Rs) i) Total Interest cost (as per Profit & loss Account) (A) NIL NIL Disallowance of Interest cost under Clause (II) A X B 0 X 10,28,09,400 A X B 0 X 10,28,09,400 28,73,99,310 C NIL Working of Average Investments and Assets (As per Balance sheet) as per Rul....
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.... in ITA No.548/2015 dated23.08.2017 and Godrej & Boyce Manufacturing Company Ltd. vs. DCIT - 394 ITR 449 (SC). 6. Ld. DR for the Revenue challenging the impugned order contended inter alia that the AO has worked out the disallowance under Rule 8D as per accounts rendered by the assessee having been duly explained at the page 3 of the assessment order; that section 114 of the Evidence Act, 1872 raises presumption in favour of the Revenue that there was non-satisfaction of the AO and relied upon the order of the AO and relied upon the decisions rendered by Hon'ble Apex Court in Mak Data Pvt. Ltd. vs. CIT - 2013- TIOL-58-SC-IT and CIT vs. Daulat Ram Rawatmull - (1973) 87 ITR 349 (SC). 7. Undisputedly, the AO, without pointing out any defect....
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.... become applicable." 9. Hon'ble Delhi High Court in HT Media Limited (supra) decided the issue in controversy in favour of the assessee by returning the following findings :- "39. Turning now to the order of the ITAT in para 33, it recorded the submission of the AR that the AO did 1)0t record any satisfaction about the Assessee not properly offering expenditure incurred in relation to the exempt income at Rs. 3 lakhs. The ITAT reproduced the contents of para 3.3.1 of the assessment order, which has been extracted by this Court hereinbefore, which contains general observations regarding earning of exempt income. This cannot be accepted as a recording by the AO of satisfaction regarding the claim of the Assessee after examining its accoun....
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.... tune of Rs. 1,00,000/- which has been accepted by the AO without pointing out any defect, provisions contained u/s 14A read with Rule 8D cannot be invoked. Because sub-section (2) & (3) of section 14A with Rule 8D of the Rules has only prescribed a formula for determination of an expenditure to earn the income which does not form part of the total income under the Act, which can only be invoked if the AO is not satisfied with the claim of the assessee. 11. AO has invoked provisions contained u/s 14A read with Rule 8D in mechanical manner without pointing out that such and such expenses have been incurred by the assessee. Furthermore, in the similar set of facts, ld. CIT (A) in assessee's own case for AY 2010-11, available at pages 21 to 2....