TaxTMI 
TaxTMI 
2014 (4) TMI 1188
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.... of convenience, they are clubbed, heard combinedly and disposed of in this consolidated order. Appeal wise and ground wise adjudication is given in the following paragraphs. 2. At the outset, Shri Yogesh A Thar, Ld Counsel for the assessee brought our attention to the appeal for the assessment year 2008-2009, and mentioned that ground no.1 raised in that appeal, which is relating to reopening u/s 147 of the Act, is pressed. After hearing the Ld DR in this regard, the said ground no.1 of the appeal ITA No.5146/M/2012 (AY: 2008-2009) is dismissed as not pressed. Ground no.2 in the said appeal, which is exactly identical to the solitary ground raised by the assessee for the AY 2009-2010 and the only difference is in figures, is raised w....
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....enue Authorities. 5. We have heard both the parties and perused the orders of the Revenue Authorities as well as the cited decision of the Tribunal in the case of M/s. Jayshree Petrochemicals Pvt. Ltd (supra). On perusal of the said order of the Tribunal, we find para 4 to 7 of the Tribunal's order (supra) are relevant and the same read as under: "4. We have considered the rival submissions as well as relevant material on record. The Assessing Officer has worked out the disallowance u/s 14A by considering the direct expenditure as well as indirect expenditure. The direct expenditure has been worked out by the A.O as under: "The assessee has also incurred following expenses which are directly connected with the earning o....
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....ion to the exempt income the same cannot be allowed against the income which is taxable. Thus, for attracting the provision of Section 14A there should be proximate cause for disallowance which has relationship with the tax exempt income. The apportionment of expenditure is needed when expenditure is incurred in relation to composite/indivisible business which results the earning of both taxable and non-taxable income. Therefore in order to disallowed the expenditure u/s 14A there must be a live nexus between the expenditure incurred and the income not forming part of the total income. In the case in hand the details of direct and indirect expenses booked by the assessee to the profit and loss account are given in schedule 14 at page no. 6 ....
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....pplying Rule 8D is not justified as there is no direct nexus between the expenditure and the exempt income which is prerequisite for applying Section 14A. Even otherwise the Rule 8D can be invoked only when Section 14A is attracted and not otherwise. The scheme and purpose of Section 14A is to disallow the claim of the expenses incurred in relation to earning the income not forming part of the total income. Therefore, the disallowance of expenditure is always in relation to the claim of expenditure and it cannot be more than the claim itself. An identical issue has been considered by the Delhi Benches of the Tribunal in case of Gillette Group India Pvt. Ltd. Vs ACIT and concluded in para 6 as under: "6. From the above, it is eviden....