2017 (7) TMI 1075

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....ER Rajendra A.M. Challenging the order, dated 21/01/2015,of CIT (A)-2,Mumbai,the assessee has filed the present appeal. Assessee-company, engaged in the business of manufacturing and trading of polyester yarn and generation and sale of electricity, filed its return of income on 20/09/2010,declaring income of Rs. 6.61 crores. The Assessing Officer(AO)completed the assessment, u/s.143 (3) of the ....

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...., 1962 (Rules).The assessee argued that while calculating the disallowance under rule 8D (2) (ii) of the Rules the interest paid on term loans should not be taken into consideration, that it was paid for availing loans for specific purposes. The AO observed that the assessee maintained a common bank account in which all sorts of receipts including term and other loans were deposited that from the ....

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....ds available for the year under consideration amounted to Rs. 47.18 crore, that the investment made by the assessee for the year was of Rs. 4.93 crore only, that the own funds were nearly 10 times that of the investments. He referred to the case of HDFC bank Ltd. (383 ITR 529) of the honorable Bombay High Court and argued that no disallowance under rule 8D(ii)should have been made, that the assess....

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.... that the assessee had sufficient own funds during the year under consideration for making the investments. The assessee had own fund of Rs. 47 crores(app.),whereas investments, resulting in exempt income, were of Rs. 4 crores(app.). The honorable jurisdictional High Court in the case of HDFC Bank Ltd (supra)has held that if an assessee possessed sufficient own fund the presumption was that invest....