2016 (5) TMI 1417

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....B.S. Bist ORDER Per B.R. Baskaran, AM :- The appeal filed by the assessee is directed against the order dated 22.12.2010 passed by learned CIT(A)-2, Mumbai and it relates to A.Y. 2007-08. 2. The first issue urged in the appeal relates to disallowance u/s. 14A of the Act. The assessee has earned dividend income of Rs. 8,13,986/- during this year and claimed the same as exempt. The asses....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....debtors for making investment in mutual funds during the instant year. Learned Counsel submitted that most of the shares held by the assessee are brought forward from earlier year and during the year under consideration it has made investment in mutual funds only. Accordingly he submitted that there is no requirement making any disallowance out of interest expenditure. 4. Learned AR further sub....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....two mutual funds and most of the shares have been brought forward from the earlier year. Under these set of facts, we are of the view that the disallowance u/s. 14A may be restricted to 2% of the dividend income earned by the assessee as held in the case of Godrej Agrovet Ltd. (ITA no. 934 of 2011 dated 8.1.2013) by Hon'ble Bombay High Court. The order of learned CIT(A) stands modified accordingly....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....sive method. Through this statement, the assessee has demonstrated that Net profit disclosed by the assessee remains the same under both methods. This statement shows that there would be no effect on the profit even if exclusive method is followed. We noticed that the Assessing Officer has not examined this statement put forth by the assessee. Accordingly, we are of the view that this issue req....