TaxTMI 
TaxTMI 
2014 (3) TMI 1128
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....II has erred in confirming the disallowance of Rs. 39,80,707/- u/s 14A of the Income Tax Act r.w. Rule 8D of the Income Tax Rules. 2. That the learned CITA(A)- II has ignored the fact that no disallowance was made in the assessment year 2008-09 & the disallowance made on the same facts in the assessment year 2007-08 stood deleted by the CIT(A) & the Hon'ble Tribunal. 3. That it has been ignored that all the investments in the shares & mutual funds were old ones and out of own funds and there was only a meager investments of Rs. 1,35,749/- during the year out of appellant's own income of Rs. 3,15,39,490/-. 4. That in any case the disallowance upheld is against the law and facts of the case. 5. That the learned CIT(A) has erre....
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....e Commissioner of Income Tax (Appeals) vide para 3.7 held that, "the fund flow pattern which emerges from the copy of the accounts is that the various loans raised by the appellant are deposited with Aarti Steels Limited on which interest is charged. Whenever any investments have to be made by the appellant the funds are withdrawn' from Aarti Steels Limited and then invested into shares or mutual funds. Therefore, it is apparent from the copy of the bank account that it is essentially the borrowed funds which are used for making investments in shares and mutual funds. These borrowed funds are being kept with Aarti Steels Limited and whenever required the same are withdrawn and used for making investments in shares and mutual funds....
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....available with the assessee of Rs. 25.02 Cr. The last plea of the assessee was that during the year under consideration, it had received interest of Rs. 1,19,32,128/- against which the interest expenditure of Rs. 77,72,910/- was debited and after netting off, the net interest was declared as income from other sources and no interest burden could be considered for the aforesaid disallowance under section 14A of the Act. 7. The ld. DR for the revenue placed reliance on the orders of the authorities below and pointed out that in view of the provisions of section 14A of the Act, the disallowance was warranted. 8. We have heard the rival contentions and perused the record. The assessee is the sole proprietor of M/s Saligram Shiv Parshad and is....