2018 (8) TMI 1485

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....y, JM This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals)-5, Pune dated 18-03-2016 for the assessment year 2010-11. The solitary issue raised by the assessee in appeal is against confirming of disallowance Rs. 10,92,618/- u/s. 14A of the Act r.w. Rule 8D(2)(iii) of the Income Tax Rules, 1962. 2. Shri Krishna Gujrathi appearing on behalf of the as....

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....ssee had categorically stated before the Commissioner of Income Tax (Appeals) that disallowance u/s. 14A cannot exceed the actual expenditure incurred for earning exempt income. The ld. AR pointed that indirect expenditure incurred by the assessee and debited to P & L Account is to the tune of Rs. 25,78,927/-. Out of the aforesaid expenditure, expenditure to the tune of Rs. 22,43,620/- is unrelate....

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....horities below. The only issue in appeal by the assessee is against confirming of disallowance of Rs. 10,92,618/- u/s. 14A r.w. Rule 8D(2)(iii). The short contention of the assessee is that the disallowance u/s. 14A cannot be made beyond the expenditure debited to P & L account in relation to earning of exempt income. The ld. AR has referred to the P & L account at page 32 of the paper book and th....

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....ome Tax (supra) has restricted the disallowance u/s. 14A to the extent of expenditure debited to P & L account. Similar view has been taken in the case of Income Tax Officer Vs. Pioneer Radio Training Services Pvt. Ltd. (supra) and in the case of M/s. Search Enviro Ltd. Vs. ACIT (supra). In light of the decisions referred above, in principle we agree with the proposition mooted by the ld. AR. Howe....