TaxTMI 
TaxTMI 
2020 (4) TMI 113
X X X X Extracts X X X X
X X X X Extracts X X X X
....isallowance deduction of Rs. 332629/- out of Rs. 607354/- in respect of sale of seeds claimed u/s 80P(2)(IV)of the I.T. Act, 1961. (607354-274725) On the facts of the case the learned C.I.T(A) failed to appreciate the facts that the said disallowance is uncalled and unwarranted Your appellant therefore prays in the interest of justice to delete the above disallowance of Rs. 332629/- out of Rs. 607354/- in respect of sale of seeds claimed u/s 80P(2)(IV)of the I.T. Act, 1961. 2. On the facts of the case the learned C.I.T.(A)on law as well as on facts of the case in law in disallowing a deduction of Rs. 440120/- u/s 14A of the I.T. Act, 1961. The learned C.I.T.(A) has wrongly invoked the provision of section 14A and Rule 8d of Income Tax Rul....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... should be allowed on net profits after debiting expenses and not gross profit. Accordingly, the ld.AO restricted the deduction by estimating indirect expenditure at the rate of 40%, which worked out to Rs. 2,74,725/- i.e. [Rs. 6,07,754/- minus Rs. 1,49,749/- (excess amount claimed by the assessee) minus Rs. 1,83,150/- being 40% of Rs. 4,57,875/- shown by the assessee as gross profit). Against this disallowance of Rs. 3,32,629/- i.e. [Rs. 1,49,749/- plus Rs. 1,83,150/-] assessee went in appeal before the first appellate authority, but the assessee could not get any relief, hence, before us. 4. Before us the ld.counsel for the assessee reiterated submissions as were made before the lower authorities. He further submitted that similar issue ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....allenged confirmation of disallowance of Rs. 4,40,120/- under section 14A of the Income Tax Act, 1961. 7. As the facts emerge from the record, during the course of assessment proceedings, the AO noted that the assessee had earned dividend income of Rs. 16,362/- which is exempt under section 10(34) of the Income Tax act. The assessee did not make any disallowance under section 14A r.w. rule 8D. It was explained by the assessee that the investments had been made out of own funds and the provisions of section 14A were not applicable to the case of the assessee. The AO did not convince with the contentions of the assessee, he calculated disallowance as per the formula given in Rule 8D and made addition of Rs. 4,40,120/-. This addition was chal....