2020 (6) TMI 128

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....On the facts and circumstances of the case, the lower authorities have erred in disallowing a sum of Rs. 73,036/- by invoking the provisions of Rule 8D of the Income Tax Rules, 1962 read with Section 14A of the Income Tax Act, 1961 (the Act). 3. It is contended that the computation of disallowance of Rs. 73,036/- is wrong and is opposed to facts on records. 4. The disallowance of Rs. 15,21,979/- being interest on capital working progress, on an estimate basis, is wrong and is opposed to facts and evidences on record. 5. The lower authorities have erred in disallowing a sum of Rs. 1,08,641/- on account if Diwali expenses. 6. The lower authorities have erred in effecting the disallowance of Rs. 5,79,100/- o....

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....he ld. CIT (A) confirmed the addition holding that the loan parties (the HUF and the mother) received the amounts from the assessee himself in a circuitous route. Before us, it was submitted that the similar addition made by the AO for the assessment year 2010-11 has been deleted by the ld. CIT (A) and the revenue's appeal filed before the ITAT has been dismissed owing to low tax effect. The ld. DR relied on the order of the ld. CIT (A) for the instant year. 6. We have perused the material on record. The main contention of the AO is that the transactions have been made up with an intention to lower the tax liability of the assessee and also to build up capital for the HUF and for the mother. We find that this is not a case where the ....

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....The AO has disallowed an amount of Rs. 73,036/- based on the CBDT Circular No. 5/2014 dated 11.12.2014. Since, no exempt income has been earned and no expenses has been claimed, we hereby hold that no disallowance is warranted under this Section. Interest on Capital Work in Progress (CWIP): 8. Facts relevant to this issue are that the closing capital work in progress stands at Rs. 1,26,83,160/- and the AO held that the interest needs to be capitalized and estimated the interest at the rate of 12% under CWIP. The total interest disallowed by the AO was Rs. 10,05,317/-. From the records, we find that the assessee has paid and claimed in P&L A/c, an interest of Rs. 10,05,318/- which was on account of interest on cash credit, interest on ....