2020 (1) TMI 1468

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....18 pertaining to A.Y. 2013-14 and assessee has raised the following grounds:- 1. In law and in the facts and circumstance of the case of appellant, the Ld. CIT(A) has grossly erred in upholding disallowance of Rs. 57,72,000 being 1% of certain administrative expenditure incurred by Appellant under section 14A r. w. Rule 8D(2)(iii) of the Act, when no such disallowance is called for. 1.1 The Ld. CIT(A) ought to have appreciate that disallowance u/s.14A r. w. Rule 8D cannot exceed exempt income of Rs. 50,000/-earned during the year. 2. The Assessing officer has erred on facts and in law charging interest u/s 234A, 234B, 234C and 234D when no such interest is leviable. The appellant denies its liability to pay interest. 2. Facts of....

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....the last day of the previous year;   P.Y, Assets 53958710000 C.Y. Assets 59509940000 Total 113468650000 2 56734325000 PY+CY   (A) (B) (C) AXB/C Interest. Exp. JA) 0 Avg. Invest. 34055570000 Avg. Assets (C) 56734325000 Total -AXB/C 0 (B) (iii) An amount equal to one-half percent of the average of the value of investment, income from which does riot or shall not form part of the total income, as appearing in the balance sheet of the assessee, on the first day of the previous year 170277850 Avq. investment 34055570000  |   0.5   100   |   170277850   |   170277850 AGGREATE OF (....

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....cer had worked out the disallowance of expenditure under section 14A of the Act read with Rule 8D to Rs. 1,02,82,049/-. The Tribunal, while restricting the disallowance to Rs. 55,604/-, relied on the decision of Delhi High Court in case of Joint Investments (P) Ltd vs. CIT reported in 372 ITR 694 holding that disallowance of expenditure in terms of section 14A read with Rule 8D cannot exceed the exempt income itself. Our High Court has also adopted the similar view in case of Commissioner of Income Tax vs. Corrtech Energy Pvt. Ltd. reported in 372 ITR 97. 3. Tax appeal is, therefore, dismissed. 5. As we can see, assessee total dividend income is Rs. 50,000/- so there cannot be disallowance of Rs. more than 50,000/- Respectfully follow....