TaxTMI 
TaxTMI 
2021 (7) TMI 77
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.... disallowance made by the AO by invoking Rule 8D(2) of the I.T. Rules without recording any satisfaction as to why the disallowance made by the assessee on its own is not correct in the facts and circumstances of the case. 3. The brief facts are that the assessee is a company engaged in the business of manufacturing of machine engineering and automobile components such as gears and shaft. The assessee filed its return of income declaring a total income of Rs. 7,45,25,549/-. Under scrutiny the AO completed the assessment and determined the income of the assessee at Rs. 7,54,17,410/- inter alia disallowing of Rs. 8,91,858/- under Rule 8D r.w.s. 14A of the Act vide its order dated 12-12-2014 u/s. 143(3) of the Act. The CIT(A) confirmed the ....
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....s and surplus more than the investments made and referred to page No. 1 of the paper book of Balance Sheet. Further, the ld. AR referred to page No. 23 of the paper book and submitted on similar issue constituting the same identical facts this Tribunal upheld the disallowance of expenditure at 15% in assessee's own case for A.Ys. 2009-10 and 2010-11 and prayed to allow the grounds raised by the assessee. 5. The ld. DR, Shri Vitthal Bhosale relied on the order of CIT(A) and prayed to dismiss the grounds raised by the assessee. 6. Having heard arguments of both the sides, we note that the assessee on its own allocated at 15% of expenses relating earning exempt income, are also other than which can be directly attributable to manufacturi....
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....esumed that the investments made from own funds. Therefore, the disallowance under interest expenditure involving Rule 8D(2)(ii) is not required in view of decision of Hon'ble High Court of Bombay in the case of CIT Vs. HDFC Bank Ltd. reported in 383 ITR 529 (Bom). 7. In respect of the grounds raised by the assessee regarding the recording of satisfaction of the Assessing Officer in respect of computation of expenditure relating to exempt income, we note that in the assessment order in para 5.3, the Assessing Officer held the submission of assessee is not accepted regarding the computation of expenditure relating to exempt income. We also note that the assessee submitted the details of accounts relating to expenditure incurred in earning....
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....he disallowance made by the assessee on its own is justified. Thus, grounds raised by the assessee are allowed. 8. The assessee raised additional grounds of appeal seeking deduction of Rs. 6,80,000/- paid towards Education Cess under Finance Act while computing the taxable income. The ld. AR submits that the above ground raised by the assessee is purely legal ground and raised for the first time before this Tribunal. Since, the Education Cess paid by the assessee available with the respondent revenue which does not require any further examination of facts and prayed to allow the additional ground. Further, he referred to page No. 31 of the paper book and submitted that this Tribunal taking support from the decision of Hon'ble High Court ....
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....he income chargeable under the head "profits and gains of business or profession". There is no reference to any "cess". Obviously therefore, there is no scope to accept Ms. Linhares's contention that "cess" being in the nature of a "Tax" is equally not deductable in computing the income chargeable under the head "profits and gains of business or profession". Acceptance of such a contention will amount to reading something in the text of the provision which is not to be found in the text of the provision in Section 40(a)(ii) of the IT Act. 23. If the legislature intended to prohibit the deduction of amounts paid by an Assessee towards say, "education cess" or any other "cess", then the legislature could have easily included referenc....
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....of Judicature for Rajasthan Bench at Jaipur in the case of Chambal Fertilisers and Chemicals Ltd. Vs. JCIT, Range -2, Kota wherein substantial question of law No.3 is relevant in this regard (Para 3) and the same was adjudicated by the Hon'ble High Court at Para 12 of the judgment. The Hon'ble High Court on this issue held the said question No.3 is answered in favour of the assessee. For the sake of completeness, the said Paragraph is extracted as under: "12. We have heard consel for the parties. On the third issue in appeal no.52/2018, in view of the circular of CBDT where word "Cess" is deleted, in our considered opinion, the tribunal has committed an error in not accepting the contention of the assessee. Apart from the ....