TaxTMI 
TaxTMI 
2022 (2) TMI 488
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....Cross objection filed by the assessee are directed against the order dated 30-05-2017 passed by Ld CIT(A)-11, Bangalore and they relate to the assessment year 2008-09. All the grounds urged in the above said appeals relate to the disallowance made u/s 14A of the Income-tax Act,1961 ['the Act' for short]. 2. This is second round of proceedings. Earlier, the appeal filed by the assessee against the addition made u/s 14A of the Act was disposed of by the Tribunal, vide its order dated 28-08-2014 passed in ITA No.1522 (Bang) 2012. In the above said order, the Tribunal restored the issue of disallowance of interest expenditure under Rule 8D(2)(ii) and the administrative expenses u/r 8D(2)(iii) to the file of the AO with the following ....
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..../advances given to subsidiary companies. In addition the AO also not recorded the satisfaction with regard to the claim of the assessee that own funds were sufficient to meet the increase of investments. Decision of the Co-ordinate Bench in the case of Reliance Utilities & Power Ltd. (supra) would definitely come to the aid of the assessee. Nevertheless, whether such own funds were sufficient to cover the additional investments when aggregated with the advances given to subsidiary companies, and whether the latter could be considered is investments giving rise to tax free income requires a fresh look by the AO. Similarly, whether Rule 8D has to be applied with regard to the claim of indirect expenditure also requires a fresh look by the AO.....
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....sallowance of Rs. 19,61,28,191/- u/r 8D(2)(ii) and Expenditure disallowance of Rs. 15,31,08,546/- u/s 8D(2)(iii). Accordingly, after setting off the voluntary disallowance made by the assessee, the AO added the amount of Rs. 29,70,81,132/- to the total income and also while computing book profit u/s 115JB of the Act. 5. The Ld CIT(A) has prepared following chart showing details of own funds, investments and Loans and advances:- Sl.No. Details of own funds and non-interest bearing funds As on March 31^st 2008 (Rs.in crorese) Details of investments As on March 31^st 2008 (Rs. in crores) 1 Share capital (a) Equity (b) Preference 364.13 0 Investment in subsidiaries, other companies and units of M....
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..... HDFC Bank Ltd (366 ITR 505), the Ld CIT(A) deleted the disallowance of interest made u/s 8D(2)(ii) of I T Rules. The Ld CIT(A), however, confirmed the disallowance of expenses made u/r 8D(2)(iii) of IT Rules. Aggrieved by this decision of Ld CIT(A), the revenue has filed this appeal. 6. We heard the parties on this issue and perused the record. From the table extracted in the preceding paragraph, it can be noticed that the own funds available with the assessee would become lower, only if the value of investments and the amount of Loans and advances are aggregated together. If we compare the own funds with the value of investments, then the own funds is more. Hence the ratio laid down by the jurisdictional High Court in the case of Micr....
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....ered in the appeal of the revenue, he will confine himself in the Cross Objection with the disallowance of expenses made u/r 8D(2)(iii) of I T Rules. 8. We heard the parties on the issue of disallowance made u/r 8D(2)(iii) of IT Rules. We noticed earlier that the assessee had made disallowance of Rs. 25 lakhs, while the AO determined the disallowance at Rs. 15,31,08,546/-. At the time of hearing, the Ld A.R took us to the various types of expenses incurred by the assessee and submitted that most of the expenses are not related to the earning of exempt income. When the bench proposed that this issue may be restored to the file of the AO to re-determine the disallowance by excluding the value of investments which did not yield exempt incom....