2022 (7) TMI 23

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....ievances raised by the parties are as follows:- (A) Grievances raised by the assessee 1. On the facts and in the circumstances of the case and in law, the respondent prays that no disallowance ought to be made in absence of earning of any exempt income. 2. Without prejudiced to ground 1 above, on the facts and in the circumstances of the case and in law, the respondent prays that in case the disallowance under section 14A is to be made in accordance with Rule 8D as prayed by the Department, then the disallowance under section Rule 8D(3) ought to be restricted to Rs. 9,87,978/- basis the working of disallowance accepted by the Department in the past assessment year. (B) Grievance raised by the Assessing Of....

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....f section 14A read with rule 8D of the Income Tax Rules, 1962 has been the subject matter of incessant litigation on almost every issue, involved, i.e. whether a disallowance can be made when no exempt income has been earned during the year, whether the satisfaction has been correctly recorded by the AO regarding the correctness of the claim and in respect of such expenditure incurred in relation to exempt income, whether share application money is to be considered as investment, whether investment in subsidiary company or joint ventures can be said to be made with a view of earn exempt income etc. In the present case the admitted fact is that no dividend income or any other exempt income has been earned during the year under consideration.....

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....s. (B-C-D-E-F)   6,58,445 Total   9,87,978 Further we would like to bring to your notice that the same issue was equally covered & decided by Honorable CIT(A), Mumbai in our case in AY 2008-09, 2009-10, 2010-11, 2011-12 & 2012-13 & Honorable ITAT in our case in AY 2008-09, 2009-10, 2010-11 & 2011-12 and the department has not contested the same before higher authorities. The Ld. Assessing Officer may, therefore, be directed to restrict the disallowance u/s. 14A of the Income Tax Act, 1961 to Rs. 9,87,978/- in normal computation, as well as under section 115JB of the Act." 5. None of the parties is satisfied. While assessee is aggrieved of the disallowance being confirmed to the extent Rs.9,87,97....