2022 (9) TMI 1238

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....has taken the following grounds of appeal: "i. That on the facts and in the circumstances of the case, the ld. CIT(A), Kolkata has erred in law to hold that disallowances u/s 14A read with 8D for the A.Y. 2016- 17 will not apply where no exempt income in received or receivable during the relevant previous year by ignoring the provision of Rule 8D that provides for computation of expenditure in respect of not only those investments, income from which does not form part of total income but also those investments, income from which shall not form part of total income. ii. That on the facts and in the circumstances of the case, the ld. CIT(A), Kolkata has erred in law in deciding that disallowance u/s 14A read with Rule 8D can....

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.... on the ground that assessee may have incurred certain expenses on making investment in shares which would later on yield exempted income. The AO has stated that as the company has paid interest on borrowed funds there may have been utilization on such borrowed funds for making the investments and he proceeded to invoke the provision of section 14A read with Rule 8D and accordingly pass the assessment order. 3. Dissatisfied with the above order, the assessee preferred an appeal before the ld. CIT(A). However, the appeal of the assessee was allowed by the ld. CIT(A). 4. Aggrieved by the above order, revenue preferred the instant appeal before the Tribunal against the ld. CIT(A) deleting the disallowance made u/s 14A of the Act read wit....

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....Tribunal. It is also noted that while deciding the issue, the ld. CIT(A) relied on the judgement of the Hon'ble Supreme Court dated 08.02.2019 in the case of CIT vs Oil Industry Development Board (SLP Civil No. 2755/2019) has dismissed the SLP filed by the revenue against the judgement of Hon'ble Delhi High Court dated 16.02.2018 by relying upon the decision in the case of CIT vs Essar Teleholdings Limited (2018) 3 SCC 253. The Hon'ble Delhi High Court had rules that, in absence of any exempt income, disallowance u/s 14A of the Act of any amount was not permissible. In arriving at this conclusion, the Hon'ble Delhi High Court had relied upon its earlier decision in the case of Cheminvest Ltd. vs CIT (378 ITR 33). The above proposition of la....