2022 (5) TMI 1591

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....ng disallowance of a sum of Rs. 14,98,610/- u/s 14A read with rule 8D (2) (i ii) by the appellant company. 1.1 That the learned Commissioner of Income Tax(Appeals) has failed to appreciate that since appellant company had earned dividend income only of Rs 7,62,771/- but AO made a disallowance of Rs 14,98,610/-. Upholding such disallowance in excess of the amount of income earned, is against the intent and spirit of the law. 1.2 That the learned Commissioner of Income Tax (Appeals) did not appreciated that, AO ignoring submission of appellant that it has suo motto added back related expenses of Rs 44643/-, still proceeded with the addition without discharging his burden to establish that, the claim of expenses incurred by a....

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....53,048/- towards interest on late deposit of TDS (Rs.64/-) FBT (Rs.14,433/-) Service tax (Rs.138551/-). That disallowance so upheld by learned Commissioner of Income Tax (Appeals) is based on misinterpretation of statutory provisions of law and hence unsustainable. 3.1 That findings of Commissioner of Income Tax (Appeals) for upholding the disallowance is reliance upon Madras High Court judgment of 1998, ignoring the subsequent judgment of Karnataka High Court of 2008 sited by appellant, in disregard the norm of following the latter decision. Learned Commissioner (Appeals) did not appreciate the settled legal position that interest on late deposit of TDS/ SERVICE TAX /FBT is mandatory provision in law which is compensatory in natur....

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..../2018 for A.Y. 2014-15 wherein it was held as under: "4. During the year, the assessee earned dividend from mutual fund of Rs.1,03,60,745/- and suo moto disallowed an amount of Rs.5,57,215/- u/s 14A. The AO by resorting the provisions of Rule 8D(2)(ii) computed disallowance to Rs.96,28,052/-. 5. The ld. CIT (A) directed the AO to recompute the disallowance u/s 14A by considering the investments from which dividend has been earned by the appellant company and relying on the order of the Special Bench of ITAT in the case of CIT Vs Vireet Investments Pvt. Ltd. 82 Taxman 415, we hereby direct that only the investments which yielded the exempt income be considered for computation of disallowance u/s 14A r.w. Rule 8D." 5. In ....

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....e assessee and since the ld. CIT (A) has followed the earlier orders of the Tribunal , we decline to interfere with the order of the ld. CIT(A)." 7. In the absence of any material change and legal proposition, we affirm the order of the ld. CIT(A). Interest on Late Deposit: 8. During the year, the assessee paid interest and debited the same to P&L account with regard to interest on late deposit of FBT of Rs.14,433/-, penalty on service tax of Rs.2,000/- and interest on late deposit of service tax of Rs.1,38,551/-. 9. The ld. CIT(A) confirmed the disallowance relying on the judgment of Hon'ble Chennai High Court in the case of CIT Vs. Chennai Properties & Investments Ltd. 239 ITR 435 (Mad.) (1998). 10. The Hon'ble Apex Court o....