2025 (8) TMI 1419

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....he Assessee against the order of the Ld. CIT, Appeal, Addl/JCIT(A)-9, Mumbai pertaining to Assessment Year 2017-18, wherein the sole ground of appeal relates to sustenance of addition of Rs. 3,22,627/- under Section 14A r.w. Rule 8D of the Income Tax Rules. 2. Briefly, the facts of the case are that during the course of assessment proceedings, the AO observed that the assessee has claimed exempt ....

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....t which, the assessee is in appeal before us. 3. During the course of hearing, the Ld. AR reiterated the submissions made before the lower authorities. It was submitted that no fresh investment has been made during the year and the same scheme of mutual funds has been continued during the year and even in the earlier years, no interest bearing loans were taken by the assessee and the investment w....

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....in built in the Net Asset Value and as such, the assessee has not incurred any separate expenditure which has been claimed in the P&L Account and therefore, there is no question of disallowance invoking provisions of Section 14A r.w. Rule 8D(2) of the Income Tax Rules. 4. Per contra, the Ld. DR submitted that even for making the investment in the Mutual Funds, the assessee has to decide which Mut....

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....atisfaction is recorded with demonstrable basis that the assessee has incurred the expenses, the AO can then proceed and determined the expenditure which can be disallowed and for the purposes of such determination, can invoke Rule 8D. In the instant case, I find that no such satisfaction has been recorded having regard to the books of accounts that the assessee has incurred the expenses which cou....