2014 (8) TMI 1260

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ependently without prejudice to one another; 1. Disallowance us/14A. 1.01) On the facts and circumstances of the case and in law, the learned CIT(A) erred in confirming disallowance of Rs 11,54,860/- vide Rule 8D(2) by invoking provisions of section 14A of the Act without appreciating that all the expenses debited to the profit and loss account are incurred for the purpose of the business income and allowable as business expense. Thus the disallowance being bad-in-law needs to be deleted. 1.02) Without prejudice to the above and without admitting, on the facts and circumstances of the case and in law, the learned CIT(A) erred in not appreciating that the resort cannot be made to Rule 8D(2) since the learned AO has....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... 1098130/- 5 Allocable Expenses 56729/- 6 Total Disallowance (4+5) 1154860/- 3.Aggrieved by the order of the AO, assessee preferred an appeal before the First Appellate Authority(FAA).It was argued before him that AO had not mentioned the defects with the calculation made by the assessee, that he should have rejected the claim of the assessee before applying the provisions of Rule 8D, that Nil/negligence expenditure was incurred for earning dividend income, that borrowed funds were not utilised by the assessee. After considering the facts of the case and submission of the assessee, FAA held that AO had made no disallowance on account of interest expenditure, that only disallowance was on account of administrative exp....