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2018 (9) TMI 1854 - ITAT PUNEDisallowance u/s 14A r.w.r. 8D(2)(ii) - disallowance made under Rule 8D(2)(ii) in respect of interest expenditure - assessee is in second appeal before the Tribunal - HELD THAT:- Hon'ble Bombay High Court in the case of CIT Vs. Reliance Utilities and Power Ltd. reported as [2009 (1) TMI 4 - BOMBAY HIGH COURT] has held that where both interest free funds and interest bearing funds are available and the interest free funds are more than the investment made, the presumption is that the investment is made out of interest free funds available with the assessee. The said decision was rendered by the Hon'ble Jurisdictional High Court in the context of Section 36(1)(iii). The Hon'ble High Court, thereafter, applied the same principle while interpreting the provisions of section 14A in the case of CIT Vs. HDFC Bank Ltd. [2014 (8) TMI 119 - BOMBAY HIGH COURT] .The Hon'ble High Court observed that where investment is made in tax free securities by the assessee, it would be presumed to have been made from own funds in case they are in excess of investment made. Thus disallowance in respect of interest expenditure made under Rule 8D(2)(ii) is deleted. The impugned order is modified, accordingly, the ground raised in appeal by the assessee is allowed.
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