TMI Blog2018 (9) TMI 947X X X X Extracts X X X X X X X X Extracts X X X X ..... Shri Saurabh Deshpande, DR ORDER PER SHRI SANDEEP GOSAIN, JUDICIAL MEMBER: These two appealsfiled by the assessee as well as revenueare against the order of Commissioner of Income Tax(Appeals) 8, Mumbai dated 29.02.16for AY 2012-13. 2. Since all the issues involved in these two appeals are common, therefore, they have been clubbed, heard together and a consolidated order is being passed for the sake of convenience and brevity. ITA No. 2891/Mum/2016 (AY 2012-13) 3. First of all we take up assessee s appeal in ITA No. 2891/Mum/2016 for assessment year 2012-13 as lead case. The ground of appeal are mentioned herein below:- 1. On the facts and in the circumstances of the case and in law the CIT (A) erred in confirming the disallowance under sec. 14A read with Rule 8D of the Income Tax Act under normal provisions of the computation of Income under the Act. 2. The Appellant craves leave to add alter or modify any ground of appeal at or before the date of hearing. 4. As per the facts of the present case, the assessee company is engaged in the business of manufacturing of alliedderivatives of phosphorous and trading, leasing and hire purchase, b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee company was asked to furnish details of expenses incurred for earning exempt income and also to show cause as to why the expenses incurred and claimed in respect of exempt income should not be disallowed as per the provisions of Section 14A read with Rule 8D. We found that assessee has furnished detailed working and offered disallowance of ₹ 9,90,000/-, ₹ 6,93,852/-, ₹ 2,41,311/- and ₹ 9,91,574 for the A.Y.2008-09, 2009-10, 2010-11 2011-12 respectively. 8. In the working so furnished and placed at page 26,22,3 and 16 of the paper book of the respective assessment years, nowhere AO has pointed out that assessee has incurred expenditure more than the sum offered by the assessee. As per the verdict of Hon ble Supreme Court Sub-Section (2) (3) of Section 14A r.w.r. 8D prescribes a formula for determination of expenditure incurred in relation to income which does not form part of the total income under the Act in a situation where the Assessing Officer is not satisfied with the claim of the assessee. As per the Supreme Court, this is to be determined having regard to the accounts of the Assessee as placed before the AO and only where it is not p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al income in the manner indicated in Rule 8D(2). Furthermore, in view of the judicial pronouncements Section 14A read with Rule 8D is not applicable to investments which have not yielded any exempt income. Hence, while computing Rule 8D such investments must be excluded. 13. Keeping in view the totality of facts and circumstances of the case and applying the proposition of law laid down by Hon ble Bombay High Court, part of which has been affirmed by the Hon ble Supreme Court, we restore the matter back to the file of the AO for deciding afresh the disallowance warranted under Rule 8D having regard to the guidelines laid down by the Hon ble Supreme Court in the case of Godrej And Boyce Mfg. Co. Ltd., in its order dated 08/05/2017. We direct accordingly. 14. Similar grounds have been taken in all the four years under consideration, following the reasoning given hereinabove, we restore the disallowance made under Rule 8D back to the file of the AO for deciding afresh in terms indicated hereinabove. After having gone through the aforementioned orders, facts of the present case as well as considering the orders passed by the revenue authorities and submissions made by bot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the orders passed by revenue authorities. We find that the identical ground raised in the present appeal had already been decided by the Coordinate Bench of Hon ble ITAT in assessee s own case in ITA No. 2538 2539/Mum/12, 6888/Mum/13 961/Mum/15 for AY 2008-09 to 2011-12 on merits. The operative portion of the order of Hon ble ITAT is contained in para no. 15 to 18 and the same is reproduced below:- 15. Assessee is also aggrieved for disallowance u/s.115JB r.w.s. 14A and r.w.r 8D. 16. At the outset, learned AR placed on record the order of the ITAT Special Bench in case of Vireet Investment Pvt. Ltd., in ITA No.502/Del/2012 dated 16/06/2017, wherein issue has been decided in favour of the assessee. Our attention was also invited to page 48 para 6.22, wherein Tribunal observed as under:-. 6.22 In view of the above discussion, we answer the question referred to us in favour of the assessee by holding that the computation under clause (f) of Explanation 1 to section 115JB(2), is to be made without resorting to the computation as contemplated u/s.14A read with Rule 8D of the Income Tax Rules, 1962. 17. In view of the decision of the Special Bench, we direct the AO ..... X X X X Extracts X X X X X X X X Extracts X X X X
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