TMI Blog2020 (10) TMI 1024X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal is filed by the revenue against the order of the Learned Commissioner of Income Tax (Appeals) 4, Mumbai [hereinafter in short Ld.CIT(A) ] dated 28.11.2018 for the Assessment Year 2014-15. 2. Revenue has raised following grounds in its appeal: - 1. On the facts and in the circumstances of the case and in law, the Ld.CIT(A) erred in restricting the disallowance u/s.14A made by the AO thereby overlooking the fact that it was correctly worked out as per the method of calculation prescribed in Rule 8D of Income Tax Rules, 1962 . 2. On the facts and in the circumstances of the case and in law, the Ld.CIT(A) erred in restricting the disallowance u/s.14A with Rule 8D when this method of working of disallowance is held as reasonable method by the jurisdictional High Court in the case of Godrej Boyce Mfg. Co. Ltd Vs. C1T 328 ITR 81 (Bom.) 3. On the facts and in the circumstances of the case and in law, the Ld.CIT(A) erred in allowing relief to the assessee relying on the decision of Hon'ble Special Bench of ITAT Delhi in the case of Vireet Investment (P) Ltd., without appreciating the facts that the issue has not reached to its finality as the Hon' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disallowance to ₹ 3,40,02,597/-. Ld.CIT(A) restricted the disallowance to the suomoto disallowance made by the assessee following the decision of the Tribunal in assessee s own case for the earlier assessment years i.e. A.Y. 2008-09 to A.Y. 2012-13 observing as under: - During the course of appellate proceedings, a written submission was filed which find place in para 5 of this order. The appellant submitted that similar type of disallowances were made in appellant's own case for assessment years 2008-09,2009-10, 2010-11, 2011-12 and 2012-13. According to the appellant, the appeal of the assessee on these grounds has been decided by Hon'ble Tribunal. I have considered the submission of the appellant, the Hon'ble Tribunal in appellant's own case has held as under: The Hon'ble ITAT during A.Y. 2008-09, in ITA No. 7598/Mum/2011 dated 22.01.2014 has held as under: We are of the considered view that a reasonable allocation of expenditure has to be made which can be attributed to the income which is chargeable to tax. Considering the facts and circumstances of the case, we are of the considered view that expenditure of ₹ 7,21,927/- as work ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... change nor any factual change therefore, respectfully following judgement of Hon'ble ITAT in appellant's own case for assessment year 2008- 09, 2009-10, 2010-11, 2011-12, 2012-13, AO is directed to work out the disallowance as per the criteria decided by Hon'ble ITAT in appellant s own case in earlier years. Hence, appeal is partly allowed. 7. We also find that for the A.Y. 2013-14 the Tribunal in ITA.No. 3512/Mum/2018 dated 19.07.2019 accepted the claim of the assessee observing as under: - 8. We have considered rival submissions and perused the material on record. Though there is no dispute that during the year under consideration, the assessee had earned both taxable as well as exempt income, however, fact remains, the total expenditure claimed by the assessee in respect of all sources income earned during the year is ₹ 6.71 lakh. Even out of the said amount, the assessee has further disallowed ₹ 2,02,688, under section 14A, towards earning of exempt income. The aforesaid disallowance was made by the assessee on proportionate basis keeping in view the quantum of taxable income and exempt income earned during the year. It is also evident, assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad no interest expenditure, disallowance in terms of Rule 8D(2)(ii) therefore would not apply. The assessee's total expenditure claim in relation to of its business activity came to ₹ 24.19 Lakhs of which the assessee had voluntarily reduced ₹ 7.79 Lakhs. The Tribunal accepted such working out. 5. Sub-section (2) of Section 14 of the Act provides that the Assessing Officer shall determine the amount of expenditure incurred in relation to such income which does not form part of the total income under this Act in accordance with such method as may be prescribed, if the Assessing Officer, having regard to the accounts of the assessee, is not satisfied with the correctness of the claim of the assessee in respect of such expenditure. Sub-rule (1) of Rule 8D also makes similar provision provides that where the Assessing Officer having regard to the accounts of the assessee is not satisfied with the correctness of the claim of expenditure made by the assessee or that the assessee claims that no expenditure has been incurred in relation to income which does not form part of the total income, the Assessing Officer would determine the amount of expenditure in terms of su ..... X X X X Extracts X X X X X X X X Extracts X X X X
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