9911796707
TMI Blog2011 (1) TMI 1385X X X X Extracts X X X X X X X X Extracts X X X X ..... per book page No.5 filed by him, stated that the Committee on Disputes had not given permission to the assessee to pursue this issue before this Tribunal. 4. We have seen the minutes of the meeting of the Committee on Disputes held on 28-10-2010 filed by assessee and relevant paper book page 6. At sl. No.24 it is mentioned that permission has been declined by the Committee to pursue the issue relating to disallowance of bad debts. In view of this, appeal of the assessee for Asst. year 1993-94 stands dismissed. 5. Now we take up the appeal of the assessee for Asst. year 2006-07. Two grounds have been taken by the assessee. First issue is regarding bad debt write off of `2,04,096/-, which was remitted by the CIT(A) to the AO. Ld. counse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... drej Boyce Mfg. Co. Ltd.(supra) and also decision of the Hon ble Punjab Haryana High Court in the case of CIT vs. Hero Cycles Ltd. (323 ITR 518), held that Rule 8D could not be applied for Asst. years prior to Asst. year 2008-09. According to him, assessee had not incurred any expenditure for earning the exempt income and in any case a disallowance of more than 2% of the exempt income for meeting common administrative expenses was not warranted. For this proposition, reliance was placed on the decision of Bombay Bench of this Tribunal in the case of Godrej Agrovet Ltd. v. ACIT (ITA No.1629/Mum/09 dated 17-09-2010), copy of which was placed at paper book page Nos.14 to 20. Ld. AR also pointed out that in assessee s own case this Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ement P. Ltd. (supra) was squarely applicable to assessee s case. 11. No doubt, in our opinion, Special Bench in the case of Daga capital Management P. Ltd. (supra) had held that Rule 8D applied retrospectively and sub-sec.(2) and (3) of sec.14A of the Act were procedural in nature and applied for all pending matters. However, Bombay High Court in the Case of Godrej Boyce Mfg.Co. Ltd. (supra) clearly held that Rule 8D was notified only on 24-03- 2008 and would apply w.e.f. Asst. year 2008-09 only. Thus effectively the decision of the Special Bench that Rule 8D had retrospective effect stands overturned. However, Hon ble Bombay High Court also held that for such earlier years prior to application of Rule 8D, AO had to adopt a reasonable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the tax free income. Neither the AO nor the CIT(A) has gone into the records and verified whether this claim of the assessee was correct or not. As for the decision in assessee s own case for Asst. year 2002-03 (Paper book pages 21 to 22) decided by this Tribunal, it was rendered prior to the development of law in subject matter through various higher judicial exposition. As the matter stands today, various decisions mentioned supra would lead to the following view regarding application of sec.14A of the Act and Rue 8D: 1. Though Sec. 14A has been inserted with retrospective effect from 01-04-1962 and since Rule 89D has been notified only on 24- 03-2008, it would be effective only from Asst. Year 2008-09 onwards. 2. For earlier As ..... X X X X Extracts X X X X X X X X Extracts X X X X
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