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TMI Blog2016 (4) TMI 944X X X X Extracts X X X X X X X X Extracts X X X X ..... hat is confirmed. Any amount of disallowance which is higher than the amount computed as per rule 8D should be treated as deleted - Decided against revenue - ITA No. 5827/Mum/2013 - - - Dated:- 7-4-2016 - R. C. Sharma, AM And Pawan Singh, JM For the Petitioner : Shri D P Reddy For the Respondent : Shri Rajesh Athawale ORDER Per Pawan Singh, JM The present appeal is filed by the Revenue against the order of CIT(A)-8, Mumbai dated 09.7.2013 for A.Y. 2005-06. The sole ground in the present appeal is against the disallowance u/s. 14A r/w Rule 8D of the Act, on the pretext that there is diversion of funds to subsidiary company. 2. The brief facts of the case are that the assessee company which is involved in the busin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... investment represents controlling interest. The question then is whether it can be said that the assessee held these shares only for the purpose of earning the dividends. The answer, in view of the admitted factual position about the investment being in the nature of controlling interest, has to be in negative. In other words, on the facts of this case it could not be said that the investment in Corbel Estate Investments was for the purpose of earning dividends. In this backdrop, let us now see the principles laid down by Hon'ble Calcutta High Court in the case of CIT Vs Anniversary Investment Agencies Limited (175 ITR 199). Their Lordships referred to and relied upon the judgments in the cases of CIT Vs New India Investment Corporat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed at by the CIT(A) and approve the same.' 5. We have further noticed that while deleting the addition/disallowance u/s. 14A, ld. CIT(A), on relying the order of CIT(A) in assessee's own case for A.Y. 2003-04, 2004-05 and 2006-07, relied on the following observation: I have considered the submissions. The issue of disallowance u/s. 36(1)(iii) has become irrelevant after introduction of sec. 14A and a notification of Rule 8D. U/s. 14A expenditure incurred in relation to exempt income is not allowable. It cannot be said that no expenditure is attributable in relation to income or potential income by way of dividends. Even if, there is some business purpose behind the investment made in M/s. Corbel Estate, the fact remains tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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