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TMI Blog2016 (12) TMI 47X X X X Extracts X X X X X X X X Extracts X X X X ..... r coordinate Bench in the case of Devkant Synthetics (India) Pvt. Ltd. (2015 (11) TMI 1067 - ITAT MUMBAI) the disallowance of expenses u/s 14A of the Act is restricted to 5% of the exempt income. The Assessing Officer is directed to retain the addition to the extent of 5% of exempt income after allowing credit for the suo motu disallowance of ₹ 50,000/- already made by the assessee. Thus, on this aspect, assessee partly succeeds. - ITA No. 944/MUM/2015 - - - Dated:- 30-9-2016 - Shri G. S. Pannu, Accountant Member And Shri Amarjit Singh, Judicial Member Assessee by : Shri N.R. Agrawal Revenue by : Shri A.K. Kardam ORDER Per G. S. Pannu, AM This appeal by the assessee is directed against the order of CIT(A)-9, M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther appeal before us. 4. Before us, the first plea of the assessee is that there was no justification for disallowing any interest expenditure since the share capital and Reserves Surplus available with the assessee were more than the investments made and thus, following the ratio of judgment of Hon ble Bombay High Court in the case of HDFC Bank Ltd., 366 ITR 505, no disallowance is called for. Apart therefrom, it was also pointed out that the assessee is an investor as well as a trader in shares and, therefore, so far as the investments in stock-in-trade are concerned, same are to be excluded while calculating the disallowance u/s 14A of the Act. At the time of hearing, learned representative for the assessee also referred to the ear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntext of application of Sec. 14A of the Act, has been approved by the Hon ble Bombay High Court in the case of HDFC Bank Ltd. (supra). Factually speaking, the said proposition is clearly attracted in the present case. In the statement of facts annexed to the Grounds of appeal, assessee has brought out that the Share capital plus Reserves and Surplus as on 1.4.2010, i.e., at the beginning of the year totalled to ₹ 29,07,33,531/- whereas the Investments in question stand at a much lower figure. Therefore, under these circumstances, in our view, invoking of Rule 8D(2)(ii) to disallow the interest expenditure u/s 14A of the Act is untenable following the ratio of the Hon ble Bombay High Court in the case of HDFC Bank Ltd. (supra). 7. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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