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TMI Blog2016 (12) TMI 801X X X X Extracts X X X X X X X X Extracts X X X X ..... 77; 8,66,34,771/-. Therefore, this Tribunal is of the considered opinion that the CIT(Appeals) has rightly confirmed the order of the Assessing Officer. This Tribunal do not find any reason to interfere with the order of the lower authority and accordingly the same is confirmed.- Decided against assessee - ITA No. 1505/Mds/2016 - - - Dated:- 30-9-2016 - Shri N.R.S. Ganesan, Judicial Member And Shri Abraham P. George, Accountant Member Appellant by : Sh. R. Vijayaraghavan, Advocate Respondent by : Shri Shiva Srinivas, JCIT ORDER Per N. R. S. Ganesan, Judicial Member This appeal of the assessee is directed against the order of the Commissioner of Income Tax (Appeals) 11, Chennai, dated 30.03.2016 and pertains to as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er. The assessee itself found that a sum of ₹ 29 lakhs can be disallowed as expenditure for earning the exempt income. The Assessing Officer proceeded to disallow a sum of ₹ 8,66,34,772/- by applying Rule 8D of Income-tax Rules, 1962. Placing reliance on the order of this Tribunal in Tamilnadu Power Finance Infrastructure Development Corporation Ltd. v. ACIT in I.T.A. No.1813/Mds/2014 dated 19.02.2016, the Ld. counsel submitted that only 0.5% of the average value of the investment, income from which does not or shall not form part of total income as appearing in the balance sheet of the assessee on the first day and the last day of the previous year, has to be taken into consideration. 5. On the contrary, Shri Shiva Sriniva ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as taken 0.5%. Ultimately, the Assessing Officer has taken the aggregate of second and third limb of Rule 8D(2) and computed the disallowance of ₹ 8,95,34,771/-. After deducting the expenditure claimed by the assessee to the extent of ₹ 29 lakhs, according to the Ld. D.R., the Assessing Officer determined the disallowance at ₹ 8,66,34,771/-. This disallowance was rightly confirmed by the CIT(Appeals). 6. We have considered the rival submissions on either side and perused the relevant material available on record. The first submission of the Ld. counsel for the assessee is that when the assessee invested its own funds, Rule 8D2(ii) of the Income-tax Rules, 1962 is not applicable at all. In the case before us, admittedly, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and paid interest. The interest paid by the assessee is not relatable to any particular income. Therefore, the second limb of Rule 8D(2) is squarely applicable. 8. We have carefully gone through the order of the Assessing Officer. The Assessing Officer has found that there was no direct expenditure relating to income which does not form part of total income. Therefore, he computed the disallowance under the second limb of Rule 8D(2) and also computed the average amount / expenditure to the extent of ₹ 8,66,34,771/-. Therefore, this Tribunal is of the considered opinion that the CIT(Appeals) has rightly confirmed the order of the Assessing Officer. This Tribunal do not find any reason to interfere with the order of the lower authori ..... X X X X Extracts X X X X X X X X Extracts X X X X
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