9911796707
TMI Blog2017 (10) TMI 234X X X X Extracts X X X X X X X X Extracts X X X X ..... d:- 26-9-2017 - Sh. N. K. Saini, AM and Sh. K. N. Chary, JM Assessee by : None Revenue by : Sh. S. P. Gupta, Sr. DR ORDER Per N. K. Saini, AM This is an appeal by the department against the order dated 14.12.2015 of ld. CIT(A)-7, New Delhi. 2. The only effective ground raised in this appeal reads as under: 1. On the facts and circumstances of the case, the Id.CIT(A) has erred in restricting the addition of ₹ 38,94,340/- to ₹ 7,000/- made by Assessing Officer by applying Rule 8D without appreciating the directions laid down in CBDT's Circular No. 5/2014 dated 11-02-2014 wherein it has been mentioned that disallowance u/s.14A of the Income Tax Act, 1961 is to be made even if there is no exempt i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us funds. 3. The funds, which have been used by the assessee for its business as well as investments, are mixed and inseparable. 4. The assessee has not shown that the above amount is invested from surplus funds, no nexus has been filed by the assessee in this regard. In the view of the above, assessee submissions are not acceptable and disallowance u/s 14A of I.T.Act, read with Rule 8D is computed as under- S. No. Disallowance Amount (Rs.) 1 The amount of expenditure directly relating to income which does not form part of total income. 0 2 In case where assessee has incurr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8,94,340/- 4. Being aggrieved the assessee carried the matter to the ld. CIT(A) who sustained the disallowance of ₹ 7,000/- by observing in paras 3.2 3.3 of the impugned order as under: 3.2. I have carefully considered the submission of the appellant and the order passed by the AO. The AO has invoked the provisions of section 14A and computed disallowance at ₹ 38,94,340/- as per Rule 8D of the I.T. Rules, 1962 as the appellant has investment in shares. It is noted that the appellant had earned dividend income of ₹ 7,000/- from shares of State Bank of Travancore. Disallowance is however worked out at ₹ 38,94,340/- which is far in excess of the exempt income. The AO has not given any reasons as to the basis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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