9911796707
TMI Blog2015 (10) TMI 2718X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the assessee could not be established by the assessee. Thus the Ld CIT(A) was justified in confirming the disallowance of interest expenditure. - Decided in favour of revenue Disallowance u/s 14A - Held that:- The finance charges was disallowed u/s 36(1)(iii) and hence the same has already been excluded by the Ld CIT(A). The remaining expenses, in our view, could not be linked to the dividend income. Hence we agree with the contentions of Ld A.R that no disallowance of expenditure is called for in terms of Rule 8D(2)(iii) of the I.T Rules. Accordingly, we set aside the order of Ld CIT(A) on this issue and direct the AO to delete the disallowance of expenses confirmed by Ld CIT(A) u/s 14A - Decided in favour of assessee - I.T.A. No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... investments. The loans taken from various banks were used for repaying part of loan taken from Vithal Kamat (HUF). Accordingly he submitted that the interest expenditure has got connection with the activities carried on by the assessee. However, the Ld D.R pointed out that the interest expenditure is not related to the income declared by the assessee by way of consultancy etc. 4. Having heard rival submissions, we are of the view that there is no merit in the contentions of the assessee. The interest on loan borrowed to repay the existing loan is allowable as deduction only if it is shown that the earlier loan was used for the purpose of business. A perusal of Balance sheet of the assessee, which is placed at page 3 of the paper book, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the profit and loss account of the assessee and submitted that major expense claimed by the assessee is only professional charges of ₹ 3,15,500/-. Other expenses consisted of membership fee, profession tax and depreciation. Accordingly he submitted that the assessee has not claimed any expenditure which could be related to the dividend income. Accordingly, he submitted that the expenditure of ₹ 2,81,826/- computed in terms of Rule 8D(2)(iii) is not warranted at all. 7. We heard Ld D.R and perused the record. We find merit in the contentions of the assessee, since the expenditure claimed by the assessee consisted of professional fee paid, finance charges, profession tax, membership fee, depreciation and miscellaneous expens ..... X X X X Extracts X X X X X X X X Extracts X X X X
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