2019 (6) TMI 1216

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..... ed 27.12.2016, under section 143(3) read with section 153A of the Income-tax Act, 1961 (hereinafter 'the Act'). 2. The only issue in this appeal of assessee is against the order of CIT(A) restricting the disallowance of expenses relatable to exempt income under section 14A of the Act read with rule 8D of the Rules, amounting to Rs. 21,83,516/- to the extent of exempt income. For this assessee has raised the following ground No. 1:- "i. The ld. CIT(A) erred in law and facts in confirming/ upholding disallowance under section 14 of the Act of Rs. 21,83,516/- out of expenses. The reasons given by him for doing so we wrong, contrary to the facts of the case and against the provisions of law." 3. Briefly stated facts are that the assessee ha .....

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..... 6,79,425/-. Aggrieved, assessee preferred the appeal before CIT(A). 5. The CIT(A) restricted the disallowance qua the exempt income at Rs. 21,83,516 by observing in Para 6.5 as under: - "6.5 In view of the above, it is held that the appellant's case warrants disallowance u/s 14A. As the assessee has not made any suo moto disallowance and has further contended that there is no case for disallowance, the AO had no choice but to resort to the method of computation prescribed under Rule 8D. The AO did not make any disallowance under Rule 3D 2(i) and 2(11) but worked out the disallowance under Rule 3D 2(iii) which was to the tune of Rs. 36,79,425/- as against exempt income of Rs. 21,83,516/-. The Hon'ble ITAT, Mumbai in the case of MI .....

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..... the decision of Hon'ble Delhi High Court in the case of H.T. Media Ltd. V. PCIT [2017] 399 ITR 576 (Delhi), wherein Hon'ble Delhi High Court vide Para 39 and 40 has considered the issue of satisfaction as under: - "39. Turning now to the order of the ITAT, in para 33, it recorded the submission of the AR that the AO did not record any satisfaction about the Assessee not properly offering expenditure incurred in relation to the exempt income at Rs. 3 lakhs. The ITAT reproduced the contents of para 3.3.1 of the assessment order, which has been extracted by this Court hereinbefore, which contains general observations regarding earning of exempt income. This cannot be accepted as a recording by the AO of satisfaction regarding the claim of t .....

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