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TMI Blog2021 (4) TMI 110X X X X Extracts X X X X X X X X Extracts X X X X ..... ting to exempt income. In the case under consideration, we find during the course of hearing that the assessee has not derived any exempt income in the relevant previous year so as to attract section 14A rwr 8D as per case law Cheminvest Ltd. [ 2015 (9) TMI 238 - DELHI HIGH COURT] , Chettinad Logistics Private Limited [ 2017 (4) TMI 298 - MADRAS HIGH COURT] and CIT vs. Corrteck Engineering Pvt. Ltd. [ 2014 (3) TMI 856 - GUJARAT HIGH COURT] . It is however made clear that the learned Assessing Officer shall be at liberty to examine the assessee s financials along with source of investments in the year in which they yield exempt income. Appeal of the revenue is allowed for statistical purposes. X X X X Extracts X X X X X X X X Extracts X X X X ..... f total income and also ignoring the order of the Hon'ble ITAT order in the case of Mis. Bellwether Micro Finance Fund Vs. ITO on which he has placed reliance?" 2. Brief facts of the case are that the assessee, a limited company, filed its return of income for the AY 2015-16 on 30/09/2015 electronically u/s 139(1) of the Act declaring a total loss of ₹ 35,81,00,299/-. Subsequently, the case was selected for scrutiny and statutory notices were issued, against which, the ld. AR of the assessee filed the required information as called for. 2.1 During the course of scrutiny proceedings, the AO observed that the assessee had shown 'Long term Borrowings' at ₹ 878,23,00,000/- and 'Short term Borrowings' at &# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds to the business operations that was incurred for the purpose of the business. Accordingly, the AR requested that no addition disallowance u/s l4A should be made in this case considering the assessee company has not earned any exempt income. 2.2 After considering the submissions of the assessee, the AO referring to the CBDT Circler No. 05/2014, dated 11/02/2014, computed the disallowance u/s 14A rwr 8D(ii) at ₹ 27,11,43,034/- by holding that since the assessee had investments during the year the disallowance u/s 14A as per the amended rule 8D, has to be made. 3. Aggrieved by the order of the AO, the assessee preferred an appeal before the CIT(A), who has deleted the disallowance by relying on the decision of the ITAT, Hyderabad in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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