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TMI Blog2022 (2) TMI 286X X X X Extracts X X X X X X X X Extracts X X X X ..... rect. [See:'GODREJ BOYCE MANUFACTURING COMPANY LTD.[ 2017 (5) TMI 403 - SUPREME COURT] From the perusal of the order passed by the assessing officer it is evident that the assessing officer has failed to record its satisfaction with regard to the claim of the assessee that it had incurred any expenses in earning the exempt income except a sum of ₹ 1,61,035/-. Therefore, in the absence of any satisfaction recorded by the assessing officer, the substantial question of law has to be answered in the negative. As fairly stated by learned Senior counsel that disallowance to the extent of ₹ 1,61,035/- which was proposed by the assessee itself has to be upheld. Therefore, the disallowance under Section 14A of the Act read w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7,500/- from its subsidiary viz., GKB RX Lens Pvt. Ltd. in which assessee held 50% shares. The assessee filed its return of income for assessment Year 2008 09 in which assessee claimed the aforesaid dividend income which was received during assessment year 2008-09 as exempt under Section 10(34) of the Act. The Assessing Officer passed an order of assessment dated 28.10.2010 and disallowed a sum of ₹ 34,21,059/- under Section 14A of the Act read with Rule 8D of the Income Tax Rules, 1962 (hereinafter referred to as 'the Rules' for short) as being expenditure which was incurred towards earning the exempt income. 3. The Commissioner of Income Tax (Appeals) by an order dated 27.07.2012 dismissed the appeal. Being aggrieved, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r with regard to incorrectness of the claim of the assessee, no further disallowance by the assessing officer could have been made. Learned Senior counsel for the assessee has fairly submitted that in any case, disallowance under Section 14A of the Act read with Rule 8D has to be confined in respect of the claim made by the assessee to the extent of ₹ 1,61,035/-. In support of aforesaid submissions, reliance has been placed on decisions in 'HINDUSTAN AERONAUTICS LIMITED S. ACIT AND ANOTHER', (2021) 125 TAXMANN.COM 80, 'GPDREK BOYCE MANUFACTURING COMPANY LTD. VS. DCIT', (2017) 81 TAXMANN.COM 111 (SC), and 'EICHER MOTORS LTD. VS. CIT', (2017) 86 TAXMANN.COM 49 (DELHI). 6. On the other hand, learned cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [See: 'GODREJ BOYCE MANUFACTURING COMPANY LTD. VS. DCIT', (2017) 81 TAXMANN.COM 111 (SC)] 8. Now we may advert to the facts of the case and examine whether the assessing officer has recorded satisfaction with regard to the correctness of the claim made by the assessee in respect of such expenditure in relation to the exempt income. The assessee has made disallowance of ₹ 1,61,035/- under Section 14A of the Act read with Rule 8D of the Rules. From the perusal of the order passed by the assessing officer and in particular paragraph 7 to 14, it is evident that the assessing officer has failed to record its satisfaction with regard to the claim of the assessee that it had incurred any expenses in earning the exempt incom ..... X X X X Extracts X X X X X X X X Extracts X X X X
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