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TMI Blog2020 (10) TMI 1314X X X X Extracts X X X X X X X X Extracts X X X X ..... h. R.K. Kapoor, C.A ORDER PER K. NARASIMHA CHARY, J.M. Challenging the order dated 19/09/2017 passed in appeal No. 10496/16-17-CIT(A)-2 by learned Commissioner of Income Tax (Appeals)- 2, New Delhi ("Ld. CIT(A)"), in the case of M/s. Continental Device India Pvt. Ltd. ("the assessee"), Revenue filed this appeal for assessment year 2014-15. 2. Brief facts of the case are that the assessee is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to investments in the instruments income which is exempt. 4. The ld. DR submitted that when the assessee failed to produce documentary evidence to show that the investments were made from out of own funds available with the assessee and for such investments, no borrowed amount was spent, the Assessing Officer is justified in invoking the provisions of Rule 8D(2)(ii) of the Rules. So also, when th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disallowance under Rule 8D(2)(iii) of the Rules besides considering the fact that the assessee met the investments out of its own funds and therefore, there is no scope of disallowance of interest component u/r. 8D(2)(ii) of the Rules. He brought to our notice that as per audited balance sheet as on 31.03.2014, the share capital of assessee was Rs. 103.40 crores whereas investments were only Rs. 8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n funds and therefore, the question of disallowing the interest component u/r. 8D(2)(ii) does not arise. In so far as consideration of investment which did not yield any dividend income for the purpose of calculating the disallowance u/r. 8D(2)(iii), it is the settled principle of law that only such investments which yielded exempt income during the year have to be considered for computing the ave ..... X X X X Extracts X X X X X X X X Extracts X X X X
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