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TMI Blog2022 (7) TMI 23X X X X Extracts X X X X X X X X Extracts X X X X ..... s thus rejected. As regards the disallowance it is sustained on the basis of computation given in the alternative plea of the assessee, but given the fact that the basic plea of non-disallowance itself was to be upheld, there was no occasion to consider the computation given in the alternative plea. This disallowance must also be deleted. - Decided in favour of assessee. - ITA No. 528/Mum/2022 CO No. 76/Mum/ 2022 - - - Dated:- 29-6-2022 - Pramod Kumar ( Vice President ) And Aby T Varkey ( Judicial Member ) Kirit Kamdar for the appellant Dr. Mahesh Akhade for the respondent ORDER Per Pramod Kumar VP 1. These cross appeals are directed against the order dated 29th November 2021 passed by the learned CIT(A) in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of grievances are interconnected, we will take them up together. 4. To adjudicate on these grievances, only a few material facts need to be taken note of. During the course of scrutiny assessment proceedings, it was noticed that the assessee is holding investments in shares, which are for the purpose of earning dividend income, but no disallowance is made u/s. 14A for expenses incurred to earn this tax exempt income. The Assessing Officer, accordingly, proceeded to make the disallowance under rule 8D read with Section 14A which worked out to Rs. 11,87,85,293. Aggrieved, assessee carried the matter in appeal before the CIT(A) who restricted the disallowance to Rs. 9,87,978 by observations, inter alia, as follows:- 6.2 I have consider ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tilities Distribution re affirmed the same. 6.3 The assessee in his written submission has also stated that- Without prejudice, even if there is disallowance u/s 14A the maximum disallowance u/s 14A r. w. rule 8D(2) (iii) cannot exceed administrative expenses less audit fees, professional fees, stamp duty on issue of debentures thus aggregating to Rs 9,87,978/- comprising of under mentioned accounts: Nature of Account Rs Rs. Employee Benefit Expenses (A) 3,29,523 Total Administrative Expenses (B) 11,48,62,285 Less: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case in the light of the applicable legal position. 7. We find that there is no dispute about the fact that the assessee did not have any tax exempt income during the relevant previous year and that the period before us pertains to the period prior to insertion of explanation to section 14A. In this view of the matter, and in the light of consistent stand by co-ordinate benches, following Hon ble Delhi High Court s judgment in the case of Cheminvest Ltd vs CIT [(2015) 61 taxmann.com 118 (Del)], we uphold the plea of the assessee that no disallowance under section 14A was and in the circumstances of the case. The plea of the Assessing Officer is thus rejected. As regards the disallowance of Rs. 9,87,978/- it is sustained on the basis of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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