2023 (4) TMI 559

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... s made in the order of assessment on account of proportionate disallowance of interest in terms of Rule 8D(2)(ii) of Income-tax Rules inspite of recording the facts and also the decisions of this Hon'ble Tribunal in appeals for earlier years in case of the appellant. 2. That the CIT(A) also erred in not giving clear directions to the Assessing Officer that the disallowance in terms of Rule 8D(2) (iii) of Income-tax Rules on account of administrative expenses was to be restricted to Rs. 17,02,000/- being 0.5% of average investments of Rs.34.04 crores on which the appellant could receive the exempt income, instead of amount of Rs.24,26,8971- wrongly added by the appellant in the return of income calculating the same on the basis of aver .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... ot sufficient own fund and in earlier year also, disallowance in this regard was disallowed. As regards disallowance with regard to Rule 8D(2)(iii), the AO accepted the assessee claim of Rs.24,26,897/-. 4. Upon assessee's appeal, the Ld. CIT(A) considered the issue as regard the disallowance Rule 8D(2)(iii). He gave part relief and he upheld the disallowance with regard to interest u/s 14A of the Act. 5. Against this order, the assessee is in appeal before us. 6. We have heard both the parties and perused the records. The ld. Counsel for the assessee contended that this issue is squarely covered in favour of the assessee by a series of order of ITAT in earlier years. He submitted that it is not disputed that the assessee's own funds are .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... 7. Per Contra, the Ld. DR did not dispute the above proposition that the issue stands covered in favour of the assessee. 8. Upon careful consideration, respectfully following the precedent in assessee's own case, we direct the AO to delete the disallowance with regard to interest u/s 14A as it is not disputed that assessee's own funds are many times more than exempt income. In this regard the assessee has filed addition ground that the disallowance with regard to section 14A cannot be imported in computation to book profit u/s 115JB of the Act. We find that this issue is also squarely covered in favour of the assessee by the decision of the Special Bench of the ITAT in ACIT Vs Vreet Investments Pvt. Ltd. in ITA No. 502/Del/2012 for the a .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X