9911796707
TMI Blog2024 (8) TMI 690X X X X Extracts X X X X X X X X Extracts X X X X ..... In all these appeals, the assessee is challenging the addition made by the AOu/s. 14A of the Income Tax Act, 1961 ("the Act") and also addition made u/s. 115JB of the Act. Accordingly, these appeals were heard together and are being disposed of by this common order, for the sake of convenience. 2. The facts relating to the case are stated in brief. The assessee is a financial service provider and also renders investment banking services. The AO noticed that the assessee has earned exempt income as detailed below, in these years:- A.Y. Exempt Income Disallowance by assessee 2014-15 38,58,048 NIL 2016-17 11,60,60,372 NIL 2017-18 1,16,837 10,00,000 2018-19 66,03,82,995 25,00,000 2.1. As noticed in the above table, the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion. In that case, the fact as to whether the AO has recorded dissatisfaction or not has to be deduced for the discussions made by him in the assessment order. In the instant cases, in our view, it cannot be said that the AO has not recorded dissatisfaction over the claim of the assessee. Accordingly, we reject the above said legal contention of the assessee in all the four assessment years. 4. We shall first take up the appeal filed for the AY. 2014-15. In this assessment year, the AO has computed disallowance of Rs. 1,51,53,295/- u/s 14A read with Rule 8D, which consisted of interest disallowance of Rs. 1,34,88,396/- u/r 8D(2)(ii)and expenditure disallowance of Rs. 16,64,899/- u/s 8D(2)(iii). In so far as the disallowance made out of int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de u/r 8D(2)(iii) of I T Rules, we direct the AO to consider only those investments, which have yielded exempt income for the purpose of computing average value of investments and accordingly recompute the disallowance under Rule 8D(2)(iii). 4.3. The Ld.AR submitted that the AO has added the disallowance computed by him u/s. 14A of the Act for computing book profits u/s. 115JB of the Act. He submitted that the Special Bench of the Delhi Tribunal has held in the case of ACIT vs. Vireet Investment (P.) Ltd., (supra) that the addition to be made under clause (f) of explanation (1) to section 115JB(2) of the Act is required to be made without resorting to computation contemplated u/s. 14A r.w. Rule 8D of the Rules. Accordingly, we set aside th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d exempt income for the purpose of computing average value of investments and accordingly recompute the disallowance under Rule 8D(2)(iii). 5.3. The Ld.AR submitted that the AO has added the disallowance computed by him u/s. 14A of the Act for computing book profits u/s. 115JB of the Act. He submitted that the Special Bench of the Delhi Tribunal has held in the case of ACIT vs. Vireet Investment (P.) Ltd., (supra) that the addition to be made under clause (f) of explanation (1) to section 115JB(2) of the Act is required to be made without resorting to computation contemplated u/s. 14A r.w. Rule 8D of the Rules. Accordingly, we set aside the order passed by the tax authorities on this issue and restore the same to the file of the AO with a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial Bench of the Delhi Tribunal has held in the case of ACIT vs. Vireet Investment (P.) Ltd., (supra) that the addition to be made under clause (f) of explanation (1) to section 115JB(2) of the Act is required to be made without resorting to computation of contemplated u/s. 14A r.w. Rule 8D of the IT Rules. Accordingly, we set aside the order passed by the tax authorities on this issue and restore the same to the file of the AO with a direction to compute the addition to be made under clause (f) of explanation (1) to section 115JB(2) of the Act on the basis of annual accounts of the assessee. 7. We shall now take up the appeal filed for the AY. 2018-19. In this assessment year, the assessee earned exempt income of Rs. 66,03,82,995/-. The a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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