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TMI Blog2024 (9) TMI 1050X X X X Extracts X X X X X X X X Extracts X X X X ..... ITAT KOLKATA] more so when the assessee himself had disallowed expenditure u/s 14A and the AO without giving any reason as to why the disallowance was not accepted and warranted the higher amount has applied Rule 8D the disallowance confirmed by CIT(A) cannot be sustained and is hereby set aside and the Ld. AO is directed to delete the addition. Hence, Ground No. 1 of the appeal is allowed. - Shri Pradip Kumar Choubey, Judicial Member And Shri Rakesh Mishra, Accountant Member For the Appellant : Akkal Dudhwewala, AR For the Respondent : S.B. Chakraborthy, JCIT, Sr. DR ORDER PER RAKESH MISHRA, ACCOUNTANT MEMBER: This appeal filed by the assessee is against the order of the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ooks after the tax matters of the Group, Mr. Chinmoy Chatterjee, arranged all the relevant papers and orders and sought guidance from our tax counsel to advise on the way forward. The tax counsel had advised to file an appeal before the Tribunal but inadvertently failed to mention that the appellant was required to make payment of appeal fees of Rs. 10,000/-. Upon the appeal application sets being shared with the tax counsel just before the due date, it was noticed that the appeal fees was not yet deposited. Upon realising the lapse, the tax counsel immediately contacted the appellant and advised to make payment of the challan so as to enable the presentation of the instant appeal before the Hon'ble Bench. The appellant has been able to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act. In the course of assessment, the appellant had provided the basis of disallowance made u/s 14A of the Act. The AO however without pointing out any defect or infirmity in this basis and calculation of the appellant and without recording objective satisfaction as to why the explanation offered by the assessee, having regard to its books of accounts, was not tenable, proceeded to make disallowance u/s 14A read with Rule 8D. The appellant further submits that the AO had invoked and applied Rule 8D without establishing any proximate cause between the expenditure disallowed and earning of exempt income. Rival contentions were heard and details filed have been examined. 6. Ground No. 2 and 3 are general in nature and do not require any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sidered the average total investment as on 31.03.2016 and 31.03.2017 and computed the disallowance of Rs. 35,22,568/-. The Ld. AO relied upon the decision of the CIT Vs. Goetze (India) Ltd. (Delhi High Court) in support of the contention that the disallowance u/s 14A of the Act also has to be applied while computing book profit u/s 115JB of the Act. The Ld. CIT(A) granted relief and excluded the disallowance u/s 14A of the Act for computing income under the provision of section 115JB of the Act but upheld the disallowance by the Ld. AO while computing the normal income computed. The assessee submitted that the company did not earn any exempt income from the investments aggregating to Rs. 32.36 crores. It was submitted that for the purposes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee had suo moto disallowed expenditure on account of exempted income as per section 14A being D-mat charges and STT at Rs. 1,08,642/- along with other disallowances while computing the total income during the year. There were short term capital loss-both STT as well as non-STT paid as well as long term capital loss and the disallowance u/s 14A of the Act of Rs. 1,08,642/- was worked out and other expenses of Rs. 39,68,946/- have been debited and the investment was in unlisted security from which no exempt income was earned. It was submitted that the amendment was prospective and in nature and did not apply to AY 2017-18. The assessee relied upon its own case for AY 201213 and drew our attention to pages 22 to 24 of the paper book in ITA N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed for and accordingly, we set aside the finding of Id. CIT(A) and deleted the addition u/s 14A of the Act at Rs. 13,28,529/-. Thus, ground no.1 raised by the assessee is allowed . 8. Respectfully following the order of the coordinate bench in the assessee s own case for the AY 2012-13, more so when the assessee himself had disallowed expenditure u/s 14A and the AO without giving any reason as to why the disallowance was not accepted and warranted the higher amount has applied Rule 8D the disallowance confirmed by the Ld. CIT(A) cannot be sustained and is hereby set aside and the Ld. AO is directed to delete the addition. Hence, Ground No. 1 of the appeal is allowed. 9. Ground No. 2 is consequential in nature while Ground No. 3 is general i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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