Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2014 (4) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2014 (4) TMI 550 - AT - Income TaxConfirmation of disallowance u/s 14A of the Act - Held that:- The decision in Godrej & Boyce Manufacturing Co. Ltd.[ 2010 (8) TMI 77 - BOMBAY HIGH COURT] followed - Rule 8D r.w.s. 14A(2) is not arbitrary or unreasonable but can be applied only if the assessee's method is not satisfactory - Rule 8D is not retrospective and applies from A.Y. 2008-09 - under section 14A of the Income Tax Act, resort can be made to Rule 8D of the Income Tax Rules for determining the amount of expenditure in relation to exempt income, if, the AO is not satisfied with the correctness of the claim made by the assessee in respect of such expenditure. The assessee has maintained separate books of account for investment and business purposes - the AO without recording any dissatisfaction with regard to the claim of the assessee that no expenditure was incurred by the assessee for earning the exempt income, straightway applied Rule 8D against the mandate of the provisions of section 14A of the Income Tax Act - CIT(A) also failed to consider the submissions of the assessee that the assessee had been maintaining separate accounts for business and investment purposes while confirming the disallowance – thus, the disallowance made by the lower authorities is set aside and the matter is remitted back to the AO for fresh adjudication – Decided in favour of Assessee. Confirmation of House property income u/s 23 of the Act – Held that:- The quantum amount assessed by lower authorities as ALV of the property is upheld - the issue is kept open so far so the method of calculation of ALV is concerned - The assessee will be at liberty to raise his contentions in this respect in subsequent years - The method adopted by lower authorities for ascertaining ALV for the current year will not be binding upon the assessee in subsequent years – Decided against Assessee. Disallowance of expenses on adhoc basis – No evidences produced - Held that:- CIT(A) while confirming the adhoc disallowance has rightly noted that the assessee did not submit any evidence to rebut the findings of the AO regarding none verifiable nature of expenses and personal element involved – thus, there was no infirmity in the order of CIT(A) – Decided against Assessee.
|