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2012 (12) TMI 131 - AT - Income TaxDisallowance u/s 14A - Held that:- sec 14A and Rule 8D would operate prospectively (and, not retrospectively) does not mean that the assessing officer is not to satisfy himself with the correctness of the claim of the assessee with regard to such expenditure. Even where the assessee claims that no expenditure has been incurred in relation to income which does not form part of total income, AO is required to verify the correctness of such claim. In case, the AO is not, on the basis of objective criteria and after giving the assessee a reasonable opportunity, satisfied with the correctness of the claim of the assessee, he shall have to reject the claim and state the reasons for doing so. There is nothing in the assessment order or impugned order as to whether the assessee placed the relevant details & accounts before AO nor CIT(A) seems to have undertaken any exercise to ascertain the details of expenditure objectively in managing and supervising the aforesaid huge investments - it is fair and appropriate to set aside the order of CIT(A) and restore the matter to the file of AO for deciding the issue, afresh in accordance with law , after allowing sufficient opportunity to the assessee - Matter remanded back - Decided in favor of revenue. Decision in Maxopp Investment Ltd. & Others Versus Commissioner of Income Tax [2011 (11) TMI 267 - DELHI HIGH COURT] followed.
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