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2013 (8) TMI 37 - AT - Income TaxInterest and administrative expenditure - disallowance u/s 14A - CIT(A) restricted the disallowance at 4.03% of the total expenditure on account of interest and other expenditure - Held that:- The assessment year involved in the present appeals is the A.Yr. 2006-07. As decided in case of M/s. Godrej Boyce Manufacturing Co.Ltd. vs DCIT (2010 (8) TMI 77 - BOMBAY HIGH COURT) the amendment had not been made with retrospective effect and that therefore, Rule 8D not to be used with retrospective effect and that therefore, Rule 8D cannot be used in cases prior to the Assessment Year 2007-08. Further in the case of DCIT, Circle-1, Kolkata vs M/s.Exide Industries Ltd. [2013 (6) TMI 533 - ITAT KOLKATA] following the decision of Sagarika Goods and Services Pvt. Ltd. vs ITO [2013 (6) TMI 534 - ITAT KOLKATA] and DCIT vs EIH Associated Hotels Ltd (2008 (1) TMI 426 - ITAT CALCUTTA-D) has restricted the disallowance u/s 14A at 1% of the exempt income for years prior to the A.Yr.2008-09. Therefore, respectfully following the same AO directed to recomput the disallowance of expenditure relating to the exempt income at 1% of the exempt income being Long Term capital gain and dividend income - appeal of the assessee partly allowed and Revenue dismissed.
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