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2014 (6) TMI 4 - AT - Income TaxDisallowance made u/s 14A r.w. Rule 8D(2)(ii) of the Act – Held that:- Following Maxopp Investment Ltd. & Others Versus Commissioner of Income Tax [2011 (11) TMI 267 - Delhi High Court] - rule 8D is applicable from the AY 2008-09 - From the assessee’s balance sheet, it can be seen that the Shareholders’ funds stand against Investment in shares - the amount invested in such securities is far in excess of the shareholders’ funds - CIT(A) was not justified in sustaining disallowance under Rule 8D(2)(ii) because the Investment in securities is quite less than the shareholders’ funds - the total expenses incurred by the assessee are much more than the disallowance and the incurring of expenses for earning exempt income is very much there - the disallowance as per the mandate of rule 8D(2)(iii) is held to have been rightly made and confirmed – Decided partly in favour of Assessee. Deletion of disallowance u/s 40(a)(ia) of the Act – Held that:- The ACIT authorized the assessee to make payment to M/s Vikson Finance & Investment Pvt. Ltd. without deduction tax at source only during the period 23.1.2008 to 31.3.2008 - The assessee was regularly deducting tax at source from brokerage payment up to 30.11.2007 - How the assessee presumed for not deducting tax at source for the period 1.12.2007 to 22.1.2008 is not understandable - there can be no question of claiming expense in first year and making disallowance in the subsequent year, if there is failure to deduct tax at source as per the relevant provisions - there is no reference to section 194H in the assessment order and further in the absence of any finding on this issue by the CIT(A) – the matter is remitted back to the CIT(A) for adjudication – Decided in favour of Revenue.
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