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2014 (6) TMI 733 - AT - Income TaxDisallowance u/s 14A r.w Rule 8D of the Act Held that:- CIT(A) rightly held that Rule 8D is not applicable for the AY Relying upon GODREJ AND BOYCE MFG. CO. LTD. Versus DEPUTY COMMISSIONER OF INCOME-TAX AND ANOTHER [2010 (8) TMI 77 - BOMBAY HIGH COURT] - Rule 8D cannot be applied in the year - a reasonable amount of indirect expenditure can be disallowed for earning such exempt income - the dividend on investments by way of cheques is credited directly to its ECS account the disallowance is restricted thus, there is no reason to interfere in the order of the CIT(A) Decided against Revenue. Addition made u/s 41 (1) of the Act Held that:- CIT(A) has deleted the addition by taking into consideration the fact that the assessee itself has offered the amount to tax in the AY 2010-11 the assessee maintains account on mercantile basis and can make a provision for an expense in the accounts on an estimate basis, once it is determined that the liability on an expenditure has accrued, even the actual determination of amount is not possible Assessee filed computation of total income and Balance Sheet & P&L a/c together with the schedules along with ledger account of miscellaneous receipt which the account has been credited with and it is clear that the appellant has itself credited the account u/s 41(1), with this liability for A.Y. 2010-11 - the assessee has offered the total income of Rs. 13,50,00,000/- inclusive of Rs. 21,88,827/- under the head miscellaneous income comprising of the same amount which has been added by the AO for the year - there is no revenue effect in respect of the amount, thus, the order of the CIT(A) is upheld Decided against Revenue.
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