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2015 (7) TMI 118 - AT - Income TaxDisallowance u/s.14A - Held that:- There is no dispute in assessee’s appeal that the authorities below have invoked Rule 8D(2)(ii) and (iii) of the Income Tax Rules in computing the impugned section 14A disallowance. The assessment year in question is 2006-07. It does not require much discussion that Rule 8D is applicable from assessment year 2008-09 onwards. The case law of Godrej Boyce and Co.[2010 (8) TMI 77 - BOMBAY HIGH COURT] is quoted in support. The Revenue is not able to point out any exception to the same. Therefore, the very basis adopted by the Assessing Officer as well as CIT(A) in computing the impugned disallowance under Rule 8D (2)(ii) and (iii) is held to be not as per the settled law. At the same time, we are of the view that reasonable computation method is arriving at such a disallowance has to be adopted in assessment years prior to 2008-09. It has come on record that the assessee’s exempt income in question from dividends reads a sum of ₹ 24.42 lacs. There is no other dispute involved in its appeal on facts and figures narrated in the CIT(A) order comprising of Assessing Officer’s findings hereinabove. We observe in these circumstances that larger interest of justice would be met in case a lumpsum adhoc disallowance of ₹ 2.5 lacs is made in these peculiar facts with a rider that the same shall not be treated as a precedent. Ordered accordingly. The assessee gets part relief. The Assessing Officer is directed to pass a consequential order. - Decided partly in favour of assessee.
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