Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2015 (7) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (7) TMI 834 - AT - Income TaxDisallowance made under section 14A assessee has agitated the action of the Ld. CIT(A) in sustaining the disallowance on account of administrative expenses at the rate of 0.5% of the average value of investment as per Rule 8D(2)(iii) as against the suo-moto disallowance of ₹ 2 lakh offered by the assessee - Held that:- Considering the nature of investments of the assessee during the year under consideration, we do not find any justification on the part of the AO in straightway applying Rule 8D and without recording any dissatisfaction in relation to the suo-moto working made by the assessee. Even otherwise, facts for the year under consideration are squarely cover with the decision of the Tribunal in the own case of the assessee in the subsequent year. We therefore do not find any justification for the Ld. CIT(A) to confirm the disallowance under Rule 8D(2)(iii) of the Income Tax Rules without considering the working/computation offered by the assessee and also without ignoring the nature of investments made by the assessee. The order of the Ld. CIT(A) confirmed the disallowance under Rule 8D(2)(iii) is therefore set aside. In view of our observations made above, the disallowance under section 14A is restricted to the suo-moto disallowance of ₹ 2 lakh offered by the assessee and the remaining disallowance over and above the disallowance offered by the assessee himself is therefore ordered to be deleted. - Decided in favour of assessee. Remission of loan liability - CIT(A) in holding it as capital receipt and not chargeable to tax - Held that:- CIT(A) has discussed the nature of the loan amount and has held that the waiver was not in respect of any benefit in kind or of any perquisite. The waiver was of the principle loan amount in cash. The assessee had not claimed any deduction in respect of loss, expenditure or trading liability in relation to the loan amount. The waiver was of the principle amount of loan for capital asset. He, thereafter, relying upon the decision of the Hon'ble Jurisdictional High Court, in the case of "Mahindra & Mahindra Ltd. vs. CIT" [2003 (1) TMI 71 - BOMBAY High Court] held that the waiver of the loan amount was a capital receipt not taxable as business income of the assessee. - Decided in favour of assessee.
|