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2015 (12) TMI 761 - AT - Income TaxDeemed dividend u/s. 2(22)(e) - Held that:- There is factual error in computing the deemed dividend. Surprisingly, there is no reference to the computation made by the assessee in the assessment order. In our considered opinion, without pointing out any flaw or error in the calculation made by the assessee, the AO should not have proceeded by calculating the deemed dividend of its own. Further, the AO has not given any basis as to how he has come to the accumulated profit of the respective companies. This issue cannot be decided on incorrect facts therefore, we restore this issue to the file of the AO. The AO is directed to decide the issue afresh in the light of the workings given by the assessee after giving a reasonable opportunity of being heard to the assessee. - Decided in favour of assessee for statistical purpose. Disallowance u/s. 14A r.w. Rule 8D - Held that:- The Hon’ble High Court of Delhi in the case of Joint Investments Pvt. Ltd (2015 (3) TMI 155 - DELHI HIGH COURT) has held that the “window for disallowance is indicated in Sec. 14A, and is only to the extent of disallowing “expenditure incurred by the assessee in relation to the tax exempt income”. This proportion or portion of the tax exempt income surely cannot swallow the entire amount as has happened in this case.” Thus we direct the AO to restrict the disallowance to ₹ 2,62,194/-.- Decided in favour of assessee for assessee in part.
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