Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2018 (9) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (9) TMI 1920 - ITAT MUMBAIDisallowance made u/s 14A of the Act - liquid mutual fund schemes - AO took the view that disallowance should be computed in accordance with Rule 8D of the I.T. Rules - HELD THAT:- A perusal of the investment portfolio of the assessee would show that the assessee has invested in four schemes of mutual funds, out of which two items have been brought forward from earlier years. During the year under consideration, the assessee has made new investments in only two schemes - Since investment activity of the assessee is limited, the Assessing Officer was not justified in invoking provisions of Rule 8D of the I.T. Rules without recording dissatisfaction on the methodology adopted by the assessee. Considering low level of investment activity, the disallowance of ₹ 2.19 lakhs made by the assessee u/s. 14A of the Act would meet the requirements of section 14A of the Act - Accordingly, the order passed by the learned CIT(A) is set aside and the AO directed to accept the disallowance made by the assessee. Charging of interest u/s 234C of the Act - Learned AR submitted that there was error in the assessment order in computing interest u/s. 234C of the Act - HELD THAT:- There should not be any dispute that interest u/s. 234C of the Act has to be computed on the returned income as per mandate of section 234C of the Act, after duly considering the advance tax paid by the assessee. According to the Ld A.R, there is mistake in the computation of interest - this issue restored to the file of the Assessing Officer for examining the claim of the assessee by duly considering the returned income as well as advance tax paid by the assessee. Appeal allowed.
|