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 1924 - AT - Income TaxAdditions u/s 14A - expenditure incurred towards earning of exempt income u/s 10(34) - CIT-A made the disallowance on the ad-hoc basis - Rule 8D are applicable from the assessment year 2008-09 - in present case, matter relates to AYs prior to 2008-09 - Held that:- the disallowance as per the provision of Rule 8D cannot be made for the year under consideration. However, the possibility of incurring the expenses in relation to exempted income on account of administrative expenses cannot be ruled out. Therefore some expenses on reasonable basis should be disallowed in pursuance of the provision of section 14A of the Act. - AO directed to disallow administrative expenses at the rate of 1% of the exempted/dividend income. MAT - computation of book profit u/s 115JB - consideration of disallowances made u/s 14A r.w.r. 8D - Held that:- ad-hoc disallowance will serve the justice to the Revenue and assessee. Therefore to put the dispute to rest in given facts & circumstances, we direct for the ad-hoc disallowance to avoid the multiplicity of the proceedings and unnecessary litigation. - onsidering the peculiar circumstances of the case, we propose to limit the disallowance on an ad-hoc basis @ 1% of the dividend/exempt income as per the clause (f) to Explanation-1 of Sec. 115JB of the Act. MAT - computation of book profit u/s 115JB - additions on account of amount written back - the amount of interest was waived off by the Vijaya bank - Held that:- it can be safely presumed that the effect of provision created for interest expenses in the earlier years have been duly given and offer to tax under the provision of MAT. Accordingly, the assessee cannot be made liable for paying tax under the provision of MAT for the year in which it was written back. - Additions deleted. Interest liability u/s 234B and 234C - Held that:- it is clear that there was a shortfall in the payment of advance tax on account of the retrospective amendment, but there will be no interest liability u/s 234B and 234C of the Act in terms of judgment as discussed above. Thus the ground of the assessee is allowed.
|