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2016 (3) TMI 1386 - AT - Income TaxDisallowance u/s 14A - indirect expenses of the dividend income - HELD THAT:- As noted that for A.Y. 2009-10 also, there is observation that the entire investment was made out of own funds and simply because the assessee had borrowed funds in the balance sheet does not mean that the assessee made investment out of borrowed capital. As further observed that the assessee made disallowance at the rate of 1%, which was considered to be towards lower side, therefore, the AO was directed to restrict the disallowance on account of indirect expenses at the rate of 5% of the dividend income and since the assessee had suomotu disallowed the Assessing Officer was directed to restrict the disallowance at ₹ 4,14,921/-. The ld. DR had also no objection to the aforesaid reasoning, if followed. - Appeal of the assessee is partly allowed.
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