Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2016 (5) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (5) TMI 254 - AT - Income TaxDisallowance u/s.14A - Held that:- When the authorities below have observed that the assessee has received ₹.70.00 lakhs from the group concern was interest free and no interest was debited on this amount, the ld. CIT(A) has rightly held that the disallowance under Rule 8D(2)(ii) cannot be made when there was no interest burden on the amount borrowed from the group concern - Decided against revenue. Disallowance of additional depreciation on Ready Mix Concrete [RMC] - Held that:- The assessee is not entitled for additional depreciation in respect of machinery used since production of ready mix concrete would not amount to manufacture of article or thing Disallowance made under Rule 8D(2)(iii) - Held that:- Assessing Officer rightly invoked the Rule-8D and arrived at the disallowance of expenses u/s.14A r.w.Rule-8D. In order to arrive at a reasonable amount of expenditure, which may vary from case to case and situation to situation, the legislature, after taking various factors into consideration, came to a conclusion that such expenses can be reasonably calculated @ 0.5% of the average investments made by the assessee. For this purpose, the legislature has arrived at a common formula to calculate the expenses @ 0.5% of the average investments made as per step-3 of the formula given in Rule-8D. Accordingly the legislature incorporated and introduced the Rule-8D. Further, as could be seen from the assessment order, the Assessing Officer has rightly quantified the expenditure under Rule 8D(2)(iii) and disallowed under section 14A of the Act.
|