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2017 (4) TMI 106 - AT - Income TaxDeduction u/s. 80IB in respect of ‘common expenses’ - Held that:- On perusal of the orders for AY 2000-01 and 2001-02 shows the basis of apportionment of head office and common selling expenses is being followed by the Assessee consistently. We find the Tribunal found the basis of apportionment of common head office and common selling expenses adopted consistently by the company is scientific and reasonable and accepted and allowed deduction under Section 80IB of the Act. Respectfully following the above, we uphold the impugned order of the CIT-A and we have no hesitation to allow the deduction as claimed u/s.80IB of the Act and therefore, ground raised in this regard fails and it is dismissed. - Decided in favour of assessee Deduction u/s.80IB in respect of ‘interest income’ on sale of scrap - Held that:- Hon’ble High Courts in the cases of DClT vs Harjivandas Juthabhai Zaveri (1999 (12) TMI 5 - GUJARAT High Court ) held that scrap generated in the manufacturing activity is eligible for deduction and respectfully following the same, we hold that the Assessee is entitled to claim deduction under the provisions of the section 80IB of the Act and the impugned order of the CIT-A on this issue is justified and delete the addition - Decided in favour of assessee Disallowance u/section 14 A - applicability of rule 8D - Held that:- as on 11-04-07 the opening surplus was 212 crores and as on the same the share capital was at 63.77 crores. Therefore it amply proves that the Assessee has made investments from its own funds and as rightly pointed by the Ld. AR that the AO did not examine the nexus between the investments if any made from borrowed funds, without the same application of Rule 8D to compute the expenditure for the purpose of disallowance u/ section 14 A of the Act is bad. We find that the issue in hand is covered by the decision in the case of CIT Vs. Ashish Jhunjhunwala [2015 (12) TMI 905 - CALCUTTA HIGH COURT] which held that while rejecting the claim of the Assessee with regard to expenditure or no expenditure, as the case may be, in relation to exempted income, the AO has to indicate cogent reasons. We find the AO without assigning any reasons to the claim of the Assessee applied Rule 8D, therefore, the disallowance as made to an extent of 38,07,778/- is not maintainable. Respectfully following the decision supra, we have no hesitation to delete the impugned addition as made by the AO and confirmed by the CIT- A - Decided in favour of assessee
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