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2019 (3) TMI 807 - AT - Income TaxDisallowance u/s 14A u/s 8D - assessee has earned dividend income on investments - DR submitted that assessee incurs interest on its borrowings and since funds are maintained in a mixed account part of interest expenditure is to be held towards earning of dividend income - HELD THAT:- For year under consideration, disallowance cannot be made as per Rule 8D of Income Tax Rules, 1963. We are therefore inclined to set aside the issue back to AO to compute disallowance having regard to assessment year under consideration, as well as decision in case of Maxopp Investments vs. CIT [2018 (3) TMI 805 - SUPREME COURT OF INDIA]. AO is also directed that the disallowance so computed shall not exceed the exempt income earned by assessee during year under consideration. Disallowance of prior period expenses - method of accounting followed - Year of assessment - HELD THAT:- For assessment year 2003-04 in assessee’s own case [2015 (1) TMI 739 - ITAT DELHI] has observed that expenses are always claimed by assessee in year in which the same are quantified, while allowing claim of assessee. It is observed that this method of accounting has been accepted by authorities below from assessment year 1991-92 to 2000-01. It is also observed that for assessment year 2000-01 notice under section 263 has been issued by CIT, for examining this issue, and the same has been dropped. Disallowance of commission expense - CIT-A deleted the addition - HELD THAT:- CIT(A) has ignored enquiries made by AO with bank wherein there is a categorical denial by bank in dealing with M/s.Umang Credit Capital Ltd., for disbursement of loan. We are of view that Ld.CIT (A) failed to examine whether party to whom commission has been paid by assessee during this year is same as that in earlier year, and whether such loan has been taken for purposes of assessee’s business. Under such circumstances we do not agree with Ld. CIT(A) as well as Ld.AR that issue stands covered by orders of this Tribunal in earlier years. We accordingly set aside this issue to Ld.AO for due verification in the light of relevant documents on record. Ld. AO is to verify the same as per law to ascertain true nature of transaction. - Decided in favour of assessee for statistical purposes.
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