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2019 (4) TMI 214 - AT - Income TaxDisallowance u/s.14A r.w.r. 8D - HELD THAT:- Assessee paid interest to Corporation Bank as well as Kotak Mahindra Bank to the tune of ₹ 1,39,445/- and ₹ 10,61,618/- respectively, thereby leaving other expenses at ₹ 8,11,107/-. The assessee submitted a chart before the CIT(A) contending that out of such remaining expenses, a sum of ₹ 7,72,505/- was exclusively incurred towards expenses in respect of taxable income thereby leaving common expenses, incurred both for taxable and non-taxable income, at ₹ 38,602/-. CIT(A) himself incorporated the submission of the assessee in the impugned order but misconstrued the same and ordered to make enhancement by the sum of ₹ 38,602/- which is not justifiable. We, therefore, order to delete the enhancement made by the CIT(A) to this extent. Exclusion of expenses exclusively towards taxable income u/s 14A - HELD THAT:- Three items of expenses, viz., professional charges for project at Parvati amounting to ₹ 5,51,500/- ; stamp duty, stamp paper and miscellaneous expenses of ₹ 86,893/-; and expenses relating to property rented out by the assessee at ₹ 50,872/-, have no connection with the exempt income and hence cannot be considered for disallowance u/s 14A. The remaining item of expense in this list is a sum of ₹ 83,240/-, which is payment of professional fees, that relates to income-tax filing return common both to the taxable and exempt income. The same is therefore, liable to be considered as common expense and not exclusively for taxable income. At this stage, it is pertinent to note that even under rule 8D, the disallowance u/s.14A cannot exceed the total amount of expenses incurred by the assessee either exclusively for exempt income or jointly for exempt and taxable income. In this backdrop of the facts, we order to restrict the disallowance to ₹ 1,21,842/- (Rs.38,602 + ₹ 83,240). The issue is, therefore, partly allowed. Computation of interest u/s.234A and 234B - date-wise payments of self-assessment tax made by the assessee, both before and after the due date u/s 139(1) - HELD THAT:- Once the amount of self assessment tax was paid, the Revenue could not be considered as deprived of the amount of tax due to it. As interest u/s 234A is compensatory, following the rationale, we hold that the consequence will be no different if the amount of self-assessment tax is also paid after the due date but before the filing of return of income. In such a scenario, the Revenue will stand compensated to the extent of payment of self-assessment tax made after the due date and accordingly the amount of interest u/s 234A for the period during which such an amount stood paid, needs to be computed on the proportionately reduced amount of tax accordingly. We set-aside the impugned order and remit the matter to the file of the AO for calculating the amount of interest u/s.234A afresh after considering date-wise payments of self-assessment tax made by the assessee, both before and after the due date u/s 139(1).
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