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2019 (7) TMI 473 - HC - Income TaxAddition u/s 14A r.w.r. 8D on account of the interest expenses - assessee was maintaining mixed funds and has failed to establish that it has its own surplus funds for investment in dividends - non recording the satisfaction by the Assessing Officer before applying the formula given in sub-rule (2) of Rule 8D - whether once there are mixed funds, Rule 8D would be attracted mandatorily? - ITAT upholding the relief under Section 14A of the Act on account of the interest expenses - HELD THAT:- The language of Section 14A of the Act is plain and clear. Before invoking Rule 8D, the Assessing Officer is obliged to indicate that having regard to the accounts of the assessee, he is not satisfied with the correctness of the claim of the assessee in respect of such expenditure in relation to the income which does not form part of the total income under the Act. To put it in other words, the condition precedent of recording the requisite satisfaction which is a safeguard provided in Section 14A should not be overlooked before going to Rule 8. In such circumstances we are not impressed by the submission canvassed on behalf of the Revenue that once there are mixed funds, Rule 8 would be attracted automatically. In the overall view of the matter, we are convinced that no error, not to speak of any error of law, could be said to have been committed by the Tribunal in passing the impugned order.
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