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2019 (10) TMI 915 - AT - Income TaxDisallowance u/s 14A r.w.r 8D - suo moto disallowance by assessee - HELD THAT:- CIT(A) correctly deleted the additions in view of the decision of the Hon’ble High Court in the case of Joint Investment Ltd. vs. CIT, [2015 (3) TMI 155 - DELHI HIGH COURT] that disallowance cannot be more than exempt income. CIT(A) has followed the binding precedent of the Jurisdictional High Court, we do not find any error in the order of the learned CIT(A) Nature of expenditure - treating the licence fee paid to DOT as revenue expenditure - HELD THAT:- We find that the learned CIT(A) has deleted the additions following the order of the Tribunal in the case of the assessee for assessment year 2007-08 [2015 (1) TMI 924 - ITAT DELHI] which is a binding precedent wherein the licence fee paid by the appellant is treated as revenue in nature Deduction u/s 10A computation - whether the telecommunication charges and foreign currency expenditure has to be reduced from the export turnover for the purpose of computing deduction? - HELD THAT:- Issue in dispute is covered in favour of the assessee by the decision of the Hon’ble Supreme Court in the case of CIT Vs. HCL Technologies Ltd. [2018 (5) TMI 357 - SUPREME COURT] held that adjustment, if any made from “export turnover” under Explanation 2 of section 10A of the Act is also liable to be paid on “total turnover” to avoid unintended and absurd results Disallowance u/s 14A invoking Rule 8D - HELD THAT:- We agree with the contention of the learned counsel that disallowance as per Rule 8D(2)(iii) ought to be computed at nil, however, on perusal of the computation of Rule 8D(2)(iii) by AO we find that he has worked out investment as on 31.03.2009 at ₹ 54,94,39,000/- and investment as on 31.03.2010 at ₹ 1,68,79,28,003/- and worked out the average investment of ₹ 111,86,83,501/-. In view of above facts, the contention that there was wrong opening and closing investment is not accepted. As far as satisfaction of the Assessing Officer is concerned, firstly the Assessing Officer has rejected the claim of assessee after perusal of the account of the assessee, thereafter, he proceeded to invoke Rule 8D of the Rules. Thus, the contentions of the assessee that no dissatisfaction has been recorded by the Assessing Officer for invoking Rule 8D is not correct. Secondly, the assessee is not in appeal before us and thus, the assessee cannot raise this issue in the appeal of Revenue. Accordingly, we reject the contentions of the assessee. In view of the decision of Joint Investment P. Ltd. [2015 (3) TMI 155 - DELHI HIGH COURT] the disallowance cannot be more than exempt income and accordingly, we restrict the disallowance at ₹ 4,22,021/- Disallowance of unrealized foreign exchange loss on account of reinstatement of assets and liabilities holding the same to be notional - CIT-A allowed the claim - HELD THAT:- We find that the learned CIT(A) has decided the issue following the decision of the Hon’ble Supreme Court in the case of CIT vs Woodward Governor India Pvt. [2009 (4) TMI 4 - SUPREME COURT] We do not find any error in the order of the learned CIT(A) on the issue in dispute, accordingly, uphold the same.
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