Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2020 (6) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2020 (6) TMI 26 - AT - Income TaxDisallowance u/s. 14A read with Rule 8D - assessee claimed that no expenditure was incurred by the assessee in earning this dividend income - AO disallowed the expenditure alleging that the assessee debited demat charges and therefore disallowances u/s. 14A r.w.r 8D is applicable in case of the assessee - HELD THAT:- AO has not given any reason why he is satisfied with the explanation rendered by the assessee and has simply remarked that he is not accepting the claim of assessee that it did not incur any expenditure for earning exempt income. It has to be kept in mind that reason is the soul of any order and here it is absent. A bald assertion by AO that he is not accepting the assessee’s claim is arbitrary and so cannot be justified. The AO has not applied his mind while dealing with the issue and his action smacks of arbitrariness and therefore his action cannot be sustained. And since the ld. CIT(A)’s action of non adjudication of the legal issue raised by the ld. CIT(A) makes it unsustainable and so inclined to set aside the order and direct deletion of addition made by AO on this issue by invoking Rule 8D. For the reasons stated above, the appeal of assessee is allowed.
|