Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2020 (9) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2020 (9) TMI 675 - HC - Income TaxAddition u/s 14A - Recording of satisfaction - Whether Tribunal was right in not considering the fact that the assessee has incurred interest expenditure and made investment more than its reserves and surpluses? - HELD THAT:- Bombay High Court in the case of Godrej & Boyce Manufacturing Company Limited, Mumbai Vs. Deputy Commissioner of Income Tax [2010 (8) TMI 77 - BOMBAY HIGH COURT] AO must, in the first instance, determine whether the claim of the assessee in that regard is correct and the determination must be made having regard to the accounts of the assessee. The satisfaction of the AO must be arrived at on an objective basis. It is only when the AO is not satisfied with the claim of the assessee, that the legislature directs him to follow the method that may be prescribed. Sub-s. (3) of s. 14A provides for the application of sub-s. (2) also to a situation where the assessee claims that no expenditure has been incurred by him in relation to income which does not form part of the total income under the Act. The above legal position has been rightly followed by the tribunal while deciding the assessee's case and therefore, rightly dismissed the appeal filed by the revenue. Substantial Question of Law has to be answered against the revenue and in favour of the assessee.
|