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2020 (12) TMI 716 - AT - Income TaxDisallowance u/s. 14A r.w. Rule 8D(2)(ii) - HELD THAT:- We find that Ld.CIT(A) following the decision of CIT v. Reliance Utilities and Power Ltd.[2009 (1) TMI 4 - BOMBAY HIGH COURT] and CIT v. HDFC Bank [2014 (8) TMI 119 - BOMBAY HIGH COURT] deleted the disallowance as the assessee has its own interest free funds by way of share capital reserves and surplus, far in excess of the investments made by it in equity shares which got yielded exempt income. We do not find any infirmity in the order of the Ld.CIT(A). Thus, the grounds of the revenue on this issue are dismissed. Disallowance u/s. 14A while computing book profits u/s.115JB - CIT(A) following the decision of Hon'ble Special Bench of Delhi in the case of ACIT v. Vireet Investments Private Limited [2017 (6) TMI 1124 - ITAT DELHI]held that the computation under clause (f) of Explanation 1 to section 115JB(2) is to be made without resorting to the computation as contemplated u/s. 14A r.w. Rule 8D of the I.T Rules, 1962. Therefore, respectfully following the said decision we restore this issue to the file of the Assessing Officer who shall decide in accordance with the decision of the Special Bench and compute the book profits accordingly. Grounds on this issue are allowed for statistical purpose. Respectfully following the decision of the Hon'ble Special Bench in the case of ACIT v. Vireet Investments Private Limited (supra), we direct the Assessing Officer to compute the disallowance as per Rule 8D(2)(iii) of I.T. Rules by considering only those investments which yielded dividend income during the assessment year under consideration.
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