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2022 (8) TMI 354 - AT - Income TaxDisallowance u/s. 14A - Addition on account of interest and on account of administrative expenses as per the provisions of Rule 8D - Mandation of recording satisfaction - HELD THAT:- As before making disallowance u/s. 14A of the Act the Assessing Officer has to state as to how he is not satisfied with the submissions of assessee that no expenditure has been incurred keeping in view the books of accounts of the assessee which means he has to point out from the books of accounts as to which expenditure is relatable to earning of such income. No such findings has made by Assessing Officer in this case. Disallowance out of salary and wages - Addition made on adhoc basis due to insufficiency of vouchers or due to self made cash vouchers - HELD THAT:- As we find that the Assessing Officer had made disallowance equivalent to 5% of such expenses which the ld. CIT(A) has restricted to 50% of such disallowance which is quite reasonable, keeping in view the fact that the Hon'ble Allahabad High Court in the case of ‘Rimjhim Ispat Ltd.’ [2016 (1) TMI 374 - ALLAHABAD HIGH COURT] has held that where the expenses was not supported bills/vouchers the disallowance equivalent to 5% of such expenditure was justified. - Decided partly in favour of assessee.
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