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TMI Blog2013 (8) TMI 37X X X X Extracts X X X X X X X X Extracts X X X X ..... peal by the Revenue and admit the appeal of the Revenue for hearing. 3. In the appeal of the assessee the issue involved is that the ld. CIT(A) erred in confirming the disallowance of interest and administrative expenditure of Rs.9,95,907/- u/s 14A of the Income Tax Act, 1961. 3.1. In the appeal of the Revenue the issue involved is that the ld. CIT(A) erred in restricting the disallowance of interest and administrative expenditure to Rs.9,95,907/- in place of Rs.23,71,642/- 4. The brief facts of the case are that during the year under consideration the assessee had shown income from long term capital gain of Rs.4,93,03,123/-and dividend income of Rs.30,68,670/- which was claimed as exempt u/s 10(38) and section 10(34) of the I.T.Act resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ive operation in case of pending assessment proceedings, the same would be applicable to the appeal before the Tribunal and also in this appeal before us and thus, the Tribunal below did not commit any illegality in applying the said provisions to the pending proceedings. Thus, the approach of the Assessing Officer to work out the pro-rata interest expenditure as relatable to earning of dividend was quite in conformity with the provisions of section 14A of the Act and we do not find any reason to disturb the said order in the light of the amended provisions of section 14A of the Act. We, therefore, find no substance in the aforesaid contention of Mr.Khaitan that the Revenue cannot get the benefit of Section 14A of the Act and consequently ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dividend income amounting to Rs.9,95,907/- 7.3. Respectfully, following the judgment of the jurisdictional High Court in the case of ISG Traders Ltd. vs CIT, WB-II, Kolkata (supra), the disallowances made by the A.O. to the extent of Rs.9,95,907/- is upheld. Both the grounds are clubbed together and disallowances made by the A.O. for both the expenses i.e. interest expenditure and other expenses are considered together and held to the extent of Rs.9,95,907/-." 6. Being aggrieved by the said order of the ld. CIT(A) both assessee and the Revenue are in appeal before us. The assessee is in appeal against the order of the ld. CIT(A) sustaining the disallowance to Rs.9,95,907/- on account of interest and other expenditure u/s 14A of the Act wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessment year involved in the present appeals is the A.Yr. 2006-07. The Hon'ble Bombay High Court in the case of M/s. Godrej Boyce Manufacturing Co.Ltd. vs DCIT 328 ITR 81 (Bom) found that the amendment had not been made with retrospective effect and that therefore, Rule 8D not to be used with retrospective effect and that therefore, Rule 8D cannot be used in cases prior to the Assessment Year 2007-08. Further, we find that the Kolkata Bench of the Tribunal in the case of DCIT, Circle-1, Kolkata vs M/s.Exide Industries Ltd. in ITA No.1640/Kol/2012 for A.Yr.2006-07 vide order dated 19.04.2013 following the decision of the Kolkata Tribunal in the case of Sagarika Goods and Services Pvt. Ltd. vs ITO vide ITA No.1278/KOl/2010 dated 24.09.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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