9911796707
TMI Blog2015 (1) TMI 1223X X X X Extracts X X X X X X X X Extracts X X X X ..... r the respective years. Assessee has filed cross objection only for AY 2009-10 and such cross objections support the order of the CIT(A). 2. Grievance raised by the revenue is that disallowances made by the AO under Section 14A of the Income-tax Act, 1961 [in short "the Act"] read along with rule 8D(2)(ii) were deleted by the CIT(A). 3. Facts apropos are that assessee had investment in shares which yielded dividend income of Rs. 8,17,020 and Rs. 13,34,577. These were claimed as exempt in the respective years. Assessee was a dealer in automobiles. Its investment in shares as on 31.3.2009 came to Rs. 4.10 crores and as on 31.3.2010 came to Rs. 7.25 crores. Against total interest cost of Rs. 8,72,40,037 for A.Y. 2009-10 and Rs. 8,39,44,973 f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ongly assailing the orders of ld. CIT(A), submitted that ld. CIT(A) had presumed the mode of utilisation of the loans. According to him, loans taken included cash credit accounts and nomenclature of the loans would not ensure its ultimate utilisation. According to him, the money was going into the same kitty and assessee could not show that the investments had no loan components therein. 6. Per contra, the ld. AR submitted that loans taken from bank were for specific purposes and could not be used for anything else. Further, according to him, assessee had substantial own funds and the disallowances were made purely on presumptions. 7. We have perused the orders and heard the rival contentions. Assessee had share capital and reserves total ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tu made a disallowance for direct interest expenditure under rule 8D(2)(i) for A.Y. 2010-11, while claiming that no such expenditure was there for A.Y. 2009-10. For application of Section 14A(2), it is necessary for the AO to show that he is not satisfied with the correctness of the claim of assessee with regard to the expenditure claimed to have been incurred for earning exempt income. That this condition applies even where the claim is one of no or nil expenditure has been held by the Hon'ble Delhi High Court in the case of Maxopp Investments Ltd. v. CIT, (2012) 347 ITR 272 in para 30 of its judgment. 8. We are therefore of the opinion that ld. CIT(A) was justified in deleting the disallowances made under rule 8D(2)(ii). No interfere ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
