TMI Blog2014 (9) TMI 1018X X X X Extracts X X X X X X X X Extracts X X X X ..... ssing officer with the direction to examine this issue afresh in the light of discussions made supra and also by duly considering the information and explanations furnished by the assessee and take appropriate decision in accordance with the law. - Decided in favour for assessee for statistical purposes. - I.T.A. No.2585/Mum/2013 - - - Dated:- 26-9-2014 - S/SHRI B.R.BASKARAN (AM) AND SANJAY GARG, (JM) Appellant by : Shri Vinod Z Vasa Respondent by : Shri Prakash L Pathade ORDER Per B.R.BASKARAN, Accountant Member: The appeal filed by the assessee is directed against the order dated 1.1.2013 passed by Ld CIT(A)-23, Mumbai and it relates to the assessment year 2009-10. 2. The Assessee is aggrieved by the or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee has filed this appeal before us. 4. We have heard the rival contentions and perused the record. From the assessment order, we notice that the assessing officer has aggregated the value of Investments and Stock in trade (both opening balance and closing balance) in order to find out average value of investments . Further, we notice that the aggregate value of investment is worked out at 1.45 times of average of total assets. There should not be dispute that the ratio of aggregate value of investment to average value of total assets shall always be less than 1, since the value of investments also forms part of the value of total assets. A perusal of the working made by the assessing officer shows that the assessing officer has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t considering the above said two decisions. We find merit in the said submissions. We notice that the Co-ordinate bench in the case of Damani Estates Finance Pvt Ltd has held that the disallowance prescribed in the provisions of Rule 8D(2)(ii) has to be scaled down while computing the disallowance in respect of shares held as Stock in trade. In the facts prevailing in the above said case, the Tribunal held that the disallowance under Rule 8D(2)(ii) of the IT Rules may be computed by taking 20% of the interest expenditure, i.e., 80% of interest expenditure is treated as related to trading activities and 20% is treated as related to tax free dividend income. In the instant case also, the interest expenditure needs to be bifurcated between ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Rule 8D(2)(ii) of the IT Rules. 9. In view of the foregoing discussions, we are of the view that this issue requires examination afresh. Hence, we prefer to set aside all the matters to the file of AO. Accordingly, we set aside the order of Ld CIT(A) and restore all the matters to the file of the assessing officer with the direction to examine this issue afresh in the light of discussions made supra and also by duly considering the information and explanations furnished by the assessee and take appropriate decision in accordance with the law. 10. In the result, the appeal filed by the assessee is treated as allowed for statistical purposes. The above order was pronounced in the open court on 26th Sept, 2014. - - TaxTMI - TMI ..... X X X X Extracts X X X X X X X X Extracts X X X X
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