TMI Blog2016 (2) TMI 505X X X X Extracts X X X X X X X X Extracts X X X X ..... ome from dividend had been shown at ₹ 1,11,564/- whereas disallowance under Section 14A read with Rule 8D of the Rules worked out by the Assessing Officer came to ₹ 4,09,675/-. Thus, the Assessing Officer disallowed the entire tax exempt income which is not permissible as per settled position of law. Consequently, the Tribunal remitted the matter to the Assessing Officer with a direction to decide the same afresh in accordance with law after affording due and reasonable opportunity of being heard to the assessee The view adopted by the Tribunal being a plausible view based on factual position and the relevant case law on the point, does not warrant any interference by this Court. Learned counsel for the appellant-revenue has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... incomes, the Assessing Officer made disallowance of ₹ 4,09,675/- by invoking the provisions of section 14A of the Act read with Rule 8D of the Income Tax Rules,1962 (in short, the Rules ). Aggrieved by the order, the assessee filed appeal before the Commissioner of Income Tax (Appeals) [CIT(A)]. Vide order dated 18.7.2013, Annexure A.2, the CIT(A) partly allowed the appeal. Still not satisfied, the assessee filed appeal before the Tribunal. Vide order dated 18.6.2015, Annexure A.3, the Tribunal set aside the order passed by the CIT (A) and remitted the matter to the Assessing Officer with the direction to decide the issue afresh in accordance with law. Hence the instant appeal by the revenue. 3. We have heard learned counsel for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, the income from dividend has been shown at ₹ 1,11,564/-, the disallowance under section 14A read with Rule 8 D worked out by the Assessing Officer comes to ₹ 4,09,675/-. Thus, it is clear that the AO has disallowed the entire tax exempt income which is not permissible in view of the judgment of the Hon'ble Delhi High Court referred to above. The Hon'ble Delhi High Court held that the window for disallowance is indicated in section 14A, and is only to the extent of disallowing expenditure incurred by the assessee in relation to the tax exempt income . The disallowance under section 14A read with Rule 8D as worked out by the Assessing officer is not in accordance with law and as such working is not sustainable. 8. I ..... X X X X Extracts X X X X X X X X Extracts X X X X
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