TMI Blog2011 (3) TMI 1686X X X X Extracts X X X X X X X X Extracts X X X X ..... 85,510/- earned by the assessee from the RBI tax free bonds, UTI ARS bonds, share mutual funds without considering the facts that no expenditure was actually incurred by the assessee for earning of such interest and dividend income. ii) That the learned Commissioner of Income Tax (Appeals) has not appreciated the fact that Sub Section (2) and (3) of Section 14A were introduced for the 1st time by the Finance Act 2006 w.e.f. 01-04-2007 and Rule 8D was inserted for the first time w.e.f. 24-03-2008 and has erred in law in giving the directions to Ld. Assessing Officer to re-compute the amount of disallowance under rule 8D despite the fact that the said rule and Sub Section (2) and (3) of Section 14A were not applicable to the assessment y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fact that the said rule and Sub Section (2) and (3) of Section 14A were not applicable to the assessment year under reference. iii) That the learned Commissioner of Income Tax (Appeals) while making an addition of ₹ 3,73,824/- for the expenditure presumed to have been incurred for the earning of interest dividend income on tax free RBI bonds, UTI ARS bonds and shares mutual funds are vague, defective and are against the facts of the case and are based on assumptions and presumptions only. iv) That the learned Commissioner of Income Tax (Appeals) has not brought any documentary evidence to show that any such expenditure of ₹ 3,73,824/- was incurred by the assessee for earning of the interest dividend income while mak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o not the case where assessee had to incur any expenditure for the purpose of earning interest which has been merely accrued on the investment made in tax free bonds and not realized. Therefore, the question of incurring any expenditure for earning interest accrued on RBI tax free relief bonds does not arise. The facts of the present case are very peculiar where no actual interest has been received but interest has been accrued on the investment made earlier. Since no actual expenditure can be said to have been incurred for the purpose of earning interest on RBI tax free relied bonds, the question of estimating the reasonable expenditure for the purpose of earning interest does not arise. We, therefore, delete the disallowance estimated ..... X X X X Extracts X X X X X X X X Extracts X X X X
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