TMI Blog2013 (3) TMI 726X X X X Extracts X X X X X X X X Extracts X X X X ..... der was passed by the ld. CIT(Appeals) on 2nd August, 2011. 2. The relevant material facts are like this. The assessee is an individual and derives income from business capital gains and other sources. During the course of the assessment proceedings, the Assessing Officer noted that the assessee has earned exempt dividend income of ₹ 7,87,452/-, and that the assessee has not offered any disallowance under section 14A read with Rule 8D. It was also noted that during the relevant assessment year, the assessee has shown interest payment of ₹ 66,89,419/-. It was in this backdrop that the assessee was asked to compute the disallowance under section 14A read with Rule 8D. The computation given at the instance of the Assessing Offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so taken by the Assessing Officer, the assessee carried the matter before the CIT(Appeals). It was contended by the assessee that the Assessing Officer was wrong in making addition under section 14A to the tune of ₹ 7,87,452/-. It was also pointed out that the Assessing Officer has not shown any nexus between the borrowed fund and investment in shares and that the computation on which the Assessing Officer as relied was simply submitted in response to the requisition made by the Assessing Officer. The assessee further pointed out that the investment in shares was made by the appellant from own surplus fund and disallowance of interest was, therefore, not justified. Ld. CIT(Appeals), however, was not persuaded the arguments in his orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount credited to the Profit Loss A/c. on account of interest is ₹ 51,55,852/-. In other words, so far as the interest expenditure and interest income is concerned, there is only a net income in that respect and no expenditure has been debited as such to the Profit Loss A/c. Ld. counsel submits that in this view of the matter, no disallowance can be made under section 14A on the facts of the case. 5. Shri K.N. Jana, ld. Sr. D.R. objects to the submissions of the assessee. He submits that the assessee on his own had offered disallowance before the Assessing Officer and, therefore, it is not open to the assessee to retract from the said stand and contended that no disallowance was warranted at all. Our attention was invited to pag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se as also the applicable legal position. 8. We find that, as ld. counsel rightly points out, the laws fairly settled on the issue that there cannot be any estoppel against the statute. Hon ble jurisdictional High Court in the case of SAIL VSP VR Employees Association -vs.- Union of India Ors. (supra) has explained this principle in law as follows :- 17. The question of estoppel because of option exercised with eyes open to the subsequent modification cannot be sustained. What is not otherwise taxable cannot become taxable because of admission of the assessee. Nor there can be any waiver of the right otherwise admissible to the assessee in las. The chargeability is not dependent on the admission of or waiver by the assessee. Charge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... material figure so far as the figure under section 14A read with Rule 8D is concerned is the figure, which is actually debited or credited to the Profit Loss A/c. and not the components thereof. The same was the view taken by the coordinate Bench of this Tribunal whereby, speaking order through one us, i.e. Accountant Member, the Tribunal concluded as follows :- 4. As learned CIT(A) has rightly observed, once there is no net interest expenditure, as is the case before us- upon setting off interest credited to profit and loss account, no part of interest debited can be disallowed as attributable to earning tax free dividend. The CIT(A) was thus quite justified in deleting the interest disallowance. We have also noted that entire expens ..... X X X X Extracts X X X X X X X X Extracts X X X X
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