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TMI Blog2015 (12) TMI 1651X X X X Extracts X X X X X X X X Extracts X X X X ..... made by it in the shares/mutual funds which were generating exempt income, without appreciating the fact that in the course of assessment proceedings, despite the opportunity provided to it, the assessee has failed to furnish any evidence to prove the nexus between the interest free funds available and investments made. Further, considering the fact that the assessee had incurred expenditure by way of interest which, on the basis of evidence furnished, is not directly attributable to any particular income or receipt, the only option available with A.O. is to work out the disallowance in accordance with Rule 8D(2)(ii)" 1(b). On the facts and in the circumstances of the case and in law, the Id. CIT (A) has erred in deleting the addition mad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n account of disallowance of Employee's C on tr ibu ti on top r ovid en t Fund/ E S IC s inc e th e p ay men ts wer e mad e af te r t h e du e d ates holding that the payments have been made within grace period without appreciating the fact that in view of the decision of Hon'ble ITAT C' Bench Kolkata in the case of Bengal Chemical and Pharmaceuticals Ltd (11 Taxmann.com 328)(2011) the assessee is not entitled to deduction u/s.36(1)(va) in respect of Employees Contribution to P.F. if it is paid after due date as specified in Explanation to section 36(1)(va) on the basis of provisions of section 43B because said section comes into play only when a deduction is otherwise allowable under Act." 3(b) On the facts and in the circums ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome totaling to Rs. 3,08,26,261/- u/s. 14A disallowed by the assessee. In course of assessment proceedings, the Assessing Officer asked the assessee to show cause and explain as to why the expenditure computed in accordance with Rule 8D should not be treated as expenditure incurred for earning dividend income and disallowed u/s. 14A of the I.T. Act, however, the explanation furnished by assessee was not accepted by the Assessing Officer and he accordingly disallowed the sum of Rs. 3,08,26,561/- to the total income of the assessee u/s. 14A of the Act. 4. Aggrieved, by the addition made by the Assessing Officer the assessee filed an appeal before learned CIT(A). Before learned CIT(A) assessee contended that the disallowances made in earlie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m of Rs. 5,00,000/- would be appropriate to allocate for administrative expenses in relation to earning of exempt income. He thus restricted the disallowance u/s. 14A to Rs. 1,12,91,985/- and addition made by the Assessing Officer to that extent is confirmed. 5. Aggrieved by the order passed by learned CIT(A) the Revenue is in appeal before the Tribunal. 6. Learned Departmental Representative supported the order passed by the Assessing Officer and relied upon the judgment of Hon'ble Calcutta High Court in the case of Dhanuka & sons (339 ITR 319). Learned AR appearing on behalf of the assessee strongly supported the order passed by learned CIT(A). 7. We have considered the rival submissions and perused the record. We are of the view t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he chairman of the company was so warranted for the assessee's business and operations. Learned CIT(A) disagreed with the Assessing Officer's finding and deleted the addition made by Assessing Officer. 10. Aggrieved by the said deletion, the Revenue filed an appeal before the Tribunal. Learned Departmental Representative supported the order passed by the Assessing Officer whereas learned AR appearing on behalf of the assessee supported the order passed by learned CIT(A). 11. We have considered the rival submissions and perused the material on record and considered the orders of the tax authorities. We are of the considered the view that the order passed by learned CIT(A) does not require any interference as the learned CIT(A) has consider ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the rival submissions and perused the materials on record. We have heard both the parties in this regard and we find that the decision relied upon by learned Departmental Representative in the case of Bengal Chemical and Pharmaceuticals Ltd. (supra) is distinguishable on facts as the assessee-company has paid the contribution to PF and ESIC after the due date but within the grace period. Learned CIT(A) was rightly held that the payment made within the grace period by following the Judgement of Hon'ble Supreme Court in the case of CIT Vs. Alom Extrusions Ltd. (185 Taxman 416). Therefore, we are of the considered view that the findings of learned CIT(A) on this issue do not require any infirmity accordingly we uphold the same. Hence gro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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