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TMI Blog2018 (1) TMI 1287X X X X Extracts X X X X X X X X Extracts X X X X ..... ged the disallowance made under section 14A r/w rule 8D. 4. Brief facts are, the assessee a company is engaged in the business of printing and publishing. For the assessment year under dispute, assessee filed its return of income on 24th September 2010, declaring loss of Rs. 3,38,54,100. During the assessment proceedings, on verifying the Balance Sheet of the company for the relevant financial year the Assessing Officer found that the assessee has invested an amount of Rs. 3,05,83,750, in the shares of Annakoot Properties Pvt. Ltd., income from which shall not form part of the total income. Therefore, he called upon the assessee to explain why disallowance of expenditure attributable to the investment made in exempt income yielding asset s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is nothing in the order of the Departmental Authorities to suggest that in the relevant previous year, the assessee had earned any exempt income. Therefore, prima-facie, the assessee's claim that it has not earned any exempt income in the relevant previous year appears to be correct. Notably, while deciding assessee's appeal against disallowance made under section 14A r/w rule 8D under identical facts and circumstances in the assessment year 2011-12, the Co-ordinate Bench vide order dated 22nd March 2017, passed in ITA no.4161/Mum./2015, has held as under:- "7. We have heard rival contentions of the parties and perused the material available on record. The specific contention of the learned Authorised Representative while challenging th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rate on this issue at length as it stands settled, at least for the present, by the decision of Hon'ble Delhi High Court in Cheminvest v/s CIT, [2015] 378 ITR 33, wherein, the Hon'ble Delhi High Court reversing the decision of the Tribunal, Delhi, Special Bench (supra), held that if the assessee had not earned any exempt income in a particular assessment year no disallowance under section 14A can be made. Applying the aforesaid ratio laid down by the Hon'ble Delhi High Court, we hold that no disallowance under section 14A r/w rule 8D can be made. Accordingly, we delete the addition made by the Assessing Officer. In view of our aforesaid decision, there is no need to deliberate upon the other propositions raised in the ground on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted that the purchases made are genuine as the Department has not doubted the sales effected by the assessee. He further submitted, the Assessing Officer has not conducted any independent enquiry and merely relying upon the information obtained from Sales Tax Department has made the addition. He submitted, under identical facts and circumstances, in assessee's own case for assessment year 2011-12, the Tribunal has restricted the disallowance to 12.5% of the bogus purchase. He, therefore, submitted, in the impugned year also the disallowance can be restricted to 12.5%. 14. Learned Departmental Representative relying upon the order of the learned Commissioner (Appeals) submitted, the assessee has not furnished transportation bills / delivery ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tribution to PF/ESIC were not paid within the due date provided under Explanation to section 36(1)(va) of the Act. Accordingly, he disallowed an amount of Rs. 3,746. 18. The learned Commissioner (Appeals) also confirmed the disallowance. 2. We have heard rival contentions and perused the material available on record. As could be seen from the facts on record, employee's contribution to PF/ESIC were paid by the assessee much before the due date of filing of return of income as provided under section 139(1) of the Act. That being the case, as per ratio laid down by the Hon'ble Jurisdictional High Court in CIT v/s Hindustan Chemicals Organics Ltd., 366 ITR 001 (Bom.), no disallowance can be made keeping in view the amendment brought to s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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