TMI Blog2018 (3) TMI 207X X X X Extracts X X X X X X X X Extracts X X X X ..... loss account. AO should also have considered the interest on net basis. After setting off interest expense against the interest income, the assessee was let with negative figure of ₹ 6,08,163/- which had been suo moto disallowed by the assessee in its entirety. Thus the ‘net’ interest expenditure is to be considered for the purposes of disallowance u/s 14A and where after setting off interest earned against the interest expenditure no further interest expense remains then disallowance cannot be made u/s 14A of the Income-tax Act, 1961. - Decided in favour of assessee - ITA No.299/Kol/2016 - - - Dated:- 15-12-2017 - SHRI S. S. VISWANETHRA RAVI, JM AND DR. A.L.SAINI, AM For The Assessee : Shri Kalyan Nath, Addl. CIT For ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rest Paid X Average of Investment = 20294822 526246229 ₹ 10693683 Average total asset of Balance Sheet 998727333 {1/2 of [1008664265+988790401] = 1997454666} [iii] Investment Investment as on 01. 04. 2008 ₹ 469289605 Investment as on 31. 03. 2009 ₹ 583202852 ₹ 1052492457 Average value of investment ₹ 5262462 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... administrative expenses of ₹ 1,22,880/- which was incurred during the year and debited to P L A/c was also suo moto disallowed by the assessee. The Assessing Officer however in his impugned order completely ignored the facts of the case and mechanically invoked Rule 8D in computing disallowance of ₹ 1,33,24,914/- u/s 14A in the most arbitrary and presumptuous manner. The Assessing Officer neither considered the disallowance suo moto offered by the assessee nor did he point out any infirmity or defect in the basis manner of disallowance made by the assessee. The assessee submitted before the CIT(A) that the Assessing Officer computed disallowance of ₹ 1,06,93,683/- with reference to interest u/s 14A r. w. r. 8D(2)(ii). W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts Ltd (ITA No. 1277/Kol/2011, dated 30/03/2012, had held that the expenses to be restricted to the extent of expenses claimed for deduction and not more. In this case, the assessee company had suo moto disallowed net interest expenditure and entire administrative expenses debited in the Profit Loss Account. Therefore, ld CIT(A) held that no further disallowances should be made and this way he deleted the addition ₹ 1,33,24,914/-. 6. Not being satisfied with the order of CIT(A), the Revenue is in appeal before us. The ld counsel for the assessee has defended the order passed by the ld CIT(A). On the other hand, the Ld. DR for the Revenue has primarily reiterated the stand taken by the Assessing Officer, which we have already note ..... X X X X Extracts X X X X X X X X Extracts X X X X
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