9911796707
TMI Blog2018 (3) TMI 949X X X X Extracts X X X X X X X X Extracts X X X X ..... under section 143(3) of the Income Tax Act, 1961 (in short "the Act") dated 30.12.2010 for the Assessment Year 2008-09. 2. The first issue to be decided in these appeals is as to whether the Ld. CIT(A) was justified in upholding the disallowance u/s 14A of the Act read with Rule 8D(2)(iii) of the Rules after granting partial relief to the assessee, in the facts and circumstances of the case. 3. The brief facts of this issue is that the assessee is a domestic company engaged inter alia in the business of purchasing and selling of molasses, leather goods, handling of liquidity cargo and bulk liquid storage, banking, lending etc. The assessee filed its original return of income for the assessment year 2008-09 on 30.09.2008 declaring total in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ght to have been taken by the ld. AO in any case by following the ratio laid down in the decision rendered by this Tribunal in the case of REI Agro Ltd. reported in 144 ITD 141. The Ld. CIT(A) placed reliance on the order of his predecessor in assessee's own case for the assessment year 2010-11 wherein disallowance under Rule 8D was made only under Third limb thereon by applying 0.5% of the average value of investments which yielded dividend income. The Ld. CIT(A) following the said order directed the ld. AO to recompute the disallowance under Rule 8D. Aggrieved, both the assessee and revenue are in appeal before us on the following grounds: I.T.A. No. 1239/Kol/2016 - Assessee Appeal 1. That on the facts and circumstances of the case, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Tribunal was appreciated by the Hon'ble High Court and accordingly it was held that no infirmity was found in the order under challenge. The ld. AR stated that even in the year under appeal before us, the ld. AO did not examine the accounts of the assessee in spite of the fact that books of accounts were duly produced before him and had not arrived on an objective satisfaction having regard to such accounts of the assessee with cogent reasons as to why the provisions of Rule 8D(2) are to be invoked in the instant case. In response to this, the ld. DR vehemently relied upon the order of the ld. AO and also argued that the workings filed by the assessee has been perused by the ld. AO and ignored by him which itself amounts to satisfact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Rules. In the instant case, we find that the assessee has claimed that no expenditure has been incurred for the purpose of earning exempt income which is quite evident from the fact that no disallowance u/s 14A of the Act has been made by the assessee in the return of income. Once it is done by the assessee, it is the duty of the Ld. AO first to disturb such belief of the assessee by recording proper satisfaction having regard to the accounts of the assessee in terms of section 14A (2) of the Act read with Rule 8D(1) of the Rules. We find no such satisfaction has been recorded by the Ld. AO in the instant case. This issue is now settled in favour of the assessee by the various decisions of Hon'ble Jurisdictional High Court in the foll ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laimed the same as allowable expenditure in the return of income. The Ld. AO disallowed the same u/s 43B(f) of the Act. This action of the Ld. AO was upheld by the Ld. CIT(A). Aggrieved, the assessee is in appeal before us on the following ground:- 2. That on the facts and circumstances of the case, the learned CIT(Appeals) erred in confirming disallowance of provision for leave encashment amounting to Rs. 29,74,020/-, under section 43B of the Act while computing income under the normal provisions of the Act. 8. We have heard the rival submissions. We find that though the Hon'ble Calcutta High Court in the case of Exide Industries Ltd vs Union of India reported in 292 ITR 470 (Cal) had struck down the provisions of section 43B(f) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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