TMI Blog2017 (2) TMI 1368X X X X Extracts X X X X X X X X Extracts X X X X ..... the current year, has implication only with regard to their financing cost, i.e., interest expenditure, direct or indirect, or even partly each. That is, it has no bearing to the indirect, administrative expenditure, which is liable to be disallowed following estimation under rule 8D(2)(iii). This is as the same is in the nature of maintenance expenditure, which is incurred from year and year, irrespective of the date of the acquisition of the relevant capital asset. There is no material adduced at any stage, much less with reference to the accounts, to indicate, even primafacie, of no such expenditure having being incurred. Its disallowance is therefore confirmed. As regards the interest cost, we consider it proper that the matter is resto ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 143(2) of the Act was issued. In compliance to the notice, the Ld. AR appeared from time to time and filed the details. The Assessing Officer on a perusal of the financial statements, found that the assessee has income from lease income and certain specific details were called for. The assessee filed details with the total lease rent received ₹ 13,58,286/-, of which only ₹ 1,85,990/- had been offered in the profit and loss account and the balance ₹ 11,72,296/- considered as principal, taken in the balance sheet. The assessee, in compliance to the show cause notice as to why only interest was offered and not the principal, explained of following Accounting Standard-19 of ICAI. Hence, the principal portion was not taxable a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 02.12.2013 and explained that the company has not incurred any expenditure or other charges to earn the dividend and also the investments are made 20 years back. The Ld. AO considered the submissions and the provisions applicable under Rule 8D and relied on the decision of Supreme Court in the case of CIT Vs. Walfort Share and Stock Private Limited 41 DTR 233 dated 06.07.2010. The Ld. AO applied the provisions u/s. 14A of the Act and worked out disallowance r.w.r. 8D(2)(iii) and relied on the decisions referred at page 4 of his order. In appeal, the Ld. CIT(A) relied on the decision of the Tribunal in the case of Siva Industries Holding Ltd. Vs ACIT in 54 SOT 49, Chennai that even in a year where no exempted income was earned disallow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... est expenditure, direct or indirect, or even partly each. That is, it has no bearing to the indirect, administrative expenditure, which is liable to be disallowed following estimation under rule 8D(2)(iii). This is as the same is in the nature of maintenance expenditure, which is incurred from year and year, irrespective of the date of the acquisition of the relevant capital asset. There is no material adduced at any stage, much less with reference to the accounts, to indicate, even prima facie, of no such expenditure having being incurred. Its disallowance is therefore confirmed. As regards the interest cost, we consider it proper that the matter is restored to the file of the AO to allow the assessee an opportunity to present its case of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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