TMI Blog2015 (4) TMI 1248X X X X Extracts X X X X X X X X Extracts X X X X ..... crores is added then the same comes to ₹ 4.71 crores. If from the total expenditure of ₹ 4.71 crores, the assessee itself has disallowed ₹ 1,65,43,645/-, then definitely it can be held to be reasonable attribution for the purpose of disallowance u/s 14A. Thus, the disallowance made by the AO over and above the disallowance and confirmed by the Ld. CIT(A) is deleted and accordingly, the order of the Ld. CIT(A) on this score is reversed. - Decided in favour of assessee. - ITA No. 6972/Mum/2012 - - - Dated:- 17-4-2015 - SHRI B.R BASKARAN, ACCOUNTANT MEMBER AND SHRI AMIT SHUKLA, JUDICIAL MEMBER For the Appellant : Shri Vijay Mehta, Shri Rajesh Chamaria Shri Anuj Kisnadwala For the Respondent : Shri Akhilendra P. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 77; 1,65,43,645/- for the purpose of disallowance u/s 14A which has been made as per Rule 8D only. The working of such disallowance was already enclosed with Tax Audit Report in From No. 3CD. However, the Assessing Officer held that the same is strictly not in accordance with the Rule 8D and worked out the disallowance of ₹ 3,55,96,346/- as per the working given at the page 4 of the assessment order. 3. Before the Ld. CIT(A), the assessee submitted that, so far as investment made in firm is concerned, the same cannot be taken in the value of investment as per clause (iii) of Rule 8D. Further share in the profit of the firm is allocated amongst the partners only when the firm has paid the taxes. Thus, the partner has already suffere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r taking the average investments made in the shares, whereas, the Assessing Officer has included the investment made by way of capital in the partnership firm. This investment in the capital of the firm was coming from earlier years. Once the assessee has itself attributed disallowable expenses, the Assessing Officer without recording his satisfaction or being satisfied with the correctness of the claim of the assessee cannot proceed to make further disallowance under Rule 8D. It is more so in this case when the assessee has duly placed before the AO, the nature of expenses as appearing in schedule 12 and 13 of P L Account which will go to show that most of the expenses were incurred for the business carried out by the assessee. Thus, witho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orrect approach. From the perusal for the expenditure debited to the P L Account, it is seen that under the head administrative, selling and other expenses the assessee has debited sums aggregating ₹ 5,08,80,326/- under following heads:- Godown Rent Warehousing Charges 5,065,038 Service Charges 5,400,000 Office Rent 3,451,696 Freight Transporation Charges 2,968,855 Other Trading Expenses 2,098,614 Insurance 952,010 Legal Profession Fees 14,187,926 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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