2016 (8) TMI 1416

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..... filed by the assessee against the order of the Ld. CIT(A)-7, Mumbai dated 27.12.2012 pertaining to assessment year 2008-09. 2. The only issue in the appeal of the assessee is that the Ld. CIT(A) erred in sustaining disallowance u/s. 14A r.w. Rule 8D of the Act. 3. The Assessing Officer while completing the assessment noticed that assessee earned exempt income of Rs. 16,06,621/- as dividend inco .....

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..... e therefore no disallowance is required to be made under section 14A. It was further contended before the Ld. CIT(A) that in any case the available surplus/reserves are much more than the investments made by the assessee during the Assessment Year, therefore no disallowance is warranted u/s 14A of the Act. However, the Ld. CIT(A) having agreed the contention of the assessee that Assessing Officer .....

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..... further invited our attention to the order of the Ld. CIT(A) for the subsequent Assessment Year 2009-10 and submits that the Ld. CIT(A) restored the issue to the file of the Assessing Officer for verification as to whether the investments were made out of accumulated funds or not and in case such investments are made out of accumulated funds, no disallowance is required to be made. Therefore, he .....

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..... e of accounts and the expenses disallowed by the assessee for earning exempt income. The Assessing Officer has not recorded any reasons for not accepting the expenditure disallowed by the assessee for earning exempt income. On a perusal of the Ld. CIT(A)'s order, we also noticed that the funds available with the assessee are much more than the investments made during this Assessment Year. Therefor .....

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..... ng Officer is directed to recompute the disallowance by excluding the investments which do not yield any exempt income while arriving at the average value of investments after giving adequate opportunity to the assessee. 7. In the result, the appeal filed by the assessee is allowed for statistical purpose. Order pronounced in the open court on 12th August, 2016.
Case laws, Decisions, Judgeme .....

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