TMI Blog2017 (11) TMI 1880X X X X Extracts X X X X X X X X Extracts X X X X ..... #8377; 13.10 Lakhs as administrative expenses for investment in its associate companies/subsidiaries. The assessee has placed on record fund flow statement (Page 33 of PB), which clearly show that the assessee has sufficient own interest free fund of ₹ 1,26,289.65/- Lakhs as on 31.03.2012. Thus, in our considered view there was no justification for making disallowance as per the provisions of section 14A r.w. Rule 8D. - ITA No.5246/Mum/2016 (Assessment Year- 2012-13) - - - Dated:- 8-11-2017 - SHRI B.R. BASKARAN, ACCOUNTANT MEMBER AND SHRI PAWAN SINGH, JUDICIAL MEMBER Assessee by: Ms. Aarti Sathe (AR) Revenue by: Shri V. Justin (DR) Order Under Section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd. The Ld.AR of the assessee argued that assessee has not earned any exempt income during the period of relevant AY. The assessee made investment in its associate concerns. The investment was made out of the interest free funds available with the assessee. The assessee voluntarily made a disallowance of ₹ 13.10 Lakhs on account of administrative expenses for investment in associate company. The Assessing Officer (AO) invoked the provision of Rule 8D holding that direct link between the investment and interest free fund is not established. The AO disallowed a sum of ₹ 5,44,69,565/- under Rule 8D (ii) and ₹ 1,30,35,122/- under Rule 8D(iii). The ld. AR of the assessee further argued that investment is made in the subsidiarie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Lakhs as on 31.03.2012. Thus, in our considered view there was no justification for making disallowance as per the provisions of section 14A r.w. Rule 8D. Further, we have noted that similar disallowance was made in AY 2008- 09, the assessee carried the matter to the Tribunal and the co-ordinate bench in ITA No. 1753/M/2012 passed the following order: 7.We have heard the rival submissions and perused the material before us. We find that assessee had not claimed any deduction in respect of exempt income nor has it claimed any expenditure against the income which does not form part of the total income. Thus, both the basic ingredients for making a disallowance u/s.14A are missing. Secondly, the fund flow statement made available to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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