TMI Blog2018 (11) TMI 1785X X X X Extracts X X X X X X X X Extracts X X X X ..... nditure worked out by the Assessing Officer goes manifold to the extent of ₹.1,08,15,631/-. The window for disallowance indicated in section 14A of the Act was only to the extent of disallowing expenditure incurred by the assessee in relation to the tax exempt income. In a recent judgement in the case of Maxopp Investment Ltd. Ors [ 2018 (3) TMI 805 - SUPREME COURT] restricting the disallowance to the quantum of exempt income. Thus, the ld. CIT(A) has rightly restricted the disallowance to the extent of exempt income earned by the assessee. As long as an exempt income was earned, the expenditure incurred as attributable to earning such exempt income, had to be disallowed under section 14A of the Act. Thus, the ground raised b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee by: Shri M. Viswanathan, C.A. ORDER Duvvuru RL Reddy, Both the appeals are cross appeals filed by the Revenue as well as the assessee are directed against the order of the ld. Commissioner of Income Tax (Appeals) 6, Chennai dated 16.12.2015 relevant to the assessment year 2012-13. Vide order in M.P. Nos. 170 177/Chny/2017 dated 07-09-2018, the Tribunal has recalled both the appeals. 2. The common ground raised in both the appeals, viz., the Revenue challenged the restriction of disallowance under section 14A of the Income Tax Act, whereas, the assessee challenged disallowance under section 14A of the Act r.w. Rule 8D of ₹.27,22,973/-. 3. By relying on the CBDT Circular No. 5/2014, the ld. DR has submit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITA No. 5592/Mum/2012 dated 01.01.2015, the ld. CIT(A) restricted the disallowance under section 14A of the Act to the extent the exempt income earned by the assessee. In this case, the assessee has not demonstrated that the investments have been made out of only its surplus funds and moreover, the assessee has not established that the borrowed funds have been utilized for the purpose of investments at any stage. Admittedly, in this case, the dividend income earned by the assessee was ₹.27,22,973/- whereas, the disallowance of expenditure worked out by the Assessing Officer goes manifold to the extent of ₹.1,08,15,631/-. The window for disallowance indicated in section 14A of the Act was only to the extent of disallowing expendi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act. On appeal, by considering the submissions of the assessee and following the decision of the Hon ble Madras High Court in the case of CIT v. Industrial Security and Intelligence India Pvt. Ltd. in TCA Nos. 585 586 of 2015 M.P. No. 1 of 2015 dated 24.07.2015, the ld. CIT(A) deleted the addition made by the Assessing Officer. 6.1 We have heard both the sides, perused the materials available on record and gone through the orders of authorities below. In this case, it is not disputed by the Revenue that the assessee has not paid the employees contribution received by it before the due date of filing of the income tax return as specified under section 43B of the Act. Various Courts including the Hon ble Jurisdictional High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X
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