TMI Blog2020 (11) TMI 762X X X X Extracts X X X X X X X X Extracts X X X X ..... ive expenditure under Rule 8D(2)(iii) is concerned, it is the contention of the assessee that for availing loan from a co-operative bank, the assessee mandatorily has to invest in shares of the bank. As submitted, the dividend income earned on such shares are directly credited to the bank account of the assessee and hence, the assessee is not required to incur any expenditure for earning dividend income. Whether or not the assessee has incurred any expenditure has to be established through supporting evidence. In any case, as per section 14A(3) whether or not the assessee has incurred any expenditure for earning exempt income, a part of the expenditure has to be attributed towards earning of exempt income - assessee has not been able to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. After calling upon the assessee to explain as to why disallowance under 14A of the Act should not be computed by applying Rule 8D, the Assessing Officer proceeded to disallow an amount of ₹ 6,17,274/- comprising of disallowance of interest expenditure under Rule 8D(2)(ii) amounting to ₹ 6,04,642/- and administrative expenditure under Rule 8D(2)(iii) amounting to ₹ 12,633/-. The assessee contested the aforesaid disallowance before learned Commissioner (Appeals). After considering the submissions of the assessee, learned Commissioner (Appeals) sustained the disallowance made by the Assessing Officer. 4. The learned Authorized Representative (AR) submitted, no disallowance of interest expenditure under Rule 8D(2)(ii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion. That being the case, there is no need for the Assessing Officer to record satisfaction under section 14A(2) of the Act regarding correctness of assessee s computation of disallowance under section 14A of the Act. Therefore, we are unable to accept the above said contention of the assessee. As regards the merits of the issue, the learned AR has submitted before us, assessee has sufficient interest free funds available with it to make the investment. In our view, the aforesaid claim of the assessee requires factual verification, in case it is found that the assessee had sufficient interest free funds available with it which can take care of investment made in exempt income yielding assets, no disallowance of interest expenditure under R ..... X X X X Extracts X X X X X X X X Extracts X X X X
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