9911796707
TMI Blog2021 (7) TMI 3X X X X Extracts X X X X X X X X Extracts X X X X ..... eciation on the car for probable personal use and the disallowance of expenditure under section 14A are bad in law, against the principles of justice, weight of evidence and probabilities of the case of the appellant. 2. The Learning Assessing Officer and the Appellate Commissioner have erred in ignoring the fact that once a car is acquired and put to use for business the asset falls under the block of asset concept and it becomes business asset which could not be segregated for personal use and business use and disallowing 25% on depreciation for personal use is untenable in law. 3. The Learned Assessing Officer and Commissioner of Income Tax, Appeals were wrong in invoking the provisions of Rule 8D read with Section 14A while that pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of delay and hence, delay in filing of above appeal is condoned and appeal filed by the assessee is admitted for adjudication. 4. The brief facts of the case are that the assessee is an individual deriving income from house property, business and other source, filed his return of income for the assessment year 2013-14 on 26.07.2014 declaring total income of Rs. 3,11,64,900/-. The assessment was completed u/s. 143(3) of the Income Tax Act, 1961 (hereinafter the 'Act') on 17.03.2016 by determining total income at Rs. 3,13,83,954/- by making addition towards 25% disallowance of depreciation on car, on the ground that use of car for personal purpose cannot be ruled out. Similarly, the AO has made addition towards disallowance of ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as been brought on record to prove the case of the AO that car was used for personal purpose. Therefore, we are of the considered view that the AO was erred in making ad hoc disallowance of depreciation on car and hence, we direct the AO to delete addition made towards ad hoc disallowance of depreciation on car. 6. The next issue that came up for our consideration is disallowance of expenses u/s. 14A of the Act. The AO has determined disallowance of Rs. 2,19,054/- u/s. 14A by invoking Rule 8D of the IT Rules, as against total exempt income being dividend income earned for the year at Rs. 1,990/-. It is a well settled principle of law that disallowance contemplated u/s. 14A of the Act, cannot exceed exempt income earned for the year. In thi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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