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TMI Blog2021 (7) TMI 1074X X X X Extracts X X X X X X X X Extracts X X X X ..... ORDER PER B.R. BASKARAN, ACCOUNTANT MEMBER: The assessee has filed this appeal challenging the order dated 10.2.2017 passed by Ld. CIT(A)-2, Bengaluru and it relates to the assessment year 2012-13. The assessee is aggrieved by the decision of Ld. CIT(A) in confirming the disallowance of Rs. 42.42 lakhs made by the A.O. u/s 14A of the Income-tax Act,1961 ['the Act' for short]. 2. The f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... confirmed the same. 3. The Ld. A.R. submitted that the assessee did not incur any expenditure for earning the exempt income. He further submitted that the main income of the assessee is income from property development which, during the year amounted to Rs. 70.03 crores. However, the assessee has received share of profit from partnership firm to the tune of Rs. 20.32 lakhs only. He submitted th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stances of the case, the application of rule 8D is not warranted. He submitted that the A.O. has failed to show that the claim of the assessee for not disallowing anything u/s 14A of the Act is not correct. He further submitted that though the assessee has invested in many partnership firms, yet it has earned share income only from two concerns namely M/s. Century Airport City & M/s. Century Corbe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 32 lakhs. Thus exempt income constitutes fraction of total revenue. With regard to the interest expenses, it is submitted that they have been incurred in respect of project specific loans and no part of the said loans have been diverted to partnership firms. It is in the common knowledge of everyone, the project specific loans can be used for the specific projects and further the usage of loans wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tivities of partnership firms by the assessee would be relevant for sec.14A of the Act. Considering these facts and also the fact that major income of the assessee is from property development, we are of the view that the disallowance u/s 14A of the Act can be made at an adhoc figure of Rs. 2.00 lakhs and the same, in our view, would meet the requirements of section 14A of the Act. 7. Accordingl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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