TMI Blog2022 (3) TMI 1120X X X X Extracts X X X X X X X X Extracts X X X X ..... disallowance of ₹ 3,16,488/- which is evidentay exceeds the dividend income. Therefore, the order of CIT(A) is not justified in confirming the disallowance made by the AO exceeding the dividend income. In the light of the decision of Hon ble High Court of Bombay in the case of M/s. Nirved Traders Pvt. Ltd. [ 2019 (4) TMI 1738 - BOMBAY HIGH COURT] we deem it proper to hold the disallowance a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee raised two grounds of appeal amongst which the only issue emanates for our consideration is as to whether the CIT(A) is justified in confirming the addition made by the AO u/s. 14A r.w. Rule 8D(2)(iii) in the facts and circumstances of the case. 3. Heard both the parties and perused the material available on record. We note that the assessee is a company engaged in the business of provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d dividend income of ₹ 100/- and claimed as exempt u/s. 10(34) of the Act. The AO asked the assessee to explain why expenses be disallowed as per Rule 8D of the Rules. In response, the assessee submits no borrowed funds were utilized in earning dividend income and investment made out of own share capital but the AO considering the same proceeded to disallow expenditure under Rule 8D(2)(iii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jarat in the case of Corrtech Energy (P.) Ltd., Hon ble High Court of Delhi in the case of Cheminvest Ltd. and the Hon ble High Court of Karnataka in the case of Pragati Krishna Gramin Bank answered the question in favour of the assessee limiting the disallowance u/s. 14A of the Act to dividend income. In the present case, we find that the assessee earned only ₹ 100/- as dividend income and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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