TMI Blog2016 (9) TMI 1654X X X X Extracts X X X X X X X X Extracts X X X X ..... therefore, interest cost cannot be made attributable. Thus a perusal of the same shows that the net worth of the assessee as on 31.03.2010 is far more than the exempt yielding investments made by the assessee as on that date. Decided in favour of assessee. - ITA No. 6498/Mum/2014 - - - Dated:- 21-9-2016 - SHRI SAKTIJIT DEY, JM AND SHRI MANOJ KUMAR AGGARWAL, AM For the Revenue : Shri B.C. S. Naik (CIT DR) For the Assessee : Shri Dilip V. Lakhani ORDER PER MANOJ KUMAR AGGARWAL (AM) : 1. The instant appeal has been filed by the revenue for the Assessment Year [AY] 2010-11 assailing the order of Commissioner of Income Tax (Appeals)-21 [CIT(A)], Mumbai dated 27.08.2014 on the following grounds of appeal:- On ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nk borrowings were exclusively meant for lending activities which is the primary business of the assessee and has generated business income. The assessee further submitted that net worth of the company as on 31.03.2010 was Rs. 1449.74 Crores which far exceeded exempt income yielding investments amounting to Rs. 729.13 Crores and therefore, investments were presumed to be made out of owned funds and no interest, therefore, could be attributed towards the said investments and hence could not be considered to work out disallowance as per Rule 8D. In this regard , the assessee relied upon the decision of Bombay High Court in the case of Reliance Utilities and Power Ltd 313 ITR 340 (Bom), wherein the Bombay High Court held that in case of a comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 14A as per rule 8D at Rs. 28,72,22,642, after taking interest cost of Rs. 24,99,03,799 and administrative cost of Rs. 3,73,18,843. The learned counsel has given various working of disallowance under section 14A and had submitted that if any disallowance is called for, then same should be made on that basis only. His main contention has been that the assessee s networth and availability of funds is far more than investment which are capable of yielding exempt income and, therefore, no interest cost should be attributed for working out the disallowance. If the assessee has huge funds which also consist of interest free funds, then presumption would be that investments have been made out of interest free funds, available with the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a chart showing calculation of excess of net worth and investment capable of yielding exempt income as on 31.03.2010. A perusal of the same shows that the net worth of the assessee as on 31.03.2010 is far more than the exempt yielding investments made by the assessee as on that date. 4. The above facts were fairly conceded by the DR and he could neither distinguish the facts in present case with that of facts in earlier years nor could point out any infirmity in the stand taken by CIT(A). 5. Therefore, on the facts and circumstances of the case, we see no reason to interfere with the order of CIT(A) and thus, the appeal of the revenue is dismissed. 6. In nutshell, the appeal of the revenue is dismissed. Order pronounced in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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