TMI Blog2023 (11) TMI 31X X X X Extracts X X X X X X X X Extracts X X X X ..... In such a scenario as held in Pr. CIT vs. Keshav Power Ltd.[ 2019 (8) TMI 811 - SC ORDER] that disallowance is not sustainable. The Revenue filed SLP before the Hon ble Supreme Court against the order (supra) of the Hon ble Delhi High Court which stands dismissed reported. [ 2018 (11) TMI 645 - DELHI HIGH COURT] . Similar is the view expressed in Pr. CIT vs. Reliance Capital Asset Management Ltd. [ 2018 (9) TMI 883 - SC ORDER] - Moreover, CIT(A) recorded the finding that sufficient own funds were available with the assessee to make investment in shares on which no interest was being paid and that interest bearing funds were utilised only for purposes of business. The above finding could not be controverted by bringing on record ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Ld. CIT(A) is contrary to Rule 8D (ii) (iii) of the Income Tax Rules. 3. Briefly stated, the assessee company is engaged in the business of engineering, procurement, construction and project management services. The assessee filed its return for AY 2015-16 on 28.11.2015 declaring loss of Rs. 875,39,91,399/-. Initially the case was selected for limited scrutiny through CASS but later on converted to complete scrutiny. Statutory notice(s) were issued/served in response to which requisite details were furnished which have been examined and placed on record by the Ld. Assessing Officer ( AO ). 3.1 On perusal of Balance Sheet as on 31.03.2015 the Ld. AO found that the assessee made investments in unquoted Trade instruments in the sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 18 under section 143(3) of the Act. 4. Aggrieved by the impugned disallowance under section 14A r.w. Rule 8D, the assessee appealed before the Ld. CIT(A). It was contended before him that the Ld. AO did not counter the submission of the assessee that no expense has been incurred and claimed for earning exempt income. The disallowance is made on the assumption that the provision of section 14A r.w. Rule 8D is automatic and mandatory even though no expenses have been incurred in relation to earning exempt income. The Ld. CIT(A) directed the Ld. AO to delete the impugned disallowance observing as under:- 4.1. I have considered the facts and circumstances of the case, submission of the appellant and perused the order of the AO. On perus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT (2021) 130 taxmann.com 178 (SC). 8. We have considered carefully the submission of the parties and perused the records. It is not in dispute that the assessee on its own made disallowance of Rs. 4,44,270/- under section 14A of the Act. It is observed that the Ld. AO has not recorded his satisfaction regarding correctness of self disallowance made by the assessee under section 14A as is mandatory in terms of sub-section (2) of section 14A to invoke and take recourse to Rule 8D. In such a scenario Hon ble Delhi High Court held in Pr. CIT vs. Keshav Power Ltd. (2019) 112 taxmann.com 323 (Del) that disallowance is not sustainable. The Revenue filed SLP before the Hon ble Supreme Court against the order (supra) of the Hon ble Delhi High ..... X X X X Extracts X X X X X X X X Extracts X X X X
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