THE DCIT, (OSD)-I, CIRCLE-4, AHMEDABAD vs. M/S. KARGIL HOLDINGS PVT. LTD., AHMEDABAD

We notice at the outset that the Revenue’s sole substantive ground seeks to revive disallowance of interest expenditure amounting to Rs.19,67,223/- made by the Assessing Officer as deleted in lower appellate proceedings. Learned Departmental Representative fails to dispute that the net tax effect in the instant appeal is less than Rs.10 lacs. We find that the Central Board of Direct Taxes; hereafter the ‘Board’ has issued the circular no. 21/2015 dated 10.12.2015 clearly envisaging therein that department’s pending appeals before the tribunal/high courts are to be withdrawn/not pressed as per the above stated circular. The same has been declared to be having retrospective effect in other words. We take into consideration the above stated Board’s circular and dismiss the instant appeal accordingly. The Revenue’s appeal ITA No.1459/Ahd/2015 is dismissed for involving low tax effect.

We advert to assessee’s Cross Objection No.177/Ahd/2015 seeking to reverse both the lower authorities’ action disallowing administrative expenditure of Rs.1,24,000/- under Rule 8D(2)(iii) of the Income Tax Rules as pertaining to the exempt income in question in the nature of dividend to the tune of Rs. 1,81,76,516/-. We notice that the CIT(A) has already entered into a detailed discussion that the assessee has incurred indirect administrative expenditure in reviewing its investments/maintaining activities of the stock holding activity in the relevant previous year. Learned counsel fails to dispute the fact that the above computation formula prescribed under Rule 8D of the Income Tax Rules is applicable from assessment year 2008-09 onwards. We therefore see no reason to interfere with the impugned administrative

The Revenue’s appeal ITA No.1459/Ahd/2015 as well as assessee’s Cross Objection i.e. C.O. No.177/Ahd/2015 are therefore dismissed.

"वभागीय ""त"न"ध, आयकर अपील"य अ"धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड" फाइल / Guard file. By order/आदेश से,