FINOLEX INDUSTRIES LTD,,PUNE vs. DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE -1 (2),, PUNE

This appeal by the assessee against the order dated 07-02-2019 passed by the Commissioner of Income Tax (Appeals)-11, Pune [‘CIT(A)’] for assessment year 2015-16.

The only issue is to be decided is as to whether the CIT(A) is justified in confirming the disallowance made under Rule 8D(2)(iii) for the purpose of section 14A of the Act.

At the outset, the ld. AR prayed to remand the issue to the file of AO for considering those investments which yielded exempt income for the purpose of disallowance made under Rule 8D(2)(iii) and placed on record order dated 10-11-2021 for A.Y. 2012-13 in assessee’s own case.

After hearing both the parties, we note that this Tribunal on similar issue on same identical facts by placing reliance in the case of ACB India Ltd. Vs. CIT reported in (2015) 374 ITR 108 (Del.) directed the AO for computation of disallowance under Rule 8D by considering only such investments which yielded exempt income. Therefore, following the same, the issue is remanded to the file of AO for its consideration for computation of disallowance of those investments which yielded income. Thus, the grounds raised by the assessee are allowed for statistical purpose.

In the result, the appeal of assessee is allowed for statistical purpose.