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Income Tax Appellate Tribunal, ‘B’ BENCH, CHENNAI
Before: SHRI N.R.S. GANESAN & SHRI S. JAYARAMAN
PAN: AACPC 5346F (अपीलाथ�/Appellant) (��यथ�/Respondent) अपीलाथ� क� ओर से/ Appellant by : Shri Ajit Kumar Chordia, CA ��यथ� क� ओर से /Respondent by : Ms. G.D. Jayanthi Angayarkanni, JCIT सुनवाई क� तार�ख/Date of Hearing : 22.08.2019 घोषणा क� तार�ख /Date of : 18.11.2019 Pronouncement आदेश / O R D E R PER SHRI S. JAYARAMAN, ACCOUNTANT MEMBER:
The assessee filed this appeal against the order of the Commissioner of Income Tax (Appeals)-8, Chennai in 17 dated 28.09.2018 for the assessment year 2013-14.
2 -: 2. Shri Ajit Kumar Chordia, the assessee, admitted income from salary and other sources for the assessment year 2013-14. While making the assessment, the Assessing Officer found that the assessee has incurred interest expenses and shown dividend receipt. During the year, the assessee has made investment in shares of Rs.2.08 crores with various companies such as M/s. Khivraj Group of Companies and many other companies. Since, the assessee has incurred expenditure by way of interest during the previous year which is not directly attributable to any income or receipt, the Assessing Officer invoked jurisdiction U/s.14A read with Rule 8D(ii) & (iii) and made disallowance of Rs.8,41,776/- combinedly. Aggrieved against that order, the assessee filed appeal before the CIT(A). The ld.CIT(A) relying on the Supreme Court decision in the case of M/s. Godrej and Boyce Mfg. Co. Ltd. (CA No.7020/2011), M/s. Maxopp Investments Limited etc.,sustained the addition made U/s.14A read with Rule 8D. Aggrieved against that order, the assessee filed this appeal.
Theld.AR pleaded that the disallowance be restricted to the extent of dividend income. Per contra, the ld.DR supported the orders of the lower authorities.
3 -: 4. We heard the rival submissions and find merit in the assessee’s claim that the restriction of disallowance be restricted to the extent of dividend income as held by the Hon’ble Delhi High Court in the case of M/s. Joint Investments (P.) Ltd. vs. CIT (2015) 372 ITR 694 (Delhi). Therefore, we direct the Assessing Officer to restrict the disallowance to the extent of exempt income, in accordance with the above decision.
In the result, the assessee’s appeal is treated as partly allowed for statistical purposes.
Order pronounced in the Court on 18th November, 2019 in Chennai.