CITY HOLDINGS PRIVATE LIMITED (ERSTWHILE CITY HOLDINGS LIMITED),KOLKATA vs. ACIT, CIRCLE 3(1),, KOLKATA

ITA 2683/KOL/2025Status: DisposedITAT Kolkata24 February 2026AY 2017-2018Bench: Shri Rajesh Kumar (Accountant Member), Shri Pradip Kumar Choubey (Judicial Member)1 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal observed that the AO computed the disallowance under Rule 8D in a mechanical manner without recording any dissatisfaction with the assessee's suo motu disallowance. The assessee's suo motu disallowance of Rs.6,173/- was considered fair and proper as it represented 2.02% of total expenditure while exempt dividend income was 1.4% of taxable income.

What were the facts?

The assessee company declared an income of Rs.9,83,61,241/- for AY 2017-18. The case was selected for limited scrutiny due to low expenses debited for earning exempt income. The Assessing Officer (AO) disallowed Rs.10,53,453/- u/s 14A, whereas the assessee had suo motu disallowed Rs.6,173/-.

What were the issues?

Whether the disallowance made by the Assessing Officer u/s 14A of the Act, calculated mechanically under Rule 8D, is justified when the assessee has suo motu disallowed a reasonable amount?

Which sections of the Income-tax Act were involved?

Section 14A,Section 10(33),Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH KOLKATA

Before: Shri Rajesh Kumar & Shri Pradip Kumar Choubey

Per Pradip Kumar Choubey, Judicial Member:

This appeal filed by the assessee is directed against the order dated 11.09.2025 of the NFAC, Delhi passed u/s 250 of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) for the assessment year 2017–18. 2. Brief facts of the case are that the assessee is a company and filed its return of income for assessment year 2017-18 by declaring an income of Rs.9,83,61,241/-. The case of the assessee selected under limited scrutiny for the reason that

The order continues below.

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