ITAT Jaipur Judgments — August 2017

The Tribunal held that Rule 8D was not applicable for the assessment year in question and that investments yielding exempt income were part of the bank's stock-in-trade. The Tribunal also affirmed the CIT(A)'s deletion of additions related to valuation of securities and amortization.

The Tribunal held that the disallowance under Section 14A computed as per Rule 8D was not justified as Rule 8D was operational from AY 2008-09. It also held that the disallowance of prior period expenses was partly confirmed and partly deleted. The disallowance made by the AO regarding deduction u/s 36(1)(viia) was not maintainable and directed to be deleted.

The Tribunal held that the disallowance under Section 14A computed as per Rule 8D was not justified as Rule 8D was operational from AY 2008-09. It also held that the disallowance of prior period expenses was partly confirmed and partly deleted. The disallowance made by the AO regarding deduction u/s 36(1)(viia) was not maintainable and directed to be deleted.

The Tribunal held that Rule 8D was not applicable for the assessment year in question and that investments yielding exempt income were part of the bank's stock-in-trade. The Tribunal also affirmed the CIT(A)'s deletion of additions related to valuation of securities and amortization.

The Tribunal held that the CIT(Exemption) erred in rejecting the application solely on the ground of insufficient volume of charitable activities. The law does not mandate significant charitable activities for registration under Section 80G, as long as other conditions are met.