Shri Deepen A. Parekh, 601 Auto Commerce House, Nana Chowk, Kennedy Bridge, Mumbai 400 007. Vs. D.C.I.T. Central Cir. 20, Mumbai.
May, 28th 2015
IN THE INCOME TAX APPELLATE TRIBUNAL "D" BENCH, MUMBAI
BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND
SHRI R.C. SHARMA, ACCOUNTANT MEMBER
./I.T.A. No. 3308 /Mum/2013
( / Assessment Year : 2009-10
Shri Deepen A. Parekh, / D.C.I.T. Central Cir. 20,
601 Auto Commerce Mumbai.
Mumbai 400 007.
. / PAN : AAIPP6817G
( /Appellant) .. ( / Respondent)
Appellant by None
Respondent by : Shri Love Kumar (D.R.)
/ Date of Hearing : 25-05-2015
/Date of Pronouncement : 27-05-2015
/ O R D E R
PER R.C. SHARMA, A.M. :
This is an appeal filed by the assessee is directed against the order
passed by the ld. CIT(A) -39,, Mumbai dated 14-01-2013 for the A.Y. 2009-10
in the matter of order passed u/s 143(3) of the Income Tax Act, 1961.
2. At the time of hearing, nobody from assessee's side has appeared
instead of giving notices to the assessee. The Bench, therefore decided to
dispose of the appeal after hearing the ld. D.R. and considering the material
placed on record.
2 ITA 3308/M/13
3. The only grievance of the assessee relates to the addition made u/s 14A
read with Rule 8-D of the Income Tax Rules, 1962.
4. We have heard ld. D.R. and found that the disallowance has been made
by the A.O. in respect of interest and administrative expenses on the plea that
the assessee has earned exempt income of Rs. 6,11,945/-. The contention of
the assessee before the A.O. was that he has incurred interest expenditure of
Rs. 4,519/- only which was paid to the bank for overdraft facility. It was also
the contention of the assessee that total expenses claimed in the P&L account
was Rs. 1,94,511/-, therefore, the total disallowance could not exceed the
expenses debited to the P&L account. However, the A.O. did not consider the
assessee's contention and arbitrarily computed the disallowance at Rs.
6,19,220/-. By the impugned order, the ld. CIT(A) confirmed the disallowance,
against which the assessee is in appeal before us.
5. We have considered the contentions of the ld. D.R. and gone through
the orders of the authorities below and found that the assessee has debited
total expenditure of Rs. 1,94,511/-. The disallowance u/s 14A read with Rule
8-D is being made in respect of expenditure attributable to earning of exempt
income. However, in no case the disallowance can be more than the
expenditure debited and claimed by the assessee. In this case, the A.O. has
disregarded the total expenditure debited to the P&L account and worked out
the disallowance at 25% of the dividend income as well as disallowance under
Rule 8D(2)(iii). We do not find any merit in the order of the A.O. and
accordingly the same is set aside and remit the matter back to the file of the
A.O. to decide the same afresh after giving due opportunity of being heard to
3 ITA 3308/M/13
6. In the result, appeal of the assessee is allowed in part for statistical
Order pronounced in the open court on 27th May, 2015.
(D. MANMOHAN) (R.C. SHARMA)
VICE PRESIDENT ACCOUNTANT MEMBER
Mumbai; Dated 17-05-2015
. ../ RK , Sr. PS
/Copy of the Order forwarded to :
1. / The Appellant
2. / The Respondent.
3. () / The CIT(A) 39, Mumbai
4. / CIT -Cent, 11, Mumbai
5. , , / DR, ITAT, Mumbai D Bench
6. / Guard file.
/ BY ORDER,
/ (Dy./Asstt. Registrar)
, / ITAT, Mumbai