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| The Tax Publishers2019 TaxPub(DT) 8427 (Kol-Trib) : (2019) 076 ITR (Trib) 0356 INCOME TAX ACT, 1961
Rule 8D(2)(ii)
Where assessee was having sufficient own funds to invest in exempt income yielding investments, it could be safely concluded that all the investments had been made out of own funds of assessee and therefore, no disallowance was called for in terms of rule 8D(2)(ii).
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Disallowance under section 14A - Expenditure against exempt income - Invocation of rule 8D(2)(ii) - Assessee having sufficient own funds
Assessee earned tax free dividend income. AO invoked rule 8D(2)(ii) and worked out disallowance of interest expenses. Assessee's case was that investments were made out of own funds available with assessee.Held: As evident, assessee was having sufficient own funds to invest in exempt income yielding investments. Accordingly, it could be safely concluded that all the investments had been made out of own funds of assessee and therefore, no disallowance was called for in terms of rule 8D(2)(ii).
Relied:CIT v. Reliance Utilities and Power Ltd. (2009) 313 ITR 340 (Bom) : 2009 TaxPub(DT) 1275 (Bom-HC).
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2010-11
INCOME TAX ACT, 1961
Section 37(1)
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