Law & Society

ITO vs Indica Industries Pvt Ltd

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During the course of scrutiny assessment proceedings, the Assessing Officer noticed that the assessee has earned dividend income of Rs.1,07,46,824/- which it claimed as exempt. The assessee was asked to furnish why the expenses relevant to earned dividend income should not be disallowed u/s 14A r.w. Rule 8D.
Relying on identical set of facts in assessee’s own case in ITA No 1764/DEL/2016 where Delhi ITAT has considered a similar disallowance, noted that the Assessing Officer nowhere recorded any satisfaction in respect of the books of accounts of the assessee qua the exempt income. On finding parity in the facts of the case, Assessing Officer was directed to delete the disallowance.

In the result, the appeal of the assessee is allowed.

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