Only net interest expenses to be considered for the purpose of making disallowance u/s.14A of the Income Tax Act,1961

Last updated: 06 January 2021

Court :
ITAT Chennai

Brief :
This appeal filed by the assessee is directed against the order of the learned CIT(Appeals)-8, Chennai dated 06.02.2019 and pertains to assessment year 2015-16.

Citation :
I.T.A.No.1018/Chny/2019

IN THE INCOME TAX APPELLATE TRIBUNAL ,
‘C’ BENCH, CHENNAI

BEFORE SHRI V.DURGA RAO, JUDICIAL MEMBER
AND SHRI G. MANJUNATHA, ACCOUNTANT MEMBER

I .T.A.No.1018/Chny/2019
Assessment Year : 2015-16)

M/s. Mint Properties Pvt.Ltd..,
122, Broadway,
Chennai -600 108.
PAN: AAACM 5348Q
Appellant

The Income Tax Officer,
Corporate Ward-4(1)
Chennai.
Respondent

Appellant by : Mr. M.Karunakaran, Advocate
Respondent by : Mr. G.Johnson, Addl.CIT
Date of hear ing : 17.12.2020
Date of Pronouncement : 31.12.2020

O R D E R

PER G. MANJUNATHA, AM:

This appeal filed by the assessee is directed against the order of the learned CIT(Appeals)-8, Chennai dated 06.02.2019 and pertains to assessment year 2015-16.

2. The assessee has raised the following grounds of appeal:-

“1. The learned Commissioner of Income-tax Appeals) erred in confirming the disallowance of Rs.16,23,470/- made under section 14A of the Act.

2. The authorities below erred in taking the interest paid of Rs.10,76,939/- as attributable to investments in the firms, the share income from which is exempt from taxu/s 10(2A) of the Act for disallowance u/s 14A r/w Rule 8D(2)(ii).

3 The authorities below should have seen that the borrowals on which interest was paid were directly advanced to various parties for interest and such interest of Rs. 27,62,380/- was offered for tax as income.

4. The appellant submits that there is a direct nexus between the borrowals and advances/loans given and therefore the interest paid has to be adjusted against the interest received and offered for tax.

To know more in details find the attachment file