Allowing the appeal of the assesse , the Tribunal held that ; though the power of CIT(A) is co –terminus with that of Assessing officer , it is Assessing Officer who has to record his satisfaction with regard to correctness of assessee’s claim before proceeding to disallow expenditure under section 14A and satisfaction to be recorded by Assessing Officer under section 14A(2) cannot be substituted by satisfaction recorded by first appellate authority. ( AY.2010-11)
Arnav Gruh Ltd. v. DCIT (2018) 168 ITD 518 (Mum) (Trib.)
S. 14A : Disallowance of expenditure – Exempt income –Satisfaction to be recorded by the Assessing Officer ,it cannot be substituted by recorded satisfaction of Commissioner of Income tax ( Appeals) [ S. 251, R.8D ]