The word ‘annual’ denotes a period of twelve months. Consequently, in determining the annual
average of the monthly averages of investments under Rule 8D(2)(ii), the aggregate must necessarily be divided by the figure of twelve to compute the annual average. The mere fact that the investments existed only for a portion of the year does not warrant a distortion of the term “annual” to suit a different computation methodology. It is evident that there is no ambiguity in the language of Rule 8D, particularly in the expression computation undertaken by the Assessing Officer, as upheld by the Learned Commissioner of Income Tax (Appeals), is a misinterpretation of the provision.