INCOME TAX ACT, 1961

Section 14A Rule 8

Disallowance under section 14A - Expenditure against exempt income - No exempt income earned -

AO made disallowances relating to exempt income under section 14A read with rule 8D. CIT(A) observed that expenditure in form of investment was incurred by assessee and there was no exempt income in form of dividend received by assessee. Following overwhelming judicial view, that 'no disallowance can be made in the absence of deemed dividend', CIT(A) deleted addition. Held: Since issue was squarely covered by orders of the Tribunal in favour of assessee, no reason was found to interfere with orders of CIT(A) and same was upheld.

Followed:CIT v. M/s. Chettinad Logistics Pvt. Ltd. [T.C.A. No. 520 of 216, dt. 13-3-2017] : 2017 TaxPub(DT) 1144 (Mad-HC), M/s. Redington (India) Ltd. v. The Additional CIT (2017) 392 ITR 633 (Mds) : 2017 TaxPub(DT) 0345 (Mad-HC), DCIT v. M/s. Radhakrishna Automobiles Pvt. Ltd. [ITA No. 511/VIZ/2017, dt. 22-11-2017], D Veerabhadra Reddy (HUF) v. Dy. CIT [ITA No. 263/Vizag/2014, dt. 23-6-2017],

REFERRED :

FAVOUR : In assessee's favour

A.Y. : 2013-14 to 2015-16

SUBSCRIBE FOR FULL CONTENT