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| The Tax Publishers2019 TaxPub(DT) 8262 (Ahd-Trib) : (2020) 180 ITD 0280 INCOME TAX ACT, 1961
Section 14A(2) Rule 8D
AO had not pointed out any defect in voluntary disallowance made by assessee under section 14A, accordingly, invocation of rule 8D was in contravention of mandate laid down under section 14A(2) as AO was under obligation to record the dissatisfaction about correctness of claim of assessee.
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Disallowance under section 14A - Expenditure against exempt income - Invocation of rule 8D - Non-recording of satisfaction by AO
Assessee earned tax free dividend income and claimed suo moto disallowance under section 14A. AO invoked rule 8D and worked out additional disallowance. Assessee challenged this on the ground of non-recording to satisfaction by AO in terms of section 14A(2).Held: AO had not pointed out any defect in voluntary disallowance made by assessee under section 14A, accordingly, invocation of rule 8D was in contravention of mandate laid down under section 14A(2) as AO was under obligation to record the dissatisfaction about correctness of claim of assessee.
Supported by:Dy. CIT v. Pidilite Industries Ltd. (2019) 107 Taxmann.com 91 (Mum) : 2019 TaxPub(DT) 4353 (Mum-Trib).
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2013-2014 & 2014-15
INCOME TAX ACT, 1961
Section 14A Section 115JB
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