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| The Tax Publishers2020 TaxPub(DT) 2986 (Mum-Trib) INCOME TAX ACT, 1961
Section 14A Rule 8D(2)(iii)
While making addition of 0.5% of average investment under rule 8D(2)(iii), only those investment which yielded exempt income during the year were to be taken in account instead of entire investments made by assessee.
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Disallownace under section 14A - Expenditure agianst exempt income - Administrative expenses under rule 8D(2)(iii) - AO considered non-dividend yielding investments also for average value of investments
Assessee earned tax free dividend income on investments in shares. AO invoked rule 8D(2)(iii) and disallowed administrative expenses under section 14A also considering non-dividend bearing investments for computing average value of investments. Held: While making addition of 0.5% of average investment under rule 8D(2)(iii), only those investment which yielded exempt income during the year were to be taken in account instead of entire investments made by assessee. AO was directed accordingly.
Relied:Asstt. CIT v. Vireet Investment (P) ltd. (2017) 82 Taxmann.com 415 (Del)(SB) : 2017 TaxPub(DT) 1760 (Del-Trib).
REFERRED :
FAVOUR : Partly in assessee's favour.
A.Y. : 2014-15
INCOME TAX APPELLATE TRIBUNAL RULES, 1963
Rule 34(4) Rule 34(5)(c)
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