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| The Tax Publishers2021 TaxPub(DT) 4345 (Mad-HC) INCOME TAX ACT, 1961
Section 14A
Following the decision of Supreme Court in the case of CIT v. Chettinad Logistics (P.) Ltd. (2018) 257 Taxman 2 (SC) : 2018 TaxPub(DT) 4126 (SC), it was held that section 14A cannot be invoked where no exempt income was earned by assessee in the relevant assessment year.
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Disallowance under section 14A - Expenditure incurred against exempted income - No exempt income earned by assessee -
Issue arose for consideration as to whether Tribunal was right in law in holding that claim of expenditure by assessee was subject to disallowance under the provisions of section 14A read with rule 8D of the Income Tax Rules, 1962. Held: Supreme Court in case of CIT v. Chettinad Logistics (P.) Ltd. (2018) 257 Taxman 2 (SC) : 2018 TaxPub(DT) 4126 (SC) wherein Supreme Court held that section 14A cannot be invoked where no exempt income was earned by assessee in the relevant assessment year was affirmed. Following the same, disallowance could not be made under section 14A.
Followed:M/s. Redington (India) Ltd. v. The Addl. CIT (2017) 392 ITR 633 (Madras) : 2017 TaxPub(DT) 0345 (Mad-HC), CIT (Central) 1 v. M/s Chettinad Logistics Pvt. Ltd. (2018) 257 Taxman 2 (SC) : 2018 TaxPub(DT) 4126 (SC), T.C.A. No. 732 and 733 of 2018, dated 7-7-2020
REFERRED :
FAVOUR : In assessee's favour
A.Y. : 2012-13
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