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The Tax PublishersTax Case Appeal No. 288 of 2019
2020 TaxPub(DT) 4962 (Mad-HC)INCOME TAX ACT, 1961
Section 14A read with Rule 8D
As there was no opinion recorded by AO as to how section 14A(1) would stand attracted in instant case and in absence of any such finding, the disallowance made under section 14A read with rule 8D was not justified and hence, the said disallowance had rightly been deleted by Tribunal.
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Disallowance under section 14A - Expenditure against exempt income - Non-recording of satisfaction -
AO made disallowance under section 14A read with rule 8D. However, Tribunal deleted the said disallowance on the ground that when there was no earning of exempt income during the year, then provisions of section 14A could not be invoked. Aggrieved, Revenue was in appeal. Held: To apply provisions of section 14A, AO should have recorded a finding as to how section 14A(1) would stand attracted. In instant case, there was no opinion recorded by AO as to how section 14A(1) would stand attracted and in absence of any such finding, the disallowance made under section 14A read with rule 8D was not justified and hence, the said disallowance had rightly been deleted by Tribunal.
REFERRED : CIT v. Celebrity Fashion Ltd. (2020) 119 taxmann.com 426 (Mad) : 2020 TaxPub(DT) 3894 (Mad-HC).
FAVOUR : In assessee's favour
A.Y. : 2014-15
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