Section 14A disallowance cannot exceed income earned by Assessee

DCIT Vs Oman International Bank S. A. O. G. (ITAT Mumbai) The issue under consideration is whether the disallowance u/s 14A is justified even if the bank had not incurred any expenditure for the purpose of earning the interest amount? ITAT states that, disallowance u/s 14A is attracted only when assessee incurs any expenditure for earning the income which is not forming part of total income. He also submitted that in this AY, assessee has not incurred any interest expenditure since assessee has earned the net interest income after setting off the interest expenditure paid to Head office. He br...