Disallowance u/s. 14A of Income Tax Act cannot exceed exempt income: ITAT Ahmedabad

Mundra International Container Terminal Pvt Ltd Vs DCIT (ITAT Ahmedabad) ITAT Ahmedabad held that disallowance under section 14A of the Income Tax Act cannot exceed exempt income. Thus, disallowance u/s. 14A restricted to the extent of exempt income. Facts- The assessee has earned dividend income of Rs.25,32,679/- which is exempt from tax but the assessee has not allocated any expenditure to earn the exempt income. Therefore, AO invoking the provisions of section 14A of the Act made disallowance of Rs.35,00,000/- as per Rule 8D. Notably, assessee suo-moto made disallowance of Rs.35,00,000/- u/...