Amendment to section 14A by Finance Act, 2022 applies Prospectively w.e.f AY 2022-23

AVH Resources India Pvt. Ltd. Vs ACIT (ITAT Delhi)

1. In this case addition was made u/s.14A r.w. Rule 8D by the AO and confirmed by CIT (A) holding that the Amendment  in the Finance Act, 2022 in relation to disallowance u/s.14A r.w. Rule 8D is applicable retrospectively even if no exempted income was earned by the assessee.

2. It was argued before the Tribunal that Hon’ble Delhi High Court in the case of ‘ Pr. CIT Vs. Era Infrastructure (I) Ltd ‘ and in the case of ‘Pr.CIT Vs. Delhi International Airport (P) Ltd’ held that the Amendment brought in by the Finance Act,2022 in relation to disallowance u/s.14A r.w. Rule 8D is applicable Prospectively w.e.f. AY 2022-23.

3. Tribunal accepted the argument and allowed the appeal in favour of the appeal deleting the disallowance of Rs.43,32,540/- made u/s.14A r.w.Rule 8D.

FULL TEXT OF THE ORDER OF ITAT DELHI

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