Expense incurred for earning only exempt income is not allowable as deduction

Vishal Diamonds Pvt Ltd Vs ITO (ITAT Mumbai) ITAT Mumbai held that expenditure claimed by the assessee relating to earning of only exempt income is not allowable as deduction. Accordingly, the whole expenditure incurred for earing exempt income cannot be allowed to carryforward. Facts- The case of the assessee was selected for complete scrutiny for the purpose that assessee has shown low income in comparison to very high investment and business loss appearing in the balance sheet. AO noticed that assessee has shown exempt income of ₹.91,39,137/- received as share of profit from partnership f...