No Disallowance under section 14A in Absence of exempt income

PCIT Vs IL&FS Energy Development Company Ltd. (Delhi High Court)

The mere fact that in the audit report for the AY in question, the auditors may have suggested that there should be a disallowance cannot be determinative of the legal position. That would not preclude the Assessee from taking a stand that no disallowance under Section 14 A of the Act was called for in the AY in question because no exempt income was earned.

Assessee-company had made investment in mutual funds in which no interest bearin

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