Satisfaction must be recorded before invoking provision of section 14A read with Rule 8D

Issue before tribunal:

Whether disallowance can be made under provision of Section 14 A read with Rule 8D on dividend income claimed under section 10 (34) of the Income-tax Act.

Brief Facts:

• Assessee was engaged in the business of share broking and filed its return of income declaring an income of Rs.5,48,588/-. During assessment proceedings, the A.O. observed that the assessee had earned exempt income.

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