Case Law Details
India Infoline Finance Limited Vs ACIT (ITAT Mumbai)
The issue under consideration is whether the disallowance under 14A can be exceed the actual expenditure incurred in this regard?
ITAT states that, the assessing officer has duly rejected the assessee’s contentions and applied Rule 8D(3) and made the disallowance which has been sustained by learned CIT(appeals). However we are of the considered opinion that the issue may be considered by the assessing officer once more by taking into account the following which are also the contentions of the assessee in earlier year i.e. (i) The disallowance under 14A cannot exceed the actual expenditure incurred in this regard. (ii) The disallowance has to be considered only with respect to the investments which have yielded exempt income. (iii) The disallowance cannot exceed the exempt income earned.
Accordingly, with these observation ITAT remit the issue to the file of the Assessing Officer to reconsider the disallowance under Rule 8D(iii) afresh.
FULL TEXT OF THE ITAT JUDGEMENT
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