Disallowance under Section 14A of Income TAx Act, 1961
Income Tax : The issue was whether exempt dividend income could be taxed by overriding Rule 8D. The ITAT held that additions beyond the Section...
Income Tax : The Tribunal clarified that disallowance under Section 14A is not warranted when sufficient interest-free own funds are available,...
Income Tax : The ruling confirms that notional disallowances under Section 14A cannot be added while computing book profits under the MAT regim...
Income Tax : Section 14A disallows expenses related to tax-exempt income. Rule 8D provides the formula, ensuring only taxable-income-related ex...
Income Tax : Tribunal confirms that detailed AO dissatisfaction justifies invoking Rule 8D, ensuring proper disallowance of expenses related to...
Income Tax : Bombay Chartered Accountants' Society has made a Representation on 'Suggestions for Amendments in the Income Tax Act', on 24th May...
Income Tax : The mechanical disallowance u/s 14A r.w. Rule 8D is also being added to the book profit by the AO irrespective of the fact whethe...
Income Tax : 1. IMPLEMENTATION OF IND-AS AND THEIR IMPACT ON TAXABLE INCOME IND-AS (Indian version of IFRS) accounting standards are being impl...
Income Tax : Amendments to Section 14A to provide that (i) dividend received after suffering dividend-distribution tax and share income from fi...
Income Tax : As earlier intimated to you, Writ Petition bearing No. 50 of 2010 (Indian Exporters Grievances Forum & Other vs. CIT) challenging ...
Income Tax : Court held that penalty under Section 270A cannot apply where assessed income does not exceed processed income. Key takeaway: stat...
Income Tax : The case examined whether interest earned from co-operative banks qualifies for deduction under Section 80P(2)(d). The Tribunal he...
Income Tax : Consistency over technicalities: ITAT Mumbai allowed actuarial pension provision as an ascertained liability, rejected mechanical ...
Income Tax : A taxpayer could submit a revised return u/s 139(5) only when it discovered a bona fide omission or incorrect statement in the ori...
Income Tax : The Tribunal set aside additions to book profit after ruling that MAT provisions do not apply to banks established under a special...
Income Tax : 2) The expenditure in relation to income which does not form part of the total income shall be the aggregate of following amounts,...
Income Tax : Circular No. 5/2014-Income Tax Central Board of Direct Taxes, in exercise of its powers under section 119 of the Act hereby clari...
Income Tax : INCOME TAX NOTIFICATION NO-45/2008, DT: March 24, 2008 Method for determining amount of expenditure in relation to income not incl...
Income Tax : The provisions of Sections 144-A and 144-B of the Income-tax Act have come into force with effect from 1st January 1976. Instructi...
Investments on whom dividend received, though chargeable to tax but allowed as rebate in view of DTAA agreement cannot be included for the purpose of computing disallowance u/s 14A of Income Tax Act.
In the present case As assessee had established nexus of interest expenses with its main activity of financing and there was not a single amount of interest bearing borrowings which could be related with investment which yielded tax-free dividend income, no disallowance under rule 8D(2)(ii) was called for. AO was directed to compute disallowance under rule 8D(2)(iii) at the rate of 0.5% of investments which actually have resulted in the exempt dividend income.
The Nainital Bank Ltd. Vs Asstt. (ITAT Delhi) When the assessee furnished all the facts and figures including the earning of the tax free income and the expenditure which was accepted by the learned AO, it is not open for the AO to say that the income escaped assessment because assessee did not reveal the […]
These four appeals are preferred by the revenue against the four separate orders passed by the Ld. CIT (Appeals) all dated 27th July, 2016 for A.Y. 2010-11, 2011-12, 2012-13 and 2013-14 and since a common issue involved therein, the same have been heard together and are being disposed of by a single consolidated order.
As AO failed to arrive at satisfaction as to non-correctness of assessee’s claim as regards no expenditure against exempt income, invocation of rule 8D was in contravention of section 14A(2) and, therefore, disallowance was deleted.
Samvardhana Motherson International Ltd. Vs ACIT (Delhi High Court) The chronology of events leading up to the passing of the orders under section 143(3) of the Act, clearly shows that the assessing officer was ‘satisfied with the claim of the assessee’ while passing the original orders. Rule 8D is triggered only in a case where […]
Future Corporate Resources Ltd. Vs. Dy. CIT (ITAT Mumbai) The assessee argued that it had earned meager dividend income of Rs. 24,138 as against which, the assessing officer disallowed a sum of Rs. 3,36,28,000 which is more than the exempt income. The assessee further argued that dis-allowance under section 14A cannot exceed amount of exempt […]
Assessee was engaged in the business of investment in shares and securities, financing and granting loans and advances against shares. The assessee earned exempt dividend income and made suo moto dis allowance against the same under section 14A.
When assessee had not earned any exempt income during the relevant assessment year, disallowance under section 14A could not be made.
No dis allowance u/s 14A is called for in a case where the shares are held as stock-in-trade as held in India Advantage Securities Ltd. (supra), CCI Ltd. v. JCIT (2012) 20 taxmann.com 196 (Karn.), PCIT v. State Bank of Patiala (2017) 78 taxmann.com 3 (P& H) and CIT v. G.K.K. Capital Markets (P.) Ltd. (2017) 78 taxmann.com 341 (Cal.).
