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2019 (7) TMI 1824 - ITAT MUMBAIReopening of assessment u/s 147 - disallowance u/s 14A - HELD THAT:- CIT(A) has clearly held that no disallowance is permissible in this case u/s. 14A on the touchstone of Hon'ble Jurisdictional High Court decision in the case of Jet Airways Ltd. [2010 (4) TMI 431 - HIGH COURT OF BOMBAY] in as much as no disallowance has been done on the issue on which reopening has been done. As a matter of fact, he Revenue is not in appeal against this order of learned CIT(A). Thus we hold that learned CIT(A) has erred in upholding part of the disallowance u/s. 14A, when he held at the threshold that no disallowance u/s. 14A is permissible in as much as no disallowance was done on the issue on which reopening was made. Accordingly, I set aside the order of learned CIT(A) and delete the disallowance. Computation of deduction u/s 14A - HELD THAT:- Hon'ble Apex Court in the case of Maxopp Investment [2018 (3) TMI 805 - SUPREME COURT] has upheld Hon'ble Punjab & Haryana High Court decision in the case of PCIT vs. State Bank of Patiala [2017 (2) TMI 125 - PUNJAB AND HARYANA HIGH COURT] wherein restriction of disallowance u/s. 14A to the extent of exempt income earned has been upheld. Hence, it is now settled that no disallowance can be done over and above exempt income earned. Now in this case, it is the submission of learned Counsel of the assessee that the assessee has not earned any exempt income in as much as dividend income of ₹ 14,077/- has been offered to tax, hence, no disallowance u/s. 14A is permissible. Thus find in agreement with the above said proposition - Assessing Officer requires to examine this aspect that the assessee has not shown any exempt income and whatever dividend income has been earned has been offered to tax. If above is found factually correct, no disallowance u/s. 14A is sustainable. Hence, this issue allowed for statistical purposes.
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