Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2014 (12) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2014 (12) TMI 207 - AT - Income TaxQuantification of the disallowance u/s. 14A(1) – Exclusion of certain expenditure - assessee is a non-banking financial company (NBFC) - Held that:- The method followed by the assessee, which gets in fact validated by its adoption by the A.O., has a strong rationale to it - the assessee's explanation and method of apportionment is to that extent arbitrary and de hors its accounts - a proximate cause, i.e., with the tax exempt income - which does not fall under any head of income, which is required to satisfy the test of 'in relation to', specified in section 14A(1), including both direct and indirect expenditure, is eminently satisfied - the expenses falling for allowance under any provision, i.e., from sections 15 to 59, would qualify for disallowance u/s.14A, which is a separate and complete code in itself - an identity or unity, i.e., in principle, between the working of the assessee and the A.O., so that what remains is to eliminate the errors inflicting their respective workings, doing which would lead to the same result. In the absence of any factual basis to the assessee's claim, the same, it was explained, would not even qualify to be one - The matter is factual, so that where, the initial onus has not been discharged by the assessee, the disallowance u/s. 14A(1) cannot be impugned for non-compliance of the procedure laid down u/s. 14A(2) – relying upon GODREJ AND BOYCE MFG. CO. LTD. Versus DEPUTY COMMISSIONER OF INCOME-TAX AND ANOTHER [2010 (8) TMI 77 - BOMBAY HIGH COURT] - the disallowance u/s.14A(1) is upheld.
|