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2015 (10) TMI 21 - AT - Income TaxDisallowance u/s 14A read with Rule 8D - Held that:- CIT(A) has given a finding that there was no expenditure incurred by the assessee for increase in investment and when the expenses in respect of exempt income have not been incurred by the assessee, the question of disallowance u/s. 14A does not arise. In assessee’s case, increase in investment was from the funds available with the assessee and no interest has been paid, but there are certain expenditures which are incurred during the process of investment. While applying provisions under Section 14A of the Act and Rule 8D of the Income Tax Rules, these factors should be looked into. But in this case, the CIT(A) held that the Assessing Officer has not placed any material on record nor has he made any clear cut finding to prove that any expenditure had been incurred by the assessee and thus disallowance u/s. 14A read with Rule 8D is not warranted instead should have been remanded back the matter to the Assessing Officer to verify the expenditure incurred while earning the dividend income. Thus finding of the CIT(A) that the disallowance of ₹ 16,00,583 against dividend income of ₹ 96,622/- was not proper. In view of the above the matter is remanded back to the Assessing Officer for examining the expenditure incurred against the investment as against the dividend income earned by the assessee.
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