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2018 (10) TMI 1894 - AT - Income TaxDisallowance u/s 14A r.w.r. 8D - claim restricted to the exempt income earned by the assessee - HELD THAT:- We find that in the case of VBC Ferro Alloys Ltd [2018 (8) TMI 130 - ITAT HYDERABAD] to which both of us are the signatories, have followed the precedents on the issue to hold that the disallowance u/s 14A read with Rule 8D cannot exceed exempt income. We are of the opinion that the disallowance under Rule 8D cannot exceed the dividend income earned and claimed as exempt. The disallowance worked out under Rule 8D(iii) being administrative expenditure is restricted to the amount of dividend earned. AO is directed to modify accordingly. Ground is partly allowed. As the issue under consideration is materially identical to the said decision, following the conclusions drawn therein, we direct the AO to VBC Ferro Alloys Ltd., Hyd. [2018 (8) TMI 130 - ITAT HYDERABAD] delete the disallowance made u/s 14A r.w.r. 8D(2)(iii) as the disallowance u/s 14A cannot exceed the exempt income. - Decided against revenue.
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