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2017 (2) TMI 542 - AT - Income TaxAddition u/s 14A - whether section 14A is applicable when the assessee has not actually received any exempt income during the year from assets capable of yielding exempt income? - Held that:- Rule 8D is only a machinery/mechanism to compute the disallowance. It is trite that the Rules are sub servient to the main enactment. Rules can never override the main provisions of the Act. If the facts of the case warrants no disallowance, the computational provision does not come into picture at all. Further, the Circulars of the CBDT prejudicial to Assessee do not exert binding force on the assessee. Accordingly, where no exempt income is received or receivable during the relevant financial year, provisions of section 14A would not operate. In this view of the matter, the disallowance made by the AO is not sustainable having regard to absence of any exempt income during the financial year relevant to the assessment year in question. Therefore, we concur with the action of the CIT(A) in deleting the disallowance made by the AO. - Decided in favour of assessee Disallowance u/s.36(1)(va) by way of employee’s contribution towards provident fund - Held that:- Assessee has allegedly made belated payments of employees’ contribution towards PF for the month of March-2012. It was observed by the CIT(A) that no explanation was submitted by the Assessee before the AO nor was any submission made before the him in this regard. The CIT(A) accordingly upheld the disallowance.In the absence of any particulars regarding delayed payment, if any, even before us we are not in a position to comprehend the case of the assessee. Hence, we decline to interfere with the order of CIT(A). - Decided against assessee
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