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2018 (12) TMI 911 - AT - Income TaxDisallowance u/s 14A - investment made in securities when no direct or indirect expenditure in relation to investment in securities has been claimed or debited - Held that:- Eligible reasons to arrive at the satisfaction for disallowance u/s 14A of the Act, r/w Rule 8D of the Rules, that there are expenses relatable to the earning of exempt income by the assessee. Since, the assessee has invested its money for such investment of shares, which is capable to generate income which does not or shall not form part of total income of the assessee and indirect cost in the form of administrative expenditures etc. is involved in this process. There is direct and proximate nexus between the exempted income, which the investments shall genearate and the expenditures directly or indirectly involved in earning the said income…. In view of these facts and circumstances, the requirements under Rule 8D(1) of I.T. Rules read with Section 14A(2) and Section 14A(3) are fulfilled and accordingly disallowance made by the AO in accordance with under Rule 8D(2) of I.T. Rules, 1962 read with Section 14A of I.T. Act, is held to be consistent with law under these facts and circumstances -disallowance made by the AO under Rule 8D of I.T. Rules read with Section 14A of I.T. Act, and confirmed by the Ld. CIT(A), are hereby upheld.- decided against assessee.
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