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2019 (4) TMI 780 - AT - Income TaxDisallowance u/s. 14A to the book profit ignoring the section 115JB - expenses relatable to earning of exempt income - whether depreciation claimed by the assessee u/s. 32 can be considered for the purpose of computing disallowance u/s. 14A? - HELD THAT:- Assessee is assessed under the normal computational provision and not under book profit under MAT. So, in that view of the matter, the disallowance u/s. 14A added back u/s. 115JB which was deleted by CIT(A) and now urged in appeal by the revenue has no tax effect for the simple reason that the assessee company was finally assessed under the normal computational provision by the AO himself and the computation of book profit was only of academic interest having no bearing on the tax liability of the assessee, therefore, this ground of appeal of revenue is also to be dismissed. So, overall, we note that the tax effect in both the grounds of appeal below the threshold limit prescribed by the CBDT Circular No. 3/2018 dated 11.07.2018 and, therefore, the appeal of the revenue is dismissed. Disallowance on account of depreciation claim u/s. 14A read with rule 8D(2)(ii) - HELD THAT:- SHRI VISHNU ANANT MAHAJAN VERSUS ACIT BARODA [2012 (6) TMI 297 - ITAT, AHMEDABAD] section 14A uses the words “expenditure incurred by the assessee in relation to income”. A statutory allowance under section 32 is not an expenditure. Nector Beverages Pvt. Ltd. Vs. DCIT [2009 (7) TMI 5 - SUPREME COURT]
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