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2019 (5) TMI 953 - HC - Income TaxDisallowance u/s 14A r/w Rule 8D - disallowance of expenditure incurred to earn exempted income - HELD THAT:- We are of the opinion that the matter deserves to be remitted back to the Assessing Authority for correct application of Rule 8D and computation of disallowance amount u/s 14A as we are of the clear opinion that the disallowance under Section 14A cannot exceed the exempted income disclosed and assessed by the Assessing Authority. The purpose of Section 14A was very clear that the expenditure incurred to earn exempted income cannot be allowed as a deduction. Normally, in such cases the Tribunal has adopted the norm of 2% of exempted income as permissible disallowance under Section 14A of the Act. Therefore, the matter deserves to be examined by the Assessing Authority once again. This Appeal is disposed of without answering the Substantial Questions of Law raised by the Revenue and the matter is remitted back to the Assessing Authority for determination of disallowance under Section 14A
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