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2020 (4) TMI 97 - AT - Income TaxDisallowance u/s 14A r.w. Rule 8D - Disallowance not exceeding the quantum of exempt income - HELD THAT:- In the case of CIT Vs. Corrtech Energy Ltd [2014 (3) TMI 856 - GUJARAT HIGH COURT] has held that in the absence of any exempt income being claimed by the assessee provisions of section 14A r.w.r 8D could not be invoked. The rationale behind this judgment is that the amount of disallowance u/s 14A should not exceed the exempt income. The ld.AO was not justified in invoking provisions of section 14A of the Act in the present case. Moreover, the assessee has earned a small amount of ₹ 2,64,500/-, whereas the ld.AO has calculated a whopping sum of ₹ 7,72,41,277/- as proportionate expenditure for earning the exempt income. Even assuming that some expenditure is required to be disallowed but such disallowance should not exceed the quantum of exempt income. Therefore, we uphold order of the ld.CIT(A) on this issue, and dismiss the ground of appeal of the Revenue.
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