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2020 (6) TMI 169 - AT - Income TaxAddition u/s.14A - assessee has not claimed any exempted income during the year under consideration- HELD THAT:- There is no quarrel that section 14A postulates the disallowance of expenditure incurred for earning the exempt income which is not forming part of the total income of the assessee. It is also clear from the copy of the return filed by the assessee for assessment year 2010-2011 that no claim has been made in respect of dividend income. The formula given in the Rule 8D does not recognize the actual expenditure incurred by the assessee but it calculates the disallowance being 0.5% of the average investment therefore, this computation of disallowance cannot disregard and override the actual expenditure attributable for earning the exempt income. The reliance placed by assessee in the case of Cheminvest Ltd [2015 (9) TMI 238 - DELHI HIGH COURT]also support the case of the assessee. Accordingly, we set aside the orders of the authorities below on this issue and delete the disallowance made by the Assessing Officer made by the AO u/s. 14A by applying Rule 8D(2). Order being pronounced after ninety (90) days of hearing - COVID-19 pandemic and lockdown - HELD THAT:- Taking note of the extraordinary situation in the light of the COVID-19 pandemic and lockdown, the period of lockdown days need to be excluded. See case of DCIT vs. JSW Limited [2020 (5) TMI 359 - ITAT MUMBAI].
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