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2021 (4) TMI 336 - AT - Income TaxDisallowance u/s 14A - addition under the normal provisions as well as while computing income under section 115JB - suo motu disallowance - HELD THAT:- Legal principles on this issue are now fairly well settled. The decisions referred to by learned Commissioner (Appeals) clearly express this view. Even, in the decisions cited before us by learned Counsel for assessee, as noted earlier, HSBC INVEST DIRECT (INDIA) LTD. [2019 (2) TMI 731 - BOMBAY HIGH COURT] has also expressed the view that disallowance under section 14A cannot exceed the exempt income earned during the year. Therefore, keeping in view the ratio laid down in various decisions, including, the decisions of Hon’ble jurisdictional High Court, supra, we uphold the decision of learned Commissioner (Appeals) in restricting the disallowance under section 14A to the extent of exempt income earned during the year. Disallowance under section 14A r.w.r. 8D while computing book profit under section 115JB - As squarely covered in favour of the assessee by the decision in case of CIT vs Vireet Investments (P) Ltd [2017 (6) TMI 1124 - ITAT DELHI] Though, under Explanation I(f) to section 115JB of the Act, the assessing officer is empowered to disallow expenditure attributable to exempt income; however, the assessing officer has to identify the expenditure incurred by the assessee which is directly attributable to earning of exempt income. In the facts of the present case, the assessing officer has not identified any such expenditure. Therefore, we do not find any reason to interfere with the decision learned Commissioner (Appeals) on the issue. Grounds raised are dismissed. Appeal is dismissed.
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