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2021 (9) TMI 1126 - AT - Income TaxDisallowance u/s 14A r.w.r. 8D - addition to the extent of exempt income - HELD THAT:- It is true that the assessee has suo moto disallowed ₹ 1,34,268/- on exempt income of ₹ 14,451/-. However, in light of the decision of M/S. CARAF BUILDERS & CONSTRUCTIONS PVT. LTD.[2018 (12) TMI 410 - DELHI HIGH COURT] contention of the assessee cannot be brushed aside lightly. We, therefore, direct the Assessing Officer to restrict the disallowance to the extent of exempt income as disallowance u/s. 14A of the Act cannot exceed exempt income. Education cess and secondary and higher education cess as a disallowable expenditure u/s. 40(a)(ii) - HELD THAT:- We find that such claim has been allowed by the co-ordinate benches in several cases and we refer to the decision in the case of EXLSERVICES. COM (INDIA) PVT. LTD. [2021 (9) TMI 361 - ITAT DELHI] as held education cess is an allowable deduction while computing the income under the head "Profits and gains from profession or business".Assessing Officer is directed to allow the deduction on cess, education cess and higher education cess.
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