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2019 (4) TMI 1738 - HC - Income TaxDisallowance u/s 14A - HELD THAT:- Consistently different High Courts in the country have taken a view that the disallowance u/s 14A read with Rule 8D of the Rules cannot exceed the Assessee's exempt income. The Delhi High Court, in the case of Cheminvest Ltd. Vs. Commissioner of Income Tax [2015 (9) TMI 238 - DELHI HIGH COURT] has held that when the Assessee has not earned any income which was exempt from tax, disallowance of the expenditure under Section 14A read with 8D of the Rules would not be permissible. Karnataka High Court, in the case of Pragati Krishna Gramin Bank Vs. Joint Commissioner of Income-tax [2018 (6) TMI 1283 - KARNATAKA HIGH COURT] has held that expenditure in relation to income not includable in the total income cannot exceed such income. We reverse the decision of the Tribunal to the extent of limiting the disallowance under Section 14A. - Decided in favour of assessee.
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