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2017 (9) TMI 653 - ITAT MUMBAIDisallowance u/s 14A - Dividend Income exempt u/s 10(34) - assessee already disallowed interest on loan on a/c of exempt income - Further disallowance by AO under Rule 8D r.w.s.14A - mix of own funds and interest borrowed capital - investments earning the exempt income out of mix fund - Held That:- There should not be any further disallowance u/s 14A under Rule 8D of the I.T. Rules, since the disallowance cannot exceed exempt income. This view of our is fortified by the decision of the Madras High Court in the case of Redington India limited v. ACIT [2017 (1) TMI 318 - MADRAS HIGH COURT]. Hence the same is deleted. - Decided in favor of assessee. Disallowance u/s 14A while computing the book profits u/s 115JB - Held That:- Computation under clause (f) of Explanation 1 to section 115JB(2) is to be made without resorting to the computation as contemplated u/s 14A r.w Rule 8D of the Act. Therefore we direct the AO to compute the book profits u/s 115 JB in accordance with the directions of the Hon’ble Special Bench in the case of ACIT v. Vireet Investments Private Limited (2017 (6) TMI 1124 - ITAT DELHI) - Appeal is allowed for statistical purposes.
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