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| The Tax Publishers2019 TaxPub(DT) 3027 (Bom-HC) : (2020) 423 ITR 0412 : (2019) 264 TAXMAN 0050 INCOME TAX ACT, 1961
Section 14A
Where assessee made invstment in tax free dividend income yielding shares out of non-interest bearing own funds available with it, no disallowance of interest expenditure under section 14A was called for.
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Disallowance under section 14A - Expenditure against exempt income - disallownace of interest expenditure - Assessee having sufficient own funds
Assessee earned tax free dividend income. AO invoked section 14A and disallowed interest expenditure.Held: As apparent assessee had its own funds and such non-interest bearing funds were in excess of investments made, therefore, it could be safely presumed that interest free funds were utilised for making exempt investment and, therefore, no disallowance of interest expenditure was called for.
Relied:CIT v. Reliance Utilities & Power Ltd. (2009) 313 ITR 340 (Bom.) : 2009 TaxPub(DT) 1275 (Bom-HC) and CIT v. HDFC Bank Ltd. (2014) 366 ITR 505 (Bom.) : 2014 TaxPub(DT) 3351 (Bom-HC).
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2006-07 to 2009-10
INCOME TAX ACT, 1961
Section 4
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