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| The Tax Publishers2019 TaxPub(DT) 6748 (Mum-Trib) INCOME TAX ACT, 1961
Section 14A
Investment is a policy decision taken by Board of Directors at the highest level which requires lot of consultancy from various experts, therefore, disallowance under section 14A read with rule 8D(2)(iii) becomes imperative, as had been computed by AO as per applicable provisions of law and assessee's computation of disallowance by allocating salary paid to junior accountant was unacceptable.
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Disallowance under section 14A - Expenditure against exempt income - Invocation of rule 8D(2)(iii) - Assessee offered disallowance by allocating salary paid to junior accountant
Assessee earned tax free dividend income on shares and offered disallowance by allocating salary paid to junior accountant. AO invoked rule 8D(2)(iii) and worked out additional disallowance.Held: Investment is a policy decision taken by Board of Directors at the highest level which requires lot of consultancy from various experts, therefore, disallowance under section 14A read with rule 8D(2)(iii) becomes imperative, as had been computed by AO as per applicable provisions of law and assessee's computation of disallowance by allocating salary paid to junior accountant was unacceptable.
REFERRED :
FAVOUR : Against the assessee.
A.Y. : 2013-14
INCOME TAX ACT, 1961
Section 32(1)
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