The Tax Publishers2020 TaxPub(DT) 4780 (Del-Trib)

INCOME TAX ACT, 1961

Section 14A Rule 8D

Where assessee had not claimed any exempt income during the year under consideration, no disallowance could be made by invoking the provision of section 14A.

Disallowance under section 14A - Expenditure against exempt income - No exempt income claimed by assessee -

AO held that assessee had invested huge amount in shares but had not disallowed any expenditure under section 14A. He was of the view that since investment has been made in the equity of the companies and the income derived or likely to be derived from such investment would be exempt from tax, therefore, provisions of section 14A were applicable. Held: In the case of PCIT v. GVK Project and Technical Services Ltd. [(2019) 106 Taxmann.com 180 (Del) : 2018 TaxPub(DT) 8094 (Del-HC)] it was held that in the absence of any exempt income reported by the assessee, no disallowance under section 14A can be made. Following the same, ground of revenue was dismissed and disallowance made was deleted.

Followed:Pr. CIT v. GVK Project and Technical Services Ltd. [(2019) 106 Taxmann.com 180 (Del) : 2018 TaxPub(DT) 8094 (Del-HC)].

REFERRED :

FAVOUR : In favour of assessee.

A.Y. : 2013-14



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