MADRAS SECURITY PRINTERS (P) LTD.,CHENNAI vs. ACIT, CHENNAI
What did the Tribunal hold?
The Tribunal held that the disallowance under Section 14A should be restricted to the extent of the exempt income earned by the assessee. This decision was based on the precedent set by the Delhi High Court.
What were the facts?
The assessee, engaged in manufacturing and exporting security forms, faced a disallowance of Rs. 8,67,057 under Section 14A read with Rule 8D for the assessment year 2016-17. The assessee had earned only Rs. 10,200 as exempt income.
What were the issues?
The primary issue was whether the disallowance of expenses relatable to exempt income should exceed the amount of exempt income itself.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Cases cited in this judgment(1)Show listHide list
Detected automatically from the text. Citations are also linked where they appear in the judgment. The count shows how many other judgments on BharatTax rely on the same authority.
- Joint Investments Pvt. Ltd. v. CIT803 citing372 ITR 694 · 2015 · HC · Read judgment
Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI
Before: SHRI N.R.S. GANESAN & SHRI S. JAYARAMAN
PAN: AAGCM 0599K (अपीलाथ�/Appellant) (��यथ�/Respondent) अपीलाथ� क� ओर से/ Appellant by : Shri G. Baskar, Advocate ��यथ� क� ओर से /Respondent by : Shri AR.V. Sreenivasan, JCIT सुनवाई क� तार�ख/Date of Hearing : 25.11.2019 घोषणा क� तार�ख /Date of Pronouncement : 28.11.2019 आदेश / O R D E R PER SHRI S. JAYARAMAN, ACCOUNTANT MEMBER:
The assessee filed this appeal against the order of the Commissioner of Income Tax (Appeals)-8, Chennai in dated 25.07.2019 for the assessment year 2016-17.
M/s. Madras Security Printers Pvt. Ltd., is engaged in the business of manufacturing and exporting security forms, computer forms, postal envelops, labels, plastic and smart cards. While making the assessment for the assessment year 2016-17, the Assessing Officer invoked the jurisdiction U/s.14A r.w.r. 8D and made disallowance of Rs.8,67,057/- under Rule 8D(ii) & (iii), respectively. Aggrieved against that order, the assessee filed an appeal before the CIT(A). The ld.CIT(A) dismissed the appeal. Aggrieved against that order, the assessee filed this appeal.
The ld.AR pleaded that the assessee earned an exempt income of Rs.10,200/- only, on which the ld.AO made a disallowance of Rs.8,67,057/- which has been upheld by the ld.CIT(A). It was pleaded that the disallowance be restricted to the extent of dividend income earned by the assessee. Per contra, the ld.DR supported the orders of the lower authorities.
We heard the rival submissions and find merit in the assessee’s claim that the restriction of disallowance be restricted to the extent of dividend income as held by the Hon’ble Delhi High Court in the case of M/s. Joint Investments (P.) Ltd. vs. CIT (2015) 372 ITR 694 (Delhi). Therefore, we direct the Assessing Officer to restrict the disallowance to the extent of exempt income, in accordance with the above decision.
In the result, the assessee’s appeal is treated as partly allowed for statistical purposes.
Order pronounced in the Court on 28th November, 2019 in Chennai.
More judgments on Section 14A
- Blacksoil Capital Private Limited (As… vs DCIT, Circle-1(1), HyderabadITA 2217/HYD/2026[2017-18]Status: Disposed9 Oct 2026AY 2017-18
- Hiral Construction, Mumbai vs ITO Ward 42(1)(2), MumbaiITA 8431/MUM/2025[2017-18]Status: Disposed8 Oct 2026AY 2017-18
- The Dy DIT (It) 1(2), Mumbai vs M/S Citi Bank N.A, MumbaiITA 4981/MUM/2007[2002-2003]Status: Disposed8 Oct 2026AY 2002-2003
- M/S. Citi Bank N.A., Mumbai vs The Addl DIT (It) RG-1, MumbaiITA 4970/MUM/2007[2002-2003]Status: Disposed8 Oct 2026AY 2002-2003
- M/S American Express Bank Ltd., Mumbai vs The Jt DIT (It)1(1), MumbaiITA 9414/MUM/2004[2000-2001]Status: Disposed8 Oct 2026AY 2000-2001
Recent GST High Court judgments
Search GST case law →- Mahaveer Ispat Traders vs. Principal Commissioner Dgst Delhi Department Of Trade And Taxes Gnctd & Anr.Delhi · 28 Oct 2026
- Modern Engineers And Contractors vs. The Deputy Assistant Commissioner (St)Andhra Pradesh · 28 Oct 2026
- K Madhusudan Reddy vs. The State Of Andhra PradeshAndhra Pradesh · 28 Oct 2026
- Sandeep Ranjan Rout vs. The Commissioner Of CT And GST, Odisha, KatakOrissa · 28 Oct 2026
- Gagan Bihari Rout@Gagan Rout vs. State Of OdishaOrissa · 28 Oct 2026