SHRI ASHOK BAJPAI,INDORE vs. THE DCIT 1(1), INDORE
What did the Tribunal hold?
The Tribunal held that Section 14A disallowance is applicable only when there is exempt income earned. Since the investment was strategically made to earn professional income and no exempt income was received, the disallowance of interest expenses was deleted.
What were the facts?
The assessee, a practicing doctor, invested a significant amount in shares of a hospital company using a bank loan. The Assessing Officer disallowed interest expenses under Section 14A, considering the investment related to earning exempt income.
What were the issues?
Whether interest expenditure incurred on borrowed funds for investment in shares is disallowable under Section 14A when the investment is made for earning professional income and no exempt income is earned.
Which sections of the Income-tax Act were involved?
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Cases cited in this judgment(2)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.
- CIT v. Hero Cycles Ltd.470 citing323 ITR 518 · 2010 · HC · Read judgment
- Maxxop Investment Ltd. v. CIT8 citing27 SOT 22 · 2009 · ITAT
Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI C.M. GARG & SHRI O.P.MEENA
PER O.P. MEENA, AM.
This appeal filed by the Assessee is directed against the order of ld. Commissioner of Income-tax (Appeals)-I, Indore [in short referred to as the CIT (A)] dated 05.07.2016 pertaining to Assessment Year 2012-13. Shri Ashok Bajpai V DCIT-1(1), Indore ITA No.1035/Ind/2016 Assessment Year 2012-13 2. The Ground No.1 & 2 relates to disallowance of expenditure
of Rs. 10,75,968/- u/s 14A of the Act, read
The order continues below.
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