“disallowance under section 14A”

DisallowancesSection 14ASection 14A2,288 judgments

The decision most relied on for disallowance under section 14A is CIT v. Reliance Petroproducts Pvt. Ltd. (322 ITR 158), cited in 2,228 judgments on BharatTax.

Leading authorities on disallowance under section 14A

CIT v. Reliance Petroproducts Pvt. Ltd.

322 ITR 158 · 2010 · Supreme Court

2,228

citing judgments

Penalty under Section 271(1)(c) for furnishing inaccurate particulars or concealment of income is not automatically leviable if the assessee has made a full disclosure of all particulars and the addition or disallowance arises from a difference of opinion.

CIT v. Reliance Utilities & Power Ltd.

313 ITR 340 · 2009 · High Court

2,118

citing judgments

Where an assessee claims that investments were made out of own funds, interest disallowance under Section 14A read with Rule 8D may not apply if the assessee demonstrates the availability of sufficient interest-free funds to cover such investments.

Maxopp Investment Ltd. v. CIT

402 ITR 640 · 2018 · Supreme Court

1,596

citing judgments

Disallowance under Section 14A is not automatic and requires the Assessing Officer to record satisfaction before applying Rule 8D. Only investments yielding exempt income are considered for disallowance, irrespective of their strategic nature.

Cheminvest Ltd. v. CIT

378 ITR 33 · 2015 · High Court

1,569

citing judgments

A disallowance under Section 14A of the Income-tax Act, 1961, for expenditure incurred in relation to exempt income cannot be made if the assessee has not earned any exempt income during the relevant previous year.

S.A. Builders Ltd. v. CIT

288 ITR 1 · 2007 · Supreme Court

1,484

citing judgments

Interest paid on borrowed funds cannot be disallowed merely because the assessee made interest-free advances, provided those advances were made for business purposes and commercial expediency. The Revenue cannot dictate a businessman's commercial decisions, but the assessee bears the onus to prove the business expediency.

CIT v. HDFC Bank Ltd.

366 ITR 505 · 2014 · High Court

1,261

citing judgments

When an assessee possesses interest-free funds sufficient to cover investments yielding tax-free income, it is presumed that such investments were made from these interest-free funds, precluding disallowance of interest expenditure under Section 14A.

Godrej & Boyce Mfg. Co. Ltd. v. DCIT

328 ITR 81 · 2010 · High Court

1,183

citing judgments

Rule 8D, for computing disallowance under Section 14A for expenses related to exempt income, applies from Assessment Year 2008-09 onwards; for prior years, a reasonable disallowance must be made. The disallowance under Section 14A cannot exceed the actual exempt income earned.

ACIT v. Vireet Investment Pvt. Ltd.

165 ITD 27 · 2017 · ITAT

882

citing judgments

No disallowance under section 14A can be made while computing book profits under section 115JB unless the expenditure is debited to the profit and loss account and satisfies clause (f) of Explanation 1 to section 115JB(2).

Judgments citing disallowance under section 14A

Capgemini India P.Ltd, Bhiwandi vs. DCIT Cir 10(2), Mumbai

In the result ground number 12 of the appeal of the assessee is allowed with above directions

ITA 4727/MUM/2016[2010-11]Status: DisposedITAT Mumbai12 May 2022AY 2010-11

Bench: Shri Vikas Awasthy, Jm & Shri Prashant Maharishi, Am Capgemini India Pvt. Ltd. The Dy. Commissioner Of C/O Kalyaniwalla & Mistry, Income Tax, Army & Navy Bldg, Circle 10(2), 3Rd Floor, R. No. 475, Vs. 148, M.G. Road, Ayakar Bhavan, Fort, M.K. Road, Mumbai-400 001 Mumbai-400 020 (Appellant) (Respondent) Pan No. Aaack2632B Appellant By : Shri M M Golvala, Ar Respondent By : Ms. Vatsalaa Jha, Cit Dr Date Of Hearing: 15.02.2022 Date Of Pronouncement : 12.05.2022

For Appellant: Shri M M Golvala, ARFor Respondent: Ms. Vatsalaa Jha, CIT DR

Section 10ASection 1O

Officer over and above the transfer pricing adjustment made following additions; i. Disallowance out of leave encashment expenditure of ₹4,69,170/-. ii. Disallowance under section 14A of the Act of ₹8,54,430/- Capgemini India P. Ltd; AY 10-11 iii. Addition on account of government grant ... against the claim made by the assessee of ₹323,04,97,000/-. vi. Book profit of the assessee was also enhanced by disallowance under section 14A of the Act of ₹ 8,54,430/-. 010. The assessee aggrieved with the above order-preferred appeal before the learned CIT (A), who passed

M/S. Subhkam Ventures (India), Mumbai vs. Deputy Commissioner of Income Tax, Circle-1(3)(1), Mumbai

Appeal is partly allowed

ITA 5298/MUM/2019[2015-16]Status: DisposedITAT Mumbai11 May 2022AY 2015-16

For Appellant: Shri Sanjay Parikh

Section 143(3)Section 14A

contentions of the Ld. A.R. that investments in growth funds are not includible while computing the average investments for calculating the disallowance under section 14A as no dividend is declared in case of growth funds and whatever gain is made that is taxable under the Act. Similarly, the dividend received

M/S. Wellknown Technologies P. Ltd., Mumbai vs. Dy CIT, CC-7(4), Mumbai

In the result, appeal by the assessee is allowed

ITA 1342/MUM/2021[2015-16]Status: DisposedITAT Mumbai06 May 2022AY 2015-16

Bench: Shri Prashant Maharishi & Shri Sandeep Singh Karhail

For Appellant: Ms. Vinita ShahFor Respondent: Shri Hoshang B. Irani

Section 10Section 10(34)Section 143(3)Section 14ASection 250

course of assessment proceedings, the assessee was asked to furnish the details of investments and also to show cause as to why the disallowance under section 14A should not be made in accordance with the provisions of Rule 8D of the Income Tax Rules, 1962 (“the Rules”). In reply ... assessee submitted that the only eligible investment to be considered for working out the disallowance under section 14A of the Act would be the investment held by the assessee company in equity shares. The assessee, without prejudice, also submitted that the disallowance under no circumstance can exceed the total claim

DCIT 6(2)(1), Mumbai vs. M/S Charak Pharma P. Ltd, Mumbai

In the result, findings of the Ld

ITA 3602/MUM/2019[2014-15]Status: DisposedITAT Mumbai29 Apr 2022AY 2014-15

Bench: Shri Amarjit Singh, Hon'Ble & Shri S. Rifaur Rahman, Hon'Ble

For Appellant: Shri Manish ShahFor Respondent: Shri R.A. Dhyani

Section 80Section 80I

erred in disallowing deduction u/s. 35(2AB) of the Act amounting to ₹.1,2,35,000/ Ground No.6 Disallowance under section 14A of the Act amounting to ₹.40,993/- On the facts and circumstances of the case and in law, the AO erred in disallowing a total

ACIT Circle -7 (3)(1), Mumbai vs. Pancard Clubs Ltd., Mumbai

ITA 2774/MUM/2018[2015-16]Status: DisposedITAT Mumbai29 Apr 2022AY 2015-16

Bench: Shri Kuldip Singh & Shri Om Prakash Kant

For Appellant: NoneFor Respondent: Shri Jasdeep Singh, D.R

Section 14A

respectively, which were challenged before the Ld. CIT(A) on the ground that the AO while making disallowance under section 14A of the Act considered all M/s. Pancard Clubs Ltd. the investments instead of restricting the calculation to the investment which has yielded exempt income. 6. At the same time ... accordance with the settled principle of law that only “exempt income yielding investments are to be taken for the purpose of making disallowance under section 14A of the Act and not all the investments made by the assessee” during the year under assessment. This issue has already been decided

ACIT 7(3)(1), Mumbai vs. Pancard Clubs Ltd., Mumbai

ITA 2773/MUM/2018[2010-11]Status: DisposedITAT Mumbai29 Apr 2022AY 2010-11

Bench: Shri Kuldip Singh & Shri Om Prakash Kant

For Appellant: NoneFor Respondent: Shri Jasdeep Singh, D.R

Section 14A

ACIT 6(2)(1), Mumbai vs. Charak Pharma P.Ltd, Mumbai

In the result, findings of the Ld

ITA 5545/MUM/2017[2013-14]Status: DisposedITAT Mumbai29 Apr 2022AY 2013-14

Bench: Shri Amarjit Singh, Hon'Ble & Shri S. Rifaur Rahman, Hon'Ble

For Appellant: Shri Manish ShahFor Respondent: Shri R.A. Dhyani

Section 80Section 80I

DCIT 6(2)(1), Mumbai vs. Charak Pharma P.Ltd, Mumbai

In the result, findings of the Ld

ITA 6365/MUM/2016[2012-13]Status: DisposedITAT Mumbai29 Apr 2022AY 2012-13

Bench: Shri Amarjit Singh, Hon'Ble & Shri S. Rifaur Rahman, Hon'Ble

For Appellant: Shri Manish ShahFor Respondent: Shri R.A. Dhyani

Section 80Section 80I

Orbit Corporation Ltd, Mumbai vs. DCIT Cen Cir 47, Mumbai

ITA 2979/MUM/2013[2008-09]Status: DisposedITAT Mumbai29 Apr 2022AY 2008-09

Bench: Shri Kuldip Singh & Shri Om Prakash Kant

For Appellant: NoneFor Respondent: Shri Jasdeep Singh, CIT D.R

Section 132(1)Section 143(3)Section 14ASection 153ASection 80I

assessee the AO made addition on account of bogus M/s. Orbit Corporation Ltd. expenses, on account of 80IB projects and on account of disallowance under section 14A of the Act and thereby framed the assessment at Rs.2,17,42,68,640/-, Rs.68,50,73,400/- & Rs.60

Larsen & Toubro Ltd, Mumbai vs. DCIT 2(2), Mumbai

In the result, appeals filed by the assessee are partly allowed and the appeals filed by the Revenue are dismissed

ITA 6908/MUM/2012[2001-02]Status: DisposedITAT Mumbai29 Apr 2022AY 2001-02

Bench: Shri S.Rifaur Rahman () & Shri Amarjit Singh ()

ordinate bench of this Tribunal, we allow the ground raised by the assessee. 24. Ground 6 in assessee’s appeal pertains to disallowance under section 14A of Rs.11,13,00,000/- solely on account of interest. 25. Upon hearing the parties, we find the identical ground has been decided ... Consistent with the earlier decision of the co-ordinate bench, we allow ground 10 of the assessee. 38. Ground 11 pertains to disallowance under section 14A for the purpose of computing book profit under section 115JB. 39. Upon hearing the parties, we find that this issue is identical

Mr. Manoharlal Tandon, Mumbai vs. ACIT_9(1)(1), Mumbai

In the result the appeal filed by the assessee is allowed for statistical purposes

ITA 5334/MUM/2019[2016-17]Status: DisposedITAT Mumbai28 Apr 2022AY 2016-17

Bench: Shri Pavan Kumar Gadale & Shri Gagan Goyalmr. Manoharlal Tandon Vs. Acit – 9(1)(1) Plot No.35 (Pr), C-2, Aayakar Bhavan, Tandon Beach House, M.K.Road, Azad Road, Santacruz (W) Mumbai-400020 Mumbai-400049 Pan/Gir No. : Aaapt2929F Appellant .. Respondent Appellant By : Dr. K Shivram.Ar Respondent By : Mr.T. Shankar.Dr Date Of Hearing 13.04.2022 Date Of Pronouncement 25.04.2022 आदेश / O R D E R Per Pavan Kumar Gadale Jm: The Assessee Has Filed The Appeal Against The Order Of The Commissioner Of Income Tax (Appeals)-16, Thane Passed U/S 143(3) & 250 Of The Act. The Assessee Has Filed The Following Grounds Of Appeal:

For Appellant: Dr. K Shivram.ARFor Respondent: Mr.T. Shankar.DR

Section 10(34)Section 14Section 143(1)Section 143(2)Section 143(3)Section 14ASection 94(7)

Appeals)-16, Thane passed u/s 143(3) and 250 of the Act. The assessee has filed the following grounds of appeal: 1. Disallowance under section 14A read with Rule 8D on securities are held stock in trade 1.1 On the facts and circumstances of the case

Hindustan Dorr-Oliver Ltd, Mumbai vs. ACIT-10(1)(1), Mumbai

The appeal is dismissed

ITA 7116/MUM/2017[2013-14]Status: DisposedITAT Mumbai28 Apr 2022AY 2013-14

Bench: Shri Prashant Maharishi, Am & Shri Rahul Chaudhary, Jm The Asst. Commissioner Of Hindustan Dorr-Oliver Ltd. Income Tax, 10(1)(1), Chakala, Andheri (E), R.No.209, Vs. Mumbai-400 009 Aayakar Bhavan, M.K. Road, Mumbai-400 020 (Appellant) (Respondent) Pan No. Aaach0964P

For Appellant: NoneFor Respondent: Shri Dr. Yogesh Kamat, CIT DR

Section 143(3)Section 144C(13)Section 40A(2)Section 40A(2)(b)Section 92(2)Section 92BSection 92C

assessee that why disallowance u/s 14 A of the act read with rule 8D should not be made. Assessee submitted of working of disallowance under section 14A of the act of Rs. 69,53,433/- under Rule 8D(2)(iii) of the income Tax Rules, 1962 (the Rules). The learned ... interest expenditure of Rs. 5,84,880/- over and above other disallowance of administrative expenses of Rs. 69,53,433/- and worked out disallowance under section 14A of the Act of Rs. 6,53,54,313/-. Accordingly, the total income was computed at a loss

Godrej Consumer Products Ltd, Mumbai vs. DCIT Cir 14(1)(1), Mumbai

In the result, the appeal filed by the assessee is partly allowed for statistical purposes

ITA 1579/MUM/2017[2012-13]Status: DisposedITAT Mumbai28 Apr 2022AY 2012-13

Bench: Shri Pramod Kumar & Shri Pavan Kumar Gadalegodrej Consumer Vs. Dcit, Cc-14(1)(1) Products Ltd., Aayakar Bhavan, Kalyaniwalla & Mistry 4Th Floor, Mk Road, Llp, Esplanade House, Mumbai-400020. 2Nd Floor, 29, Hazarimal Somani Marg, Fort, Mumbai – 400 001. "थायी लेखा सं./जीआइआर सं./Pan/Gir No.: Aabcg3365J Appellant .. Respondent Appellant By : Mr.Farrokh.V. Irani.Ar Respondent By : Dr.Yogesh Kamat. Cit Dr & Mr.Satya Pinisetty.Dr Date Of Hearing 27.01.2022 Date Of Pronouncement 05.04.2022 आदेश / O R D E R Per Pavan Kumar Gadale Jm: The Assessee Has Filed The Appeal Against The Order U/S 143(3) R.W.S 144(C)(13) Of The Income Tax Act, 1961 Passed In Pursuance To Directions Of The Drp.The Assessee Has Raised The Following Grounds Of Appeal.

For Appellant: Mr.Farrokh.V. Irani.ARFor Respondent: Dr.Yogesh Kamat. CIT DR

Section 1Section 115Section 143(3)Section 14ASection 36(1)(iii)Section 801CSection 80ISection 921

case of the Appellant. 4. The learned Dispute Resolution Panel erred in confirming the action of the Assessing Officer in making a disallowance under Section 14A of the Act in the absence of exempt income. 5. The learned Dispute Resolution Panel erred in holding that the interest expenditure on borrowings ... India. In our considered opinion, if in the year under consideration the assessee has not earned any exempt income, no disallowance under section 14A r/w rule 8D can be made. Therefore, the Assessing Officer is directed to delete the disallowance after verifying assessee’s claim. Even otherwise also

Sansera Engineering Limited (Formerly Known As Sansera Engineering Private Limited), Bangalore vs. Commissioner of Income Tax(Appeals)- 14, Bangalore

ITA 132/BANG/2021[2009-10]Status: DisposedITAT Bangalore27 Apr 2022AY 2009-10

Bench: Shri N. V. Vasudevan & Ms. Padmavathy Sassessment Year : 2009-10 M/S. Sansera Engineering Ltd., Cit(A) - 14, Vs. 143/A, Jigani Link Road, Bengaluru. Bommasandra Industrial Estate, Bommasandra Post, Bengaluru – 560 105. Pan : Aaecs 2440 M Appellant Respondent

For Appellant: Shri. Bharath L, CAFor Respondent: Shri. Priyadarshini Mishra, Addl. CIT(DR)(ITAT), Bengaluru

Section 143(3)Section 14A

Tribunal by its order Page 2 of 4 dated 10.12.2014 set aside the order of the CIT(A) and remanded the issue of disallowance under section 14A of the Act for fresh consideration by the AO. 3. In the set aside proceedings the AO passed an order dated ... which he accepted that there was no necessity for making any disallowance under section 14A of the Act r.w.r. 8D(2)(ii) of the Rules. He however made a disallowance of other expenses under Rule 8D(2)(iii) of the Act of a sum of Rs.11,72,052/-. The assessee

Wanbury Limited, Mumbai vs. DCIT 15 (3)(1), Mumbai

In the result, appeal of the assessee is allowed

ITA 2587/MUM/2019[2015-16]Status: DisposedITAT Mumbai25 Apr 2022AY 2015-16

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm Wanbury Limited The Dy. Commissioner Of 10Th Floor, Sector 30A, Income Tax, Bsel Tech Park B Wing Circle 15(3)(1), Vs. Opp Vashi Rly Station R.No. 451 Aayakar Bhavan Vashi, New Marine Lines, Mumbai-400075 Mumbai-400 020 (Appellant) (Respondent) Pan No. Aabcp5939P

For Appellant: ShriFor Respondent: Shri Hoshang B. Irani, DR

Section 14Section 143Section 14ASection 154Section 36Section 36(1)(iii)

proportion of average loan advanced to four unrelated parties to the average value of total assets for AY 2015-16. 2. Disallowance under Section 14A of the Act 2.1 On the facts and circumstances of the case, the Ld. CIT(A) has erred in upholding disallowance ... order u/s 154 of the act retained this disallowance. The learned CIT – A also confirmed the same. 014. On the issue of disallowance under section 14A of the Act, learned AR submitted that assessee has not earned any exempt income and further has categorically submitted that it has not incurred

Tmf Holding Ltd., Mumbai vs. Pr. CIT -1, Mumbai

ITA 1628/MUM/2020[2015-16]Status: DisposedITAT Mumbai22 Apr 2022AY 2015-16

Bench: Shri S. Rifaur Rahman, Hon'Ble & Shri Pavan Kumar Gadale, Hon'Bletmf Holdings Ltd., V. Pr.Cit – 1 {Formerly Known As Tata Motors Finance Ltd.,} 3Rd Floor, Room No. 330 10Th Floor, 106 A & B Aayakar Bhavan, M.K. Road Maker Chamber-Iii Mumbai - 400020 Nariman Point, Mumbai Pan: Aacct4644A (Appellant) (Respondent) Shri Nikhil Tiwari Assessee By : Department By : Shri S.N. Kabra

For Appellant: Department byFor Respondent: Shri S.N. Kabra

Section 115JSection 143(3)Section 14ASection 263Section 47

accepted by the Assessing Officer that no 14A of the Act is warranted; 16. erred in directing the Assessing Officer to compute disallowance under section 14A of the Act, without appreciating that the appellant had not earned any exempt income during the year and hence no disallowance under section 14A ... Holdings Ltd., sold during the year of State Bank of India which was duly offered to capital gains tax, and hence no disallowance under section 14A is warranted; 18. without prejudice to the above, erred in directing Assessing Officer to make disallowance of expenditure under section 14A

Dy CIT CC-2(3), Mumbai vs. Gauri Avinash Bhosale, Mumbai

In the result, all the three appeals filed by the learned Assessing

ITA 122/MUM/2021[2012-13]Status: DisposedITAT Mumbai19 Apr 2022AY 2012-13

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm

For Appellant: Shri Vijay Mehta, ARFor Respondent: Shri Jasbir Chouhan, CIT DR

Section 10(38)Section 132Section 143Section 143(3)Section 14ASection 153A

proceedings could not have been made by the learned Assessing Officer in 153A proceeding. Same are the facts with respect to the disallowance under section 14A of the Act. ITA No.122 & Ors./Mum/2021 Gauri Avinash Bhosale; AY 12-13 Accordingly, grounds no. 1 & 2 of the appeal of the learned ... Income Tax Act, 1962. 2. Whether on the fact and circumstances of the case the Ld. CIT(A) erred in restricting the disallowance under section 14A to exempt income earned without appreciating the fact that circular no. 5 of 2014 dated 11th February, 2014, issued by the Central Board

DCIT 13(3)(1), Mumbai vs. M/S Wall Street Finance Ltd, Mumbai

In the result, appeal by the Revenue is dismissed

ITA 2175/MUM/2019[2014-15]Status: DisposedITAT Mumbai19 Apr 2022AY 2014-15

Bench: Shri Prashant Maharishi & Shri Sandeep Singh Karhail

For Appellant: Shri Madhur AgrawalFor Respondent: Shri Hoshang B. Irani

Section 143(3)Section 14ASection 2Section 250Section 50Section 54E

raised in Revenue’s appeal is dismissed. 14. The issue arising in ground no.2, raised in Revenue’s appeal is with regard to disallowance under section 14A r/w rule 8D of the I.T. Rules, 1962 (“the Rules”). Wall Street Finance Ltd. ITA No.2175/Mum./2019 15. The brief facts ... well as the details of expenditure incurred or attributable for earning the same. In reply, the assessee submitted the working of suo– motu disallowance under section 14A of the Act at Rs.64,315. The Assessing Officer vide order dated 28.12.2016, did not agree with the submissions of the assessee

Deputy Commissioner of Income Tax-14(2)(1), Mumbai vs. Infrastructure Leasing and Financial Services Limited, Mumbai

In the result, both, assessee’s appeal and revenue’s appeal are partly allowed for statistical purpose

ITA 4515/MUM/2017[2012-13]Status: DisposedITAT Mumbai19 Apr 2022AY 2012-13

Bench: Shri Vikas Awasthy () & S. Rifaur Rahman ()

Section 143(1)Section 143(3)Section 14A

line with the earlier directions of the Tribunal. This ground is allowed, for statistical purpose. 13. Grounds 4 to 7 pertain to disallowance under section 14A read with rule 8D of I.T. Rules, 1962. 14. Heard rival submissions. The Ld.AR of the assessee submitted that this Tribunal, for the assessment

Infrastructure Leasing & Financial Services Ltd, Mumbai vs. DCIT 14(2)(1), Mumbai

In the result, both, assessee’s appeal and revenue’s appeal are partly allowed for statistical purpose

ITA 4448/MUM/2017[2012-13]Status: DisposedITAT Mumbai19 Apr 2022AY 2012-13

Bench: Shri Vikas Awasthy () & S. Rifaur Rahman ()

Section 143(1)Section 143(3)Section 14A