“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

Cognizant Technology Solutions India Private Limited, Chennai vs. The Assistant Commissioner of Income-Tax, Central Circle 1(1), Chennai

ITA 1206/CHNY/2024[2013-14]Status: DisposedITAT Chennai16 May 2025AY 2013-14

Bench: Shri Aby T Varkey, Hon’Ble & Shri S. R. Raghunatha, Hon’Ble

For Appellant: Shri N.V. Balaji, AdvocateFor Respondent: Shri R. Clement Ramesh Kumar, CIT

Section 10ASection 144ASection 14ASection 40Section 9(1)

No.1194/Chny/2024 for AY 2011-12 are as under: “The grounds of appeal listed below are without prejudice to each other. Issue No. 1 — Disallowance under section 14A of the Income-tax Act, 1961 (‘the Act’) computed as per Rule 8D of the Income-tax Rules, 1962 (‘the Rules ... appreciating the fact that the investments made in debt-oriented mutual funds shall not be considered for the purpose of computing disallowance under section 14A of the Act. 5. Without prejudice to the above, the learned CIT(A) has erred in facts and law in not appreciating that the provisions

Cognizant Technology Solutions India Private Limited, Chennai vs. The Assistant Commissioner of Income-Tax, Central Circle 1(1), Chennai

ITA 1205/CHNY/2024[2012-13]Status: DisposedITAT Chennai16 May 2025AY 2012-13

Bench: Shri Aby T Varkey, Hon’Ble & Shri S. R. Raghunatha, Hon’Ble

For Appellant: Shri N.V. Balaji, AdvocateFor Respondent: Shri R. Clement Ramesh Kumar, CIT

Section 10ASection 144ASection 14ASection 40Section 9(1)

Cognizant Technology Solutions India Private Limited, Chennai vs. The Assistant Commissioner of Income-Tax, Central Circle 1(1), Chennai

ITA 1194/CHNY/2024[2011-12]Status: DisposedITAT Chennai16 May 2025AY 2011-12

Bench: Shri Aby T Varkey, Hon’Ble & Shri S. R. Raghunatha, Hon’Ble

For Appellant: Shri N.V. Balaji, AdvocateFor Respondent: Shri R. Clement Ramesh Kumar, CIT

Section 10ASection 144ASection 14ASection 40Section 9(1)

Cognizant Technology Solutions India Private Limited, Chennai vs. The Assistant Commissioner of Income-Tax, Central Circle 1(1), Chennai

ITA 1193/CHNY/2024[2010-11]Status: DisposedITAT Chennai16 May 2025AY 2010-11

Bench: Shri Aby T Varkey, Hon’Ble & Shri S. R. Raghunatha, Hon’Bleआयकर अपील सं./Ita Nos.1193, 1194, 1205, 1206 & 1207/Chny/2024 ("नधा"रण वष" / Assessment Years: 2010-11, 2011-12, 2012-13, 2013-14 & 2014-15) Vs Cognizant Technology Solutions The Asst. Commissioner India Pvt. Ltd., Of Income Tax, No.5/535, Okkiam Thoraipakkam, Central Circle 1(1), Old Mahabalipuram Road, Chennai. Chennai – 600 096. Pan : Aaacd 3312M (अपीलाथ"/Appellant) (""यथ"/Respondent) & आयकर अपील सं./Ita Nos.1262, 1263, 1264, 1265 & 1266/Chny/2024 ("नधा"रण वष" / Assessment Years: 2010-11, 2011-12, 2012-13, 2013-14 & 2014-15) Vs The Asst. Commissioner Of Cognizant Technology Income Tax, Solutions India Pvt. Ltd., Central Circle 1(1), No.5/535, Okkiam Chennai. Thoraipakkam, Old Mahabalipuram Road, Chennai – 600 096. Pan : Aaacd 3312M (अपीलाथ"/Appellant) (""यथ"/Respondent)

For Appellant: Shri N.V. Balaji, AdvocateFor Respondent: Shri R. Clement Ramesh Kumar, CIT

Section 10ASection 14ASection 40Section 9(1)

No.1194/Chny/2024 for AY 2011-12 are as under: “The grounds of appeal listed below are without prejudice to each other. Issue No. 1 – Disallowance under section 14A of the Income-tax Act, 1961 (‘the Act’) computed as per Rule 8D of the Income-tax Rules, 1962 (‘the Rules ... appreciating the fact that the investments made in debt-oriented mutual funds shall not be considered for the purpose of computing disallowance under section 14A of the Act. 5. Without prejudice to the above, the learned CIT(A) has erred in facts and law in not appreciating that the provisions

Warden International Private Limited, Mumbai vs. Dy. Commissioner of Income Tax Circle 8(3)(2), Mumbai

Appeal of the assessee is allowed

ITA 1754/MUM/2025[2012-13]Status: DisposedITAT Mumbai16 May 2025AY 2012-13

Bench: Ms Padmavathy S, Am & Rahul Chaudhary, Jm

For Appellant: Shri Sukhsagar Syal / Atul SuraiyaFor Respondent: Shri Bhangepatil Pushkaraj

Section 10(34)Section 143(3)Section 144Section 14ASection 154Section 250

Income Tax Act, 1961 (the Act). The AO issued a show-cause notice to the assessee as to why the disallowance under section 14A r.w.r 8D should not be made in assessee's case. The assessee submitted that the expenses attributable to earning of exempt income to the tune ... before the CIT(A) that the investments made in subsidiaries are strategic investments and therefore cannot be considered for the purpose of making disallowance under section 14A of the Act. The assessee made a without prejudice submission that the assessee has not earned any exempt income from the investments made

Assistant Commissioner of Income Tax, Circle-25(1), New Delhi vs. Vic Enterprises Pvt. Ltd., Delhi

In the result, appeal of the Revenue is partly allowed

ITA 24/DEL/2024[2020-21]Status: DisposedITAT Delhi16 May 2025AY 2020-21

Bench: Shri Mahavir Singh & Shri Manish Agarwal

Section 14ASection 250

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “C” BENCH: NEW DELHI BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENT & SHRI MANISH AGARWAL

Assistant Commissioner of Income Tax, Circle Ltu-1, Chennai, Nungambakkam vs. Orient Green Power Company Limited, Chennai

In the result, appeal filed by the assessee is allowed

ITA 230/CHNY/2025[2014-15]Status: DisposedITAT Chennai15 May 2025AY 2014-15

Bench: Shri Manu Kumar Giri & Shri S.R.Raghunatha

For Appellant: Ms. Anitha, Addl.CITFor Respondent: Mr. Raghav Rajeev Menon

Section 143(3)Section 14ASection 92BSection 92C

92CA r.w.s 144C(1) on 29.01.2018 by making following additions:- i) Downward Adjustments suggested by the TPO of Rs.4,04,49,600/-. ii) Disallowance under section 14A of Rs.22,02,09,271/-. iii) Disallowance Pre-Operative expenses of Rs.76,67,347/-. iv) Addition Interest received on IT refund of Rs.18

M/S. Edelweiss Rural & Corporate Services Limited (As Sucessor of Edelweiss Capital Markets Limited ), Mumbai vs. Deputy Commissioner of Income Tax Circle -3(1)(2), Mumbai

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

ITA 1752/MUM/2025[2017-18]Status: DisposedITAT Mumbai15 May 2025AY 2017-18

Bench: Shir Vikram Singh Yadav & Shri Raj Kumar Chauhanm/S. Edelweiss Rural & Dcit Circle-3(1)(2), Corporate Services Limited R. No. 607, 6Th Floor, Aayakar (As A Success Of Edelweiss Capital Vs. Bhavan, Maharshi Karve Road, Markets Limited), Churchgate, Mumbai-400 020 14Th Floor, Edelweiss House, Off Cst Road, Kalina, Santacruz East, Mumbai – 400 098 Pan: Aacce5207G (Appellant) (Respondent)

Section 115JSection 143(2)Section 14ASection 250

earned for making the disallowance under Rule 8D(2)(ii) of the Rules. (e) In the alternative and without prejudice to the above, disallowance under section 14A of the Act is excessive and unreasonable. Accordingly, the Appellant prays that the order passed by the CIT(A) under section

Bio Med Pvt. Ltd., Ghaziabad vs. ACIT, Special Range, Ghaziabad

In the result, the appeal for assessment year 2014-15 filed by the assessee is partly allowed

ITA 184/DEL/2024[2016-17]Status: DisposedITAT Delhi13 May 2025AY 2016-17

Bench: Shri Mahavir Singh & Shri Manish Agarwal

For Appellant: Sh. Ved Jain, Adv., Sh. Aman Garg, CA &For Respondent: Sh. Om Prakash, Sr. DR

Section 14ASection 35

decided the same against the assessee by observing as under:- "8.1 There is specific Rule prescribed for working out the quantum of disallowance under section 14A of the Act. The appellant assessee has not worked out the disallowance under section 14A of the Act as per the income Tax Rules ... impugned order has held that the AO has recorded his dissatisfaction about the disallowance under section 14A of the Act. Hence, the Rule 8D comes into effect and the disallowance under section 14A of the Act has to be worked out accordingly. After careful consideration of facts of the case

Bio Med Pvt. Ltd, Ghaziabad vs. JCIT, Special Range, Ghaziabad

In the result, the appeal for assessment year 2014-15 filed by the assessee is partly allowed

ITA 183/DEL/2024[2014-15]Status: DisposedITAT Delhi13 May 2025AY 2014-15

Bench: Shri Mahavir Singh & Shri Manish Agarwal

For Appellant: Sh. Ved Jain, Adv., Sh. Aman Garg, CA &For Respondent: Sh. Om Prakash, Sr. DR

Section 14ASection 35

Gujarat State Financial Services Ltd., Ahmedabad vs. The Dy. CIT, Circle-2(1)(1), Ahmedabad

In the result, appeal of the assessee is allowed in part

ITA 1226/AHD/2024[2020-21]Status: DisposedITAT Ahmedabad09 May 2025AY 2020-21

Bench: Shri T.R. Senthil Kumar & Shri Narendra Prasad Sinhaassessment Year: 2020-21

Section 135(5)Section 143(3)Section 14ASection 37Section 80GSection 80G(2)(a)

crores under Section 14A of the Act, in response to which the assessee had furnished a detailed explanation. The assessee had reworked the disallowance under Section 14A of the Act at Rs.98,872/- only and accordingly requested the Assessing Officer to restrict the disallowance to this amount. As an alternate ... plea, the assessee had submitted that the disallowance under Section 14A may be restricted to Rs.1,09,000/- applying the ratio of equity share investment to total asset, to the administrative cost of Rs.3.02 Crores. The Assessing Officer, however, rejected the alternate pleas of A.Y. 2020-21 Gujarat State Financial

DCIT-C-6(2), Mumbai vs. Samira Habitats India Limited, Mumbai

In the result, the cross-objection by the assessee for the assessment year 2012-13 is dismissed

ITA 5714/MUM/2024[2012-13]Status: DisposedITAT Mumbai09 May 2025AY 2012-13

Bench: Shri Narendra Kumar Billaiyashri Sandeep Singh Karhailita No.5714/Mum/2024 Assessment Year : 2011-12 Assessment Year : 2012-13 Assessment Year : 2009-10

For Appellant: Shri Rakesh JoshiFor Respondent: Dr. Kishor Dhule, CIT-DR

Section 132(4)Section 250

raised in Revenue’s appeal is allowed. 41. The issue arising in Ground No. (xi), raised in Revenue’s appeal, pertains to disallowance under section 14A read with Rule 8D of the Income Tax Rules, 1962 (“the Rules”). ITA No.5709, 5710, 5714/Mum/2024 & CO No.11, 12 & 13/Mum/2025 28 42. The brief ... profit and loss account, however, no expenditure has been treated as attributable to the earning of exempt income by the assessee, and no disallowance under section 14A of the Act has been made. Accordingly, the assessee was asked to show cause as to why the disallowance under section 14A

DCIT-C-6(2), Mumbai vs. Samira Habitats, Mumbai

In the result, the appeal by the Revenue for the

ITA 5710/MUM/2024[2009-10]Status: DisposedITAT Mumbai09 May 2025AY 2009-10

Bench: Shri Narendra Kumar Billaiyashri Sandeep Singh Karhail

For Appellant: Shri Rakesh JoshiFor Respondent: Dr. Kishor Dhule, CIT-DR

Section 132(4)Section 250

raised in Revenue's appeal is allowed. 41. The issue arising in Ground No. (xi), raised in Revenue's appeal, pertains to disallowance under Section 14A read with Rule 8D of the Income Tax Rules, 1962 (“the Rules”). 42. The brief facts of the case are that during the assessment ... profit and loss account, however, no expenditure has been treated as attributable to the earning of exempt income by the assessee, and no disallowance under Section 14A of the Act has been made. Accordingly, the assessee was asked to show cause as to why the disallowance under Section 14A

DCIT-C-6(2), Mumbai vs. Samira Habitats India Limited, Mumbai

In the result, the appeal by the Revenue for the

ITA 5709/MUM/2024[2011-12]Status: DisposedITAT Mumbai09 May 2025AY 2011-12

Bench: Shri Narendra Kumar Billaiyashri Sandeep Singh Karhail

For Appellant: Shri Rakesh JoshiFor Respondent: Dr. Kishor Dhule, CIT-DR

Section 132(4)Section 250

raised in Revenue's appeal is allowed. 41. The issue arising in Ground No. (xi), raised in Revenue's appeal, pertains to disallowance under section 14A read with Rule 8D of the Income Tax Rules, 1962 (“the Rules”). 42. The brief facts of the case are that during the assessment ... profit and loss account, however, no expenditure has been treated as attributable to the earning of exempt income by the assessee, and no disallowance under section 14A of the Act has been made. Accordingly, the assessee was asked to show cause as to why the disallowance under section 14A

Cera Sanitaryware Limited, Ahmedabad vs. The DCIT, Circle-1(1)(1), Ahmedabad

In the result, the appeal filed by the Assessee is allowed

ITA 1334/AHD/2024[2022-23]Status: DisposedITAT Ahmedabad08 May 2025AY 2022-23

Bench: Smt. Annapurna Gupta (Accountant Member), Shri T.R. Senthil Kumar (Judicial Member)

Section 142(1)Section 143(3)Section 14A

such investment yielding exempt income. As there is no interest-bearing fund involved in making such an investment, the question of making any disallowance under section 14A r.w. Rule 8D does not arise. 3. Regarding administrative expenses, the assessee identified on a scientific basis, certain expenditures, which can be attributed ... follows: I.T.A No. 1334/Ahd/2024 A.Y. 2022-23 Page No 4 Cera Sanitaryware Ltd. vs. DCIT Cera Sanitaryware Limited Assessment Year 2022-23 Disallowance under section 14A Particulars Amount (Rs) Employee Cost 3,62,625 Depreciation 19.433 Cost + Dep)] 95,514.40 Other overheads [25% of (Emp. Total 4,77,572 Employees

Atul Limited, Ahmedabad vs. The ACIT, Circle-1(1)(1), Ahmedabad

In the result, the appeal is partly allowed

ITA 38/AHD/2023[2017-18]Status: DisposedITAT Ahmedabad08 May 2025AY 2017-18

Bench: S/Shri T.R. Senthil Kumar & Makarand V.Mahadeokarasstt.Year : 2017-18 Atul Limited Acit, Cir.1(1)(1) Atul House, Gi Patel Mark Vs Ahmedabad. Mithila Society, Ahmedabad. Pan : Aabca 2390 M (Applicant) (Responent) Assessee By : Shri Bandish Soparkar, Ar : Shri Prathvi Raj Meena, Cit-Dr Revenue By सुनवाई क" तारीख/Date Of Hearing : 01/05/2025 घोषणा क" तारीख /Date Of Pronouncement: 08/05/2025 आदेश/O R D E R आदेश आदेश आदेश

For Appellant: Shri Bandish Soparkar, AR

Section 115JSection 143(3)Section 144CSection 144C(13)Section 144C(5)Section 14ASection 35Section 40Section 9(1)(vii)Section 92C

other grounds of appeal. Accordingly, this ground is rendered academic and requires no separate adjudication. Ground Nos. 2(a) to 2(d): Disallowance under section 14A r.w. Rule 8D and addition to book profits under section 115JB 8. The assessee has challenged the action of the Assessing Officer ... before the lower authorities. The AR submitted that the Assessing Officer as well as the DRP erred in invoking Rule 8D to compute disallowance under section 14A without recording any dissatisfaction with the method of computation adopted by the assessee. The assessee had voluntarily made a disallowance of Rs.8

ITO 1(2)(3), Mumbai vs. Mangalam Drugs & Organics Ltd, Mumbai

Appeal of the revenue is dismissed

ITA 5279/MUM/2015[2011-12]Status: DisposedITAT Mumbai08 May 2025AY 2011-12

Bench: Shri Saktijit Dey, Vp & Ms Padmavathy S, Am

For Appellant: Shri V.K. Tulsian, ARFor Respondent: Shri Rakesh Ranjan- Sr. DR

Section 133(6)Section 14ASection 250

account of bogus purchase -Rs. 37,84,29,954/- (ii) Addition on account of excess depreciation claimed -Rs. 51,80,357/- (iii) Disallowance under section 14A -Rs. 99,248/- 3. Aggrieved the assessee filed further appeal before the CIT(A). The CIT(A) gave partial relief to the assessee ... deleting the additions made towards bogus purchases and by confirming the addition made by the AO towards excess depreciation and disallowance under section 14A of the Act. The revenue is in appeal before the Tribunal against the relief given by the CIT(A) towards bogus purchases. 4. The brief facts

Assotech Moonshine Urban Developers P.Ltd, New Delhi vs. ACIT, Circle-1(1), New Delhi

In the result, the appeal of the assessee is allowed

ITA 2524/DEL/2022[2014-15]Status: DisposedITAT Delhi08 May 2025AY 2014-15

Bench: Shri Challa Nagendra Prasad & Shri Avdhesh Kumar Mishra

Section 142(1)Section 143(3)Section 147Section 14ASection 263

Officer (AO) to pass assessment 2 Micromax Informatics Ltd. order afresh after examining the issues of taxability of interest income on FDRs and disallowance under section 14A of the Act. 4. At the outset, the Ld. Authorized Representative (AR) submitted that the AO, in pursuance of the impugned order passed ... Rs.16,18,16,439/- on FDRs was not justified. 3 Micromax Informatics Ltd. 5. The second issue is in respect of the disallowance under section 14A of the Act. The Ld. AR, drawing our attention to the question No. 09 to the notice issued under section

Shyam Sunder Gupta, Kanpur vs. Dy. Commissioner of Income Tax-1, Kanpur

ITA 168/LKW/2017[2012-13]Status: DisposedITAT Lucknow06 May 2025AY 2012-13

Bench: Shri Kul Bharat & Shri Nikhil Choudhary

For Appellant: Respondent byFor Respondent: Date of hearing

Section 150Section 150(1)Section 153(3)(ii)Section 2(22)(e)Section 251(2)Section 41(1)

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH “A”, LUCKNOW BEFORE SHRI KUL BHARAT, VICE PRESIDENT AND SHRI NIKHIL CHOUDHARY

Chimanlal Maneklal Securities Private Limited, Mumbai vs. Income Tax Officer, Aayakar Bhawan, Mumbai

In the result, appeal of the assessee is partly allowed

ITA 127/MUM/2025[2016-17]Status: DisposedITAT Mumbai06 May 2025AY 2016-17

Bench: Shri Narender Kumar Choudhry & Shri Prabhash Shankar

For Appellant: Shri Om Kandalkar,ARFor Respondent: Shri Kiran Unavekar, (Sr. DR)

Section 10(34)Section 115JSection 143(3)Section 14A

regarding the disallowance of Rs.19,94,087/- under Section 14A to the book profits calculated under Section 115JB. The appellant contends that the disallowance under Section 14A cannot be included in the computation of book profits, and the said addition is erroneous and should be deleted. 3. Brief facts