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“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

DCIT-2(3)(1), Mumbai vs. Kotak Mahindra Bank Ltd, Mumbai

In the result, **appeal of the Revenue is dismissed

ITA 4103/MUM/2023[2019-20]Status: DisposedITAT Mumbai07 Jan 2025AY 2019-20

Bench: Shri Sandeep Gosain & Shri Prabhash Shankar**

Section 143(3)Section 144BSection 41(1)

admitted for adjudication. - 14.1 In various interrelated grounds, it is contented that *NFAC erred in not adjudicating all the grounds relating to disallowance under section 14A of the Act, 1961 read with Rule 8D(2)(ii) of the Rulesand summarily partly allowed this ground by directing the Assessing Officer ... finding/ satisfaction that the claim of assessee regarding expenditure incurred in relation to exempt income is incorrect, that he can compute the disallowance under Section 14A as per the provisions of Rule 8D. 15.1 It may be stated here that the Hon'ble Supreme Court of India in the case

Kotak Mahindra Bank Limited, Mumbai vs. DCIT-3(2)(2), Assessment Unit, Income Tax Dept, Mumbai

In the result, appeal of the Revenue is dismissed

ITA 3754/MUM/2023[2019-20]Status: DisposedITAT Mumbai07 Jan 2025AY 2019-20

Bench: Shri Sandeep Gosain & Shri Prabhash Shankar

For Appellant: Shri Madhur Agrawal a/w Shri Bhargav ParekhFor Respondent: Shri Biswanath Das (CIT DR)
Section 143(3)Section 144BSection 41(1)

admitted for adjudication. 14.1 In various interrelated grounds, it is contented that NFAC erred in not adjudicating all the grounds relating to disallowance under section 14A of the Act, 1961 read with Rule 8D(2)(ii) of the Rulesand summarily partly allowed this ground by directing the Assessing Officer ... finding/ satisfaction that the claim of assessee regarding expenditure incurred in relation to exempt income is incorrect, that he can compute the disallowance under Section 14A as per the provisions of Rule 8D. 15.1 It may be stated here that the Hon'ble Supreme Court of India in the case

Shree Chandi Maa Mahakali Prachin Mandir Sidh Peeth Samiti, Sonipat vs. CPC, Banglore

ITA 4791/DEL/2024[2022-23]Status: DisposedITAT Delhi07 Jan 2025AY 2022-23

Bench: Shri Prakash Chand Yadav & Shri Brajesh Kumar Singh

For Appellant: Shri Ajay Vohra, Sr. A.RFor Respondent: Shri Bhopal Singh, Sr. D.R
Section 92C

ITA Nos.4859/Del/2009; ITA Nos.157 to 159, 4791, 4856 & 5358/Del/2010 & ITA No.2539/Del/2017 Gujarat Guardian Ltd., New Delhi IN THE INCOME TAX

Aura Securities Private Limited, Ahmedabad vs. The ACIT, Circle-1(1)(1), Ahmedabad

In the result, appeal of the assessee is partly allowed for statistical purpose

ITA 850/AHD/2023[2017-18]Status: DisposedITAT Ahmedabad02 Jan 2025AY 2017-18

Bench: Ms. Suchitra Kamble & Shri Makarand Vasant Mahadeokarassessment Year: 2017-18

Section 115JSection 142(1)Section 143(2)Section 14ASection 250

assessee disallowed direct expenses and administrative expenses if Rs.1,81,31,827/-. The assessee was called upon related to disallowance under Section 14A of the Act and after taking cognisance of the assessee’s details and reply, the Assessing Officer Assessment Year: 2017-18 Aura Securities Pvt. Ltd. Vs. ACIT ... Page 3 of 6 disallowed under Section 14A read with Rule 8D(2) of the Act and worked out at Rs.14,51,461/-. Thus, thereby making disallowance under Section 14A of the Act at Rs.1,92,52,863/-. The calculation of book profit was Rs.2

ACIT, Non-Corporate Cirle-8, Chennai vs. Indian Overseas Bank, Chennai

ITA 254/CHNY/2023[2017-18]Status: DisposedITAT Chennai31 Dec 2024AY 2017-18
For Appellant: Shri. C. Naresh, C.AFor Respondent: Shri. A. Sasikumar, IRS. CIT
Section 115JSection 143(2)Section 143(3)Section 14ASection 14A(2)Section 250Section 36(1)(vii)Section 36(1)(viia)

947/Chny/2018 dated 28.02.2019, the relevant portion is extracted as under: “14. The next ground raised by the Revenue is against the disallowance under section 14A. The Ld. DR submitted on the lines of grounds of appeal. However, the Ld AR submitted that this issue was decided in favour ... assessee submits that assessee bank is holding securities as stock-in-trade, when once securities are held as stock-in trade, no disallowance under section 14A is warranted. The counsel submits that co- ordinate Bench of this Tribunal decided similar issue for the assessment year 2009-10 in ITA No.1949/Mds/2012

ACIT, Non-Corporate Cirle-8, Chennai vs. Indian Overseas Bank, Chennai

ITA 253/CHNY/2023[2016-17]Status: DisposedITAT Chennai31 Dec 2024AY 2016-17
Section 115JSection 143(2)Section 14ASection 14A(2)Section 250Section 36(1)(vii)Section 36(1)(viia)

947/Chny/2018 dated 28.02.2019, the relevant portion is extracted as under: “14. The next ground raised by the Revenue is against the disallowance under section 14A. The Ld. DR submitted on the lines of grounds of appeal. However, the Ld AR submitted that this issue was decided in favour ... assessee submits that assessee bank is holding securities as stock-in-trade, when once securities are held as stock-in trade, no disallowance under section 14A is warranted. The counsel submits that co- ordinate Bench of this Tribunal decided similar issue for the assessment year 2009-10 in ITA No.1949/Mds/2012

Indian Overseas Bank, Chennai vs. DCIT, Ltu(2), Chennai

Accordingly, this ground of Revenue is dismissed

ITA 203/CHNY/2023[2017-18]Status: DisposedITAT Chennai31 Dec 2024AY 2017-18

Bench: Hon’Ble Shri Manoj Kumar Aggarwal & Hon’Ble Shri Manu Kumar Giriआयकरअपील सं./ Ita Nos.661/Chny/2019, 202 & 203/Chny/2023 (िनधा"रणवष" / Assessment Years: 2015-16, 2016-17 & 2017-2018) Indian Overseas Bank, Vs. The Assistant Commissioner Of 763, Anna Salai, Income Tax, Chennai 600 002. Ltu (2) Chennai. आयकरअपील सं./ Ita Nos.914/Chny/2019, 253 & 254/Chny/2023 (िनधा"रणवष" / Assessment Years: 2015-16, 2016-17&2017-2018) The Assistant Commissioner Of Vs. Indian Overseas Bank, Income Tax, 763, Anna Salai, Ltu (2) Chennai 600 002. Chennai. [Pan: Aaaci 1223J] (अपीलाथ"/Appellant) (""यथ"/Respondent) Assessee By : Shri. C. Naresh, C.A., Department By : Shri. A. Sasikumar, Irs. Cit. सुनवाई क" तार"ख/Date Of Hearing : 14.11.2024 घोषणा क" तार"ख /Date Of Pronouncement : 31.12.2024

For Appellant: Shri. C. Naresh, C.AFor Respondent: Shri. A. Sasikumar, IRS. CIT
Section 115JSection 143(2)Section 14ASection 14A(2)Section 250Section 36(1)(vii)Section 36(1)(viia)

947/Chny/2018 dated 28.02.2019 , the relevant portion is extracted as under: “14. The next ground raised by the Revenue is against the disallowance under section 14A. The Ld. DR submitted on the lines of grounds of appeal. However, the Ld AR submitted that this issue was decided in favour ... assessee submits that assessee bank is holding securities as stock-in-trade, when once securities are held as stock-in trade, no disallowance under section 14A is warranted. The counsel submits that co- ordinate Bench of this Tribunal decided similar issue for the assessment year 2009-10 in ITA No.1949/Mds/2012

Indian Overseas Bank, Chennai vs. DCIT, Ltu(2), Chennai

ITA 202/CHNY/2023[2016-17]Status: DisposedITAT Chennai31 Dec 2024AY 2016-17
Section 115JSection 143(2)Section 14ASection 14A(2)Section 250Section 36(1)(vii)Section 36(1)(viia)

947/Chny/2018 dated 28.02.2019, the relevant portion is extracted as under: “14. The next ground raised by the Revenue is against the disallowance under section 14A. The Ld. DR submitted on the lines of grounds of appeal. However, the Ld AR submitted that this issue was decided in favour ... assessee submits that assessee bank is holding securities as stock-in-trade, when once securities are held as stock-in trade, no disallowance under section 14A is warranted. The counsel submits that co- ordinate Bench of this Tribunal decided similar issue for the assessment year 2009-10 in ITA No.1949/Mds/2012

ACIT Ltu-2, Chennai vs. Indian Overseas Bank, Chennai

ITA 914/CHNY/2019[2015-16]Status: DisposedITAT Chennai31 Dec 2024AY 2015-16
Section 115JSection 143(2)Section 14ASection 14A(2)Section 250Section 36(1)(vii)Section 36(1)(viia)

947/Chny/2018 dated 28.02.2019, the relevant portion is extracted as under: “14. The next ground raised by the Revenue is against the disallowance under section 14A. The Ld. DR submitted on the lines of grounds of appeal. However, the Ld AR submitted that this issue was decided in favour ... assessee submits that assessee bank is holding securities as stock-in-trade, when once securities are held as stock-in trade, no disallowance under section 14A is warranted. The counsel submits that co- ordinate Bench of this Tribunal decided similar issue for the assessment year 2009-10 in ITA No.1949/Mds/2012

Indian Overseas Bank, Chennai vs. ACIT Ltu-2, Chennai

ITA 661/CHNY/2019[2015-16]Status: DisposedITAT Chennai31 Dec 2024AY 2015-16
Section 115JSection 143(2)Section 143(3)Section 14ASection 14A(2)Section 250Section 36(1)(vii)Section 36(1)(viia)

947/Chny/2018 dated 28.02.2019, the relevant portion is extracted as under: “14. The next ground raised by the Revenue is against the disallowance under section 14A. The Ld. DR submitted on the lines of grounds of appeal. However, the Ld AR submitted that this issue was decided in favour ... assessee submits that assessee bank is holding securities as stock-in-trade, when once securities are held as stock-in trade, no disallowance under section 14A is warranted. The counsel submits that co- ordinate Bench of this Tribunal decided similar issue for the assessment year 2009-10 in ITA No.1949/Mds/2012

Ecl Finance Limited, Mumbai vs. DCIT-Central Circle-1(1), Mumbai

In the result, the appeal filed by the assessee is allowed and the appeal filed by the revenue is dismissed

ITA 5283/MUM/2024[2017-18]Status: DisposedITAT Mumbai31 Dec 2024AY 2017-18

Bench: Shri Anikesh Banerjeeand Miss Padmavathy S.- A.Y. 2017-18 - A.Y. 2020-21

For Appellant: Shri Ravikant PathakFor Respondent: Shri Lieder Panicker, SR DR
Section 115JSection 142(1)Section 143(3)Section 14ASection 250

assessee, which raised both legal and factual grounds. The assessee first contested the satisfaction recorded by the Ld. AO regarding the disallowance under Section 14A of the Act, but this challenge was dismissed by the Ld. CIT(A).However, with respect to the calculation of disallowance under Section 14A ... assessment proceedings, the Ld.AO did not record any satisfaction in the assessment order regarding the necessity or basis for making an additional disallowance under Section 14A. The issue is directly covered by the decision in the assessee’s own case in ITA No. 2539/Mum/2024 for the Assessment Year

Trent Limited, Mumbai vs. Deputy Commissioner of Income Tax Circle 2(3)(1), Mumbai

ITA 4074/MUM/2024[2017-18]Status: DisposedITAT Mumbai31 Dec 2024AY 2017-18

Bench: Shri Pavan Kumar Gadale & Shri Girish Agrawal

For Respondent: Shri Rajan Vora and Nikhil Tiwari, CA
Section 10(34)Section 115JSection 143(3)Section 14ASection 234Section 234CSection 250

prejudice to one another On the facts and in the circumstances of the case and in law, the Commissioner of Income-tax (Appeals) Disallowance under section 14A of the Act in respect of expenditure incurred towards earning exempt income: 1. erred in not accepting the disallowance amounting ... made by the appellant on a reasonable basis in the return of income: 2. upholding the action of the Assessing Officer in computing disallowance under section 14A of the Act by applying the provisions of Rule SD of the Income-tax Rules, 1962 ('the Rules") only in respect of investments

Deputy Commissioner of Income Tax, Mumbai vs. Welspun Steel Limited, Gujarat

Accordingly, Ground No.1 raised by the Revenue is dismissed

ITA 3862/MUM/2023[2016-17]Status: DisposedITAT Mumbai31 Dec 2024AY 2016-17

Bench: SHRI RAHUL CHAUDHARY, JUDICIAL MEMBER SHRI OMKARESHWAR CHIDARA (Accountant Member)

For Appellant: Shri Ajay NagpalFor Respondent: Dr.Kishor Dhule
Section 115JSection 143(3)Section 14ASection 153ASection 250

account the Explanation inserted by the Finance Act 2022. Referring to the clarification provided under the sub-heading “The clarification in respect of disallowance under Section 14A in absence of any exempt income during an assessment year” contained in the Memorandum to the Finance Bill, 2022, the Learned Departmental Representative ... addition made by the Assessing Officer be restored as the provisions contained in Section 14A of the Act do not provide that the disallowance under Section 14A of the Act is to be restricted to the amount of exempt income earned by an assessee during the relevant previous year

ACIT-3(3)(1), Mumbai vs. Sikka Ports and Terminals Limited, Mumbai

Accordingly the grounds raised by the revenue contending these two issues are dismissed

ITA 3047/MUM/2024[2018-19]Status: DisposedITAT Mumbai30 Dec 2024AY 2018-19

Bench: Shri Amit Shukla, Jm & Ms Padmavathy S, Am

For Appellant: Shri Nimesh Vora & MokshaFor Respondent: Shri Dr. Kishor Dhule, CIT-DR
Section 115JSection 135Section 14ASection 37Section 37(1)Section 80G

noticed that the assessee has made large investments during the year under consideration and accordingly called on the assessee to show cause why disallowance under section 14A r.w.r 8D cannot be made. The assessee submitted that during the year under consideration the assessee has not earned any exempt income

DCIT 3(3)(1), Mumbai vs. Sikka Ports and Terminal Limited, Mumbai

Accordingly the grounds raised by the revenue contending these two issues are dismissed

ITA 3755/MUM/2023[2020-21]Status: DisposedITAT Mumbai30 Dec 2024AY 2020-21

Bench: Shri Amit Shukla, Jm & Ms Padmavathy S, Am

For Appellant: Shri Nimesh Vora & MokshaFor Respondent: Shri Dr. Kishor Dhule, CIT-DR
Section 115JSection 135Section 14ASection 37Section 37(1)Section 80G

noticed that the assessee has made large investments during the year under consideration and accordingly called on the assessee to show cause why disallowance under section 14A r.w.r 8D cannot be made. The assessee submitted that during the year under consideration the assessee has not earned any exempt income

Pink City Jewel House Private Limited, Jaipur vs. Principal Commissioner of Income Tax (Central), Jaipur

ITA 598/JPR/2024[2018-2019]Status: DisposedITAT Jaipur26 Dec 2024AY 2018-2019
For Appellant: Sh. Siddharth Ranka, AdvFor Respondent: Sh. Saurav Harsh, Adv.&
Section 10ASection 142(1)Section 143(2)Section 144oSection 14ASection 263Section 69

ITA No. 598/JP/2024 Pinkcity Jewelhouse Pvt. Ltd. vs. PCIT आयकर अपीलीय अधिकरण, जयपुर न्यायपीठ, जयपुर IN THE INCOME TAX APPELLATE

Deputy Commissioner of Income Tax, Circle- V (I), Kolkata vs. Birla Corporation Limited, Birla Building

In the result, both the appeals of the revenue is dismissed, as also the cross objection filed by the assessee for both the years

ITA 1024/KOL/2023[2016-17]Status: DisposedITAT Kolkata24 Dec 2024AY 2016-17

Bench: SHRI SONJOY SARMA, JUDICIAL MEMBER SHRI SANJAY AWASTHI (Accountant Member)

Section 115JSection 14ASection 250Section 80I

consider that in a case where employees perform multiple functions, one of which is handling investments, the apportioned salary and expenses offered for disallowance under section 14A of the Income Tax Act, 1961 cannot be given a go by and rule 8D of the Income Tax Rules, 1962, cannot ... that the Commissioner of Income Tax (Appeals) was not justified in law in rejecting the Respondent's working and explanation for disallowance under section 14A of the Income Tax Act, 1961 and in invoking sub-section (2) of section 14A and rule 8D(2)(iii) of the Income Tax Rules

DCIT Circle- 15(1)(2), Mumbai vs. Hrel Real Estate Ltd, Mumbai

In the result, all the three appeals of the Revenue as well as In the result, all the three appeals of the Revenue as well as cross-objection of the assessee are dismissed

ITA 2837/MUM/2024[2013-14]Status: DisposedITAT Mumbai20 Dec 2024AY 2013-14

Bench: Shri Om Prakash Kant () & Shri Raj Kumar Chauhan ()

For Appellant: Mr. Biswanath Das, CIT-DRFor Respondent: Ms. Priyanka Jain

objections on the invoking of Rule 8D raised Rule 8D raised by the appellant do not find any merit. 5.8. However, since the disallowance under Section 14A cannot 5.8. However, since the disallowance under Section 14A cannot 5.8. However, since the disallowance under Section 14A cannot exceed the exempt income

DCIT Circle- 15(1)(2), Mumbai vs. Hrel Real Estate Ltd, Mumbai

In the result, all the three appeals of the Revenue as well as In the result, all the three appeals of the Revenue as well as cross-objection of the assessee are dismissed

ITA 2825/MUM/2024[2014-15]Status: DisposedITAT Mumbai20 Dec 2024AY 2014-15

Bench: Shri Om Prakash Kant () & Shri Raj Kumar Chauhan ()

For Appellant: Mr. Biswanath Das, CIT-DRFor Respondent: Ms. Priyanka Jain

objections on the invoking of Rule 8D raised Rule 8D raised by the appellant do not find any merit. 5.8. However, since the disallowance under Section 14A cannot 5.8. However, since the disallowance under Section 14A cannot 5.8. However, since the disallowance under Section 14A cannot exceed the exempt income

DCIT, Circle-15(1)(2), Mumbai, Aayakar Bhavan, Churchgarte vs. Hrel Real Estate Ltd, Hincon House, Vikhroli West

In the result, all the three appeals of the Revenue as well as In the result, all the three appeals of the Revenue as well as cross-objection of the assessee are dismissed

ITA 1531/MUM/2024[2012]Status: DisposedITAT Mumbai20 Dec 2024

Bench: Shri Om Prakash Kant () & Shri Raj Kumar Chauhan ()

For Appellant: Mr. Biswanath Das, CIT-DRFor Respondent: Ms. Priyanka Jain

objections on the invoking of Rule 8D raised Rule 8D raised by the appellant do not find any merit. 5.8. However, since the disallowance under Section 14A cannot 5.8. However, since the disallowance under Section 14A cannot 5.8. However, since the disallowance under Section 14A cannot exceed the exempt income