“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

Royal Twinkle Star Club P.Ltd, Mumbai vs. DCIT Cen Cir 2(4), Mumbai

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

ITA 1426/MUM/2018[2010-11]Status: DisposedITAT Mumbai11 May 2023AY 2010-11

Bench: Shri G.S. Pannu & Shri Sandeep Singh Karhail

Section 147Section 194ASection 250Section 40

sheet has shown a total investment of Rs.660,23,99,000. Accordingly, the assessee was asked to show cause as to why the disallowance under section 14A should not be made for the exempt income shown. In response thereto, the assessee submitted that it has not made any investment with ... During the hearing, the learned AR by placing reliance upon the decisions forming part of the legal paper book submitted that the disallowance under section 14A of the Act cannot exceed the quantum of exempt income. On the other hand, the learned Departmental Representative vehemently relied upon the orders passed

Royal Twinkle Star Club P.Ltd, Mumbai vs. DCIT Cen Cir 2(4), Mumbai

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

ITA 1425/MUM/2018[2009-10]Status: DisposedITAT Mumbai11 May 2023AY 2009-10

Bench: Shri G.S. Pannu & Shri Sandeep Singh Karhail

Section 147Section 194ASection 250Section 40

Ufo Moviez India Limited, Mumbai vs. ACIT Circle-27(1), New Delhi

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

ITA 8014/DEL/2019[2016-17]Status: DisposedITAT Delhi10 May 2023AY 2016-17

Section 143(3)Section 14A

Income Tax - 27(1), New Delhi (‘AO’) under section 143(3) of the Income-tax Act, 1961 (‘Act’), on the following grounds: Disallowance under section 14A of the Act read with Rule 8D of Income-tax Rules, 1962 (‘Rules’) 1. On the facts and circumstances of the case

M/S. Religare Enterprise Ltd., Noida vs. DCIT, New Delhi

In the result, the appeal of the assessee is allowed for statistical purposes

ITA 5116/DEL/2016[2011-12]Status: DisposedITAT Delhi10 May 2023AY 2011-12

For Appellant: Shri Rohit Jain, AdvocateFor Respondent: Ms. Princy Singla, Sr. DR

Section 10(34)Section 14ASection 37

Income Tax Rules, 1962, ("the Rules"). 2. That the CIT(A) erred on facts and in law in not appreciating that the disallowance under section 14A of the Act 2 ITA No.5116/Del./2016 calculated by the Appellant under Rule 8D(2)(iii) of the Income Tax Rules ... section 14A of the Act read with Rule 8D of the Rules is erroneous. 4. That on facts and circumstances of the case, disallowance under section 14A of the Act read with clauses (i) to (iii) of Rule 8D of the Rules (i.e., both out of interest and administrative expenditure

Ptc India Financial Services Ltd, New Delhi vs. DCIT, Circle- 19(1) & (2), New Delhi

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

ITA 5051/DEL/2017[2012-13]Status: DisposedITAT Delhi09 May 2023AY 2012-13

For Appellant: Shri Salil Kapoor, AdvocateFor Respondent: Shri T. Kipgen, CIT DR

Section 143(1)Section 14A

funds and the assessee has available, non-interest-bearing funds larger than the investments made in tax-free securities then in such cases, disallowance under section 14A cannot be 12 ITA No.4985/Del./2017 ITA No.5051/Del./2017 made [Refer Para 17 and 20 on Page 77c and 77d, respectively of case

M/S. Ptc India Financial Services Ltd., New Delhi vs. ACIT, New Delhi

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

ITA 4985/DEL/2017[2012-13]Status: DisposedITAT Delhi09 May 2023AY 2012-13

For Appellant: Shri Salil Kapoor, AdvocateFor Respondent: Shri T. Kipgen, CIT DR

Section 143(1)Section 14A

Parmatma Investments Pvt Ltd., Mumbai vs. ITO-3(2)(4), Mumbai

ITA 612/MUM/2023[2010-11]Status: DisposedITAT Mumbai08 May 2023AY 2010-11

Section 143Section 143(1)Section 147Section 14A

taking fictitious loss to the tune of Rs. 31,25,085/-. The AO also made addition of Rs. 36,288/- by way of disallowance under section 14A of the Act and thereby framed assessment under section 143 r.w.s. 147 of the Act. 3. Assessee carried the matter before

Jsw Steels Ltd, Mumbai vs. DCIT CC 8(3), Mumbai

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

ITA 2116/MUM/2017[2012-13]Status: DisposedITAT Mumbai04 May 2023AY 2012-13

Bench: Shri Amarjit Singh & Shri Sandeep Singh Karhail

For Appellant: Shri Rishabh Shah a/wFor Respondent: Dr. Yogesh Kumar

Section 115JSection 142(1)Section 143(2)Section 143(3)Section 144C(1)Section 144C(13)Section 144C(5)Section 14ASection 801ASection 80I

view of the decision on ground no.7. 31. The issue arising in grounds no.8, raised in assessee‟s appeal, is pertaining to disallowance under section 14A read with Rule 8D of the Income Tax Rules, 1962. 32. The brief facts of the case pertaining to this issue are: During ... held that where assessee‟s own funds and other non–interest bearing funds were more than the investment in tax-free securities, no disallowance under section 14A of the Act can be made. We further find that the Hon'ble Supreme Court in South Indian Bank

JCIT, New Delhi vs. M/S. Daawat Foods Ltd., New Delhi

In the result, the appeal of the assessee is partly allowed as indicated above and the appeal of the Revenue is dismissed

ITA 2387/DEL/2017[2010-11]Status: DisposedITAT Delhi04 May 2023AY 2010-11

Bench: Shri G. S. Pannua N D Shri Challa Nagendra Prasad

For Appellant: Ms. Deepashree Rao, C.A

Section 10Section 14A

number 11, there were made the report of the special auditor as the basis for the disallowance, special auditor worked out the total disallowance under section 14A of the Act read with Rule 8D of the Rules at rupees, 41, 80, 208/-, but in view of the provisions of section ... Income Tax Rules, 1962. But the Assessing Officer considered exempt income earned as share in profit from partnership firm for the purpose of disallowance under Section 14A of the Act. The investments was made out of own funds and not borrowed funds and therefore, the assessee has not made

Dawat Foods Ltd., Gurgaon vs. ACIT, New Delhi

In the result, the appeal of the assessee is partly allowed as indicated above and the appeal of the Revenue is dismissed

ITA 1758/DEL/2017[2010-11]Status: DisposedITAT Delhi04 May 2023AY 2010-11

Bench: Shri G. S. Pannua N D Shri Challa Nagendra Prasad

For Appellant: Ms. Deepashree Rao, C.A

Section 10Section 14A

ACIT.Commissioner of Income Tax, Range 10(1), Mumbai vs. M/S Tata Consultancy Services Ltd (Successor Company to M/S Cmc Limited), Mumbai

Accordingly the same is dismissed

ITA 6824/MUM/2011[2007-08]Status: DisposedITAT Mumbai03 May 2023AY 2007-08

Bench: Shri Aby T.Varkey, Jm & Shri Om Prakash Kant, Am आयकर अपील सं/I.T.A.No.6824/Mum/2011 (निर्धारणवर्ा/Assessment Year:2007-08) Assistant Commissioner Of बिधम M/S Tata Consultancy Income Tax-10 (1) Services Ltd (Successor Vs. 455, Aayakar Bhavan, 4Th Company To M/S Cmc Floor, M.K. Marg, Ltd.) Mumbai-400 020 9Th Floor, Nirmal Building Nariman Point, Mumbai-400 021 स्थधयीलेखधसं/.जी. आइ. आर. सं/.Pan/Gir No: .Aaacc2030K .. अपीलार्थी प्रत्यर्थी / Appellant / Respondent

For Respondent: Shri Harsh Kothari

Section 10A

portion of common expenses attributable to the activity of investments. The Assessing Officer was not satisfied with the assessee's manner of disallowance under section 14A of the Act; and re-worked the disallowance under section 14A of the Act to the tune of Rs.53,99,136/-, resulting in further ... before the Ld. CIT(A) who following the findings given in the earlier AY 2008-09, directed the AO to re-work the disallowance under section 14A of the Act on the same lines. 25. Being aggrieved with the decision of Ld. CIT(A), both the assessee and Revenue preferred

Shri Girishkumar Vachhraj Dholakia, Junagadh vs. The Pr. Commissioner of Income Tax-1, Rajkot-Gujarat

In the result, both the appeals filed by the assessee(s) are dismissed

ITA 15/RJT/2021[2015-16]Status: HeardITAT Rajkot02 May 2023AY 2015-16

Bench: Shri Waseem Ahmed & Ms. Madhumita Royआयकर अपील सं./ Ita No. 14/Rjt/2021 Assessment Year : 2015-2016 Shri Jugalkishore Natwarlal Pr. Commissioner Of Dholakia, Vs Income-Tax, C/O. Chokshi Vachhraj Makanji & Pcit-1, Rajkot Co., Shishumangal Road, Gandhigram, Junagadh-362001 Pan : Abqpd 2710 D आयकर अपील सं./ Ita No. 15/Rjt/2021 Assessment Year : 2015-2016 Shri Girishkumar Vachhraj Pr. Commissioner Of Dholakia, Vs Income-Tax, C/O. Chokshi Vachhraj Makanji & Pcit-1, Rajkot Co., Shishumangal Road, Gandhigram, Junagadh-362001 Pan : Abupd 6245 P अपीलाथ"/ (Appellant) "" यथ"/ (Respondent) Assessee By : Shri Samir Jani, Ar Revenue By : Shri Vijay Kumar Jaiswal, Cit-Dr सुनवाई क" तारीख/Date Of Hearing : 01/05/2023 घोषणा क" तारीख /Date Of Pronouncement: 02/05/2023 आदेश/O R D E R Per Ms. Madhumita Roy:-

For Appellant: Shri Samir Jani, ARFor Respondent: Shri Vijay Kumar Jaiswal, CIT-DR

Section 10Section 142(1)Section 143(2)Section 14ASection 263Section 36(1)(iii)

examine nexus between utilization of interest bearing fund for investment, income from which was claimed exempt for tax and failed to make disallowance under Section 14A of the Act out of such interest expenses. It was further found that the assessee received interest income of Rs.80,29,679/- as partner ... proceedings u/s 263 of the Income Tax Act. NIRAJ KUMAR PCIT 3, RAJKOT” 6. The learned PCIT was of the opinion that the disallowance under Section 14A r.w. Rule 8D of Rs.15,97,108/- should have been made in the case of the assessee by the learned Assessing Officer himself

Shri Jugalkishore Natwarlal Dholakia, Junagadh vs. The Pr. CIT-1, Rajkot

In the result, both the appeals filed by the assessee(s) are dismissed

ITA 14/RJT/2021[2015-16]Status: HeardITAT Rajkot02 May 2023AY 2015-16

For Appellant: Shri Samir Jani, ARFor Respondent: Shri Vijay Kumar Jaiswal, CIT-DR

Section 10Section 142(1)Section 143(2)Section 14ASection 263Section 36(1)(iii)

ACIT, Circle-61(1), New Delhi vs. Om Prakash Khaitan, New Delhi

In the result, both the appeals by the Revenue are dismissed

ITA 4702/DEL/2018[2013-14]Status: DisposedITAT Delhi28 Apr 2023AY 2013-14

Bench: Shri N.K. Billaiya & Shri Anubhav Sharmaआ.अ.सं/.I.T.A No.4701/Del/2018 िनधा"रणवष"/Assessment Year:2011-12 बनाम Acit Om Prakash Khaitan Circle 61(1), Vs. B-1, Defence Colony, Room No. 2005, 20Th Floor, New Delhi. Block E-2, Dr. Shyma Prasad Mukherjee, Civic Centre, New Delhi. Pan No. Ahjpk7370H अपीलाथ" Appellant ""यथ"/Respondent & आ.अ.सं/.I.T.A No.4702/Del/2018 िनधा"रणवष"/Assessment Year:2013-14 बनाम Acit Om Prakash Khaitan Circle 61(1), Vs. B-1, Defence Colony, Room No. 2005, 20Th Floor, New Delhi. Block E-2, Dr. Shyma Prasad Mukherjee, Civic Centre, New Delhi. Pan No. Ahjpk7370H अपीलाथ" Appellant ""यथ"/Respondent

Section 14A

Delhi in ITA No. 416/2015, wherein the Hon’ble High Court has held as under: - “9. As regards the second issue concerning the disallowance under Section 14A of the Act, the ITAT noticed the decision of its co-ordinate Bench in Justice Sam P. Bharucha v. Addl, Commissioner of Income ... expenditure there must be a nexus between the expenditure incurred and the income not forming part of the total income. Consequently, the disallowance under Section 14A of the Act was rightly deleted by the CIT (A) and affirmed by the ITAT. 10. The Court finds that no substantial question

ACIT, Circle-61(1), New Delhi vs. Om Prakash Khaitan, New Delhi

In the result, both the appeals by the Revenue are dismissed

ITA 4701/DEL/2018[2011-12]Status: DisposedITAT Delhi28 Apr 2023AY 2011-12

Section 14A

Shri Gordhanbhai R. Asodaria, Surat vs. Assistant Commissioner Income Tax, Central Circle-3, Surat

In the result, the ground No

ITA 267/SRT/2022[2012-13]Status: DisposedITAT Surat25 Apr 2023AY 2012-13

Bench: Shri Pawan Singh(Virtual Hearing) Shri Gordhanbhai R. Asodaria, A.C.I.T., 8, Raghuvir Bunglow, City Light Road, Central Circle-3, Vs. Parle Point, Surat-395007. Surat. Pan No. Abapa 6910 G Appellant/ Assessee Respondent/ Revenue

Section 10Section 139(1)Section 143(3)Section 147Section 148Section 14ASection 234ASection 254(1)Section 271(1)(c)

before the ld. CIT(A). There was no true and correct disclosure by assessee. The Assessing Officer has not made any suo moto disallowance under Section 14A of the Act despite the fact that the assessee has claimed exempt income during the relevant period. 6. In short rejoinder

Assistant Commissioner of Income Tax 4(3)(1), Mumbai vs. M/S.Taurian Iron and Steel Company Private Limited, Mumbai

In the result, appeal of the Revenue is dismissed

ITA 5890/MUM/2017[2011-12]Status: DisposedITAT Mumbai24 Apr 2023AY 2011-12

Bench: Amit Shukla () & Ms. Padmavathy S. ()

Section 14ASection 41Section 41(1)

Unexplained purchases Rs. 1,20,000/- 3) Disallowance of depreciation on car Rs. 22,34,428/- 4) Disallowance under section 14A Rs. 3,10,982/- 5) Advances from customers u/s 41(1) Rs.31,41,92,824/- Aggrieved, the Assessee filed appeal before the CIT(A). The Ld.CIT(A) gave partial

M/S Bec Infra Private Limited, Durg vs. Dy. Commissioner of Income Tax-1(1), Bhilai

In the result ground no. 3 of the appeal of the assessee is allowed

ITA 66/RPR/2020[2014-15]Status: HeardITAT Raipur24 Apr 2023AY 2014-15

Bench: Shri Ravish Sood, Jm & Shri Arun Khodpia, Am आयकर अपील सं./Ita No.66/Rpr/2020 (Assessment Year: 2014-2015) M/S Bec Infra Private Limited, Vs Circle-3(1), Raipur 47, Motilal Nehru Nagar, Durg Pan No. :Aagcm 0049 N (अपीलार्थी /Appellant) (प्रत्यर्थी / Respondent) .. नििााररती की ओर से /Assessee By : Shri Nilesh Jain, Ca राजस्व की ओर से /Revenue By : Shri Piyush Tripathi, Sr. Dr सुनिाई की तारीख / Date Of Hearing : 20/04/2023 घोषणा की तारीख/Date Of Pronouncement : 24/04/2023 आदेश / O R D E R Per Arun Khodpia, Am : The Assessee Has Filed This Appeal Against The Order Passed By The Cit(A)-Ii, Raipur, Dated 31.12.2019 For The Assessment Year 2014-2015. 2. At The Outset, Ld. Sr. Dr Submitted That The Appeal Filed By The Assessee Is Delayed By 59 Days, Which Can Be Further Extended Since The Claim Of The Assessee That The Order Was Served After 38 Days Of Delay Was Not Supported By Any Documentary Evidence. As Per Appeal Memo In Form No.36, The Date Of Service Of Communication Of The Order Was 7Th February, 2020 & The Appeal Was Filed On 08.06.2020. On This Aspect, The Ld. Ar Submitted That This Was The Covid-19 Period & The Hon’Ble Apex Court Has Already Directed To Extend The Limitation For That Period, Therefore, The Delay May Be Condoned. The Submission Of The Ld. Ar Found Satisfactory & Acceptable & Accordingly, The Delay In Filing The Present Appeal By The Assessee Is Condoned.

For Appellant: Shri Nilesh Jain, CAFor Respondent: Shri Piyush Tripathi, Sr. DR

Section 14A

includible in total income (Applicability of) – Whether where assessee invested its own surplus funds in mutual funds and made 12 ITANo.66/RPR/20 suo motu disallowance under section 14A, further disallowance made by Assessing Officer by applying rule 8D without recording his dissatisfaction on disallowance made by assessee was rightly deleted ... includible in total income (Disallowance) – Assessment year 2002-03 – Whether only that expenditure which is in relation to earning dividends can be disallowed under section 14A and rule 8D – Held, yes – Whether dominant purpose for which investment into shares is made by assessee may not be relevant as section 14A

Omni Active Health Technologies Limited, Mumbai vs. Addl/Jt/Dy/Asst/CIT/ITO/NFAC, Delhi

ITA 748/MUM/2022[2017-18]Status: DisposedITAT Mumbai19 Apr 2023AY 2017-18

For Appellant: Shri Ketan VedFor Respondent: Shri Manoj Kumar

Section 115JSection 142(1)Section 143(3)Section 144BSection 144C(13)Section 14ASection 35Section 5Section 92C

Ground No. 3 to 3.3] (d) Addition to Book Profit under Section 115JB of the Act of the Act on account of disallowance under Section 14A of the Act amounting to INR 2,00,201/-. [Ground No. 4 to 4.3] (e) Addition to Book Profits under Section 115JB ... Ground No. 4 to 4.3 are directed against the addition to Book 29. Profit under Section 115JB of the Act on account of disallowance under Section 14A of the Act amounting to INR 2,00,201/. Since we have deleted the disallowance of INR 2,00,201/- made under Section

Sprint Advisory Services Pvt. Ltd., Mumbai vs. Pr. CIT- 3 Mumbai, Mumbai

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

ITA 1411/MUM/2022[2017-18]Status: DisposedITAT Mumbai18 Apr 2023AY 2017-18

Bench: Shri B.R. Baskaran (Am) & Shri Pavan Kumar Gadale (Jm)

Section 133(6)Section 142(1)Section 143(3)Section 14ASection 263Section 68

Learned PCIT also noticed that the assessee has made investment of Rs. 738.62 crores but did not make the disallowance under section 14A of the Act. The Learned PCIT also noticed that the Assessing Officer had raised a specific query on disallowance under section 14A of the Act and assessee ... replied that it has not earned any exempt income and hence no disallowance under section 14A was made. According to learned PCIT, the Assessing Officer has accepted the above said contention of the assessee without properly examining the issue in accordance with the circular issued by the CBDT. Accordingly