“disallowance u/s 14A”

DisallowancesSection 14ASection 14A2,938 judgments

The decision most relied on for disallowance u/s 14A is CIT v. Corrtech Energy (P.) Ltd. (223 Taxmann 130), cited in 579 judgments on BharatTax.

Leading authorities on disallowance u/s 14A

CIT v. Corrtech Energy (P.) Ltd.

223 Taxmann 130 · 2014 · High Court

579

citing judgments

Disallowance under Section 14A read with Rule 8D is not warranted if the assessee has not earned any exempt income in the relevant assessment year.

CIT v. Gem Plus Jewellery India Ltd.

330 ITR 175 · 2011 · High Court

207

citing judgments

Disallowances made under various sections, such as for PF/ESIC contributions, result in an increase in business profits, and these enhanced profits are eligible for deduction under Sections 10A and 10AA. Similarly, gains from foreign exchange fluctuations directly linked to export sales are also eligible for deduction under Section 10A.

Cargo Motors (P.) Ltd. v. DCIT

145 Taxmann.com 641 · 2022 · High Court

citing judgments

The disallowance under Section 14A read with Rule 8D, particularly Rule 8D(iii) for administrative expenses, should only consider investments that have actually yielded exempt income during the relevant assessment year. Section 14A empowers the Assessing Officer to determine expenditure related to income not forming part of total income.

Sobha Developers Ltd. v. DCIT

125 Taxmann.com 72 · 2021 · High Court

citing judgments

Disallowance under section 14A is a notional disallowance and cannot be added back while computing Book Profits under section 115JB for Minimum Alternate Tax purposes.

Tata Industries Ltd. v. ITO

181 TTJ 600 · 2016 · ITAT

citing judgments

Disallowance under Section 14A cannot exceed the exempt income earned by the assessee. Even if interest expenditure is considered, it cannot be solely attributed to earning exempt dividend income as investors also consider potential capital gains.

PCIT v. J.J. Glastronics (P.) Ltd.

139 Taxmann.com 375 · 2022 · High Court

citing judgments

Additions made under Section 14A of the Income-tax Act, read with Rule 8D, cannot be considered for computing book profit under Section 115JB of the Act.

M/s.Bajaj Allianz General Insurance Co. Ltd. v. ACIT

38 DTR 282 · 2010 · Reported

citing judgments

Section 14A of the Income-tax Act is not applicable to insurance businesses governed by specific provisions of Section 44 and Schedule 1. Profit on sale of investments by insurance companies is not taxable, especially after the deletion of sub-rule (b) of Rule 5 of the First Schedule.

PCIT v. Dipesh Lalchand Shah

143 Taxmann.com 419 · 2022 · High Court

citing judgments

Disallowance under section 14A cannot be made if the assessee has not earned any exempt income in the relevant assessment year. This applies even if the assessee has made investments in shares or has income from a partnership that is negative.

Judgments citing disallowance u/s 14A

Dy CIT CC 6(4), Mumbai vs. Arshiya Ltd., Mumbai

In the result, the present appeal by Revenue (ITA No

ITA 900/MUM/2020[2014-15]Status: DisposedITAT Mumbai05 Jul 2022AY 2014-15

For Appellant: Shri Piyush ChhajedFor Respondent: Shri Sunil Jha

Section 132Section 143(3)Section 14ASection 153ASection 36(1)(iii)

facts and in the circumstances of the case and in law, the ld. CIT(A) has erred in restricting the disallowance u/s 14A to the extent of exempt income as against the disallowance computed by the Assessing Officer in accordance with the provisions of Rule 8D(2) of the Income

ACIT, Circle - 2(1)(1), Mumbai vs. The Bombay Dyeing & Mfg. Co. Ltd., Mumbai

ITA 3299/MUM/2019[2010-11]Status: DisposedITAT Mumbai05 Jul 2022AY 2010-11

Bench: Shri Kuldip Singh & Shri Gagan Goyalassessment Year : 2009-10 & Assessment Year: 2010-11

For Appellant: Shri Yogesh Thar, A.RFor Respondent: Dr. Yogesh Kamar, D.R

Section 145Section 14ASection 92CSection 92F

5/2014 dtd 11.02.2014 clearly specifies that even if no exempt income is earned on the investments for the purpose of calculation of disallowance u/s 14A r.w.r. 8D, these are to be included. 1.1 On the facts and in the circumstances of the case ... erred in not appreciating that from A.Y. 2008-09, the disallowance u/s. 14A is required to be computed as per rule 8D as held by the Bombay High Court in Godrej & Boyce and the method adopted by the assessee is not a valid method. 2. On the facts

ACIT, Circle - 2(1)(1), Mumbai vs. The Bombay Dyeing & Mfg. Co. Ltd., Mumbai

ITA 2779/MUM/2019[2013-14]Status: DisposedITAT Mumbai05 Jul 2022AY 2013-14

Bench: Shri Kuldip Singh & Shri Gagan Goyalassessment Year : 2009-10 & Assessment Year: 2010-11

For Appellant: Shri Yogesh Thar, A.RFor Respondent: Dr. Yogesh Kamar, D.R

Section 145Section 14ASection 92CSection 92F

M/S. Rallis India Ltd., Mumbai vs. Dy CIT, Cicle-8(1)(1), Mumbai

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

ITA 913/MUM/2021[2015-16]Status: DisposedITAT Mumbai04 Jul 2022AY 2015-16

Bench: Shri Pavan Kumar Gadale & Shri S Rifaur Rahmanm/S. Rallis India Ltd Vs. Dcit, Circle – 8(1)(1) C/O Kalyaniwalla & Room No. 624, 6Th Mistry Llp, 2Nd Floor, Floor, Aayakar Bhavan Esplanade House, 29, M.K Road, Hazarimal Somani Mumbai – 400020. Marg, Mumbai – 400001 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aabcr2657N Appellant .. Respondent Appellant By : Mr.Jitendra Jain.Ar Respondent By : Mr.S.N Kabra. Dr Date Of Hearing 03.06.2022 Date Of Pronouncement 04.07.2022 आदेश / O R D E R Per Pavan Kumar Gadale Jm: The Assessee Has Filed The Appeal Against The Order Of The Principle Commissioner Of Income Tax (Pr.Cit) – 8, Mumbai Passed U/S 263 Of The Act.

For Appellant: Mr.Jitendra Jain.ARFor Respondent: Mr.S.N Kabra. DR

Section 10(34)Section 10ASection 115JSection 143(2)Section 14ASection 2(47)Section 263Section 263eSection 80Section 801A

assessee appeared from time to time and submitted the details and the case was discussed. 6. On the first disputed issue of disallowance u/s 14A of the Act, the Assessing Officer (A.O) observed that the assessee has claimed the exemption of dividend M/s Rallis India Ltd, Mumbai. income ... satisfied with the explanations and dealt on the applicable provisions and the judicial decisions and finally worked out the disallowance u/s 14A r.w.r 8D(2)(ii)&(iii) of I T Rules of Rs. 27,60,092 after giving the set off of su omoto disallowance made by the assesee

M/S Atlanta Ltd, Mumbai vs. DCIT Circle- 9 (1)(2), Mumbai

In the result, Revenue‟s appeal (ITA No

ITA 7749/MUM/2019[2016-17]Status: DisposedITAT Mumbai04 Jul 2022AY 2016-17

For Appellant: Shri Vijay MehtaFor Respondent: Shri Sunil Jha

Section 115JSection 143(3)Section 14ASection 250

Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in restricting the disallowance u/s. 14A of the Income Tax Act, 1961 to the extent of exempt income, without appreciating the facts that in the case of Maxopp Investment Limited ... effect? 5. Whether in the facts and circumstances of the case and in law, the Ld. CIT(A) erred in deleting the disallowance u/s. 14A to the Book Profit computed u/s.115JB of the Act without appreciating the fact that the same requires to be added to Book Profit

Dy CIT 9 (1)(2), Mumbai vs. Atlanta Limited, Mumbai

In the result, Revenue‟s appeal (ITA No

ITA 7695/MUM/2019[2016-17]Status: DisposedITAT Mumbai04 Jul 2022AY 2016-17

For Appellant: Shri Vijay MehtaFor Respondent: Shri Sunil Jha

Section 115JSection 143(3)Section 14ASection 250

Bates India Pvt. Ltd., Mumbai vs. The DCIT, Cir-8, Kolkata

In the result, the appeal of the assessee is partly allowed

ITA 1046/KOL/2016[2011-2012]Status: DisposedITAT Mumbai01 Jul 2022AY 2011-2012

For Appellant: Shri P. J. Pardiwala (Adv.)For Respondent: Shri H. N. Singh (DR)

Section 115JSection 14ASection 2Section 43B

Kolkata dated 30.03.2016 for the assessment year 2011-12. At the outset, the Ld. AR submitted that the AO has made 2. disallowance u/s 14A of the Income Tax Act, 1961 (hereinafter “the Act”) r.w. Rule 8D of the Income Tax Rule, 1962 (hereinafter “the Rules”). However

M Pallonji Shipping P. Ltd, Mumbai vs. DCIT 5(2)(2), Mumbai

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

ITA 5875/MUM/2017[2013-14]Status: DisposedITAT Mumbai30 Jun 2022AY 2013-14

Bench: Shri Prashant Maharishi & Shri Pavan Kumar Gadalem.Pallonji Shipping Pvt Vs. Dcit – 5(2)(2) Ltd.46A Veetrag Mumbai Chambers, Cawasji Patel Street, Fort, Mumbai-400001 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aaecm4615L Appellant .. Respondent Appellant By : Dr.K. Shivaram & Shri Rahul Hakani.Ar Respondent By : Ms.Vatslaaa Jha.Cit.Dr Date Of Hearing 08.06.2022 Date Of Pronouncement 28.06.2022 आदेश / O R D E R Per Pavan Kumar Gadale Jm:

For Appellant: Dr.K. Shivaram, &For Respondent: Ms.Vatslaaa Jha.CIT.DR

Section 143(2)Section 143(3)Section 92C

respect of loan given to its foreign subsidiaries in the foreign currency and which cannot be part of Tonnage Tax Scheme.(iii) the disallowance u/s 14A r.w.r 8D(2)(ii)&(iii) of I T Rules of Rs.47,33,547/- and determined the total income of Rs.19,46,88,820/- u/s

ACIT 3(1) (1), Mumbai vs. M/S. Bajaj Capital Ventures Pvt.Ltd, Mumbai

In the result, appeal of the Assessing Officer is dismissed and appeal of the assessee is allowed

ITA 528/MUM/2022[2016-17]Status: DisposedITAT Mumbai29 Jun 2022AY 2016-17

Section 14Section 143(3)Section 14A

Utilities Distribution re affirmed the same. 6.3 The assessee in his written submission has also stated that- "Without prejudice, even if there is disallowance u/s 14A the maximum disallowance u/s 14A r. w. rule 8D(2) (iii) cannot exceed administrative expenses less audit fees, professional fees, stamp duty on issue ... 76/Mum/ 2022 Assessment year: 2016-17 Page 4 of 5 The Ld. Assessing Officer may, therefore, be directed to restrict the disallowance u/s. 14A of the Income Tax Act, 1961 to Rs. 9,87,978/- in normal computation, as well as under section 115JB of the Act.” 5. None

DCIT 8(3)(2), Mumbai vs. Vyoman Tradelink India Pvt. Ltd.(Ealier Known As M/S. Rupee Finance and Management Pvt. Ltd.), Mumbai

In the result, the appeal filed by the revenue stands dismissed

ITA 3032/MUM/2019[2012-13]Status: DisposedITAT Mumbai29 Jun 2022AY 2012-13

Bench: Shri Amit Shukla, Jm & Shri Gagan Goyal, Am आयकरअपीलसं./ I.T.A. No. 3032/Mum/2019 (ननधधारणवर्ा / Assessment Year: 2012-13) M/S Vyoman Tradelink Dcit-8(3)(2), India Pvt. Ltd. (Earlier R. No. 615, Aayakar Known As M/S Rupee Bhavan, M. K. Road, बनाम/ Finance & Management Mumbai-400020 Pvt. Ltd.), 135, Continental Vs. Building, Dr. Annie Besant Road, Worli, Mumbai-400 018 स्थधयीलेखधसं./जीआइआरसं./ Pan No. Aabcr9194C (अपीलधथी/Appellant) (प्रत्यथी / Respondent) : अपीलधथीकीओरसे/ Appellant By : Shri Nimesh Yadav, Ld. Dr प्रत्यथीकीओरसे/Respondent By : Shri Jay Bhansali, Ld. Ar सुनवधईकीतधरीख/ : 20.06.2022 Date Of Hearing घोर्णधकीतधरीख / : 29.06.2022 Date Of Pronouncement आदेश / O R D E R Per Amit Shukla: The Aforesaid Appeal Has Been Filed By The Revenue Against The Impugned Order Dated 05.12.2018 Passed By Ld. Cit(A)-14, Mumbai

For Appellant: Shri Nimesh Yadav, Ld. DRFor Respondent: Shri Jay Bhansali, Ld. AR

Section 14Section 143(3)Section 147Section 148Section 14ASection 151(2)

validly reopened u/s. 147 of the Act, ignoring the fact that the AO has not expressed any opinion on the issue of disallowance u/s. 14A in the original assessment order passed by him, as held by the Hon'ble Supreme Court in the case of ITO vs. Tech Span India ... Vyoman Tradelink India Pvt. Ltd. In this case, it was noticed from the computation of total income that the assessee has made disallowance u/s. 14A suo moto, while computing disallowance according to the rule 8D the assessee has considered first and second limb of the said rule 8D and made

M/S. the Sandur Manganese & Iron Ores Ltd, Sandur vs. Assistant Commissioner of Income Tax, Circle-1, Bellary

In the result, both the appeals filed by the assessee stands partly allowed

ITA 1965/BANG/2018[2015-16]Status: DisposedITAT Bangalore29 Jun 2022AY 2015-16

Bench: Shri. Chandra Poojari & Smt. Beena Pillai

For Respondent: Shri S. Parthasarathi

Section 37(1)

IN THE INCOME TAX APPELLATE TRIBUNAL ‘C’ BENCH : BANGALORE BEFORE SHRI. CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. BEENA PILLAI, JUDICIAL

M/S. the Sandur Manganese & Iron Ores Ltd, Sandur vs. Assistant Commissioner of Income Tax, Circle-1, Bellary

In the result, both the appeals filed by the assessee stands partly allowed

ITA 1964/BANG/2018[2012-13]Status: DisposedITAT Bangalore29 Jun 2022AY 2012-13

Bench: Shri. Chandra Poojari & Smt. Beena Pillai

For Respondent: Shri S. Parthasarathi

Section 37(1)

IN THE INCOME TAX APPELLATE TRIBUNAL ‘C’ BENCH : BANGALORE BEFORE SHRI. CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. BEENA PILLAI, JUDICIAL

M/S Total Environment Building Systems Private Limited, Bangalore vs. Deputy Commissioner of Income Tax Circle-7(1)(1), Bangalore

In the result, revenue’s appeal stands dismissed and the assessee’s appeals for A

ITA 46/BANG/2017[2011-12]Status: DisposedITAT Bangalore29 Jun 2022AY 2011-12

Bench: Shri. Chandra Poojari & Smt. Beena Pillai

For Respondent: Shri Vilas V Shinde, CIT DR

Section 250Section 37Section 40Section 43B

assessee made the submissions and after considering the submissions of the assessee, AO by invoking the provision of Rule 8D worked out the disallowance u/s 14A of the Act. The alternate submissions of the Ld.AR in working disallowance u/s 14A by considering the investment which have yielded tax free income ... investments has not been controverted by the revenue. In such a situation, relying on the aforesaid decisions, we are of the view that disallowance u/s 14A needs to be re-worked on the basis of the investments which have yielded tax free income. We therefore direct the Ld.AO to work

Total Environment Building Systems Private Limited, Bangalore vs. Deputy Commissioner of Income Tax Circle-7(1)(1), Bangalore

In the result, revenue’s appeal stands dismissed and the assessee’s appeals for A

ITA 45/BANG/2017[2010-11]Status: DisposedITAT Bangalore29 Jun 2022AY 2010-11

Bench: Shri. Chandra Poojari & Smt. Beena Pillai

For Respondent: Shri Vilas V Shinde, CIT DR

Section 250Section 37Section 40Section 43B

Deputy Commissioner of Income Tax Circle-7(1)(1), Bangalore vs. M/S Total Environment Building Systems Pvt Ltd, Bangalore

In the result, revenue’s appeal stands dismissed and the assessee’s appeals for A

ITA 40/BANG/2017[2010-11]Status: DisposedITAT Bangalore29 Jun 2022AY 2010-11

Bench: Shri. Chandra Poojari & Smt. Beena Pillai

For Respondent: Shri Vilas V Shinde, CIT DR

Section 250Section 37Section 40Section 43B

Tata Housing Development Company Ltd., Mumbai vs. DCIT- 8(3)(1), Mumbai

In the result, the appeal filed by the assessee ITA

ITA 3491/MUM/2019[2015-16]Status: DisposedITAT Mumbai28 Jun 2022AY 2015-16

Bench: Shri Pavan Kumar Gadale & Shri Amarjit Singhm/S Tata Housing Vs. Dcit – 8(3)(1) Development Company Room No. 615, Ltd.,E Block, Voltas Aayakar Bhavan, Compound, Tb Kadam Mk Marg, Marg, Chinchpokli, Mumbai – 400020. Mumbai – 400033. "थायी लेखा सं./जीआइआर सं./Pan/Gir No. :Aaact0191Q Appellant .. Respondent Dcit – 8(3)(1) Vs. M/S. Tata Housing Room No. 615, Aayakar Development Company Bhavan, Ltd.,E Block, Voltas Mk Marg, Compound, Tb Kadam Mumbai – 400020. Marg, Chinchpokli, Mumbai – 400033. "थायी लेखा सं./जीआइआर सं./Pan/Gir No. :Aaact0191Q Appellant .. Respondent

For Appellant: Shri.Madhur Agarwal.ARFor Respondent: Shri.Ajay Kumar. CIT DR

Section 115JSection 143(2)Section 143(3)Section 14ASection 36(1)Section 36(1)(iii)

interest expenditure u/s 36(1)(iii) of the Act of Rs. 57.42 crores. 4.(ii) The second disputed issue is in respect of disallowance u/s 14A r.w Rule 8D, the assessee has made suo-moto disallowance u/s 14A of the Act of Rs. 10,118/- and the A.O. has issued ... having investments as per the balance sheet, has relied on the details, financial statements and judicial decisions and has worked out the disallowance u/s 14A r.w.r 8D(ii) of Rs.18,45,13,117/- and disallowance u/s 8D(2)(iii) of Rs.3,09,08,500/- and total aggregating

Yes Bank Limited, Mumbai vs. DCIT 2 (2)(2), Mumbai

In the result, appeal filed by the learned assessing officer in ITA number 3238/M/2018 for assessment year 2013 –

ITA 3500/MUM/2018[2013-14]Status: DisposedITAT Mumbai28 Jun 2022AY 2013-14

Bench: Shri Prashant Maharishi, Am & Shri Sandeep Singh Karhail, Jm

For Appellant: Shri Yogesh Thar, ARFor Respondent: Shri Shekhar L. Gajbhiye, CIT

Section 14ASection 35DSection 40

3238/Mum/2018 Yes Bank Limited; A.Y. 11-12 to 13-14 of the IT Act without appreciating that the disallowance u/s 14A has to be mandatorily calculated as per rule 8D of IT Rules and no discretion is available with the A.O for estimated disallowances? 2. Whether on the facts ... Bombay High Court in CIT vs. Reliance Utilities Ltd. 313 ITR 340, no indirect or direct interest expenditure is disallowable. v. No disallowance u/s 14A could be made when investment in shares is held as stock in trade. vi. Only those securities on which tax-free dividend are earned