The ITAT upheld the Assessing Officer's (AO) order rejecting...

The ITAT upheld the Assessing Officer's (AO) order rejecting disallowance under section 14A read with Rule 8D for AY 2020-21, finding the AO's view plausible and lawful, thus precluding revision by the PCIT under section 263. For AY 2021-22, the Tribunal noted the amendment rendering dividend income and capital gains taxable, negating the applicability of section 14A disallowance since no exempt income was claimed. The PCIT's reliance on CBDT Circular No. 5/2014 was held to be a misapplication of the law post-amendment. As the assessee had offered the relevant income to tax under appropriate heads, expenses relatable to such income were fully allowable. Consequently, the Tribunal set aside the PCIT's revision and restored the AO's order for both years, allowing the assessee's appeal.

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