Co-operative society's mandatory reserve and share capital fixed deposits with banks-interest treated as business income under 80P(2)(a)(iii) deductio...
Income tax reassessment reopening after four years on investigation tip, without s.147 proviso disclosure failure, struck down as borrowed satisfactio...
Disallowance under s.14A r/w r.8D was examined where the taxpayer had made a suo motu disallowance against exempt income. Since r.8D is not automatic, the AO could invoke it only after examining the taxpayer's accounts and recording satisfaction under s.14A(2) that the taxpayer's claim was incorrect; a mere remark that the disallowance was "very low" did not meet this statutory requirement. Applying this mandatory satisfaction test, as reiterated in Maxopp, the r.8D-based incremental disallowance was held bad in law and deleted, restricting disallowance to the taxpayer's suo motu amount; the appeal was allowed. - ITAT
Disallowance under s.14A r/w r.8D was examined where the taxpayer had made a suo motu disallowance against exempt income. Since r.8D is not automatic, the AO could invoke it only after examining the taxpayer's accounts and recording satisfaction under s.14A(2) that the taxpayer's claim was incorrect; a mere remark that the disallowance was "very low" did not meet this statutory requirement. Applying this mandatory satisfaction test, as reiterated in Maxopp, the r.8D-based incremental disallowance was held bad in law and deleted, restricting disallowance to the taxpayer's suo motu amount; the appeal was allowed. - ITAT
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