https://www.taxtmi.com/caselaws?id=213763 ITAT allowed the appeal in favour of the assessee. The tribunal held the AO wrongly disallowed interest under s.14A because no nexus was shown between borrowed funds and tax-free investments and the interest related to taxable textile operations; deletion of the interest disallowance was upheld. Administrative expenses could not be ad hocly disallowed under s.14A; Rule 8D could not be mechanically applied absent evidence that expenses were incurred to earn exempt income. Denial of deductions under ss.80IA/80IB for the pre-demerger period was also reversed, finding the claim properly made in the return and supported by audit certification. en-us Fri, 04 May 2012 00:00:00 +0530 Mon, 03 Nov 2025 15:51:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=213763 ITAT allowed the appeal in favour of the assessee. The tribunal held the AO wrongly disallowed interest under s.14A because no nexus was shown between borrowed funds and tax-free investments and the interest related to taxable textile operations; deletion of the interest disallowance was upheld. Administrative expenses could not be ad hocly disallowed under s.14A; Rule 8D could not be mechanically applied absent evidence that expenses were incurred to earn exempt income. Denial of deductions under ss.80IA/80IB for the pre-demerger period was also reversed, finding the claim properly made in the return and supported by audit certification. Case-Laws Income Tax Fri, 04 May 2012 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=213763