https://www.taxtmi.com/caselaws?id=257219 Disallowance under s.14A r/w r.8D was upheld by the appellate authorities despite the assessee's suo motu disallowance. The HC held that the AO lacked jurisdiction to invoke r.8D because he neither examined the accounts nor recorded dissatisfaction with, or reasons for rejecting, the assessee's working, as mandated by precedent. It further held that a disallowance exceeding the exempt income is legally impermissible, since s.14A permits disallowance only of expenditure incurred "in relation to" exempt income and cannot be construed to neutralize the exempt receipt itself. Consequently, the ITAT order was set aside and the issue was decided in favour of the assessee. en-us Wed, 25 Feb 2015 00:00:00 +0530 Thu, 18 Dec 2025 14:09:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=257219 Disallowance under s.14A r/w r.8D was upheld by the appellate authorities despite the assessee's suo motu disallowance. The HC held that the AO lacked jurisdiction to invoke r.8D because he neither examined the accounts nor recorded dissatisfaction with, or reasons for rejecting, the assessee's working, as mandated by precedent. It further held that a disallowance exceeding the exempt income is legally impermissible, since s.14A permits disallowance only of expenditure incurred "in relation to" exempt income and cannot be construed to neutralize the exempt receipt itself. Consequently, the ITAT order was set aside and the issue was decided in favour of the assessee. Case-Laws Income Tax Wed, 25 Feb 2015 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=257219