https://www.taxtmi.com/caselaws?id=767696 ITAT Delhi allowed the appeal, holding that Section 14A disallowance cannot be made when no expenditure was actually incurred to earn exempt income. The tribunal ruled that despite having exempt income, the assessee incurred no related expenses, and Section 14A only disallows expenditure actually incurred for earning exempt income, not on assumption basis. The AO failed to record satisfaction regarding expenses claimed as related to exempt income before invoking Section 14A with Rule 8D. Following SC precedent in Maxopp Investment, the addition was held unsustainable. en-us Wed, 19 Mar 2025 00:00:00 +0530 Sat, 22 Mar 2025 08:34:45 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=767696 ITAT Delhi allowed the appeal, holding that Section 14A disallowance cannot be made when no expenditure was actually incurred to earn exempt income. The tribunal ruled that despite having exempt income, the assessee incurred no related expenses, and Section 14A only disallows expenditure actually incurred for earning exempt income, not on assumption basis. The AO failed to record satisfaction regarding expenses claimed as related to exempt income before invoking Section 14A with Rule 8D. Following SC precedent in Maxopp Investment, the addition was held unsustainable. Case-Laws Income Tax Wed, 19 Mar 2025 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=767696