https://www.taxtmi.com/caselaws?id=789838 Disallowance under section 14A cannot survive where the assessee earned no exempt income, because the rule presupposes the existence of such income and Rule 8D cannot be invoked in its absence. ESOP discount was treated as employee compensation rather than a notional loss or short receipt of share premium, and was held allowable as revenue expenditure under section 37(1) because expenditure may include a liability incurred for services rendered. The same treatment as a perquisite in employees' hands supported its character as staff cost. On both points, the additions were deleted and the Revenue's challenge failed. en-us Mon, 23 Mar 2026 00:00:00 +0530 Wed, 15 Apr 2026 09:05:04 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=789838 Disallowance under section 14A cannot survive where the assessee earned no exempt income, because the rule presupposes the existence of such income and Rule 8D cannot be invoked in its absence. ESOP discount was treated as employee compensation rather than a notional loss or short receipt of share premium, and was held allowable as revenue expenditure under section 37(1) because expenditure may include a liability incurred for services rendered. The same treatment as a perquisite in employees' hands supported its character as staff cost. On both points, the additions were deleted and the Revenue's challenge failed. Case-Laws Income Tax Mon, 23 Mar 2026 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=789838