https://www.taxtmi.com/caselaws?id=793586 Disallowance under section 14A read with Rule 8D was restricted to investments that actually yielded exempt income, so non-income-yielding subsidiary investments were excluded and the incremental addition was deleted. The corresponding adjustment to book profit under section 115JB was also deleted because clause (f) of Explanation 1 operates independently of the section 14A computation. The subsidy received under the incentive scheme was treated as a capital receipt, as its purpose was to encourage industrial investment in the notified area and it was linked to capital outlay rather than operational expenses. The assessee succeeded on these substantive issues, and the additional ground was remanded for consequential consideration. en-us Fri, 08 May 2026 00:00:00 +0530 Thu, 18 Jun 2026 12:33:11 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=793586 Disallowance under section 14A read with Rule 8D was restricted to investments that actually yielded exempt income, so non-income-yielding subsidiary investments were excluded and the incremental addition was deleted. The corresponding adjustment to book profit under section 115JB was also deleted because clause (f) of Explanation 1 operates independently of the section 14A computation. The subsidy received under the incentive scheme was treated as a capital receipt, as its purpose was to encourage industrial investment in the notified area and it was linked to capital outlay rather than operational expenses. The assessee succeeded on these substantive issues, and the additional ground was remanded for consequential consideration. Case-Laws Income Tax Fri, 08 May 2026 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=793586