2023 (6) TMI 1115

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....unds of disallowance of Rs.9,60,000/- u/s.14A of the Act as against the exempt income of Rs.7,29,565/- which is out of the dividend income earned by the assessee. 3. The brief facts are that the assessee is a private limited company engaged in the business of investments in shares and immovable properties, finance activities and trading in shares and securities including derivatives. The assessee company had filed its return of income date and 30.09.2013 declaring loss of Rs.3,38,04,124/- and the return of income was subsequently revised on 31.03.2015 claiming loss on inventory valuation and declared total loss of Rs.4,90,00,948/-. In the return of income, the assessee had voluntarily disallowed Rs.9,60,000/- u/s. 14A of the Act. The asses....

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....it was held that disallowance u/s.14A cannot exceed the exempt income earned by the assesse for that year. The ld. CIT(A) also relied on various other decisions for the said proposition. 5. The assessee is in appeal before us challenging the order of the ld. CIT(A) in restricting the disallowance to Rs.9,60,000/- u/s.14A of the Act on the ground that the same shall not exceed the exempt income earned by the assessee for that year. 6. The ld. Authorised Representative (ld. AR for short) for the assessee contended that the assessee has earned exempt income of Rs.7,29,565/- during the impugned year and had suo moto made a disallowance of Rs.9,60,000/- as per the provisions of section 14A of the Act. The ld.AR further stated that the ld.CIT(A....