2023 (9) TMI 154

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ppeal. on following grounds: 2. Heard the learned Representatives of both sides at length and case records perused. 3. The solitary issue involved in present appeal is the disallowance of Rs. 1,34,43,488/- made by AO u/s 14A read with Rule 8D on account of expenditure for earning exempted income in the form of dividend on shares. 4. Ld. AR for assessee straightaway carried us to Para No. 3.1 of the order of first-appeal where the CIT(A) has recorded a clear finding "The fact that there is no exempt income earned during the year from such investment is seen from the return of income as well as audited Balance-Sheet of the Appellant ." Having demonstrated this factual position, Ld. AR carried us to the order of ITAT, Indore in assessee's o....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....A of the Act can be made more than actual exempt income earned by the assessee. Similar proposition has been rendered by Hon'ble High Court of Delhi in the case of Cheminvest Ltd. vs Commissioner of Income Tax (supra). In our humble view until unless the issue is adjudicated at the level of Hon'ble Supreme Court modifying of setting aside the orders of judgments of Hon'ble High Court all authorities below to the High Court's including this Tribunal is duty bound to follow the propositions rendered by Hon'ble High Court therefore we are inclined to hold that the Ld. CIT(A) was right in granting relief to the assessee by following the proposition rendered by various High Court's including judgment of Hon'ble Delhi High Court in the case of Ch....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....4. In order to make the intention of the legislation clear and to make it free from any misinterpretation, it is proposed to insert an Explanation to section 14A of the act to clarify that notwithstanding anything to the contrary contained in this Act, the provisions of the section shall apply and shall be deemed to have always applied in a case where exempt income has not accrued or arisen or has not been received during the previous year relevant to an assessment year and the expenditure has been incurred during the said previous year in relation to such exempt income 5. This amendment will take effect from 1st April,2022. 6. It is also proposed to amend sub-section (1) of the said section, so as to include a non-obstante clause in re....