2025 (1) TMI 656

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....uestions of law were pressed before this Court :- SUBSTANTIAL QUESTION OF LAW "(1) On the facts and in the circumstances of the case and in law, the Hon'ble ITAT erred in deleting the disallowance u/s 14A of gross interest expenditure of Rs. 75,20,81,001/- which is incurred towards earning tax free income ignoring the facts that such interest expenditure was on account fo investment in subsidiary companies/ controlled companies yielding tax free dividend for the purpose of computing income from Business or Profession and also for computing the Adjusted Book Profit u/s 115JB of the Act. (7) On the facts and in the circumstances of the case and in law, the Hon'ble ITAT was right in limiting the disallowance u/s 14A to exe....

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....sallowed more than the exempted income, disallowance should be restricted to the extent of the exempted income of Rs.6.16 crores. The Tribunal accepted the said contention of the respondent-assessee which is now challenged in the present appeal. 4. The issue whether disallowance under Section 14A can exceed the exempt income is concluded by series of judgment of the Co-ordinate Benches of this Court namely:- (i) Nirved Traders Private Limited Vs. Deputy Commissioner of Income Tax'(2020) 421 ITR 142 (Bom). (ii) Principal Commissioner of Income Tax, Panaji, Goa Vs. Ajit Ramakant Phatarpekar (2021) 124 taxmann.com 124 (Bombay) (iii) Principal Commissioner of Income Tax-3 Vs. Reliance Ports and Terminals Ltd. Incom....

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....the last of the decision following the decision of Nagri Mills Co. Ltd. (supra) is in the case of Principal Commissioner of Income Tax, Panaji Goa Vs. Rajesh Prakash Timblo (2019) 106 taxmann.com 255 (Bom). This view also finds support from the decision of the Supreme Court in the case of CIT vs. Excel Industries (2013) 358 ITR 295. In our view, respectfully following the decision of the Supreme Court and the Co-ordinates Bench of this Court, no substantial question of law arises on this issue. 8. In any case, the decision of the Supreme Court in the case of Madras Industrial Investment Corporation Ltd. Vs. Commissioner of Income Tax' (1997) 225 ITR 802 (SC) has been subsequently considered and explained by the Supreme Court in the case ....