ESOP discount deduction and no-exempt-income rule under section 14A supported deletion of tax disallowances.

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....Employee stock option discount is treated as employee remuneration and, following the cited Biocon ruling, is described as deductible business expenditure under the mercantile system even without actual cash outflow, because the liability is ascertained and not merely contingent when quantified on exercise. On the second issue, where no exempt income was earned or claimed in the relevant year, the text states that section 14A read with Rule 8D does not apply; the Finance Act, 2022 amendment extending the provision to years with no exempt income is said to operate prospectively from assessment year 2022-23. The reported result is deletion of both disallowances.....