2017 (3) TMI 1682 - HC - Income Tax

Disallowance under Section 14A - Held that - Assessing Officer (AO) did not expressly record reasons for rejection of that figure and instead proceeded to disallow a sum in excess of ₹ 5,61,02,732/-. The DRP reduced this figure to ₹ 2,56,62,215/- which was ultimately rejected by the ITAT by placing reliance upon the judgment of this Court in Cheminvest Limited v. CIT-VI 2015 (9) TMI 238 - DELHI HIGH COURT and ACB India Limited v. ACIT 2015 (4) TMI 224 - DELHI HIGH COURT This Court is of the opinion that since the ITAT has relied upon the judgments of this Court which have explained the scope of Section 14A in such circumstances, no question of law arises. The appeal is accordingly dismissed along with the pending applications.

Summary

The Delhi High Court dismissed the Revenue's appeal against the ITAT order rejecting disallowance under Section 14A of the Income Tax Act for AY 2008-09. The ITAT rejected the disallowance of Rs. 2,28,777 made by the assessee and instead disallowed a higher amount. The Court upheld the ITAT decision citing previous judgments on Section 14A.