2024 (2) TMI 1436 - HC - Income Tax

Disallowance u/s 14A - expenditure incurred on exempt income - HELD THAT - Even if the assessee has not earned any exempt income, the issue is no longer res integra and there are several decisions to the effect that amendment made u/s 14A of the Act by Finance Act, 2022 will be applicable prospectively and disallowance should not exceed the exempt income earned by the assessee during the year. The PCIT has also noted the decision of Chettinad Logistics Pvt. Ltd. 2018 (7) TMI 567 - SC ORDER and Oil Industries Development Board 2019 (3) TMI 1571 - SC ORDER - Decided against the revenue.

Summary

The High Court of Calcutta dismissed the revenue's appeal under section 260A of the Income Tax Act, 1961. The appeal was against the order of the Income Tax Appellate Tribunal for the assessment year 2012-2013. The court found that the tribunal was justified in dismissing the appeal as the issue of disallowance under section 14A of the Act had been clarified by previous judgments and amendments. The appeal was dismissed, and the substantial questions of law were answered against the revenue.