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TMI Blog2019 (2) TMI 1595X X X X Extracts X X X X X X X X Extracts X X X X ..... expenditure would not cease to be an expenditure incurred for business. The concurrent finding of fact by the CIT (A) and the Tribunal cannot be found fault with. Accordingly, the question as proposed does not give rise to any substantial question of law. Thus, the two questions are not entertained. Disallowance u/s 14A r.w.r.8D - HELD THAT:- Where no exempt income is earned in the subject assessment year, occasion to disallow any expenditure under Section 14A could not arise. - Decided against revenue - INCOME TAX APPEAL NO. 1306 OF 2016 - - - Dated:- 22-2-2019 - AKIL KURESHI M.S. SANKLECHA, JJ. Mr. Suresh Kumar for the Appellant P.C.: 1. This appeal under Section 260 A of the Income Tax Act, 1961 ( the Act for s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n No. (a) (b) :- 5.1 The respondent is a company engaged in construction of commercial and residential complexes and also in investment including lending / advancing money. During the course of scrutiny assessment proceedings, the Assessing Officer treated interest income of ₹ 3.65 crore earned by the assessee as income from other source not as business income which was claimed by the respondent. It also disallowed the claim of interest expenditure as business expenditure to the extent of ₹ 2.31 crore and even held that it cannot be allowed as deduction under Section 57 of the Act, while determining income from other source. 5.2 Being aggrieved, the respondent filed an appeal to the Commissioner of Income Tax [Appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the two questions are not entertained. 6. Regarding Question No. (c) (d) : 6.1 In its computation of income, the respondent had worked out suo motu disallowance of ₹ 1.28 lacs under Section 14A of the Act. The Assessing Officer did not accept the same and and on application of Section 14A read with 8D of the Income Tax Rules ( Rules for short) disallowed a sum of ₹ 3.14 crore. This essentially on the ground of interest paid towards purchase of preference shares in a group company M/s. PPL. 6.2 Being aggrieved by, the respondent filed an appeal to the CIT(A). By order dated 4.10.2013, the CIT(A) confirmed the disallowance made by the Assessing Officer under Section 14A of the Act. 6.3 Being aggrieved, the resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an 2 (SC) dismissed the Revenu's SLP from the order of the Madras High Court in CIT Vs. Chettinad Logistics (P) Ltd holding that Section 14A of the Act cannot be invoked where no exempt income is earned by the assessee. It is relevant to note that the decision of the Apex Court in Chettinad Logistics (P) Ltd (supra) was rendered on 2.7.2018 i.e much after its decision in Maxopp Investment Ltd (supra) on 12.2.2018. Thus, the reliance on the Maxopp Investment Ltd (supra) on the part of the Revenue is not correct. Therefore, no fault can be found in the impugned order to the extent it holds that where no exempt income is earned in the subject assessment year, occasion to disallow any expenditure under Section 14A could no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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