Section 14A-Artificial Apportionment of Expenses not allowed

Last updated: 07 May 2009

Court :
Delhi High Court

Brief :
In the absence of any specific finding that any particular expenditure was incurred by the assessee in relation to exempted dividend income, no artificial disallowance can be made invoking section 14A of the Act.

Citation :
CIT vs Hindustan Co-op. Society Services Co. Ltd. [2008] 170 TAXMAN 458 (DELHI)

1. For the assessment year 1999-2000, the revenue has filed this appeal, against the judgment dated 25-8-2006 passed by the Income-tax Appellate Tribunal in ITA No. 3848/Delhi/2003. Inter alia, the revenue seeks to urge the following question for our consideration: “Whether ITAT was correct in law in holding that in the absence of any specific finding that any particular expenditure was incurred by the assessee in relation to exempted dividend income, no artificial disallowance can be made invoking section 14A of the Act?” 2. The tax effect in this case is very minimal. 3. No substantial question of law arises. 4. Dismissed. Judges: MADAN B. LOKUR AND DR. S. MURALIDHAR, JJ. IT APPEAL NO. 302 OF 2007 SEPTEMBER 3, 2007