B.R.R. Kumar ORDER
Dr. B.R.R. Kumar, Member (A)
1. The present appeal has been filed by the assessee against the order of ld. CIT( A)- 36, New Delhi dated 18.10.2019.
2. The only issue raised before us pertains to disallowance of expenses u/s 14 A of the Income Tax Act, 1961. During the year, the assessee received total amount of Rs.66,810/- in respect of which exemption was claimed u/s 10 of the Income Tax Act, 1961. The amount consists of Rs.51,228/- on account of share in profit in the partnership firm, an amount of Rs. 15,582/- on account of dividend income from mutual fund. The assessee has suo motu made disallowance of Rs. 8,44,669/- u/s 14A r.w.r. 8D. The Assessing Officer has increased the disallowance to Rs. 1,35,74,360/- which the ld. CIT(A) confirmed. Aggrieved, the assessee filed appeal before us. The facts are not in dispute. By this time, it is settled position that the disallowance u/s 14 A of the Act cannot exceed exempt income claimed. Since, in the instant case, the exempt income claimed by the assessee was Rs. 66,810/- and the disallowance already made were to the tune of Rs. 8,44,699/-, respectfully placing reliance on the judgment of Hon'ble High Court in the case of Joint Investment Pvt. Ltd. Vs. CIT (MANU/DE/1144/2015 : 2015:DHC:1804-DB : 372 ITR 694 ) wherein the appeal filed by the Revenue was also dismissed in SLP No. 23650 of 2018 and CIT Vs. Caraf Builders (Del-HC), we hold that disallowance made by the Assessing Officer cannot be sustained.
3. In the result, the appeal of the assessee is allowed. Order Pronounced in the Open Court on 03/01/2024.
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