|DATE:||(Date of pronouncement)|
|DATE:||January 31, 2014 (Date of publication)|
|Click here to download the judgement (Narain_Dalmia_14A_Rule_8D.pdf)|
For s. 14A/ Rule 8D(2)(ii), interest expenditure on loans taken for taxable business purposes has to be excluded
Rule 8D(2)(ii) is very clear that the expenditure on account of payment of interest would be covered in the said Rule only if it is not directly attributable to any particular income or receipt. If the assessee is able to demonstrate that the payment of interest is directly attributable to the assessee’s taxable business activity, it cannot be considered under Rule 8D(2)(íi) of the I.T. Rules and has to be excluded while computing the disallowance u/s 14A.