The assessee earned exempt dividend income and voluntarily disallowed a part of the expenditure under section 14A. The Assessing Officer invoked Rule 8D and made a further disallowance. The Tribunal held that the investments had been made out of interest-free internal accruals and were strategic investments in group companies. No direct expenditure had been incurred for earning exempt income. Accordingly, the disallowance under section 14A was rightly restricted to the actual exempt income earned and further disallowance under Rule 8D was unsustainable. (AY. 2014-15).