Disallowance under S.14A read with rule 8D is to be restricted to exempt income earned during year and only average of investments which have yielded exempt income is to be considered for computation of S. 14A disallowance. (AY. 2014 -15)
Mylan Laboratories Ltd. v. DCIT (2020) 180 ITD 558/ 187 DTR 259/ 204 TTJ 426 (Hyd) (Trib.)
S. 14A : Disallowance of expenditure – Exempt income – Disallowance cannot exceed exempt income- Average of investments which have yielded exempt income is to be considered for computation of S. 14A disallowance. .[ R.8D ]