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PCIT v. IFFFCO Ltd ( 2022) BCAJ- November – P. 55 ( Delhi)( HC)

S .14A : Disallowance of expenditure – Exempt income – Dividend income from overseas company in Oman – No tax is payable on said dividend in India- Provision of section 14A is not attracted – DTAA -India – Oman .[ S. 2(45), 5,90(2)) R.8D , Art , 25 ]

Dismissing the appeal of the Revenue the Court held that  since the dividend income received by the assessee from OMIDCO , Oman is chargeable to tax in India  under the head “Income from other sources “  and forms part of the total income , the same is included in taxable income in the computation of income filed by the assessee . However rebate of tax has been allowed to the assessee from the total taxes in terms of Section 90(2) of the Act , read with Article 25 of the Indo -Oman , DTAA and thus  dividend earned can be  said to be in the nature of excluded income and therefore , the provisions of Section 14A would not be attracted .Referred CIT v. Kribhco ( 2012) 349 ITR 618 ( Delhi)( HC)   ( ITA No. 3900 of 2022 dt. 11-10-2022) ( AY. 2007 -08 )